Petroleum Supply Reforms Could Yield Huge Savings Page 1 of 11 THE WORLD BANK GROUP A .V;rLs F rtrl of PrIvrr!r 5lNAL 1,*- WRLDAN Findings 1 Africam. B Findings reports on ongoing operational, economic and sector work carried out by the World Bank and its member governments in the Africa Region. It is published periodically by the Africa Technical Department on behalf of the Region. Petroleum Supply Reforms Could Yield Huge Savings IN THIS ISSUE: A new study on procurement, supply and distribution of petroleum products in Sub-Saharan Africa has Petroleum Supply Reforms shown that some $1.4 billion could be saved Could Yield Huge Savings 1 annually through open market policies, deregulation, and more efficient refining and distribution-more Training Flourishes in the than all disbursements on World Bank and IDA Inforam al Sector 2 policy loans to Africa. Sixty-five percent of these savings would require no initial investment outlay; Credit Is a Constraint to they would result from policy changes alone. Credit Is a Constralnt to Compared with the gains that might be obtained Enterprise Developm enit 2 through energy conservation, the benefits from rationalizing the supply and distribution of petroleum C an Africa Pay for Its products are impressive, especially given the small Universities? 3 number of actions and institutions involved. How to Double Sub- Saharan Petroleum products play a more central role in the Africa's Agricultural Growth region's economies than is often fully appreciated. Rate 4 Imports of petroleum products absorb from 25 to 70 percent of African countries' export earnings, and Up grading Fanning System s taxes on petroleum products contribute nearly 40 in the Sahel 5 percent of total revenue to the budget. Moreover, petroleum products constitute over 70 percent of the Agricultural Research Is Being region's commercial energy consumption. Revitalized S This detailed analysis of the entire petroleum http://www.worldbank.org/afr/findings/english/findO2.htm 9/13/01 Petroleum Supply Reforms Could Yield Huge Savings Page 2 of 11 Incentives Are Needed to downstream chain, from point of procurement to Imp rove Afri c an Tr an sp ort 6 retail sale, reveals a high degree of inefficiency in the supply and distribution of petroleum products throughout the region. About half of the savings Protecting Health could be achieved at the procurement end, and some Exp enditures 7 35 percent could come from rationalizing or closing Africa's old, poorly maintained, and underutilized Rapid Way Found to Assess refineries that are too small ever to be competitive; AIDS Risk 8 the rest would come from addressing the dilapidated infrastructure and inappropriate pricing systems. Innovative Petroleum Exploraton Planned in East Each year Sub-Saharan Africa imports some 30 Africa 8 million tons of petroleum and petroleum products. A large part of the crude oil is processed in small, poorly maintained refineries that produce high cost fuel. These inefficiencies and those of the state owned and managed distribution companies are compounded by heavy government regulation and price controls. Through the monopolistic control of procurement, refining, and distribution consumers are forced to pay far more than necessary. The study calls for major policy changes, refurbishing of infrastructure, and much greater inter- regional cooperation in petroleum procurement. Procurement inefficiencies arise primarily due to foreign exchange shortages, poor credit arrangements, inappropriate bidding procedures, and unnecessarily high transport and transit costs. The proposed reforms include competitive bidding, privatization, and liberalized internal distribution arrangements. Carried out by Italian consultants, the study includes specific country action plans. These have been discussed in detail with the industry and relevant government authorities, who generally accept the study's central conclusions. As a followup to this study, high level conferences are planned, involving government decision makers, oil companies, and the World Bank, aimed at putting into practice the study's recommendations required in this sector. (Source: Does Downstream Petroleum Trade Matter? A Summary 1990 - Petroleum Industry Data Sheets - Sub-Saharan Africa, World Bank Africa Technical Department - Industry and Energy Division Note No. 14, June 1992, and Note No. 17, September 1992). Training Flourishes in the Informal Sector Which skills do micro-entrepreneurs value? How do they acquire these skills? What are the possibilities for promoting skill acquisition in micro-enterprises? These questions were addressed to 1,750 entrepreneurs in a survey just completed in the four West African towns of Dakar, Ibadan, Niamey, and Lome. Traditional apprenticeship was shown to be extensive, market-driven, and effective in passing on skills, and flexible enough to adapt to modern activities. It is the means by which most African entrepreneurs gain their skills. It is self-regulating, self-financing, and relevant to micro-entrepreneurs in a manner that the formal training institutions cannot be because of scale, orientation, and limited resources. The survey highlights education as a critical variable determining entry to and potential success in the http://www.worldbank.org/afr/findings/english/findO2.htm 9/13/01 Petroleum Supply Reforms Could Yield Huge Savings Page 3 of 11 African informal sector. Basic education is a precondition for employment and entrepreneurship in attractive and rewarding informal economic activities. Education complements traditional apprenticeship by