Document of The World Bank Group FOR OFFICIAL USE ONLY Report No. 54689- ZR INTERNATIONAL DEVELOPMENT ASSOCIATION COUNTRY ASSISTANCE STRATEGY PROGRESS REPORT FOR THE DEMOCRATIC REPUBLIC OF CONGO May 26, 2010 Central Africa Country Cluster 2 (AFCC2) Africa Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. ii DATE OF CURRENT COUNTRY ASSISTANCE STRATEGY November 16, 2007 DEMOCRATIC REPUBLIC OF CONGO-FISCAL YEAR January 1 ­ December 31 CURRENCY EQUIVALENTS (Exchange Rate Effective as of February 03, 2010) Currency Unit Congolese Franc (CDF) US$1.00 CDF 903.464 WEIGHTS AND MEASURES Metric System SELECTED ABBREVIATIONS AND ACRONYMS AAA Analytical and Advisory Activities AAP Africa Action Plan ADB African Development Bank ALF Africa Leasing Facility CAF Country Assistance Framework CAS Country Assistance Strategy CEM Country Economic Memorandum CG Consultative Group CIDA Canadian International Development Agency CNDP Congrès National pour la Défense du Peuple DDR Disarmament, Demobilization and Reintegration DfiD Department for International Development DGI Direction Générale des Impôts DPL Development Policy Loan DPO Development Policy Operation DRC Democratic Republic of Congo EC European Commission EFA Education for All EIB European Investment Bank EIR Extractive Industries Review EITI Extractive Industries Transparency Initiative EMIS Education Management Information System ESW Economic and Sector Work FAO Food and Agriculture Organization FARDC Army of the Democratic Republic of Congo FDI Foreign Direct Investment FDLR Forces Démocratiques pour la Libération du Rwanda FEC Fédération des Entreprises des Congo GAC Governance and Anti-Corruption GDP Gross Domestic Product GEF Global Environment Facility GER Gross Enrollment Rates HD Human Development HDI Human Development Index HIPC Heavily Indebted Poor Countries HMIS Health Management Information System iii HRM Human Resource Management IASC Inter-Agency Standing Committee ICA Investment Climate Assessment IDA International Development Association IFC International Finance Corporation IMF International Monetary Fund M&E Monitoring and Evaluation MDG Millennium Development Goal MDRI Multilateral Debt Relief Initiative MDTF Multi-Donor Trust Fund MIGA Multilateral Investment Guarantee Agency MONUC Mission des Nations Unies en République Démocratique du Congo (UN peacekeeping mission) MTEF Medium Term Expenditure Framework NGO Non-Governmental Organization OHADA L'Organisation pour l'Harmonisation en Afrique du Droit des Affaires PER Public Expenditure Review PFM Public Financial Management PPP Public-Private Partnership PRGF Poverty Reduction Growth Facility PRGS Poverty Reduction and Growth Strategy PRONAREC National Capacity Building Program PRI Political Risk Insurance PRSP Poverty Reduction Strategy Paper PSD Private Sector Development QAG Quality Assurance Group REDD Reduced Emissions from Deforestation and Degradation in Developing Countries REGIDESO Water Distribution Authority SADC Southern Africa Development Community SENAREC National Secretariat for Capacity Building SMP Staff-Monitored Program (of the International Monetary Fund) SNCC Société Nationale de Contrôle du Congo SNEL Société Nationale d'Electricité SOE State-Owned Enterprise SSA Sub-Saharan Africa TTL Task Team Leader (World Bank) UK United Kingdom UN United Nations UNDP United Nations Development Program UNEP United Nations Environment Programme USAID United States Agency for International Development WBG World Bank Group Vice President: Obiageli K. Ezekwesili Country Director: Marie Françoise Marie-Nelly Task Team Leader: Marie-Chantal Uwanyiligira The core team was composed of: Marie-Chantal Uwanyiligira, Milaine Rossanaly, Thomas Jeffrey Ramin, and Deborah Davis. Substantive inputs were received from: Nicolas Ahouissoussi, Eric Bell, Eustacius Betubiza, Christophe Bosch, Franck Bousquet, Jerôme Chevallier, Roisin De Burca, Steven Dimitriyev, Mahine Diop, Christian Diou, Alexandre Dossou, Philippe Durand, John Elder, Louise Engulu, Luigi Giovine, Bernard Harborne, Johannes Herderschee, Paul J. Martin, Anne Mossige, Patrick Mullen, Amadou Ba Omar, Susan Opper, Pierre A. Pozzo di Borgo, Rachidi Radji, Simon Rietbergen, Christophe Rockmore, Kim Venne, Tony Verheijen, Jan Walliser, Gotthard Walser, Adamou Labara (IFC) and Thomas A. Vis (MIGA). Support was provided by Lucie L. Bobola, Racky D. Camara, Natalie Ford, Véronique Okito, Linda Patnelli, Luc Sukadi and Cyprien S. Towambi. iv COUNTRY ASSISTANCE STRATEGY FOR THE DEMOCRATIC REPUBLIC OF CONGO FY08-FY11 PROGRESS REPORT FOR THE PERIOD FY08-09 TABLE OF CONTENTS I. Introduction ....................................................................................................................................... 1 II. Economic and Policy Developments ................................................................................................ 1 III. Progress toward CAS Outcomes ....................................................................................................... 3 IV. Adjustments to the CAS and Progress in Implementation ................................................................ 8 BOXES Box 1: CAS Consultation.............................................................................................................................. 8 FIGURES Figure 1: Copper Production in DRC, 1960-2009 ........................................................................................ 2 Figure 2: Bank Support by Pillar, 2008-2009 ............................................................................................... 4 ANNEXES Annex 1: DRC Poverty Reduction and Growth Strategy (PRGS) .............................................................. 15 Annex 2: Democratic Republic of Congo: Economic Developments, 2002-2008 .................................... 16 Annex 3. Democratic Republic of Congo: Recent Economic Developments............................................ 17 Annex 4. Democratic Republic of Congo: Selected economic indicators .................................................. 18 Annex 5: Democratic Republic of Congo: Social and Economic Indicators .............................................. 20 Annex 6: Democratic Republic of Congo: Progress Toward Millenium Development Goals 1990-2015 . 21 Annex 7: Progress Status of HIPC Completion Point Triggers (as of March, 2010) ................................. 22 Annex 8: Actual DRC deliverables as of March 2010 ............................................................................... 24 Annex 9: Actual AAA delivered as of March 2010.................................................................................... 25 Annex 10: Early achievements ................................................................................................................... 26 Annex 11: Transport sector map: Program supported by the Bank ............................................................ 38 Annex 12: Revised CAS results matrix ...................................................................................................... 39 Annex 13: FY10-11 Remaining lending program ...................................................................................... 42 Annex 14: Proposed AAA program FY10-11 ............................................................................................ 42 Annex 15: Country Ongoing Operations .................................................................................................... 43 Annex 16: Portfolio of active trust funds .................................................................................................... 44 Annex 17: IFC portfolio.............................................................................................................................. 46 Annex 18: Division of labor between donors ............................................................................................. 47 Annex 19: Country- At-A-Glance............................................................................................................... 51 Annex 20: Country MAP ............................................................................................................................ 54 v I. INTRODUCTION 1. This Country Assistance Strategy Progress Report (CAS PR) for the Democratic Republic of Congo (DRC) reviews implementation of the Bank's FY 08-11 CAS at mid term, and assesses the continuing validity of the CAS objectives, outcomes, instruments, and risks presented to the Board on December 18, 2007. The report offers a strategy for the next two years for consolidating progress, with some adjustments to account for recent economic and social developments in the country. 2. The overall objective of the CAS--to lay the foundation for a medium-term poverty reduction effort, with a strong focus on governance and shared growth--remains valid, and its strategic focus continues to be in line with the Government's Poverty Reduction and Growth Strategy (PRGS ­ see Annex 1). However, the original lending strategy requires an adjustment to respond to (a) the large macroeconomic imbalances resulting from the impact of the global financial crisis on the DRC's economy; (b) the findings of analytical work undertaken during this period; and (c) the Kinshasa Agenda of June 2009, which sets the stage for enhanced coordination among donors. II. ECONOMIC AND POLICY DEVELOPMENTS 3. The security situation in the eastern provinces has improved but remains fragile. The democratically-elected government has been in place since early 2007 but decision-making has sometimes been slow, leading to delays in carrying out needed reforms. Next presidential elections are planned for 2011. In March 2009, the Government and the key rebel group, "the National Congress for the Defense of the People (Congrès National pour la Défense du Peuple, CNDP)" signed an agreement to integrate rebel combatants into the national army. The authorities have since regained control of most of the territory and its borders, although the Forces démocratiques de libération du Rwanda (FDLR) and the Lord's Resistance Army (LRA) remain a source of insecurity for civilians in the Kivus region and Orientale Province. The disarmament and reintegration program remains a challenge with significant budget costs. In October 2009, an inter-ethnic dispute in the northwestern part of the country (Equateur province) triggered an armed conflict that displaced large numbers of people; the regular army, supported by United Nations Mission in DRC (MONUC),1 gained control of the main cities; but the situation remains volatile, as another incident occurred in early April 2010 in the provincial capital Mbandaka. Security-related challenges continue to weigh on the authorities and the economy. 4. Building on earlier macroeconomic stabilization efforts, growth was robust in 2007 and 2008. However, in the second half of 2008, DRC suffered from two shocks (see Annex 2): (a) the escalation of conflict in the eastern provinces, leading to an increase in security-related expenditure, and (b) the collapse of the price of copper, cobalt, and diamonds, which together represent four fifths of the 1 In French, Mission de l'Organisation des Nations Unies en République Démocratique du Congo. MONUC's peacekeeping mandate is expiring at the end of May 2010, and the Government is demanding MONUC's withdrawal within a period of 18 months, ahead of the next presidential elections planned for mid 2011. A UN Security Council resolution reviewing MONUC's mandate is expected in mid-May. country's exports (copper prices fell from over US$4 per pound in June 2008 to less than US$1.5 per pound by year end). Figure 1 shows the immediate impact of the financial crisis on copper production. FIGURE 1: COPPER PRODUCTION IN DRC, 1960-2009 (In thousands tons) 600 500 Financial crisis 400 300 Mining Code 200 Nationalization of UMHK 100 and creation of Gecamines 0 1960 1963 1966 1969 1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 5. Macroeconomic policies were tightened in 2009 (see Annex 3). A new three-year arrangement under the Extended Credit Facility (ECF) was approved by the Executive Board of International Monetary Fund (IMF) on December 11, 2009; program performance through end-2009 appears to have been satisfactory, with all quantitative benchmarks being met. Although there had been delays on the structural reform front, all structural benchmarks under the program were implemented by end-April. There had also been progress in implementing the HIPC Completion Point triggers. If all goes as planned, IMF Board consideration of the first review of the ECF arrangement and HIPC Completion Point under HIPC could take place in July 2010. 6. Macroeconomic performance during the second half of 2009 was satisfactory. Economic growth is estimated to have slowed from 6.2 percent in 2008 to 2.8 percent in 2009 owing to the effects of the global financial and economic crisis on the country. After continuing to decline in August, inflation increased - and the exchange rate depreciated vis-à-vis the US dollar - in September and October on account of increases in the money. By the end of the year, inflation had declined back to about 53 percent, slightly above the Government's target of 49 percent. However year-on-year inflation declined to 26 percent by mid-April 2010. Gross international reserves rose from a historic low of US$30 million in February 2009 to US$1 billion at end-December (9 weeks of non-aid import cover) following the disbursement of emergency assistance from the IMF and other development partners, the disbursement of the first tranche of the signature bonus under the Sino-Congolese Cooperation Agreement, and importantly the general and special allocations of special drawing rights (SDRs) from the IMF to member countries. Key economic indicators are in Annex 4. 7. In spite of economic recovery, social conditions remain dire. Despite progress over the past five years in political and economic reforms, many communities live in deteriorating conditions, with little access to markets for purchasing supplies or for selling their produce, and poor access to public services. The United Nations estimates some 2.3 million displaced persons and refugees inside the country, as well as some 323,000 Congolese living in refugee camps outside the country. A humanitarian 2 emergency persists in many of the more unstable parts of DRC, and the impact of conflict on the population includes high rates of sexual violence. All social indicators remain among the lowest in Africa (Annex 5) and the country is unlikely to reach any of the Millennium Development Goals (Annex 6). Medium-Term Outlook 8. The outlook is positive, but risks remain. The recovery of copper prices and increased investment would help boost export earnings and economic growth to 5.4 percent in 2010. This growth rate is within the bounds of past performance since the end of the conflict, and is well below full potential estimated at more than 10 percent per annum. The ECF-supported program's end-period inflation objective (15 percent) is achievable if actions are taken to strengthen liquidity forecasting and coordination. Although the external current account deficit is expected to remain high (22 percent of GDP), this is due principally to buoyant investment-related imports financed by foreign direct investment and aid. Maintaining international reserve at about 9 weeks of non-aid imports is also realistic. There are risks to the outlook: loss of fiscal control (induced by intense social pressures), the looming 2011 presidential elections, and deterioration in security that could undermine program implementation. Further, external shocks such as a deterioration of the terms of trade could weaken economic growth and public finances. 9. The DRC's debt situation is unsustainable in the absence of substantial debt relief. The recently completed joint Bank/Fund Debt Sustainability Analysis (2009) concluded that debt burden indicators markedly exceed their policy-based thresholds. In the absence of debt relief from the enhanced HIPC Initiative and the Multilateral Debt Relief Initiative (MDRI), external debt burden indicators are projected to remain above policy-dependent thresholds over prolonged periods. DRC is expected to reach the HIPC Completion Point during 2010, after a one-year satisfactory implementation of the Poverty Reduction Grant Facility (PRGF) and observance of the specific HIPC triggers (see Annex 7). Provided that the Government takes steadfast actions, the IMF and World Bank staffs expect to submit the request for debt relief to their respective Boards before end-June. However, DRC would continue to be vulnerable to adverse exogenous shocks even after access to debt relief reduces the country's debt burden indicators below the thresholds, and would need to continue managing its external debt prudently by relying strictly on grants or highly concessional loans. III. PROGRESS TOWARD CAS OUTCOMES 10. Over the two years of CAS implementation, the country has been moving gradually from emergency to sustainable development. Bank support has evolved along the same path, with a phasing out of its emergency multi-sector program and the development of a new era of projects/programs 3 combining investments with sector and economic policy reforms. The World Bank has already provided about 70 percent of IDA 152 support (see Annex 8), and plans to commit about US$980 million by end of IDA15 , including the remaining IDA 15 balance of about US$339 million and US$103 million from the Crisis Response Window (CRW). The World Bank's support (see Figure 2) has been concentrated on Pillar 2 of the CAS (Macroeconomics and Growth: 78 percent), with 16 percent for Pillar 3 of the CAS (Access to Social Services) and 6 percent for Pillar 1 (Governance and Peace Consolidation). Analytical work delivered (see Annex 9) also covers the three CAS pillars. FIGURE 2: BANK SUPPORT BY PILLAR, 2008-2009 Governance and peace Social sectors 6% (Education, Health, HIV/AIDS) Growth 16% (Agriculture, Forestry, Energy, Transport, Urban Devt, Water, Private Sector)... 11. Progress towards the CAS outcomes has been largely positive, with notable advances in the areas of post-conflict and emergency rehabilitation, demobilization and reintegration of ex-combatants, decentralization, road development, education, forestry sector , and social protection. Less progress was registered in public finance management (PFM), energy, public enterprise reform, and mining sector reform due to the complexity of issues, weak implementation capacity, and in some cases lack of political commitment. The results matrix summarizing progress under the CAS is shown in Annex 10. This section reviews specific progress made under each of the three strategic elements of the CAS. 12. Progress under Pillar 1 of the CAS (governance and peace consolidation) has been slower than expected in all areas, except the demobilization and reintegration of ex-combatants. In support of the Governance Compact3, IDA has focused mainly on demobilization, decentralization, public finance management, public service reform, and transparency in the management of natural resources, with support provided through the ongoing governance capacity building, forestry sector, and private sector development projects. 2 Under IDA 15, the country allocation (including the post-conflict allocation) was SDR 721.8 (equivalent to about $1.097 billion), including SDR 280.1 for FY09, SDR 245 and SDR 196.8 for FY11. The proposed lending is over- programmed by US$200 million, which could be mobilized from a reallocation of unused resources at the end of the IDA 15 cycle. 3 In 2007, the Government adopted its Governance Compact, which lays out its objectives in four cross-cutting areas (decentralization, public financial management, public administration, and transparency) and three sectoral themes (public enterprises, the mining sector, and the security sector, including demobilization and reintegration of ex-combatants). 4 13. In the area of demobilization and reintegration of ex-combatants, results were impressive. The Bank contributed significantly to the UN-supported peace process and security reform under the IDA-funded Emergency Demobilization and Reintegration Project (EDRP), which helped demobilize a total of 110,844 adults and 38,019 children, and reintegrate about 77,780 beneficiaries. An estimated 5,000 adults and 8,000 children remain to be reached. 14. Less progress was achieved in the areas of decentralization, public finance management, and public sector reform. In the area of decentralization, Bank support, through several pieces of analytical work jointly produced with the European Commission, UNDP, and the Belgian Cooperation,4 has been instrumental in establishing a package of laws regulating the functions of the provincial governments, developing a transparent revenue sharing formula, and assessing the feasibility of the proposed territorial administration reform. However, key aspects of fiscal inter-governmental relations and issues of staff transfer remain to be settled. These aspects will be addressed once the new Public Finance law (now in Parliament) is adopted. In public finance management, technical assistance provided by the Bank helped develop the medium-term expenditure frameworks (MTEFs) for some ministries,5 estimates and projections of provincial GDP and medium-term expenditure programs, as well as the provincial PFM and human resource management (HRM) systems. However, the financial crisis has led to reduced transparency in fiscal transfers to the provinces, reversing some of the gains made in 2005- 2008. The new Public Finance Law, as referred to above, together with the public finance management action plan (both prepared with Bank and other donors' support), are expected to reestablish fiscal discipline and accountability. In the area of public administration reform, the complexity of reform, lack of political commitment, and absence of a consensus among all stakeholders has yielded limited results so far. Moreover, a new momentum is being generated through the planned support to the retirement process, which is based on an incremental approach ­ ministry by ministry6. 15. Under Pillar 2 of the CAS, significant progress was achieved in transport, water, forestry, and agriculture. In the transport sector, progress was noticeable in the reopening of national roads reunifying the former belligerent parts of the country, thus reducing the cost of transportation - in some cases by 80 percent - and cutting travel time by half. Of the 15,000 km of national roads in the country, the World Bank, mainly through its emergency program, contributed to reopening and maintaining 2,077 km (13.8 percent), including 130 km of roads rehabilitated from Lumbubasi to Kasimeno, 750 km from Kisangani to Beni, and 177 km from Bukavu to Kamituga. Annex 11 presents a map of Bank-supported program in reopening the roads and railways. In the water and sanitation sectors, the Bank supported the rehabilitation of water facilities, including construction of a module at the N'Djili plant, which provides 110,000 m3 of additional drinking water per day to about 3 million people in Kinshasa. In the forestry sector, with Bank support, the legal review of the 156 logging contracts by an inter-ministerial commission was successfully completed in early 2009. Bank support was also instrumental in helping the 4 Decentralization: Opportunities and Risks (2008) technical background notes; and study for Territorial Administration Reform (Decoupage; 2009). 5 In 2008, the Bank provided technical assistance for the preparation of MTEFs for the health, education, and agriculture sectors. However, they have not yet been integrated in the preparation of the budget. 6 The public administration reform was piloted in the Ministry of Environment through the ongoing forestry operation. The pilot is expected to be extended to other ministries, including the ministries of agriculture, education, and health. 5 country to play an important role in the Copenhagen climate change negotiations, where it pushed for the creation of a Reduced Emissions from Deforestation and Degradation in Developing Countries (REDD) mechanism.7 In the agriculture sector, the Bank's support helped farmers around Kinshasa to substantially increase their rice production (e.g. their annual yield is six times what it used to be). The recently approved Agriculture Sector Rehabilitation Project will build on the results achieved, although the sector has yet to be revamped for high growth. 16. Results were mixed in the areas of macro stabilization, transparency in the management of the mining sector, and private sector development. In the area of macro stabilization, the DRC economy grew at an average of 6 percent between 2001 and 2008, but growth was weakened by the onset of the global financial crisis, which led to a sharp deterioration of the country's terms of trade, rapid depletion of foreign reserves, high inflation, and large job losses in the mining sector. The Bank, together with the IMF, helped design the macroeconomic policies for 2010 aiming at reducing inflation while continuing to mitigate the impact of the global financial crisis on the economy. Support by the Bank (including the first operation in the Africa Region under the Fast Track Facility in February 2009) and other donors helped cushion the impact of the crisis. Bank staff are also stepping up their efforts to help the Government meet the HIPC Completion Point triggers by 2010. In the mining sector, with Bank support, a new Mining Code was adopted in 2002 and opened the way for private investments in the mining sector; but the financial crisis and a poorly managed process of renegotiating mining contracts over the past few years8 have constrained new investments. DRC was accepted as an EITI Candidate Country at the EITI board meeting in Accra in February 2008, and produced its first mining revenues reconciliation report in December 2009, and is at an advanced stage for validation9. . In the energy sector, implementation of the two regional IDA-supported programs to rehabilitate Inga I and II was hampered by cost overruns and weak implementation capacity.10 In private sector development, IFC and IDA support resulted in development of regulatory frameworks (e.g. telecommunications, microfinance), stabilization of key enterprises11 (e.g. Gecamines and SNCC) through private management, and improvements in the investment climate, including in financial intermediation (via Central Bank liquidation of three State-owned banks), and in regulation of business registration and contract enforcement, culminating in a 2009 campaign to reduce the cost of doing business and adopt the OHADA 7 Forest Carbon Partnership Facility (FCPF) and UN-REDD (FAO, UNDP, UNEP) are jointly supporting the country in REDD Readiness. The coordination of these two REDD programs in DRC is regarded as a model for other countries engaged in REDD, as well as for donor harmonization. 8 A review of 60 mining contracts was undertaken by the Government. Although largely completed, the review of one contract (TFM) is still pending. The KMT contract (IFC is a shareholder of KMT) was canceled and is currently subject to arbitration. 9 In April 2010, on the basis of the progress to date, the country was granted by the EITI Board a 6-months extension period to be able to reach full validation. 10 Seven out of 14 units at Inga I and II are functional. With the additional financing being put in place, it is expected that by 2011, unit G12 (55MW) will be operational, along with G23 (162MW), being repaired by Mag Energy, Canada (non-Bank funding). This will bring the total generation capacity of Inga I and II to 1042 MW by 2017 [the reference to 2017 is confusing as the earlier part only refers to 2011. 11 Bank support included the financing of retrenchment programs. This has triggered three requests for inspection panel, including two initiated by former Gecamines employees and one from former employees of liquidated three State- owned banks. With Bank's support, the government has prepared action plans that contained elements aimed at resolving the issues raised by the Requesters, including a conflict resolution mechanism, a certification of the social debt per enterprise and per employee, and reform of the national pension scheme. Implementation of the said action plan will be supported by the Bank. 6 (Organization for the Harmonization of Commercial Law in Africa) legal framework.. In addition, DRC's investment climate remains among the least favorable in the world. DRC ranked second from the bottom in the 2010 Doing Business Survey12. Building on renewed Government commitment to improve the business climate, both the Bank and IFC are engaging with the authorities on a series of policy reforms designed to help the country improve its Doing Business rating. 17. A cross-cutting issue in the Bank's support for sustainable development has been the reform of state-owned enterprises (SOEs).13 The SOE reform agenda gained momentum in 2008. The Government has enacted a new legal framework14 that sets the stage for public enterprise reform and for private sector participation in the delivery of infrastructure services--a critical milestone in addressing one of the binding impediments to growth. In response, the Bank has stepped up its support for the reform of targeted utilities (SNCC for transport, SNEL for energy, REGIDESO for water, OCPT for telecom). 18. Under Pillar 3 of the CAS, IDA responded in a timely manner to DRC's economic and social recovery needs when it resumed its operations in the country, through a series of multisectoral emergency operations covering local administration, health, education, social protection, roads, energy, water and sanitation, and agriculture. The emergency operations included: the Multisectoral Emergency Reconstruction and Rehabilitation Program, the Emergency Reunification Project, the Living Conditions Improvement Support Project, the Social and Urban Rehabilitation Project, and the Social Action Program. Through these programs, the Bank has substantially contributed to malaria control and to the construction of social infrastructure, including schools and health centers. In addition, through its human development (HD) portfolio15 (education, health, HIV/AIDS, Social Fund), IDA has helped the Government to make progress towards several of its goals in terms of access to health and education services. While still off track to reach the Millennium Goals (Annex 5), the country has made substantial progress in improving health16 and education17 outcomes, as well as in social protection,18 compared to conditions during the conflict. 12 Issues range from constraining business regulations (aggravated by corruption and a weak judiciary) to poor infrastructure, resulting in very high costs and high risks of doing business. 13 SOEs are characterized by high inefficiencies, resulting in a high cost of doing business in DRC. SOEs are also crippled by high indebtedness and social costs amounting to about $1.2 billion. 14 The Government enacted four major laws and their implementing decrees that set the modalities for State disengagement from enterprises where the State has sole or partial ownership ("sociétés mixtes"). 15 Implementation of the HD portfolio has been weak, but efforts are underway to restructure the slow-disbursing projects in health, HIV/AIDS, and education. 16 Under-five mortality in the period 2002-07 was 148 per 1,000 live births, compared to 220 in the 1990s. In the IDA health project zone, utilization of curative health services has increased by a third in comparison to the baseline, and access to qualified delivery care has risen from 47 to 57 percent in project areas. 17 As of today, more than 40 percent of children of school age are attending primary school, and 50 percent of those are reaching secondary school. Quality is also improving. IDA's recent distribution of 14 million textbooks to complement Belgium's support has been praised by civil society for its visible impact on the ground. 18 Evaluation data for the Social Fund project show a substantial impact for these types of community projects, with school enrollment increasing by 53 percent and health consultations by 95 percent after schools and clinics have been constructed. 7 IV. ADJUSTMENTS TO THE CAS AND PROGRESS IN IMPLEMENTATION 19. While the overall CAS BOX 1: CAS CONSULTATION objective of laying the foundation for a medium-term poverty Under the leadership of the Government, the Bank, jointly with the AfDB, the European Union, the United Nations, held a one-day reduction effort, and the consultation in Kinshasa on the mid-term review of our respective country's IDA 15 allocation both country assistance strategies (CAS consultation). It was attended by remain largely unchanged, it is representatives of the central government, provincial administrations, proposed that the pillars and the civil society, private sector, and development partners. lending program be adjusted to: The consultation resulted in the following areas of agreement: (a) (a) gradually narrow the Bank's priority areas include infrastructure, human development, governance, interventions on few sectors, in line regional integration; (b) in terms of division of labor, the UN systems with the Kinshasa Agenda; (b) help should concentrate on peace and security and human development, while the EU, AfDB, and World Bank should focus on infrastructure the country mitigate the negative and private sector development; (c) in terms of arrangements: impact of the financial crisis on its enhance the use of country systems, increase presence of field-based economy; and (c) accelerate progress technical staff, use members of Diaspora in capacity building programs, and increase the use of trust funds (or common donors' toward reaching the HIPC implementation arrangements); (d) increase civil society's and Completion point by 2010. Based on provincial administrations' participation in the design and the outcome of the consultations implementation of programs, with a focus on social accountability held as part of this CAS Progress and monitoring of results; and (e) effective communication jointly by government and development partners to account for results and build Report (see Box 1), the Bank pillars consensus whenever needed for critical reforms. will be in line with the PRGS but will be modified slightly to provide critical support to key sectors that will spur the development of other sectors. As its emergency program is phased out, the Bank will gradually focus its interventions on sectors, particularly infrastructure, where it has a clear comparative advantage. Consequently, the CAS results matrix (Annex 12), the lending program (Annex 13), and the non-lending program (Annex 14) will all be revised. The Bank will continue to closely monitor the implementation of the ongoing portfolio (Annex 15), as well the trust funds' portfolio19 (Annex 16). 20. Under Pillar 1 of the CAS, Bank's support will focus mainly on rebuilding State capacity to expand access to basic services and improve the quality of public service delivery (the public wage bill accounts for 6 percent of GDP and close to 22 percent of public expenditure). In line with best practice for post-conflict countries, Bank support would include: (a) helping the country develop a retirement strategy to address an over-aged civil service (an estimated 65-70 percent of civil servants are past retirement age); (b) developing a legal framework for the retirement; (c) finalizing a census (the census initiated in 2005 is still far from completed); (d) initiating phased structural reforms (including retirement, administrative reorganization, results-based incentives for civil servants20) of key ministries responsible for service delivery (in the absence of an overall reform of the public function); and (e) 19 The trust funds nicely complement the ongoing portfolio and focus on analytical work in the areas of governance, health strategies, education, gender-based violence, and peace building. 20 There are 27 legal statutes governing public service payments and working conditions, as well as an unknown number of specific bonus and allowance schemes. 8 providing training in critical State functions (planning, financial management, procurement, etc.) at both the central and provincial levels, as well as targeted leadership training to develop tailored rapid results tools. Support will be provided under the planned Core Public Sector Systems Modernization Project, the planned Public Service Rejuvenation Project (APL), the existing Governance Partnership Facility Trust Fund, and ongoing and planned sectoral operations (e.g., the agriculture operation). The Bank will also continue to work to ensure implementation of PFM and HRM systems in all provinces, through the Governance Capacity Building Project and mobilization of other development partners' funds. 