increasing the propensity to pass on skills, diminishing cultural and gender barriers in the informal sector, and reinforcing the value of subsequent skill development through apprenticeship. The case for promoting skill acquisition in the informal sector is justified by: * The high level of microenterprise employment * Its contribution to reducing critical inequities, such as inequality of access to primary education. * Entrepreneurs' desire and ability to use better knowledge-they live in an environment of myth and rumor that depresses output, productivity, and employment * The failure of expensive formal training institutions to supply the skills needed by the micro- enterprise sector. The reforms advocated by the researchers include (1) widening access to primary education; (2) redirection of resources from formal training centers to micro-enterprises; and (3) direct assistance to the apprenticeship system, applied in partnership with indigenous institutions and respecting an already effective system. Above all, governments should avoid undermining the dynamism of the informal sector through the heavy hand of bureaucratic control. (Source: Skill Acquisition and Work in Micro-Enterprises: Recent Evidence from West Africa, by Stace Birks and others. World Bank Africa Technical Department - Education and Training Division Technical Note No. 4, September 1992). Credit is a Constraint to Enterprise Development How severe is the credit constraint on enterprise development in Africa? A survey just completed in Ghana, the first in a series to be undertaken as part of an Africa Regional Program on Enterprise Development (RPED), suggests that previous investigations overstated the financial deprivation of small enterprises and understated the degree of market linkage between formal and informal financial sectors. Important features of credit markets were overlooked, particularly the availability of informal finance. In practice, a remarkable amount of finance is being provided to small firms in the form of trade credit, personal loans, and through moneylenders. RPED is aimed at better understanding the dynamics of enterprise formation and development. The research methodology consists of collecting panel date from 200 to 300 firms in eight countries- Ghana, Cameroon, CMte dIvoire, Kenya, Rwanda/Burundi, Tanzania, Zambia, and Zimbabwe-over three successive years (1992/93 ato 1994/95). By using local researchers, the project will establish a permanent monitoring and evaluation capacity within these countries for enterprise development of policy reform. During the course of the study, reports addressing trends, developments, constraints, and opportunities for changes in policies and programs will be produced and circulated to policymakers. Workshops and seminars will also be organized in the countries to discuss results. The initiative is seen as a major building block of the initiation of policy reform and enterprise development programs. In Ghana as in many developing countries, the banking system is not channeling much credit to small firms. While some of the problems have been caused (and made worse) by poor monetary policies http://www.worldbank.org/afr/findings/english/findO2.htm 9/13/0 1 Petroleum Supply Reforms Could Yield Huge Savings Page 4 of II and mismanagement of the banking system, the banks also face considerable information and contract enforcement problems in lending to small and medium enterprises in an environment is which accounting systems and legal institutions are weak. For example, all the small enterprises in the RPED survey had had major disputes with clients and other firms over late or nonpayment of debts, even after they had taken the precaution of lending only to those they knew well. Thus, even at a highly desegregated level, at which information is more readily available compared to the situation that banks face in dealing with firms at "arms length,"the banks find it difficult to enforce contracts. To circumvent the lack of formal credit, firms and other market agents in Ghana have developed informal mechanisms to intermediate financial resources. Most small and medium firms have access to working capital loans through advance payments from buyers and short-term credit from input suppliers. Some of this trade credit was being extended on the basis of post-dated checks. Interestingly, some 60 percent of small firms in Ghana have bank accounts; many even have overdraft facilities. At the small end of the size distribution of enterprises, most trade credit is extended on the basis of "relational" contracts, that is, contracts (oral or written) based on a borrower's connections or reputation. In the case of new firms, reputation is often acquired by the owner having served as an apprentice in an established firm. Informal moneylenders are much in evidence in Ghana, making short-term loans at high interest rates to firms in need of quick cash. In addition, firms lend to other firms. And almost all firms lend to their employees-salary advances as well as longer term loans, which are often used for outside businesses. Friends and relatives also play a significant role in Ghana's informal credit market. More than 90 percent of the firms interviewed had started up with loans or gifts from friends and relatives. Last, informal susu savings societies also intermediate credit, although they play a relatively minor role. The main lesson to be drawn from the Ghana survey is that greater efforts are needed to get more domes-tic credit into the private sector. Only a small percentage of total domestic