21. In addition to the more targeted support being provided for building country public financial management and procurement systems, the DRC will continue to build the capacity of national institutions after reaching the HIPC Completion Point, for which approval of a new Procurement Code is a trigger. The Bank will provide such support under the proposed Core Capacity Building Project. In case of PFM, the comprehensive PFM action plan will be supported by the Bank through the ongoing Governance Capacity Building Project, in close coordination with other donors. Further support will be provided under the proposed Development Policy Operation (DPO), which will begin in FY11. 22. Demand side of good governance. The Bank, building on existing solid partnerships between the government and non-state actors, will continue working with non state actors ( e.g. faith-based organizations and other international and national organizations) in improving social sectors delivery (i.e. health and education)21. In addition, the Bank intends to continue working on strengthening accountability in various ways: (i) working with decentralized authorities will be further stepped up, in particular support to provincial governments and assemblies. These have become important actors in pushing for enhanced transparency of resource allocation decisions at central government level, including public investment management decisions. A coaching facility has been put in place to support champions of decentralization, (ii) working closely with non-state actors to promote social accountability, through the use of report citizen cards and active participation in initiatives aiming at improving transparency in the management of natural resources sectors (e.g. active civil society members in the Board of the EITI). The Bank will also seek to support the enhancement of civil society and parliamentary capacity to monitoring results of government policies22. 21 Since the 80's and in view of the collapse of the state, non-state actors ( including faith-based organizations) have taken over the delivery of education and health care services in DRC. This has, to some extent, worked, albeit an uneven quality throughout the country. The current government, through donor-supported program (including the Bank) has maintained such mechanisms ­ through in some cases performance-based contracts - in the management of schools and health facilities, while stepping up its investment and monitoring of the quality of service delivered. 22 We are preparing an IDF define capacity building program to help strengthen the capacity of both civil society and the Parliament to monitor project results. The IDF will be complementary to the support provided by the planned Core Capacity Building program. 9 23. Pillar 2 remains valid but the lending program will be adjusted to (a) provide additional financing to the two regional energy operations that have experienced substantial overruns23; and (b) help the country mitigate the negative impact of the financial crisis on the maintenance of its infrastructure (see paragraph 23). Two original operations under this pillar will not be pursued ­ the original proposed energy booster program will be replaced by the additional financing for the Regional and Domestic Power Market (PMDE); and the original proposed urban development project will be replaced by the Emergency Operation to mitigate the impact of the financial crisis. Pillar 3 of the CAS also remains valid but the lending program (see paragraph 24) will be revised to help the country protect expenditures in the health and education sectors in a context of a tighter macroeconomic situation resulting from the global financial crisis. Going forward and beyond this CAS cycle, in line with the Kinshasa Agenda, the Bank will (a) use its limited resources to leverage other donors' resources, through enhanced use of multi-donor trust funds; and (b) increase its analytical work to generate knowledge in the HD sectors and lay the foundation for further donor-supported investments, including the preparation of sector MTEFs and their inclusion in the budget. The original proposed lending for health and education sector-wide programs (SWAPS) will not be pursued, as the sectors are not yet ready for such instruments. 24. The lending program will be adjusted to help the country address some of the near-term impacts of the current financial crisis and sustain social and economic activities until the Government's policy responses can take effect and medium-term donor support, including the Bank, can be fully deployed. Bank support includes: (a) replacing the proposed original Urban Project by the Emergency Project to mitigate the financial crisis (US$100 million); and (b) preparing a series of additional financing (AF) ­ using the US$103 million allocation received from Crisis Response Window (CRW) ­ to address weaknesses of some financial institutions and protect public expenditures in key social and infrastructure sectors. This additional financing will include (a) US$30 million24 to the Private Sector Development Project; (b) US$120 million additional financing25 to the Emergency Urban and Social Rehabilitation Project (focusing on the payment of the operating costs for schools and malaria programs); (c) US$90 million26 to the Road Maintenance Program to maintain public expenditure for the maintenance of high- priority networks until the newly established Road Maintenance Fund becomes fully operational; and (d) Core Public Sector Management Systems strengthening project (US$30 million) and Public Service Rejuvenation Project (US$40 million). 25. Unlike under the original CAS, the Bank is proposing to mainstream good governance. DRC is governance and anti-corruption (GAC) country and the CAS will remain governance- 23 Additional financing (US$181 million) for the Regional Southern Power Pool APL, mainly to cover cost overruns, was approved in June 2009, bringing the total project amount to US$358 million. Additional financing (US$300 million) for the Regional Domestic Energy Markets APL is also under preparation, also to cover cost overruns. 24 US$15 million comes from the CRW and the balance of US$15 million comes from the country IDA allocation. 25 US$40 million comes from the CRW and US$80 million will be a top up from unused IDA allocation. 26 US$40 million comes from the CRW and US$50 million from the country IDA allocation. The proposed AF will be co-financed by the recently approved additional financing of GBP36 million (US$54 million equivalent) from DFID to the recipient-executed Multi-Donor Trust Fund (MDTF) administered by the Bank. 10 based; but governance will now be treated as a cross-cutting issue. The country team has opted to systematically (a) carry out sector governance diagnostics (including a political economy analysis when appropriate) as part of the preparation of any investment/technical assistance program; and (b) develop and implement an anti-corruption plan for each operation proposed under the CAS. This work approach will complement the Bank's support of the decentralization agenda through the ongoing Governance and Capacity Building Project, as well as under the new Governance Partnership Facility (GPF).27 26. In line with the Africa Region's strategy of making development climate resilient, the CAS program, going forward, will initiate efforts to support climate change adaptation and mitigation. Harboring 145 million hectares of forests and woodlands with a stock of around 140 gigatons of CO2 equivalent, DRC has the potential to benefit from the REDD mechanism, an emerging international mechanism to compensate countries for reducing emissions from deforestation and degradation. If REDD is adopted, DRC could benefit from performance-based payments against reduction of expected future emissions.28 To have access to these funds, DRC will need to effectively address the causes of deforestation and forest degradation, which cut across various sectors, including agriculture, land use planning, mining, energy, and forestry. The Readiness Preparation Proposal (R-PP), which is a roadmap for how the country plans to achieve readiness to participate in REDD, has been delivered to the Forest Carbon Partnership Facility. DRC's proposal, the second in Africa after Ghana's, was approved by the FCPF Participants Committee at the end of March in Gabon. Upon the committee's endorsement, an FCPF grant of up to US$3.4 million could be signed with the Government for implementation of the R- PP. The other big climate challenge facing DRC is that of adaptation. Investments in low-risk agricultural intensification options will be key for both mitigation and adaptation, as will building the capacity of farmers and local organizations to manage small-scale irrigation schemes. 27. The Bank has been increasingly supportive of the regional cooperation agenda but needs to do more. There are four existing and planned regional projects in the areas of transport, energy, and telecommunications. DRC is a member of a number of regional integration initiatives, including the Common Market for Eastern and Central Africa (COMESA) and the Southern Africa Development Community (SADC), but it does not implement any of the trade preference protocols of these regimes. The ongoing Diagnostic Trade Integration Study (DTIS) calls for major policy reforms aimed at facilitating trade as a source of growth. Its recommendations will inform the design of the trade facilitation component under the Multimodal Transport project, as well as the trade facilitation activities of other donors. Simplification of the required procedures could significantly boost trade, in particular because the official customs tariffs are similar to those of other countries in the region. Deeper integration with regional partners could significantly contribute to growth and poverty alleviation, and these large benefits can be realized at modest cost. The location of major population centers close to the 27 Under the new Governance Partnership Facility (GPF), the DRC received the largest single allocation globally (US$3 million). The GPF allocation supports critical analytical and advisory work on PFM and decentralization, with special emphasis on sector governance issues. 28 Deforestation and forest degradation are likely to increase in DRC. According to a recent analysis by the Ministry of the Environment, cumulative deforestation could reach around 12 million ha by 2030, and cumulative degradation around 21 million ha by 2030, with associated annual emissions on the order of 400 million tons of CO2. 11 border in (a) the eastern provinces, (b) Katanga, and (c) Kinshasa and Bas Congo create natural opportunities to benefit from the human and physical infrastructure in the region. 28. IFC's post-conflict initiative in DRC (Annex 17) is in line with IFC's Strategic Initiative for Sub-Saharan Africa, and includes advisory and technical assistance and investment operations. In 2009, IFC provided a US$7 million credit line to Rawbank, accompanied by a US$1.2 million technical assistance to help Rawbank develop products and services targeting SMEs and women-owned enterprises. A venture capital fund has been created to provide risk capital of up to US$500,000 to start-up companies. IFC's Africa Leasing Facility (ALF) is working in partnership with the Central Bank and the Ministry of Finance to develop leasing activities. A partnership has been finalized with the pan-African leasing group Alios Finance to create the first leasing company in DRC. The main challenge for IFC's program in DRC is the Government's cancellation in 2009 of the mining contract with Kingamyambo Musonoi Tailings (KMT), in which IFC has an ownership stake. The case is under international arbitration and IFC has decided to stop all investment activities in DRC until the dispute is resolved. Advisory services operations will continue, with the exception of Gecamines and mining-related activities. This approach will be re-assessed within the next 6 months. 29. MIGA's program in DRC is consistent with the Agency's Operation Direction's initiative of 2008-2011. MIGA's current exposure in DRC is US$29.4 million. In the period under review, MIGA has supported two investment projects in DRC ­ (a) US$25.1 million in Political Risk Insurance (PRI) define support to the Congo Equipment SPRL define project operating out of Lubumbashi; and (b) a US$4.3 million guarantee for the Congo Oil and Derivatives SARL define project. Going forward, MIGA will continue to focus on the development of energy generation projects, mining, and agribusiness. 30. The Bank Group is also laying the foundation for improved disbursement rates and reduced disbursement lags, although sustainable improvements will require stronger government leadership in portfolio monitoring. The adoption of the following measures are proposed: (a) intensified dialogue with the GoDRC during the next round of CPPRs, on the need for government to resolve the problem projects; (b) increase the proactivity of task teams, including the disbursement team, in pursuing risk-based implementation and disbursement-related support for projects; (c) adoption of e-signature and report-based, rather than statement of expenditure-based, disbursement arrangements for most new operations, supplemented by client capacity enhancements before project launch; and (d) timely effectiveness of new operations. 31. DRC continues to enjoy the support of a range of development partners, including nontraditional partners, and its relationship with those partners continue to evolve along the lines outlined in the Kinshasa Agenda. At present, official development assistance (ODA) to DRC finances 50 percent of government spending, and the level of ODA spending will remain significant. Non- traditional partners are also likely to take a more prominent role. IDA's engagement with other development partners has been strengthened substantially since the elaboration of the 2007-2010 multi- donors' Country Assistance Framework (CAF) in 2007, from which the CAS was derived. The Bank will continue to play a leading role in improving donor coordination and harmonization, and in the thematic groups under its co-leadership (governance, industry, and mining). In line with the Kinshasa Agenda, which calls for better division of labor among donors and use of harmonized implementation mechanisms 12 (in the absence of use of national systems), donors are revising their country assistance to focus on fewer sectors. While refocusing its program as well, the Bank will also pursue strategic partnerships with other donors in its areas of concentration. The Bank has taken the lead in developing joint mechanisms for project implementation to help reduce the cost of doing business and avoid overtaxing already weak government capacities. An illustrative case is the joint implementation unit for energy sector programs funded by the Bank, AfDB, and the European Investment Bank (EIB). Similar arrangements to maximize donor coordination are anticipated for other sectors. In addition, the Bank, in coordination with other donors, will continue to move from stand-alone project units towards sector implementation units integrated in the lines ministries. Annex 18 shows the World Bank's present sector engagement as well as its strategy to contribute to a better division of labor in the future. 32. The World Bank is committed to the principles of harmonization through the decentralization of key staff and active participation, including leadership, in key sector working groups. Supervision will be more intensive supervision and include further support for implementation. The decentralization process has pursued its course, with the Country Director located in Kinshasa since 2008; and in the course of 2009-2010, about 14 international staffers have been relocated to Kinshasa, including a lead Operations Officer and sector leaders for sustainable development and human development. The Bank will continue to locate more TTLs in the field (currently six out of 17 projects are managed from DRC and three others from neighboring countries). Further, the Bank will work closely with the provincial administrations in the implementation of our programs, and will gradually begin designing province-level programs, such as the agriculture operation focusing primarily on Equateur Province. 33. The risks and mitigation measures enumerated in the CAS--related to the fragile political and security situation, the limited capacity to manage macroeconomic shocks, the slow implementation of economic and governance reforms, a poorly managed decentralization process, corruption, lack of donor coordination, and poor operational performance--remain largely valid. In fact, the risks related to political and security, macroeconomic management, and the large reform program might increase in the 18 months before the upcoming presidential and parliamentary elections. If any of these risks materializes and the reform program goes off track, up to 80 percent of the Bank's portfolio could be affected. As there is a high likelihood that one or more of these risks will materialize, the Bank has made risk mitigation an integral part of its program for the remaining CAS period. Risk mitigation activities will include: (a) closely monitoring the macroeconomic situation, in coordination with the IMF, and taking proactive steps to mitigate any deepening impacts due to the financial crisis and/or to any fiscal slippage from overspending during the upcoming elections, which could derail the ECF supported program . Should the macro situation deteriorate, the Bank will realign its support accordingly, including through the use of emergency response measures; (b) working with the UN to closely monitor the peace and security situation, and assessing the impact of any deterioration on both the portfolio and pipeline;29 and (c) closely monitoring the pace of implementation of critical Bank-supported economic reforms. As the elections approach, for example, there might be resistance from the authorities 29 There are three principal areas of risk to peace: (a) resumption of hostilities in eastern Congo; (b) insecurity due to ineffective security forces; and (c) competition for resources between the center and various peripheral provinces. 13 to implement SOE reforms. If one or more of these risks materialize, the Bank will review the risk implications for the ongoing program and make required adjustments. 14 ANNEX 1: DRC POVERTY REDUCTION AND GROWTH STRATEGY (PRGS) The Government completed its full PRGS paper, covering the period 2006-2008, through a participatory process in July 2006. The PRGS was endorsed by the democratically elected government in March 2007. The strategy is based on five pillars: (a) promotion of peace and good governance; (b) consolidation of macroeconomic stability and promotion of economic growth; (c) improvement in access to social services; (d) the fight against HIV/AIDS; and (e) promotion of community dynamics. In practice, implementation of the PRGS has also been supported by the government's "Programme d'Actions Prioritaires (PAP)" for the period 2006-2009. In its PRGS Progress Report of July 2008, the Government acknowledged that the strategy was overly ambitious. With implementation hindered by the conflict in the eastern provinces and by capacity and budgetary constraints, little progress was made in achieving the PRGS objectives, and key social indicators did not improve significantly, with the exception of primary education enrollment and maternal mortality rates. Delays in rebuilding democratic institutions also affected the Government's ability to monitor key reforms. With a view to ensuring the achievement of PRGS objectives despite the problems experienced to date, the Government has extended the strategy for an additional 18 months, through the end of 2010, and adopted an updated Priority Action Plan (PAP2) for 2009-10 that seeks to correct the weaknesses identified in the Progress Report by prioritizing the key policies and actions to be implemented. Aligning the budget with these priorities will be a key element of the Government's strategy going forward. Given that poverty dynamics in the DRC remain unchanged, staff believes that the current PRGS remains the appropriate basis for Bank assistance during FY10-11. In parallel, the Government is preparing its second generation PRGS, which will cover the period 2011- 15. This document will be developed in a participatory manner, including at the provincial level, and is expected to be completed and approved by December 2010. 15 ANNEX 2: DEMOCRATIC REPUBLIC OF CONGO: ECONOMIC DEVELOPMENTS, 2002-2008 (1) Despite a slowdown in recent years, (2) Fiscal performance was uneven, with a widening of Growth was robust, the deficit in 2007-08 12.0 Growth Contribution by Sectors 3 30 Revenue, Expenditure, and Fiscal Balance 10.0 Agriculture Secondary (Percent of GDP) Tertiary Mining Revenue 2 20 Underlying fiscal 8.0 Balance (cash basis) 10 1 6.0 0 0 4.0 -10 2.0 -1 -20 Expenditure Overall balance 0.0 -30 -2 2002 2003 2004 2005 2006 2007 2008 2002 2003 2004 2005 2006 2007 2008 (3) Resulting in an increase in net credit to government (4) The resurgence of inflation, And base money. 450 35 Base Money and Net Credit to Government Inflation 400 (Billions of Congolese francs) (Annual percent change) 30 350 25 Overall Food 300 Base money 250 20 200 Net credit to the 15 Government 150 10 100 Fuel 50 5 0 0 2002 2003 2004 2005 2006 2007 2008 2003 2004 2005 2006 2007 2008 (5) A widening of the external current account (6) ... and drop in reserves . Deficit, 80 250 5 Exports, Imports and Current Account (Percent of GDP) Gross Official Reserves 60 200 5 Terms of trade (Millions of US$ ; (Right axis) 200 (Weeks of 4 40 Left axis) Imports Exports (left axis) 150 4 of goods and 20 150 Services; right 3 Axis) 0 3 100 -20 100 2 2 -40 Current account (left axis) 50 50 1 -60 1 Imports (left axis) -80 0 0 0 2002 2003 2004 2005 2006 2007 2008 2002 2003 2004 2005 2006 2007 2008 Sources: Congolese authorities and IMF staff estimates and projections. 16 ANNEX 3. DEMOCRATIC REPUBLIC OF CONGO: RECENT ECONOMIC DEVELOPMENTS (1) After a tightening in the first half of 2009, higher spending ....(2) combined with central bank failure to mop up liquidity financed by emergency aid... . injections ... 100 300 500 500 Revenue, Expenditure and Domestic Balance (Billions Base Money and Net Credit to Government of Congolese francs) 450 (Billions of Congolese francs) 450 200 60 400 400 Revenue (right axis) Base money 100 350 350 20 0 300 300 -20 250 250 -100 Net credit to Domestic balance government (left axis) 200 200 -60 Domestically-financed -200 150 150 expenditure (right axis) -100 -300 100 100 2007Q4 2008Q3 2009Q2 Dec-07 May-08 Oct-08 Mar-09 Aug-09 (3) led to a depreciation of the exchange rate ...(4) and pickup in inflation. 980 1000 Gross Reserves and Exchange Rate 80 80 900 Inflation 860 70 (Percent, year-to-year) 70 800 740 Official exchange rate 60 Food 60 700 Fuel (CF/U.S$;right axis) 620 600 50 50 Overall 500 500 40 40 Gross reserves (millions of U.S $; left 400 380 30 30 axis) 300 260 20 20 200 140 100 10 10 20 0 0 0 Dec-07 Jun-08 Dec-08 Jun-09 Dec-07 Jun-08 Dec-08 Jun-09 (6) The pickup in inflation resulted in an appreciation of the (5) In response, the central bank tightened monetary policy. real exchange rate. 80 Interest rates 140 Real and Nominal Effective Exchange Rate 70 (Index, 2002=100) 60 Indicative rates 120 Real effective exchange rate 50 100 40 80 30 BTR volumes 60 20 40 10 Nominal effective exchange rate 0 20 Dec-07 May-08 Oct-08 Mar-09 Aug-09 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Sources: Congolese authorities; and IMF staff estimates. 17 ANNEX 4. DEMOCRATIC REPUBLIC OF CONGO: SELECTED ECONOMIC INDICATORS 18 19 ANNEX 5: DEMOCRATIC REPUBLIC OF CONGO: SOCIAL AND ECONOMIC INDICATORS Per capita income is the lowest in SSA. Socioeconomic conditions are poor, 5000 Real Per Capita, 2008 0.530 Human Development Index 4500 (2000 US$) (High value= high performance) 0.510 4000 0.490 3500 3000 0.470 Sub-Saharan Africa 2500 0.450 2000 0.430 Democratic Republic of 1500 Congo 0.410 1000 500 0.390 0 0.370 1975 1980 1985 1990 1995 2000 2005 Botswana Nigeria Comoros Ethiopia Swaziland Lesotho Madagascar Congo, DRC While high cost of doing business 200 Doing Business Ranking, 2009 190 (Low value= high performance) 180 Democratic Republic 170 of Congo Fragile 160 SSA Countries 150 140 130 120 110 100 Starting a Registering Business Property Credit Investors Taxes Sources: IMF, World Economic Outlook, 2009, World Bank, Doing Business, 2009, UNDP, Human Development Report, 2008-09. 20 ANNEX 6: DEMOCRATIC REPUBLIC OF CONGO: PROGRESS TOWARD MILLENIUM DEVELOPMENT GOALS 1990-2015 (Percent, unless otherwise indicated) 120 120 Primary Completion Rate, Total Ratio of Girls to Boys in Primary and Secondary (Percent of relevant age group) Education (Percent) 100 100 80 60 80 40 60 Goal 20 Goal Actual Actual 0 40 1990 1995 2000 2005 2010 2015 1990 1995 2000 2005 2010 2015 300 1400 Under-5 Mortality Rate Maternal Mortality Ratio (Per 1,000) 1200 (Per 100,000 live births) 250 1000 200 800 150 600 400 100 Goal Goal Actual 200 Actual 50 0 1990 1995 2000 2005 2010 2015 1990 1995 2000 2005 2010 2015 60 100 Malnutrition Prevalence, Weight for Age Access to Improved Water Source (Percent of children under 5) 90 (Percent of population) 50 80 70 40 60 30 50 40 20 30 Goal 20 Goal 10 Actual 10 Actual 0 0 1990 1995 2000 2005 2010 2015 1990 1995 2000 2005 2010 2015 Sources: World Bank, http://ddp-ext.worldbank.org; and United Nations, http://unstats.un.org. 21 ANNEX 7: PROGRESS STATUS OF HIPC COMPLETION POINT TRIGGERS (AS OF MARCH, 2010) Triggers Progress status 1. PRSP The PRSP progress report has been prepared by the Completion of a full PRSP through a participatory government and received technical comments from process and its implementation for one year duly Bretton Woods institutions. The report will be submitted documented in the DRC's annual progress reports and to the latter by late April 2010 for the preparation of the confirmed as satisfactory by a joint staff advisory note JSAN. (JSAN). IMF staff conducted in March 2010 the first review of 2. Macroeconomic stability the PRGF/ECF-supported program (July 2009-June Continued maintenance of macroeconomic stability after 2012). The conclusion of the mission was that reaching the decision point, as evidenced by satisfactory implementation of the 2009 economic program is performance under the IMF's PRGF-supported program satisfactory. 3. Use of budgetary savings. An audit to assess the use of HIPC resources for pro- 2. Use of budgetary savings resulting from enhanced poor spending is being conducted jointly by the HIPC Initiative-related debt service relief during the Congolese audit office (Cour des comptes) and an interim period for poverty-related expenditures in international independent firm. The audit reports as well accordance with the I-PRSP, with supporting as the related action plan are yet to be delivered. documentation. 4. Public expenditure management A computerized budget-execution system (Chaine de la (a) Implementation of a modernized budget-execution dépense) , in place since 2003 has been improved in system, providing information from commitment to February 2010 through its manual of procedures. payment, and allowing for the monitoring of arrears; (b) Adoption and implementation of a double-entry The double-entry government accounting system and government accounting system and a new chart of new chart of accounts has been adopted and accounts; and implemented. However, treasury accounts produced (c) Production of quarterly budget execution reports from the system are not yet exhaustive and fully reliable. using economic, administrative, and functional With technical assistance from the IMF-AFRITAC classifications. centre, the system is being strengthened. Budget execution reports (États de suivi budgétaire - ESB) are produced using economic, administrative and functional classifications, but with a lag of 2-3 months. They also need to be harmonized in a timely manner with the Treasury financial operations table (Tableau des opérations financières de l'État - TOFE). 5. Governance and service delivery in priority sectors Budget-tracking exercises to monitor the execution of - (a) Completion of a budget-tracking exercise on health, social sectors expenditure and a survey on the quality of education, rural development and infrastructure service delivery completed have been conducted by the expenditure, consisting of (i) monitoring the execution of government. Related reports are expected late April poverty-related public expenditure; (ii) evaluation by 2010. user groups of the quality of related public services, and (iii) evaluation by service-providers of constraints to The draft procurement code was adopted by Parliament effective provision; and by April 2010. GODRC is currently focusing on implementing regulations, especially these related to - (b) Adoption and implementation of a new institutions and procedures. This is being done with procurement code and key implementing decrees. technical assistance from the World Bank. 22 Triggers Progress status 6. Social and rural sectors Development strategies and related implementation Adoption of satisfactory sectoral development plans for health and education have been adopted by strategies and related implementation plans for health, the government end of March 2010. The strategy for education and rural development. agriculture and rural developments is yet be adopted . 7. Debt management A computerized debt-recording system has been Installation and full activation of a computerized debt- installed and fully activated since 2006. Monthly debt- recording system, covering all public and publicly service projections are produced on a quarterly basis, guaranteed debt, as well as public enterprise debt not and are regularly posted, among other data, on the carrying the guarantee of the State that can (a) produce government debt management office's web site monthly debt-service projections, and incorporate (www.dgdp-rdc.org). actual disbursement and debt-service payment Centralization of debt information in a single center has execution data; and (b) support the centralization of been completed and action plan for its improvement is debt information in a single center. In addition, being implemented. Report has to be submitted to monthly debt-service projections that will be published IDA. in advance on a quarterly basis. Source: World Bank, IMF and DRC technical teams 23 ANNEX 8: ACTUAL DRC DELIVERABLES (AS OF APRIL 2010) CAS PLAN ACTUAL DEL. of which of which FY08 Project Name IDA($) IDA($) IDA Grant IDA Credit P105729 M DRC DDR Supplemental 50.0 $ 50.0 $ 50.0 $ P108905 M DRC EMRRP Supplemental 2 12.0 $ 12.0 $ 12.0 $ P090872 M DRCPriv Sec Dev & Comp Supplemental 60.0 $ 60.0 $ 60.0 $ P104041 DRCEnhancing Governance 50.0 $ 50.0 $ 50.0 $ P101745 DRCProRoutes (Roads Maintenance) $ 40.0 $ 50.0 $ 50.0 SubTotal 212.0 $ $ 222.0 222.0 $ $ CAS PLAN ACTUAL DEL. of which of which FY09 Project Name IDA($) IDA($) IDA Grant IDA Credit P100620 DRCForestr & Env 50.0 $ $ 64.0 $ 64.0 P091092 DRC DRC Urban Water Supply 150.0 $ 190.0 $ 190.0 $ P115642 DRC Emerg Proj to Mitigate Fin Crises $ $ 100.0 $ 100.0 DRC Economic Mgt Support TA 30.0 $ $ $ Regional: Funded from AFCRI except for IDA $ P105654 South AFR Power Market Add'L Financing 30.0 $ 62.0 $ $ 62.0 Subtotal 260.0 $ $ 416.0 $ 416.0 $ CAS PLAN BUSINESS of which of which FY10 Project Name IDA($) PLAN IDA($) IDA Grant IDA Credit P106976 DRC Urban Rehab & Development (Dropped) 100.0 $ $ P118658 DRC Emerg Social Action Add'l Financing 50.0 $ 35.0 $ $ 35.0 P092724 DRCAgriculture Rehab SIL 120.0 $ $ 120.0 $ 120.0 Subtotal 270.0 $ $ 155.0 $ 155.0 $ GRAND TOTAL FY08FY11 742.0 $ $ 793.0 $ 793.0 24 ANNEX 9: ACTUAL AAA DELIVERED (AS OF APRIL 2010) DRC: FY0811 ESW DELIVERABLES AND COSTS ACTUAL COSTS FY08 Project Name CAS Plan WPA Del. BB TF Total DRC Financial Sector Assessment Program (FSAP) x P101585 DRC Public Expenditure Review (PER) x x 552 552 P104047 DRC Programmatic Governance (Phase 1) x x 267 267 P100294 DRC Youth Education Study x x 148 61 210 P097645 DRC Investment Climate Assessment x 123 123 P101019 DRC Mining Sector Study x 375 375 Subtotal 5 5 1,465 61 1,526 ACTUAL COSTS FY09 Project Name CAS Plan WPA Del. BB TF Total DRC Country Financial Accountability Assessment (CFAA) x DRC Public Enterprise Review x DRC Risk and Vulnerability Assessment Study x P104047 DRC Programmatic Governance (Phase 2) x x 165 326 162 P111516 DRC ROSC Accounting & Auditing x 74 74 P114948 DRC Infrastructure Review x x 56 56 Subtotal 5 3 294 456 162 ACTUAL COSTS/BUSINESS PLAN FY10 Project Name CAS Plan BUS. PLAN BB TF Total DRC Health Country Status Report x P106432 DRC CEM and DTIS x x 757 479 1,237 P113578 DRC Pygmy Development Strategy x 146 146 P104047 DRC Programmatic Governance (Phase 3) x 100 55 155 P111838 DRC Review GenderBased Activities x 32 32 Subtotal 2 4 1,035 534 1,570 GRAND TOTAL FY08FY11 12 12 2794.683 757.1 3551.783 25 ANNEX 10: EARLY ACHIEVEMENTS Annex 10 DRC CAS Progress Report ­ March 2010 Milestones for achieving Achievements to Date (Includes results for the indicators Relevant CAS Outcome Indicator Comments CAS Outcome Indicators & milestones listed in Columns 1 & 2.) projects Pillar 1: Promote Good Governance and Consolidate Peace through Strengthened Institutions 1. The civil service is reformed and 1.a Public service pay system is Indicators Indicators transformed into a professional simplified, reducing number of 1.1 Data from 3rd quarter 2009 indicates 643,308 civil servants 1.2 Improvement primarily as the structure (CAF PUBLIC variables from 20 to 3 by the end registered in DRC. Of this total, 179,278 (28%) paid through PTS transport and housing allowances Enhancing ADMINISTRATION 1) of 2010 system. Remainder receives occasional allowances. Civil service are now part of the salary. Governance as illustrated by a more effective and census planned to clarify the status and number of workers. Capacity (FY08) transparent management of the 1.b A fully automated public 1.3 As this still includes a payroll system for civil servants service pay system is in place by 1.2 Achievement estimated at 55% to 60% by end-2009 and varies significant portion of personnel HIPC Initiative 1.1 Discrepancy between personnel the end of 2010 by ministry. working in the provinces in the register and payroll numbers is reduced health, education, and agricultural from the current 20% to less than 5% 1.c A Human Resource Database 1.3 Average during first three quarters 2009 = 29% taking into sectors, who are still paid by the in 2011 is operational at central level by account all civil servants paid by the central government. This central government, the result will the end of 2009 means nearly 180,000 out of 643,300 civil servants were paid by improve once these provincial staff 1.2 Base pay is at least 75% of real pay the simplified system known as PTS. are paid by the provincial in 2011, up from 10% in 2007 1.d National Statistical administration. Further progress also Development Strategy Milestones depends on completing the civil 1.3 90% of central government civil (FY09/10) 1.a Public service pay system is being simplified. service census and then regularizing servants are paid through a reformed the status of workers who are not yet payroll system by 2010 1.b Fully automated public service pay system by 2011 registered in the system. 1.c Dependent on completing the civil service census which has Milestones been delayed. Not likely before 2011. 1.d National statistical plan to be prepared and national census to be 1.d New statistics law passed. conducted. 2. Fiduciary systems at provincial 2.a 11 provinces have fully Indicators Indicators Enhancing and local levels are established and taken over exclusive 2.1 1st trimester 09 = 12% of domestic revenue transferred to sub- 2.1 A transparent revenue sharing Governance capacity to deliver social services are competencies by 2010 national government level; 2nd trimester 09 = 15.69% and 3rd formula, part of the 08 budget, was Capacity (FY08) strengthened (CAF LOCAL GOV & trimester 09 = 6.91% (N.B. These figures do not include salaries to abandoned with the 09 budget, DECENTRALIZATION) 2.b New revenue retention and provincial staff paid by the central government, which adds another though the Govt has committed to HIPC Initiative 2.1 At least 35% of domestic revenue transfer systems fully 24%) reinstating the formula in 2010. is assigned to sub-national level by operational by 2011 Revenue sharing system has been a 2011 compared to 10-15% in 2007 2.2 Public Finance Framework law has been submitted to major source of contention between 2.c Rudimentary public service Parliament and is expected to be adopted this year. This law will the national & provincial gvts. 2.2 Financial viability of the provinces and payroll systems in place in 5 will ensure the right of the provinces to receive their share of is achieved based on the new provinces by 2011 national revenues. 2.3 Study delayed due to time taken implementation of effective solidarity to contract the local firm, prepare mechanisms by 2011. 2.d Citizen Scorecard Survey 2.3 and 2.d Collection of baseline data began in Nov 2009 in the 3 the study design & instruments, and undertaken in 2008 and 2010 pilot provinces (Bandudu, Katanga and South Kivu). Results test the survey instruments. Annex 10 DRC CAS Progress Report ­ March 2010 Milestones for achieving Achievements to Date (Includes results for the indicators Relevant CAS Outcome Indicator Comments CAS Outcome Indicators & milestones listed in Columns 1 & 2.) projects 2.3 Citizen satisfaction with public available by March 2010. 2nd survey planned for 2011 with results services in Provinces supported by 2012. Milestones provided at the provincial level reaches 2.a Provincial governments at least 60% by 2011 (baseline to be Milestones established in 07 after the 06 established in 2008) 2.a Legal framework for provincial & local gvts adopted. elections, and a package of laws 2.b New revenue retention & transfer systems being prepared. regulating their functions adopted in 2.c Systems in place in the 3 pilot provinces & Bas Congo 2008. But key aspects of inter- Enhancing governmental fiscal relations & Governance issues of staff transfer to be settled. Capacity (FY08) 3. Government revenues are 3.a Tax Authority has a fully Indicators Indicators increased and the budgetary process automated tax application 3.1 Revenues increased from FC 1.2 trillion in 2008 to FC 1.5 3.1 Decline is attributed to the HIPC Initiative is reformed in line with international processing system trillion in 2009 but fell as a share of GDP from 18.5 percent to impact of the financial crisis. This standards (CAF PFM 1) as 16.8 percent should change once the economic illustrated by an improved tax 3.b New legal framework for situation has stabilized. collection and budget execution PFM is prepared by 2010 3.2 Average deviation of 47.89% in 2009 (T1: 56%; T2: 54.44%; process T3: 33.23%). 3.2The realism of the budget 3.1 20% increase in Government 3.c A time-bound action plan to projections adopted in Parliament revenues excluding grants (from 13.3% reinforce participation of priority Milestones are the main issue but it was of GDP in 2006) line ministries in the budget 3.a PFM action plan includes this result. Installation of new aggravated by revenue shortfalls formulation, execution, tracking system delayed. in the wake of the financial crisis. 3.2 Deviation between actual and and reporting budgeted expenditure by function 3.b A new legal framework for budget management has been Milestones cannot be more than 20% from 2009 3.d Revised & upgraded finalized and should be submitted to Parliament early in 2010. 3.f In public finance management, onwards expenditure chain in place the fiscal crisis led to reduced reducing the number of visa 3.c PFM Action Plan has not yet been adopted. transparency, reversing some of the 3.3 Budget allocations for pro-poor required manually from 10 to 3 gains made in 2007-2008, especially expenditures are met from 2008 and by 2010 3.d PFM Action Plan has made this a priority. Revision is ongoing concerning the volume of public onwards and should be upgraded by 2011. expenditure managed outside regular 3.e Live data exchange expenditure management operational between expenditure 3.e Not expected before 2012. procedures. However, a new legal & revenue side of the budget by framework for budget management 2010 3.f At the central level, reports on budget execution are produced, has been finalized and should be but not validated on time. That explains the delay in publication of submitted to parliament early in 3.f Report on budget execution those reports on the ministries' websites. 2010. Furthermore, the new received from key sectoral At the sub-national level, reports on budget execution are not Procurement Code under discussion ministries every year from 2008 produced because of the non operational expenditure chain. They in parliament should, if adopted, onwards should change by 2010. eliminate current opaque contract allocation practices. A 3.g Implementation of the 3.g New Procurement Code is under discussion in Parliament and comprehensive action plan for revised public procurement should be adopted end of January 2010 public finance is currently under legislation preparation, and IDA--in close 27 Annex 10 DRC CAS Progress Report ­ March 2010 Milestones for achieving Achievements to Date (Includes results for the indicators Relevant CAS Outcome Indicator Comments CAS Outcome Indicators & milestones listed in Columns 1 & 2.) projects collaboration with the IMF--will 3.h A new institutional support its implementation under the framework for the auditing and ongoing governance project and the accounting body Institut de planned Development Policy Reviseurs Comptables in place Operation. by 2008 4. The FARDC is reformed and 4.a An additional 40,000 ex- Indicators Indicators transformed into a professional and combatants demobilized by 2009 4.1 181,666 combatants have been processed­ of which 109,711 4.1 The target of 95% was the CAF Emergency unified structure (CAF SECURITY (71.5%) have demobilized. 78,477 adults provided with reinsertion target, while the Bank end of project Demobilizat. & SECTOR 2) as illustrated by ex- 4.b 60% of demobilized ex- support (cash) and socioeconomic assistance; 30,129 children target was 60% of ex-combatants Reintegrat. combatants demobilized and combatants under intervention released from the armed groups; 514 disabled ex combatants fully reintegrated by 2010 compared (FY04) successfully reintegrated into civilian engaged in productive economic received additional support in terms of medical assistance; and to 20% in 2007. Children continue life activity by 2009 1000 vulnerable women from the fighting forces are receiving to be identified and released. 4.1 95% of ex-combatants fully specialized assistance reintegrated by 2010 compared to 20% Milestones by 2007 Milestones 4.a Under the additional financing, 4.a Under additional financing, 5,747 ex-combatants out of the 23,000 from FARDC & 19,000 40,000 were demobilized. militia were estimated to be demobilized, but figure was revised 4.b 71.5% of demobilized ex-combatants under intervention as the militia were integrated into engaged in productive economic activity by 2009. the army & only 5,747 from FARDC were demobilized Pillar 2: Consolidate Macro-Economic Stability and Growth 5. Debt, inflation and fiscal 5.a HIPC Completion Point is Indicators management improved achieved by 2008 5.1 Stock of external debt is about US$13.149 billion in 2009 with HIPC Initiative 5.1 Debt indicators below the threshold debt service amounting to 1/4 of total expenditure levels from 2008 onwards 5.b Debt information Emergency management centralized 5.2 Due to financial crisis, inflation estimated at 53% end-2009. Project to 5.2 Single-digit inflation from 2009 Mitigate Impact onwards 5.c Monthly debt service 5.3 Estimated at -5.6 in 2009 versus ­ 4.0 in 2008 (excluding of Financial projections produced grants on a cash basis). Crisis (FY09) 5.3 Fiscal balance (excluding grants) less than 5% from 2008 onwards 5.d Monthly Treasury balance Milestones produced automatically 5.a and 5.b Expected by 2010 5.e Action Plan established to 5.c Debt service projections are expected to be produced quarterly reinforce Treasury management from 2010 onwards. includes tools for better projections & monitoring by 5.d Monthly budget execution tables produced within 30 days. 2008 5.e Expected by mid-2010 28 Annex 10 DRC CAS Progress Report ­ March 2010 Milestones for achieving Achievements to Date (Includes results for the indicators Relevant CAS Outcome Indicator Comments CAS Outcome Indicators & milestones listed in Columns 1 & 2.) projects Other Milestones: 5.f $50.5 million paid to Government to support imports of essential goods and commodities. With combined donor support (WB, IMF, ADB, others) foreign reserves increased from $39 million (2-3 days of imports) in Jan. 09, to $268 million by July 09. 5.g $23 million paid to enable Government to pay water and electricity bills from Jan.-June 09 in order to ensure continued service by both utilities. 6. The agriculture sector is 6.a 1,650,000 households The Agriculture project was delayed and will become effective in recapitalized and inputs are benefited from campaigns to 2010 Agriculture provided (CAF Agriculture 1) improve productivity of cassava, Rehabilitat. & 6.1 35% of rural workforce provided soy and maize plantations and Recovery Support with seeds, small animals & tools by distribution of improved seeds Milestones (FY10) 2010 by 2008 6.a Cassava cuttings provided to 2,116,551 households; 6,802 tons of improved seeds produced and distributed. Emergency Multi 6.2 10% increase in the yield of 6.b 400,000 households Sector primary crops by 2010 compared to 07 benefiting from improved rural 6.b 2,000 km of feeder roads rehabilitated. Rehabilitat. & roads to transport agricultural Recovery (FY03) 6.3 30% decrease in post-harvest losses produce to markets by 2008 nationwide by 2010 over 2007 7. Natural resources are managed in 7.a Third party observer to assist Indicators Indicators Emergency a sustainable manner on the basis of the forest administration in law 7.1 Review of 156 logging contracts successfully completed end- 7.5 DRC endorsed the EITI Economic and legal codes (CAF Natural Resources enforcement in the field is 2008. Ongoing missions to verify status of closed concessions. List principles to strengthen transparency Social Rehab Management 1) as illustrated by deployed by 2008 of legally held concessions published. and good governance of the (FY04) more effective law enforcement, extractive industries sector on 17 7.2 SGC/Helvetas contract signed; WRI SyGIS contract expected to March 2005. Following this public Forest and Nature empowerment of local communities, 7.b Increased number of partnerships with civil society to be signed by Feb 2010; active use of systems established to verify statement the country began to Conservation rehabilitation of key protected areas and environmental services monitor the implementation of legality of logging and taxes due. implement the initiative. DRC was (FY09) rewarded in the forest sector reforms in the field and to accepted as an EITI Candidate Rehab and 7.1 Moratorium on new forest support local communities' 7.3 Contracts awarded for management of key sites. Baseline has Country at the board meeting in Participatory Mgt concessions is maintained and illegal initiatives been determined in the project results matrix. Accra 22 February 2008. The of Key Protected concessions are cancelled country now has until September 7.4 REDD preparedness plan submitted to the Forest Carbon 2010 to undertake validation. The Areas (FY09) 7.c Conduct audits of companies 7.2 Increase in the proportion of illegal whose sales exceed US$10 Partnership Facility. EITI procedures will consist of: (i) logging operations prosecuted million per annum and of gathering of statistics on, first, the (baseline & target Tbd as part of government agencies involved in 7.5 A diagnostic study of the mining sector was carried out by an taxes and fees paid by extractive PROMINES operat) assessment and collection of independent consultant (Price Waterhouse Coopers (PWC)) and enterprises (mines, hydropower, (FY10) mining taxes by end 2008. was approved in Jan 2010. The study, which identifies priorities fossil fuels, forests, etc.), and, 7.3 The management of key bio- and generates an action plan for the operation of the EITI second, the revenue collected by the 29 Annex 10 DRC CAS Progress Report ­ March 2010 Milestones for achieving Achievements to Date (Includes results for the indicators Relevant CAS Outcome Indicator Comments CAS Outcome Indicators & milestones listed in Columns 1 & 2.) projects diversity and natural habitats is 7.d Create 10 new artisanal mechanism, evaluates the contribution to government revenues State and the EADs; (ii) the audit improved (as measured by increases in mining zones by end 2008 and from the mining sector at between US$200 million and US$300 and reconciliation of these statistics the management score; baselines and upgrade skills of SAESSCAM to million in 2008. by an independent auditor to be targets TBD as part of operation) effectively deliver extension recruited; and finally (iii) their services to artisanal miners. 7.6 Several mining contracts are available online and due to the publication on a website. 7.4 Number of contracts and pilot EITI procedures, there is a broader dissemination of information initiatives based on payment for carbon related to mining companies. 7.8 It is estimated there are more storage, biodiversity conservation, and than a million people involved in other environmental services by 2011. 7.7 There are more international mining firms active in DRC which artisanal & small scale mining in may be more likely to comply with international standards (lower DRC. 7.5 Mining revenues up from 30 rates of problems, fatality, health issues ect.) To be verified. million in 2007 to 100 million by 2010 7.8 A diagnostic on artisanal mining is under preparation which 7.6 Publicat. & disclosure of mining will help design support to artisanal mining. companies & shareholders details by end 2008 Milestones 7.a Contracts prepared for signature with REM (Resource Extract 7.7 Increased compliance with Monitoring). applicable occupational health, safety and environmental standards by 2011 7.b Landscape contracts under negotiation with consortia of (baselines & targets Tbd) international and local NGOs. 7.8 Improve conditions for artisanal 7.c Not yet achieved. Companies carry out their own audits. Need and small scale miners in terms of for an official mandate otherwise. reduced workplace accidents by end 2011 (baselines and targets Tbd) 7.d 6 new artisanal mining zones have been created. Conditions have slightly improved for the artisanal miners living in those zones. Upgrade of skills has not been achieved yet. 8. The transport structure is 8.a 40 km of road rehabilitated Indicators Indicators rehabilitated, state and non-state in Kinshasa to improve or regain 8.1 130 km of roads rehabilitated from Lumbubasi to Kasimeno. 8.1 Collaboration between Chinese Emerg MS Rehab owned transport enterprises are access for 800,000 residents by 827 km of roads, including Kisangani-Beni road (650 km) and and the Government for the Multi- & Recovery ERL reformed and investments in the 2011 Bukavu Kamituga road (177km) road. modal project means Government (FY03) sector are prioritized (CAF 35 km of roads rehabilitated (Kinsagani, Oriental Province). will contribute for $200 million TRANSPORT 1) for improved 8.b 1,400 kms of road reopened from Chinese loan. No progress yet Pro-Routes access and reduced transport costs and maintained in the Oriental 8.2 Data not available. ProRoutes baseline survey to be conducted on railway or waterways. Expect (FY08) 8.1 Principal road, water and railway Eastern Province and South Kivu during 2010 and will establish current situation for this indicator in another 500 km to be opened and links between targeted urban areas re- and Katanga by 2011. targeted zones. repaired by 2011 (ProRoutes). Emergency established Urban & Social 8.c Improved signaling on major 8.3 Of the 15,000 km of national roads (RN), World Bank 8.4 No data yet available for Rehab (FY07) 8.2 Increase in % of households with waterways and port of Kinshasa contributed to reopening and maintaining 2,077 km (13,8%). railways or airport. access to all-weather road within 2 kms and Mbandaka rehabilitated by 30 Annex 10 DRC CAS Progress Report ­ March 2010 Milestones for achieving Achievements to Date (Includes results for the indicators Relevant CAS Outcome Indicator Comments CAS Outcome Indicators & milestones listed in Columns 1 & 2.) projects in target area (baseline & target Tbd) 2008. 8.4 No survey data available but will be once ProRoutes baseline Milestones Emergency 8.3 Increase in % or roads in good survey completed 2010. However, in areas where roads opened 8.b Revised target is 1800 km by Living Condition condition (baseline and target Tbd) 8.d Concession of N'dili and repaired, transport is now by vehicle rather than by bicycle so 2013 (ProRoutes), of which 600 km Improvement international airport is completed speed and cost have improved. is expected by 2011. (FY05) 8.4 Average transport cost for railway, and an autonomous Port airport & port reduced by 1/3 by 2011 Administration is established for 8.5 Anecdotal examples of time savings and reduced transport costs Emergency compared to 2007 (baseline costs DRC's main ports by 2009 e.g., reduced costs between Kisangani and Nia Nia, but no survey Economic and available) data available. Social 8.e Road Maintenance Fund in Rehabilitation 8.5 Average transport costs on place/operational by 2009 Milestones (FY04) upgraded roads: 8.a 17.1 km of road works underway. 24 km under preparation in - 25% reduction in transport costs for Kinshasa; goods between Lubumbashi and Kasenga by 2010 compared to 2007 8.c Port of Mbandaka repaired. - 30% reduction in transport costs for goods between Akula and Gemena by 8.d No decision on airport expected before 2012, and no decision 2010 compared to 2007 on port as yet. 8.e Achieved 2009 9. Increased availability of electric 9.a 1000 MW of reliable Indicators Milestones Emerg Urban & power (CAF INDUSTRY & generation capacity at Inga I and 9.1 Contract for construction of a 2nd line to be signed by June 9.a 7/14 units functional (3 produce Social SERVICES 2) to serve domestic II by 2011. 2010. Completion by 2013. Revised target=3650 GWhs by 2011. 55MW & 4 produce 165MW). By Rehabilitation demand and for export 2011, unit G12 (55MW) will be (FY07) 9.1 Increase in GWhs of energy 9.b Distribution infrastructure 9.2 Contracting ongoing. Revised targets by 2012: Power exports to operational, along with G23 delivered from Inga rehabilitated in Kinshasa and SAPP 210 MW; Power supplied to Katanga province 300 MW. (162MW) being repaired by Mag Emerg Multi - to Kinshasa by at least 50% (from eight provincial cities by 2008 Energy, Canada (non-Bank Sector 3000 GWhs in 2007 to 4625 GWhs in 9.3 Contract under preparation. 40,000 additional households funding). Revised total 1042 MW by Rehabilitation & 2011). 9.c Improved performance of connected expected by 2012. 2011. Recovery (FY03) SNEL as measured by (i) 30% 9.2 Increase in GWhs of energy increase in revenue collected per Milestones SAPMP APL 1b delivered from Inga to South African kWh and (ii) increase in 9.a Reliable capacity at Inga is 825 MW at end-2008. (FY07) Power Pool countries and Katanga collection of account receivables Southern AFR region by at least 100% (from 715 from 35% to 55% in 2011 9.b Emergency distribution work in Kinshasa to improve and Power Market GWhs in 2007 to 1500 GWhs in 2011) increase quality of supply will be completed in 2011. Prog (FY03) 9.3 330,000 households connected in 9.c Revenue collected per kWh (US cents) from 1.96 in 2007 to 2.1 Regional & Kinshasa by 2011 (up from 290,000 in in 2008. Signing of SNEL management contract by 2011 will result Domestic Power 2006) in increased collection of accounts receivables from 35-55% Market Project (FY07) 10. Pro-investment legislation and 10.a Enterprise creation Indicators Indicators frameworks are established and procedures and licensing 10. 1 and 10.a Starting a Business: 10.2 New Milestone: International 31 Annex 10 DRC CAS Progress Report ­ March 2010 Milestones for achieving Achievements to Date (Includes results for the indicators Relevant CAS Outcome Indicator Comments CAS Outcome Indicators & milestones listed in Columns 1 & 2.) projects public enterprises are restructured requirements are simplified by (i) Implementation of Decree eliminating the following: expert assigned to Central Bank to Private Sector and reformed in line with 2009 - Certificate of headquarters location (procedure 1) strengthen compliance monitoring. Development & international standards (CAF -Criminal records (procedure 3) Also, expect action to be taken Competitiveness Investment Climate 1) for reduced 10.b Action plan to modernize -Certificate of "non fonctionnaire" (procedure 5) regarding banks not in compliance. (FY04) cost of compliance, improved the payment system developed -Company seal (procedure 13) Both by 2011. financial services and more effective and agreed upon IFC TA management of SOEs (ii) Procedure 6: Commercial Registry cost reduced by 20% Milestones 10.1 Number of days to create a 10.c Credit Bureau is 10.e Management contracts may be company reduced by 50 percent modernized (iii) Procedure 8: Ministry of Commerce time reduced from 2 extended beyond May 2010. between 2006 and 2011 months to 48 hours 10.2 Commercial banks' compliance 10.d Micro-Finance Promotion If effectively implemented, these reforms will cut the number of 10.g Also noteworthy related to with prudential regulations is Fund is institutionalized procedures and days to register a business but the cost of starting a OHADA: DRC ratified the decision satisfactory (IMF assessment) by 2011 business remains high compare to African countries: to join OHADA which will enable 10.e Inventories of RVA, the country to modernize the 10.3 At least 5 microfinance ONATRA and SNCC assets and Registering property Business Law framework. institutions reach operational self liabilities completed by 2009 Procedure 4: state fees were reduced from 6% to 3% Under PURUS, 50 million US$ sufficiency by 2011 were allocated to debt settlement. 10.f Restructuring strategy for 10.2 March 09, compliance rated unsatisfactory (IMF/WB review) The percentage of creditors 10.4 Major public enterprises RVA, ONATRA and SNCC is receiving full payment due is 99.4% (including mining, & transport sectors) approved by the Government, 10.3 Microfinance reaches 120,000 clients end-08 (100,000 end-07) (357 paid out of 359 identified). have some private sector involvement, including financing plan whether through public/private covering social liabilities and 10.4 US$1,512 million FDIs in 2007 [source WIR 2008] partnerships, private management divestiture methods by 2009 Gecamines: different JV agreements signed with the private sector. contract, or other arrangement. SNCC, RVA and ONATRA: management contracts on-going. 10.g Public debts from SNEL & REDIGESO: management contract in preparation ONATRA, RVA and SNCC are settled, commercial debts are Milestones identified by 2009. 10.b Some progress but currently stuck at phase 2 of action plan. 10.c IFC currently reviewing status of Credit Bureau and will continue to provide TA while KFW (Germany) assumes responsibility for this action. 10.d Expected by May 2010. 10.e Not completed. Inventory of SNCC on-going under the management contract 10.f SNCC restructuring strategy approved by Cabinet early 2008. 10.g Not completed. Information is being collected under the management contract for SNCC. Auditors to undertake a debt audit 32 Annex 10 DRC CAS Progress Report ­ March 2010 Milestones for achieving Achievements to Date (Includes results for the indicators Relevant CAS Outcome Indicator Comments CAS Outcome Indicators & milestones listed in Columns 1 & 2.) projects are under recruitment. Pillar 3: Improve Access to Social Services and Reduce Vulnerability 11. The coverage and quality of basic 11.a 150 schools built or Indicators Indicators primary and secondary education rehabilitated with community 11.1 Government reports that primary education GER stands at 11.1 GER data may not be accurate Education Sector services is improved (CAF involvement through the Social 91% (Statistics 2007-2008) due to methods used for data Project. (FY07) EDUCATION 4) Action Fund by 2010 collection. Another survey may be 11.1 Increase in primary education 11.2 Stands at 51% (the latest Government report ) done but Govt is dependent on Emergency GER from 64% in 2007 to 72% in 11.b 100 schools & more than external financing - AfDB will be Social Action 2011 3000 classrooms rehabilitated by 11.3 According to UNESCO report, 4.53 m girls enrolled against taking the lead on this. Fund (FY05) 2008 benefiting 290,000 students 5.43 m boys in 2007/08, giving a girl to boys' ratio of 83.4%. Under PURUS, 3 of 5 payments for 11.2 Increase in primary education (EMRRP) According to the same source ratio was 80.9% in 2007. school operating costs were made ($ Emergency Multi completion rate from 29% in 2007 to 24 million) to 99.5% (26,141) of Sector 34% in 2011 11.c More than 100 schools and 11.4 No CRC survey has been done. officially recognized primary and Rehabilitation 500 classrooms rehabilitated by secondary schools in the country. and Recovery 11.3 Increase girls to boys ratio in 2011 Milestones This support is meant to enable (FY03) primary school from 85% in 2007 to 11.a 396 schools built or rehabilitated (61 completed, 296 in parents to send additional children 93% in 2011 11.d Reform of teacher career progress and 39 pending projects). It is expected that all the 396 to school. It has also helped activate structure by 2011 schools will be completed by Sept 2010. dormant parent-teacher associations. 11.4 CRC surveys show improvement in quality (assessment 1 in 2008 and 11.e Education sector strategy 11.b 2342 classrooms rehabilitated with 12,517 student desks 11.4 Qualitative survey to be assessment 2 in 2011) approved by 2011 delivered. completed by DFID intended to prepare TORs for citizen report card 11.f 11 million text books and 11.c MEPSP has signed contracts to repair 1572 classrooms and survey to be financed by IDA 278,000 teachers' guides for rehabilitation of National Pedagogical University. Half of the Education project. distributed by 2011 achieving 1 classrooms, with water points and latrines, should be completed by text book per student and 1 text 2011, along with the Pedagogical Institute. Milestones book and the corresponding 11.e Sector-wide strategy includes: teaching guide per teacher 11.d Draft MEPSP strategy under review by sector stakeholders; (i) preparation of the Medium Term strategy incorporates financing projections to 2015 based on Expenditure framework; (ii) 11.g 30,000 primary school development/policy scenarios. Strategy covers teacher training. agreement among the gvt & partners teachers are integrated into the on a national strategy for gradual public payroll for public primary 11.e This is a HIPC trigger. Main achievements are: (i) MESPS reduction of school fees at the schools (institutional diagnosis of Ministry & Secondary Education) primary level; (iii) institutional strategy formulated & under review by the national donors; (ii) pre- diagnosis of Ministry and Secondary draft doc. on Policy Note for higher education prepared; and (iii) Education (MEPSP), enabling the diagnosis of Social Affairs sub-sector underway. development of a reference 11.f 13,720,000 textbooks grades 1&2 Math/French and 381,000 framework for restructuring the teachers' guides were purchased, delivered & are being distributed ministry & a plan for institutional to schools throughout DRC. Delivery completed by June 2010. strengthening at all levels of the sector; (iv) diagnosis of the impact 33 Annex 10 DRC CAS Progress Report ­ March 2010 Milestones for achieving Achievements to Date (Includes results for the indicators Relevant CAS Outcome Indicator Comments CAS Outcome Indicators & milestones listed in Columns 1 & 2.) projects 11.g Not achieved. The Bank provided policy dialogue & technical of decentralization & development advice. No decision reached on how to select the 30,000 primary of a proposed roadmap for its school teachers. implementation; and (v) consultations among key education players, leading to the preparation of a draft Law on National Education & a plan for career and professional development of teachers. 11.f Nb of textbooks provided increased in response to increased enrollment. Textbooks published in French, and adapted using texts from various countries. 12. Increase access in target areas to 12.a Implementation of MOH Indicators Indicators a well-defined package of quality package of health services 12.1 Annual per capita utilization of curative health care services in 12.1 The health sector was rated Health Sector essential health services (CAF supported in 83 health zones project area increased from 0.19 in 2007 to 0.31 in 2009. (Source Moderately Unsatisfactory for most Rehabilitation HEALTH 2) focusing on child preventive, HMIS) 2008-2009. It was recently upgraded Support Project reproductive and neonatal heath to Moderately Satisfactory due to (FY06) 12.1 Proportion of cases of illness in interventions 12.2 Initial assessments by the Kinshasa Provincial Inspectorate of improved management and results previous 2 weeks in target Health Health indicate that 70% of children <5 are now sleeping under a on the ground in terms of increased Emergency Multi Zones who did not seek care due to 12.b Drug revolving fund and mosquito net after distribution of 2 million bednets during 3 months health service utilization. Sector cost (reduced from 30% in 2007 to new equipment available in 83 ending Jan. 09 in Kinshasa (2 nets per household). Rehabilitation 15% in 2010) zones by 2008 12.2 The nets are expected to last an and Recovery 12.3 72% children 0-11 months vaccinated end-2009 (baseline 07: average of 4 to 5 years, and an (FY03) 12.2 60% of children under five in the 12.c All health staff in 83 zones 54%). 60% of children aged 12-23 months in target Health Zones. additional 50,000 are being target Health Zones sleep under a long- will receive performance based (Baseline 54%, from HMIS, reported by M&E firm) distributed due to project cost Emergency lasting insecticidal net. Baseline was bonus to improve quality by savings. They are expected to Social Action 32%. 2008 12.4 10 million people with access to a basic package of health, reduce the incidence of malaria, Fund (FY05) nutrition, or population services & 100% of target population with especially among children. Results 12.3 DPT3 vaccination coverage 83% 12.d Three million free bed nets access to health centers of an evaluation to confirm Emergency in 2011 in target Health Zones distributed in 160 zones by end utilization by under five is expected Urban and Social of 2008 Milestones by early 2010. Rehabilitation 12.4 In 55 targeted health zones under 12.a 57% of deliveries assisted by qualified personnel end-2009 Project (FY07) EMRRP covering 7 million people (i) 12.e Availability of new malaria (Baseline 07: 47%). 70% of pregnant women enrolled in antenatal Milestones 50% have access to a functional health drug treatment in 160 zones by care end-2009 (Baseline 07: 63%). 1,3 % of deliveries by caesarean 12.a The central Ministry of Health center; (ii) more than 80% of the 2008 (EMRRP and HSRSP) section end-2009 (Baseline 07: 0.9%) has agreed to transitional measures children (12-23 months) are to clarify the division of vaccinated; (iii) 60% of the deliveries 12.f All family planning 12.b 223 rural health centers rehabilitated & supplied with basic responsibilities with the new are assisted by trained personnel methods available in 83 zones by emergency drugs. provincial ministries of health, but 2008 important challenges remain, 34 Annex 10 DRC CAS Progress Report ­ March 2010 Milestones for achieving Achievements to Date (Includes results for the indicators Relevant CAS Outcome Indicator Comments CAS Outcome Indicators & milestones listed in Columns 1 & 2.) projects 12.c 3,855 health personnel received training. particularly in the areas of 12.g 50 Clinics built with management and payment of community involvement by 12.d 2 million bednets impregnated with long-duration insecticide, government health workers, through the Social Action Fund delivered & distributed in 2009 in Kinshasa. including backlogs of retirements as by 2010 well as many workers assigned to 12.e 3 million doses of antimalarial drugs available government health facilities who are 12.h 194 Health Centers not on the civil service rolls. rehabilitated with community 12.f 92% increase in medical consultations in FDRC centers involvement by 2008 with more 12.g Expected all health centers to than 500,000 consultations 12.g 17 completed, 65 in progress and 4 pending be completed by Sept 2010, & some (EMRRP) 12.h 174 health centers rehabilitated and 87 health zones additional health centers will be constructed, renovated and/or equipped. financed under the Additional financing (end March 2013). 13. Improved access to water and 13.a A water sector reform Indicators sanitation services in urban areas roadmap is developed and 13.1 Construction of an 110,000 m3 module at the N'Djili plant, The Urban Water Supply Project Urban Water (CAF WATER AND SANITATION implemented which provides 110, 000 m3 of additional drinking water per day to Financing Agreement was signed in Supply Project 1,3 and 4) about 3 million people in Kinshasa. January 09 but the project was Water (FY09) 13.1 150,000 additional persons with 13.b Key priority investment and finally declared effective on access to potable water in Kinshasa by rehabilitation program for the 13.2 Rehabilitation of 133 water points and construction of 248 November 3, 2009. Emergency 2011 (baseline available) water sector agreed water sources in rural areas Urban and Social Rehabilitation 13.2 Increased quality and coverage of 13.c Pilot private sector schemes 13.3 No results to date as project only recently effective. Project (FY07) essential services in seven provincial to deliver potable water services capitals and eighteen medium cities are evaluated and appropriate Milestones (baselines and targets TBD) policy recommendations made 13.a Development of a sector strategy and action plan to reform the Emergency Multi water sector in urban areas by 2009 Sector 13.3 Technical, commercial and 13.d Water treatment, Rehabilitation financial performance of the national distribution networks and 13.b, 13.c and 13.d No results to date. and Recovery water utility REGIDESO improved (as household connections improved (FY03) measured by changes on utility in 3-4 major urban centers 13.e Work is expected to begin 2010 to extend access to potable indicator scorecard) water to an additional 150,000 people. Emergency 13.e Completion of Lukaya Social Action water extension project, 13.f 84 improved community water points constructed or Fund (FY05) Kinshasa. rehabilitated. 100% of critical water infrastructure rehabilitated or constructed. 271 million m3 of water production per day 13.f 81 drinking water sources provided (EMRRP) 35 Annex 10 DRC CAS Progress Report ­ March 2010 Milestones for achieving Achievements to Date (Includes results for the indicators Relevant CAS Outcome Indicator Comments CAS Outcome Indicators & milestones listed in Columns 1 & 2.) projects Pillar 4: Combat HIV/AIDS 14. (1) HIV/AIDS prevention 14.a All 83 targeted health zones Indicators Indicators Multisectoral accelerated and scaled up, (2) steps (reaching 10 million people) HIV AIDS are taken towards universal access staffed with trained personnel by 14.1 159,393 as of end-2009 tested and received their test results. 14.2 Global Fund is expected to take Project (FY04) to free HIV/AIDS treatment/care 2009 over the HIV/AIDS program in and (3) negative impact of 14.2 12,595 on treatment by project based on project information DRC and discussions are underway HIV/AIDS on PLWHA and their 14.b Drugs available in all to avoid a "funding gap." families is mitigated (CAF HIV targeted health zones by 2009 14.3 494 women are on treatment by the project based on project AIDS 1-3) information 14.c Selected health facilities in Milestones 14.1 800,000 persons aged 15 and targeted zones properly 14.4 20,183 (number of orphans receiving funds for education) older received counseling and testing equipped by 2009 11.e This indicator will be revised for HIV and received their test results during the restructuring because the in areas targeted by the MAP by2011 14.d 600 service outlets carrying Milestones project has shifted its approach to out blood safety activities have community-level activities. 14.2 50% men and women with been established countrywide by 14.a No results to date. advanced HIV infection receiving 2011 14.b Acquisition of HIV/AIDS drugs (ARV) and 5,127 patients put antiretroviral combination therapy in under treatment areas targeted by the MAP by the end 14.e At least 5,000 subprojects of 2010 (up from 9% in 2007) (sensitization, community 14.c No results to date. services for PLWHA) by NGOs, 14.3 70% of HIV-infected pregnant CBOs and FBOs have received 14.d 159,393 units of blood tested. women receive a complete course of support. antiretroviral prophylaxis to reduce the 14.e 1, 077 subprojects have received support risk of Mother To Child Transmission in areas targeted by MAP by the end of 2010 (up from 4% in 2007) 14.4 15,000 orphans & other vulnerable children received care/support 36 Annex 10 DRC CAS Progress Report ­ March 2010 Milestones for achieving Achievements to Date (Includes results for the indicators Relevant CAS Outcome Indicator Comments CAS Outcome Indicators & milestones listed in Columns 1 & 2.) projects Pillar 5: Promote Local Initiatives 15. The capacity of community based 15.a 550 micro projects Indicators Emergency organizations to deliver basic implemented satisfactorily by Social Action services at the local level is increased 2010 15.1, 15.2 and 15.a Dec 09: 203 proj completed; 417 proj under Fund (FY05) (CAF COMMUNITY DYNAMICS implementation & 27 proj approved/waiting to be processed. 649 1) 15.b 90% of these 550 micro- communities benefiting from at least one sub-proj. Nb of sub-proj Emergency projects maintained one year completed per sector as of Sept 09: Living 15.1 Full targets for micro projects to after completion - Education: 61 completed; 296 in progress & 39 pending proj. Conditions improve e.g. market access, schools, 433 libraries established during the proj; 7392 scholarships Improvement clinics to be established, but include 50 15.c 550 communities with provided to students. (FY05) clinics and 150 schools built or improved capacity to plan, - Health: 17 clinics completed, 65 in progress & 4 pending rehabilitated by 2010 implement and manage their - Water: 48 projects completed, 21 in progress & 5 pending economic and social - Roads: 6 projects completed, 25 in progress & 3 pending 15.2 Increased quality and coverage of infrastructure - Markets: 11 completed, 33 in progress & 2 pending essential services in seven provincial - Energy:2 projects completed, 6 in progress & 3 pending capitals and eighteen medium cities - Environment: 1 completed & Micro gardening: 1 completed (baselines and targets TBD) Enrollment in Social Fund (SF)-supported schools increased by 53%; medical consultations in SF-supported health center increased by 92 % and the nb of motorized vehicles using roads rehabilitated by the SF increased by 127%. Milestones 15.b Over 97% of subproj maintained 1 year after completion. 15.c 100% of the pop indicated knowledge of the sub-proj. At least 518 local structures (NGOs, community committees) in all provinces for a total of 1.107 participants including 202 women & 905 men were trained in management of community-based proj (finance/accounting, monitoring/implementation, procurement...). 37 ANNEX 11: TRANSPORT SECTOR MAP: PROGRAM SUPPORTED BY THE BANK REPUBLIQUE DEMOCRATIQUE DU CONGO Zongo Zongo Bosobolo Bondo Ango Bondo Faradje Niangara MINISTÈRE DU PLAN Gbadolite Libenge Bari « UCoP » Businga Businga Bambesa Gemena Rungu Kungu Gemena Poko Aru Watsa Bunduki Buta Mahagi Akula Isiro Isiro Réseaux Routiers Budjala Aketi Bumba Wamba Djugu Lisala Mars 2010 Bomongo Banalia Nia-nia Mambasa Komanda Basankusu Basoko Bunia Yahuma Bafwasende Bolomba Isangi Befale Djolu Beni Kisangani Butemb Légende Mbandaka o Lubero Kasindi Ingende Boende Bokungu Opala Bokatola Lubutu Financement Bque M. Bikoro Ubundu Rutshuru Masisi PUSPRES : 986 km Kiri Ikela Punia Monkoto Walikale PUAACV : 526 km GOMA Inongo PMURR : 894 km Lomela Kalima Walungu Bukavu Total B.M. : 2.406 km Kutu Kindu Shabunda Financement B.M.&DFID. Oshwe Dekese Katakokombe Mwenga Bandundu Lodja Pangi ProRoutes : 1.516 km Kamituga Uvira Bagata Kole Kibomboa Ilebo KINSHASA Lufimi Total BM&DFID : 3.922 km Fizi Fizi Kwango Masimanimba Kasongo Kasongo Lusambo Financement BAD Tshela Seke-Luozi Mongata Mweka Lubefu BanzaKisantu SonaBata Kenge Kikwit Demba Lubao Kongolo Pr. Infrstr. Rout. : 168 km Batshamba Dimbelenge Gungu Mbuji Mayi Kalemie Boma Ngidinga Popokabaka Kananga Kananga Nyunzu Financement U.E. Moanda Kimvula Pt Loange Kazumba Kabinda Kabalo PAR II via OdR : 2.356 km Matadi Feshi Kasongo- Tshikapa Tshikapa Lunda Tshimbulu Gandajika Programme Sino - Congolais. Kahemba Luiza Mwene Manono Manono Moba Kabongo CREC : 2.356 km Ditu Kaniama Tembo Malemba-Nkulu Kapanga Programme Gvt. Congolais. Mitwaba Pweto Kibula Longueur : 441 km Kamina Bukama Bukama Kabondo Dianda Financement Coop Belge Kilomètres Sandoa Luena Lubudi Progr. d'urg. RDC: 98 km 0 100 200 300 400 500 Kasenga Kasenga Nguba Signification des traits Likasi Kasomeno Kolwezi Contrat en cours Kipushi Lubumbashi Sections réalisées Etudes Limites des provinces Kasumbalesa Sakania Etudes&Travaux Vers Afrique du Sud / en projet Zambie / Zimbabwe/ Botwana Tanzanie Plan25 « UCOP /Tobie » mars 2010 ANNEX 12: REVISED CAS RESULTS MATRIX CAS Outcomes WBG Expects to Influence by end Milestones/Outputs by 2011 WBG instruments 2011 CAS Pillar 1 - Rebuilding State Capacity to Increase Access and Improve Quality of Basic Services (Corresponds to DRC PRSP Pillar 1 Good Governance and Peace Building, and Pillar 3 Improved Access to Social Services and Reduced Vulnerability) CAS outcome 1.1: Implementation by 2011 of Preparation of National Code of Values, on the National Code of Values to provide overall Core Public Sector basis of the government leadership retreats, and Systems guidance and basic principles to the Congolese its adoption by government; Modernization administration: Project (FY11) # of key ministries implementing Code; CAS Outcome 1.2: Adoption by Government Finalization of PAP-REC and PRONAREC; and partners of the National Capacity Building Discussion of PAP-REC and PRONAREC with Core Public Sector Program (PRONAREC): civil society and private sector; Systems Funding for initial action plan acquired; Modernization PRONAREC approved by government Project (FY11) Implementation plan with budget approved; Implementation begins ; CAS Outcome 1.3: Establish a more effective and transparent payroll system for civil servants: Governance Discrepancy between personnel register and ESW (FY10) payroll numbers is reduced from 20% (2007) to Public service pay system is simplified, Enhancing less than 5% in 2011; Governance reducing number of variables from 20 to 3; Base pay is at least 75% of real pay in 2011, up Capacity (FY08) A Human Resource Database is operational at from 10% in 2007; central level; DPL (FY11) 65% of central government civil servants are Public Service At least 15,000 public servants having reached paid through a reformed payroll system by 2011, Rejuvenation the mandatory pension age effectively up from 31% 2008; Project (FY 11) Civil service retirement process and organizational re-alignment completed for at least two ministries CAS Outcome 1.4: Fiduciary systems are 11 provinces have fully taken over exclusive established in targeted provinces: competencies; Governance ESW (FY11) At least 35% of domestic revenue is transferred New revenue retention and transfer systems fully operational ; Enhancing to sub-national level by 2011 compared to 10- Public service and payroll systems in place in 5 Governance Capacity 15% in 2007; (FY08) Citizen satisfaction with public services in provinces; Baseline Citizen Scorecard Survey undertaken DPL (FY11) targeted provinces reaches at least 60%; CAS Outcome 1.5: Central Government revenues are Tax Authority has a fully automated tax HIPC Initiative increased and the budgetary process is reformed: application processing system; PER (FY08) 20% increase in Government revenues excluding New legal framework for PFM; CFAA (FY09) grants (from 13.3% of GDP in 2006); Annual report on budget execution received Enhancing Deviation between actual and budgeted from key ministries starting 2010; Governance Capacity expenditure by central government is reduced Implementation of the revised public (FY08) from 34% in 2008 to less than 20% by 2011. ; procurement legislation; CAS Outcome 1.6: Improved access to water and Government continues regular payment of water Emergency Living sanitation services in targeted urban areas: bills; Conditions Improvement (FY05) Number of additional persons with access to REGISDESO Private Operator recruited and potable water in Kinshasa by 2011; operational by end 2010; Emergency Urban REGIDESO performance on utility indicator Water treatment, distribution networks and and Social. Reh. scorecard (baselines Tbd following recruitment (FY07) household connections improved in Kinshasa; of Private Operator). Completion of Lukaya water extension project. Urban Water Supply (FY09) CAS Pillar 2 ­ Creating Conditions for Growth and Economic Diversification (Corresponds to DRC PRSP Pillar 2 Consolidating Macro-Economic Stability and Growth) Outcome 2.1: Debt, inflation and fiscal management HIPC Completion Point achieved by 2010; improved: HIPC Initiative Debt information management centralized; Debt indicators below the threshold levels by Monthly debt service projections produced PER (FY08) 2011; quarterly; Econ. Mgt TA Inflation below 15% by 2011; Monthly Treasury balance produced (FY09) Domestic fiscal balance deficit < 2% (IMF automatically. DPL (FY11) definition) by 2011. CAS Outcome 2.2.: Targeted transport infrastructure is rehabilitated : 40 km of roads rehabilitated in Kinshasa to improve access for 800,000 residents; Emergency Living Increase in % national roads (RN) in good Conditions Additional 1,400 kms of roads (RN) reopened Improvement (FY05) condition (2077 km, 13.8%, in good condition and maintained in Oriental, South Kivu and 2009); Pro-Routes (FY08) Katanga; Average transport costs on upgraded roads: Emergency Urban 25% reduction in transport costs for goods and Social between Lubumbashi and Kasenga by 2010 Rehabilitation (FY07) compared to 2007 ; 30% reduction in transport costs for goods between Akula and Gemena by 2010 compared to 2007; CAS Outcome 2.3: Increased availability of Regional and electricity to serve domestic demand and for export: Rehabilitation of transmission line to border of Domestic Power Zambia; Market Development Increase power delivered from Inga : Power distribution infrastructure rehabilitated in (FY07) to Kinshasa from 3000 GWhs in 2007 to Kinshasa; Southern Africa 3650 GWhs in 2011) to South African Power Pool to 210 MW Power Market from 100MW by 2012, and to Katanga Program (SAPMP region to 300 MW by 2012; APL-1) (FY03 +add 330,000 households connected in Kinshasa by fin FY08) 2011 (up from 290,000 in 2006); Improved performance of SNEL as measured by (i) 30% increase in revenue collected per kWh and (ii) increase in collection of account receivables from 35% to 55% in 2011; 40 CAS Outcome 2.4: Undertake reforms and build Moratorium on new forest concessions is Forest and Nature capacity so that natural resources are managed in a maintained and illegal concessions are Conservation (FY09) sustainable manner: cancelled; Rehabilitation and Percentage of logging infractions discovered Third party observer to assist the forest Participatory that are prosecuted in pilot provinces administration in law enforcement in the field is Management of Key (Baselines and targets Tbd); deployed; Protected Areas The management of key bio-diversity and natural ICCN and NGO partnerships strengthened to (FY08) habitats is improved (as measured by increases in rehabilitate protected areas; DPL (FY11) the management scores); Adopt specific legislation and guidelines relative PROMINES (FY10) Number of contracts and pilot initiatives based to disclosure of company information modeled on payment for carbon storage, biodiversity on requirements of TSX or ASX; conservation, and other environmental services; Upgrade skills of mines inspection service to conduct health, safety and environmental compliance inspections in at least 15 mining sites in Katanga; CAS Outcome 2.5: Business climate improved and Enterprise creation procedures and licensing Investment climate public enterprises are restructured and reformed in requirements are simplified; (FY07) line with international standards: Action plan to modernize the payment system IFC Pro-credit Bank Number of days to create a company reduced by developed and agreed upon; 30 percent between 2006 and 2011; Credit Bureau is modernized; IFC Global Trade Finance Program Commercial banks' compliance with prudential Micro-Finance Promotion Fund is regulations is satisfactory (as per IMF institutionalized; FIAS TA (FY08) assessment) by 2011; Inventories of RVA, ONATRA and SNCC Private Sector Devt/ At least 5 microfinance institutions reach assets and liabilities completed. Competitiveness operational self sufficiency by 2011; (FY08) Infrastructure review (FY10) CEM (FY11) CAS Pillar 3 ­ Providing Improved Access to Health and Education (Corresponds to DRC PRSP Pillar 3, Improving Access to Social Services and Reducing Vulnerability) CAS Outcome 3.1: Access to and quality of basic Complete construction of 396 schools and repair Education Sector primary education services is improved: of 600 classrooms in targeted areas ; Project. (FY07) 30,000 primary school teachers are integrated Increase in primary education GER from 64% in Youth Education into the public payroll; 2007 to 72% in 2011 Study (FY08) Evaluate progress to reduce school fees paid by Increase in primary education completion rate Emergency Social parents ; from 29% in 2007 to 34% in 2011 Action Fund (FY05) Reform of teacher career structure; Education sector strategy approved. CAS Outcome 3.2: Increase access in target areas to Health Sector a well-defined package of quality essential health Complete 86 clinics. Rehabilitation services: Support (FY06) % children 0-11 months vaccinated with DPT3 Emergency Social increases from 54% (2007) to 75% (2011); Action Fund (FY05) % deliveries assisted by qualified personnel increases from 47% (2007) to 65% (2011); 41 ANNEX 13: FY10-11 remaining lending program FY Proposed Operation Amount($m) Pillar 2: Growth Add. Fin. Roads (Pro-Routes) 90 Growth w/Gov in Mining Ext. Industry. 50 Multimodal 255 Pillar 3: Social services Support to the Street Children &Vulnerable 10 FY10 Add. Fin. PURUS (education & malaria) 40 Regional Regional trade facilitation 3.5 Subtotal FY10 340 Pillar 1: Rebuilding state capacity Core Public Sector Mgt systems modernization 30 APL ­ Public Service Rejuvenation Project 40 Pillar 2: Growth FY11 Add. Fin. PSD (Financial Sector) 30 DPO 100 Pillar 3: Social Add Fin. PARSS (Malaria) 80 Regional Additional Financing. Domestic &Reg. Energy 100 Subtotal FY11 380 TOTAL FY10-11 720 Pillar 2: Growth Growth Pole TBD Agriculture TBD Energy (APL 2) TBD Outer Multimodal (APL2) TBD years DPO II TBD Governance II TBD Regional Transport Corridor &Trade Facilitation TBD Telecommunications TBD ANNEX 14: Proposed AAA program FY010-11 FISCAL YEAR PILLAR PROPOSED PROGRAM Pillar 1: Rebuilding state capacity Programmatic Governance: Phase 3 (territorial administration) FY10 Pillar 2: Growth DTIS Pillar 1: Rebuilding state capacity Programmatic Governance: Phase 4 (Retirement) Country Economic Memorandum Urban Development Pillar 2: Growth FY11 Spatial Infrastructure Review (Follow up) Skills development Poverty Assessment Pillar 3: Social services Health Financing Study 42 ANNEX 15: COUNTRY ONGOING OPERATIONS (DATA AS OF 3/31/2010) # ISRs Work. Version # Mos since last ISR Date, Original Closing ISR Archive Date Flg Long-Term Rsk Date, Rev Closng Country Record Net Comm Amt Date, Approval Restruct. Date Prob. Months Date, Signing Cntrpt Fndg Country Env. % Disbursed # Prob Proj Date, Effectv Safeguards Golden Flg. # Pot Proj # Risk Flgs Fin Mgmt Proc Prob Slow Disb Disb in FY Latest DO Mgt Prob Tot Disb Latest IP Lgl Cov Eff Dly Age yrs Proj ID M&E TL Dossou, Pro-Routes (FY08) P101745 Alexandre 3/18/08 7/8/08 10/7/08 9/30/13 9/30/13 2.0 50 5.87 12% 2.69 0 S MS 0 0 # 2 0 0 0 0 0 0 0 0 0 0 1 1 0 0.3 3/23/10 Enhancing Verheijen, P104041 Governance Antonius 4/22/2008 5/26/08 8/23/08 2/28/13 2/28/13 1.9 50 9.09 18% 3.71 0 MS MS 0 1 # 3 0 0 0 0 0 0 0 1 0 0 1 1 0 3.3 12/21/09 Ag Rehab & Ba,Amadou P092724 Recovery SIL Oumar 3/30/2010 # # 12/15/15 12/15/15 0.0 120 0.00 0% 0.00 0 # # 0 0 # 2 0 0 0 0 0 0 0 0 0 0 1 1 0 0.0 Forest and Nature Rietbergen, P100620 Conservation SIL Simon A. P. 4/2/2009 5/30/09 9/9/09 6/30/15 6/30/15 1.0 64 5.30 8% 5.30 0 MS MS 0 0 # 2 0 0 0 0 0 0 0 0 0 0 1 1 0 3.7 12/9/09 Emerg Demob Harborne, P078658 Reintegr ERL Bernard 5/25/2004 6/10/04 11/9/04 3/31/08 6/30/10 5.9 147 117.08 80% 12.71 0 S S 0 1 05/26/08 3 1 0 0 0 0 0 0 0 0 0 1 1 0 0.7 3/11/10 Priv Sec Dev Dimitriyev, P071144 Competitiveness Steven R. 7/29/2003 8/11/03 12/2/03 3/31/10 12/31/12 6.7 180 113.05 63% 9.52 0 S S 0 1 # 4 0 0 0 0 0 1 0 0 0 1 1 1 0 3.0 12/29/09 Education Sector Radji, P086294 Project (FY07) Rachidi B. 6/5/2007 6/8/07 1/11/08 12/31/12 12/31/12 2.8 150 23.81 16% 17.09 1 MU S 3.03 0 # 2 0 0 0 0 0 0 0 0 0 0 1 1 0 3.0 12/29/09 Multisectoral Frere,Jean- P082516 HIV/AIDS (FY04) Jacques 3/26/2004 4/16/04 10/8/04 1/31/11 1/31/11 6.0 102 77.57 76% 18.84 1 MS MU 45.1 0 05/29/07 4 1 0 0 0 0 0 1 0 0 0 1 1 0 3.3 12/20/09 Health Sec Rehab Frere,Jean- P088751 Supt (FY06) Jacques 9/1/2005 10/18/05 4/13/06 6/30/10 12/31/11 4.6 150 81.98 55% 29.39 0 MS MS 0 1 # 4 1 0 0 0 0 1 0 0 0 0 1 1 0 3.3 12/22/09 Emerg Soc Action Mossige, P086874 (FY05) Anne 8/26/2004 10/26/04 7/26/05 3/31/09 3/31/13 5.6 95 57.65 61% 15.00 0 S S 0 1 # 3 0 0 0 0 0 0 0 0 0 1 1 1 0 3.0 1 12/29/09 Emerg Proj to Mitig Bousquet, P115642 Impact Fin Cris Franck 2/26/2009 3/2/09 3/20/09 3/1/10 8/31/10 1.1 100 93.42 93% 40.06 0 S S 0 0 # 2 0 0 0 0 0 0 0 0 0 0 1 1 0 0.7 3/11/10 Emerg Econ & Soc Diop, P081850 Reunif ERL (FY04) Mahine 9/11/2003 9/22/03 12/5/03 9/30/08 9/30/10 6.6 214 218.48 102% 10.04 0 S S 0 1 09/23/08 3 0 0 0 0 0 0 0 0 0 1 1 1 0 4.0 11/30/09 Em. Urban & Social Diou, P104497 Rehab ERL (FY07) Christian 3/29/2007 4/11/07 7/6/07 5/31/11 5/31/11 3.0 180 107.39 60% 11.47 0 S S 0 1 # 3 0 0 0 0 0 0 0 0 0 1 1 1 0 1.8 2/3/10 Emergen Living Diop, P088619 Condition Impr Mahine 5/26/2005 6/28/05 9/23/05 9/30/10 9/30/10 4.8 82 51.37 63% 10.20 0 MS MS 0 1 # 3 0 0 0 0 0 0 0 0 0 1 1 1 0 4.0 1 11/30/09 Urban Water Supply Bosch, P091092 Project (FY09) Christophe 12/18/2008 1/19/09 11/3/09 3/31/14 3/31/14 1.3 190 2.77 1% 2.77 0 S MS 0 1 # 3 0 1 0 0 0 0 0 0 0 0 1 1 0 4.0 1 11/30/09 ANNEX 16: PORTFOLIO OF ACTIVE TRUST FUNDS (AS OF FEBRUARY 2010) Funds Recd Funds Disb Fund TF Prog. Closing Grant Grant Amt Grant Amt Fund TF Name to date in to date in Balance in Proj Defn Src Date Curr (Grant Curr) (USD) USD USD USD TF052557 HIPC - IDA - DRC HIPC 12/31/2030 USD 1,031,222,520 1,031,222,520 (88,871,334) 88,871,334 - - National Parks Network Rehabilitation GEF National Parks TF094033 GEFIA 1/31/2014 USD 7,000,000 7,000,000 (7,000,000) - 7,000,000 Project (FY09) Health Sector TF092458 DRC HRBF Design - Bank Executed HRBF 12/31/2009 USD 200,000 200,000 (200,000) 187,713 12,287 Rehabilitation Supt Congo River Trade and Transport Multi-modal transport TF095396 TRTA 12/31/2010 USD 500,000 500,000 (72,000) 9,767 62,233 Corridor Review (FY10) DRC Foreign Commercial Debt DRC-Debt Buy Back TF055758 DRF 6/30/2010 USD 900,000 900,000 (900,000) 261,000 639,000 Reduction Operation For Congo Operation (FY06) MDTF Grant for strengthening Forest and Nature TF092910 Governance for natural resources in AFRSD 2/28/2010 USD 4,481,000 4,481,000 (4,481,000) 1,739,931 2,741,069 Conservation SIL DRC (DRC-Forest) (FY09) High priority roads reopening and TF092300 AFRSD 9/30/2013 USD 42,700,000 42,700,000 (7,500,000) 4,625,816 2,874,184 Pro-routes (FY08) maintenance project Supervision costs of the high priority TF092852 AFRSD 6/30/2013 USD 3,764,200 3,764,200 (683,520) 246,559 436,961 - roads reopening & maintenance project W1-DRC Country Governance and Anti Enhancing Governance TF093740 GPF 10/31/2012 USD 3,000,000 3,000,000 (1,150,000) 681,421 468,579 Corruption Program Implementation Capacity (FY08) Fiscal & administrative impact assessment of administrative-territorial EW Dem. Rep. Congo reform in the DRC: assessing the fiscal, TF093666 BPRP 9/30/2009 USD 157,000 157,000 (157,000) 138,806 18,194 Governance & Public administrative and political viability of Service the split of 11 provinces into 26 and the impact on basic service delivery Country Economic TF093499 Technical assistance for DRC'S MTEF BPRP 6/30/2010 USD 250,000 250,000 (256,000) 253,936 2,064 Memorandum (CEM) Capacity Building in Macro-projections TF094817 BPRP 12/31/2010 USD 255,000 255,000 (255,000) 172,405 82,595 - for the MTEF and PRSP Trade Facilitation Audit and Corridor TF095197 TFF 3/31/2010 USD 249,585 249,585 (249,585) 59,025 190,560 - Diagnostic Emergency trust fund for the East - CD-Emergency TF092284 DRCR 6/30/2010 EUR 333,102 468,907 (468,907) 171,098 302,946 World Bank spn Program Support to the Social Support to the social & economic & Eco Reintegration of TF093787 reintegration of demobilized children DRCR 6/30/2010 EUR 1,216,691 1,712,736 (1,712,736) 251,379 1,466,961 Demobilized CAFF associating with fighting and OVC in the DRC 44 Support to the Social and Eco Reintegration DRC - reintegration support in eastern of Demobilized Ex- TF090963 LICUS 12/31/2009 USD 1,975,200 1,975,200 (1,975,200) 1,973,474 1,726 DRC combatants in the Provinces of North and South Kivu TF093497 Reintegration of demobilized ex- combatants in the provinces of north and DRCR 6/30/2010 EUR 1,014,650 1,428,323 (1,428,323) 501,530 933,247 - south Kivu TF094135 Forest & Nature Conservation Proj Rehab & Particip Mgt GEFIA 6/30/2015 USD 6,000,000 6,000,000 - - - of key Prot. Areas (FY09) TF093502 Coordinated PFM reform assistance to Coordinated PFM DRC FS-AFR 8/31/2011 USD 950,000 950,000 (382,160) 257,627 124,533 reform assistance TF093871 DRC: FCPF READINESS GRANT FCPF Readiness Grant FCPFR 7/31/2010 USD 200,000 200,000 (200,000) 100,000 100,000 TF095241 PHRD Staff Grant Support for Shiho DRC Development Nagaki PHRD 9/27/2010 USD 92,404 92,404 (92,404) 26,989 65,415 Policy Loan TF094217 Utilization, results and accountability of DRC Health Systems public expenditures on health in DRC BPRP 6/30/2010 USD 250,000 250,000 (250,000) 44,341 205,659 and Financing TF094364 GAVI Proposal For Africa HSS work in DRC GAVI 12/31/2010 USD 76,000 76,000 (76,000) 27,365 48,635 - TF095047 DRC HRBF Impact Evaluation - Bank Executed HRBF 6/30/2011 USD 500,000 500,000 (500,000) 251,490 248,510 - TF051064 HIPC - AFDB - DRC (CONGO) HIPC 12/31/2030 USD 151,297,430 151,297,430 (182,259,570) 182,211,677 47,893 - TF092749 ETC ASSIGNMENT FOR TOMO MORIMOTO IN AFTH3 PHRD 1/31/2010 USD 87,610 87,610 (87,610) 86,751 859 - TF095918 PHRD Staff Grant Support for Tomo Morimoto PHRD 1/13/2011 USD 110,244 110,244 (110,244) - 110,244 - Total 1,258,782,635 1,259,828,159 (301,318,592) 283,151,434 18,184,353 45 ANNEX 17: IFC PORTFOLIO ACTIVITY STATUS Special Economic Zone 2008-present Ongoing Doing Business reforms 2009-present Ongoing Business Enabling Environment Program Closed Airport PPPs Dropped IFC Investment Portfolio Client Industry (Sector) Instrument Exposure ($ millions) Tigo Telecoms Loan 50.00 Celtel/ZAIN DRC Telecoms Loan 68.00 KMT Mining Equity 3.23 Procredit Congo Finance Equity 0.72 Rawbank Finance Loan 7.00 Stanbic DRC Finance Quasi-equity 3.00 Advans Banque Congo Finance Equity 2.15 Total 134.10 IFC Investment Pipeline SECTOR POTENTIAL IFC INVESTMENT ($ MILLIONS) Hotel 50.00 Mining 60.00 General Manufacturing 10.00 Building Materials (Cement) 30.00 Agribusiness 35.00 Banking 15.00 Property Development 10.00 Total 220.00 IFC Advisory Programs Portfolio and Pipeline PROJECTS STATUS SME Development Program Ongoing Access to Finance Ongoing Mining Linkages (on Hold) Leasing Ongoing Training Banking Sector Ongoing Road Maintenance and Construction Conception Agri-business Technical Assistance Conception Private Heath Technical Assistance Conception Private Education Technical Assistance Conception Business Incubators Conception ANNEX 18: DIVISION OF LABOR BETWEEN DONORS Lead Ministry Co-secretary World Bank operational role and Group Donors intervening Harmonization strategy Other partners plans Army 16: EU, Belgium, USA, Defense Co-secretary: Eusec Bank support is focusing on the The UN, EU and key bilateral are better UN, Netherlands, Sweden, Others: France, demobilization and reintegration of ex- positioned than the Bank to play a UK, Japan, WHO, Canada, USAID combatants through the ongoing leading role. The Bank stands ready to Spain, France, Italy, Emergency Demobilization and provide analytical work to inform the Norway, Ireland, WB Reintegration Project reform of the security sector. Police 15: EU, Belgium, USA, Interior and Security with the Co-secretary: Eupol No particular role. UN, Netherlands, Sweden, participation of Others: EC, France, UK, Japan, WHO, Canada, Decentralization & Territorial USAID Spain, France, Italy, Administration Norway, Ireland Sexual violence 16: EU, Belgium, USA, Gender, Family and Children, Co-secretary: Bank support is focusing on analytical The Bank intends to work closely with and gender UN, Netherlands, Sweden, with the participation of Netherlands/Sweden work and advisory services for the the other donors to inform the design of UK, Japan, WHO, Canada, Defense and Interior Others: Canada, design of a strategy and pilot programs programs aiming at fighting gender Spain, France, Italy, EUPOL, UNICEF, aiming at fighting gender-based violence, mainly its support to Norway, Ireland, WB USAID. violence. Support is provided through knowledge generation, trust funds. Justice and 19: WB, EU, Belgium, Justice, with the participation Co-secretary: EC No particular role. However, the Bank Human rights USA, UN, Germany, of Interior, Human Rights Others: France, will use the new Trust Fund on human Netherlands, Sweden, UK, Sweden, UNICEF, rights to better inform the design of its Japan, AfDB, Canada, USAID. program in terms of mainstreaming Spain, France, Italy, human rights aspects in the Bank-funded Switzerland, Norway, El operations. Salvador, Poland Local 19: WB, EU, Belgium, Decentralization and Co-secretary: UNDP The Bank is playing a critical role in Through TA & investments, the Bank Governance & USA, UN, Germany, Territorial Administration, Others: AfDB, supporting the decentralization agenda intends to closely coordinate with other decentralization Netherlands, Sweden, UK, with the participation of Belgium, Canada, and intends to pursue its support in close donors, with a concentration in 3 Japan, AfDB, Canada, Interior, Budget, and Finance EC, USAID, World collaboration with other donors, through provinces. The Bank is encouraging Spain, France, Italy, Bank the ongoing Enhancing Governance and other donors to roll over the Switzerland, Norway, El Capacity Building Project, decentralization program in the rest of 7 Salvador, Poland provinces Economic 19: WB, EU, Belgium, Public Function, with the Co-secretary ; EC Through analytical work, selected The Bank will continue to play a lead governance & USA, UN, Germany, participation of Interior, Others: Canada, sectoral operations (e.g. the role in the public sector reform and state public service Netherlands, Sweden, UK, Decentralization & Territorial France, IMF, UNDP, Agriculture sector Project) and, the capacity building, through the planned Japan, AfDB, Canada, Administration, Finance, USAID, World Bank Bank is taking the lead in helping in Core Public Sector Mgt systems Spain, France, Italy, Budget public service reform, with a focus modernization Project and the Public Switzerland, Norway, El on the retirement of civil servants. sector Rejuvenation Project. They are Salvador, Poland Through the Ongoing Enhancing being prepared through joint multi-donor Lead Ministry Co-secretary World Bank operational role and Group Donors intervening Harmonization strategy Other partners plans Governance and Capacity building efforts. Project, the Bank is playing a lead, along with the IMF and other Through the planned DPO and analytical donors, in the public finance reform. work (Country Economic Memorandum) The Bank, through its policy advice, as well policy dialogue and in close TA, investment, will take the lead in collaboration with the IMF ­ECF, the supporting the macro stability and Bank will closely monitor the macro economic reform program. situation, including the public finance reform. Elections & 15: EU, Belgium, USA, Interior with the participation Co-secretary: UNDP No particular role. However, the Bank This will be coordinated with the parliament UN, Netherlands, Sweden, of Decentralization & Others: EC, Canada, intends to support capacity building for program aiming on capacity building UK, Japan, WHO, Canada, Territorial Administration, Sweden, USAID the monitoring of results for civil society being developed by WBI, and other Spain, France, Italy, Relations with Parliament, and Parliament. Support will be provided partners involved. Norway, Ireland National Assembly, & the through an IDF Grant. National Independent Electoral Commission Investment 7: European Commission, Planning with the Co-secretary: AfD The Bank Group (IFC and IDA) are The Bank Group will closely work with climate & Belgium, Japan, Canada, participation of Finance, Others: AfDB, working providing TA to help improve other donors and intends to play a private sector Italy, WB, IFC Budget, Economy and Trade, Canada, France, IFC, the investment climate, with a particular important role in moving ahead the Justice, Industry and SME, UNDP, USAID, focus on the improving of the Doing reforms aiming at improving the Employment and Labor and World Bank Business rating, transparency in the investment climate through the Private Social Protection, President's natural resources sectors. The Bank is Sector Development Competitiveness Office, Prime Minister's intervening through the Private Sector project and the planned Mining Office Development Competitiveness project. Governance Project. Media & Communication and Media Co-secretary: France No particular role culture with the participation of Others: Sweden, Culture USAID Roads & 10: WB, European Infrastructure and Public Co-secretary: EC The lead is taken by EC and the Bank, The EC is taking the lead on the road sub transport Commission, Belgium, works, with the participation Others: UNDP, through its investment program (Pro- sector, the Bank and AFDB on the UN, Germany, UK, Japan, of Transport, Rural World Bank Routes, Emergency Urban & Social railway, AFDB and EC on the air AfDB, China, India Development and Planning Rehabilitation, Emergency Living transport. The port remains largely Conditions Improvement and Emergency unfunded. The Transport sector is an Eco & Social Reunification projects) and area of concentration for the Bank. policy advice, will work closely with Support will be provided through the other donors (traditional and no ongoing Pro-routes, the planned traditional), with a focus on the railway Multimodal Transport Project, as the but possibly on the other aspects of the emergency program phases out by end of other modes of transport. FY11. Energy & 5: WB, European Energy with the participation Co-secretary: AfDB The Bank plays an important role The Bank is working closely with the hydrocarbons Commission, Belgium, of Hydrocarbons Others: France, through its technical assistance, advisory main donors involved in the sector 48 Lead Ministry Co-secretary World Bank operational role and Group Donors intervening Harmonization strategy Other partners plans Canada, AfDB UNDP, USAID, services, and major investment (2 (AfDB, BEI) and has stepped up efforts World Bank regional projects ­ Southern Power Pool of harmonization in implementation Project and Regional and Domestic arrangements with these major donors. Market Project) in the sector, which is an Efforts will be pursued as the Bank area of concentration of the Bank. continues to explore new investments. Mining 5: WB, European Mining Co-secretary: World Through its planned Mining Governance The IDA-funded project has been Commission, Belgium, Bank Project and advisory services, the Bank instrumental in enhancing coordination Canada, AfDB, DFID Others: AfDB, will play an important role in the mining and harmonization of donors' activities Canada, DfID, EC, sector, with focus on improving in the sector and this will be pursued. UNDP governance in the sector The Bank is co-leading the thematic group on mining. Agriculture and 13: WB, European Agriculture, with the Co-secretary: Through its investment program The Bank, working closely with the rural Commission, Belgium, participation of Rural Belgium (Agriculture Rehabilitation projects) and other donors, intends to support this development USA, UN, Germany, , UK, Development and Planning Others: Sweden, policy advice in this growth-led sector, sector through a series of sector Japan, AfDB, Canada, UNDP, USAID, the Bank will play an important role in operations that will be complementary to Spain, Italy, China World Bank re-launching the recovery and other donors' program development of this crucial sector for growth in DRC Primary and 15: WB, European Primary, Secondary & Co-secretary: DfID The Bank is provided its support through The Bank will increase its analytical Sec. Education Commission, Belgium, Professional Education with Others: AfDB, the education program (investment and work as it prepares to play a catalyst role and Informal USA, UN, Sweden, UK, the participation of Higher Belgium, France, TA) as well as policy advice. The focus in further mobilization donors support to Training, Japan, AfDB, Canada, Education, Scientific UNICEF, USAID, is on primary education (Education this crucial sector. Higher Spain, France, China, research, and Planning World Bank Sector Project, Emergency Social Action Education, and ACBF, DFID Fund) informal training Health 20: WB, European Health, with the participation Co-secretary: EC The Bank is providing its support The Bank will increase its analytical Commission, Belgium, of Planning and the National Others: Canada, through an investment program as well work as it prepares to play a catalyst USA, UN, Germany, Program to fight HIV/AIDS Sweden, UNICEF, as policy advice (Health Sector Rehab role in further mobilization donors Netherlands, UK, Japan, USAID, World Bank Support Project (FY06), Emergency support to this crucial sector AfDB, WHO, Canada, Social Action Fund (FY05), Emerg Spain, France, Italy, China, Urban and Social Rehab (FY07) and Switzerland, Norway, Multisectoral HIV AIDS P (FY04) South Korea, Turkey projects). Environment, 13: WB, European Environment Co-secretary: The Bank is playing an important role The Bank, in close collaboration Water, Commission, Belgium, Germany through its TA, investment program with other donors, will step up its Sanitation and USA, UN, Germany, Others: AfDB, EC, (Forest and Nature Conservation and program on climate change, Forestry Netherlands, Sweden, France, Sweden, GEFs for Protected Areas) working including regional programs, in Canada, Spain, France, UNICEF, USAID, closely with other donors, with a focus close collaboration with other Italy, GEF World Bank on improving governance in the forestry 49 Lead Ministry Co-secretary World Bank operational role and Group Donors intervening Harmonization strategy Other partners plans sector. This would be complemented by donors. the TA provided under various TFs for climate change. The Bank is focusing on urban water as well on the reform of REGIDESO through its investment program (Urban The Bank will remain concentrated on Water Supply Project, Emergency Urban urban water and SOE reform and work & Social Rehab, Emergency Multi closely with other donors that are present Sector Rehab & Recovery (FY03) and in other parts of the country and sub- Emergency Social Action Fund (FY05) sector of the sectors. projects) in a complementary way to the program funded by other donors. Social 12: WB, European Social services Co-secretary: Through its investment program Protection Commission, Belgium, UNICEF (Emergency Social Action Fund), the USA, UN, UK, Japan, Others: USAID Bank is substantially contributing to this. France, Italy, China, India, ACBF Community 12: WB, European Planning, with the Co-secretary: Japan No particular role Dynamics Commission, Belgium, participation ofRural Others: Canada, USA, UN, UK, Japan, Development UNDP France, Italy, China, India, ACBF Statistics Co-secretary: Planning with The Bank is working with other donors The SNDS process will include all the participation of INS to develop the strategy for statistics that interested donors. The SRF preparation will be the basis for further investment will focus on a programmatic approach and support by donors to this crucial to the sector. sector. The Bank is also working with government and other partners on the Statistics for Results pilot grant. 50 Annex 19: Country At AGlance 52 53 ANNEX 20: COUNTRY MAP