credit goes to the private sector while the lion's share is consumed by government-and, given the fungibility of money, the more domestic credit that can be shifted to the private sector, the more that will find its way through informal channels to efficient investors. The informal credit sector remains the critical element; because of the high information costs and weak legal systems, commercial banks cannot be relied on in the near future to intermediate most of the credit that must go to indigenous enterprises. The Ghana survey results seem to point to the need for (1) programs and policies to the need for (1) programs and policies to assist banks and non-bank financial institutions to do a better job in intermediating credit, and (2) increased efforts to strengthen informal lending channels (for example, trade credit) and monetary instruments. Another important finding of the survey was the lack of a well-functioning judicial system. This has induced entrepreneurs to develop informal ways to minimize costs of business transactions. Firms are making long-term "contracts" in product, labor, and financial markets, which are governed by tight relational networks. However, such informal contracts limit firm mobility across markets outside the networks. Without formal contracts, enforceable by law, industrial activity is severely circumscribed. For large businesses, some modem contracting mechanism are being found, for example by requiring their local suppliers and subcontractors to sign written contracts with specified penalties for delays and quality standards. Smaller firms may gradually follow suit. But these measures are not real substitute for reform of the judicial system. http://www.worldbank.org/afr/findings/english/find02.htm 9/13/01 Petroleum Supply Reforms Could Yield Huge Savings Page 5 of 11 Source: Regional Program on Enterprise Development, Quarterly Report (July-September 1992), World Bank Africa Technical department. Can Africa Pay for Its Universities? African universities face ever-increasing enrollments while governments are less and less able to finance them. What can be done? Financial diversification and income generation strategies are two solutions. Fifteen universities in Anglophone Africa were surveyed in late 1991 to assess options, and this survey produced several important conclusions. * Cost recovery for nonacademic services such as student food and accommodation is a real possibility. Training and management information systems are being introduced to improve management efficiency and stretch scare resources. Student fees for specific activities (registration, recreation, library and laboratory use) are growing but contribute only 10 percent or less of recurrent budgets. Various income-generation activities (consultancy units, publishing, commercial farms) are underway but generate little revenue. Africa universities still depend on governments for 85 percent or more of their funds. - Some new ideas are promising. Continuing education programs could be enlarged to meet growing demand, and full-costs fees charged for this service. Facilities rental could be more aggressively promoted and currently subsidized charges adjusted to market value. Development offices could be crated to pursue fundraising systematically. Alumni associations offer a long- term promise of assistance. And there is room for the expansion of student fees. * Caution in some areas is suggested by experience. Consulting holds limited comparative advantage for most universities and to be successful requires good marketing and business skills. The same holds true for university enterprises such as bakeries, maize mills, dairies, and farms. Universities should enter these activities only after careful feasibility studies. * Governments must give universities greater autonomy in their financial administration to diversify university financing, reinforce educational quality, and encourage efficiency. Governments and universities to include predictable funding arrangements, a linkage between allocations and enrollments, untying salary scales from those of the general civil service, and gradual expansion of student fees. Universities must become more cost-conscious and profit- oriented. Business-sector ideas (such as business plans, cost centers, and computerized management information systems) must be part of university management practice. Costs can be reduced by rationalizing staff:student ratios, consolidating low-enrollment programs, and introducing performance incentives. * Student protests over fee increases are common. Students often close campuses, cause damage and loss of life, and can even topple governments. Yet there is no long run alternative for improved university funding. Strategies for attaining this goal include educating students about the current university crisis, more involvement of students as adult participants in university affairs, and consensus-building around the need for university reform. * Donors can assist by organizing and funding programs to inform governments, universities, and students on the needs for financial, management, and governance reform. They can supply proven computerized management information systems and associated training. And they can support business planning and pilot implementation of income-generating activities. http://www.worldbank.org/afr/findings/english/findO2.htm 9/13/01 Petroleum Supply Reforms Could Yield Huge Savings Page 6 of 11 (Source: Financial Diversification and Income Generation at African Universities, by Robert D.D. Blair, AFTED Technical Note No.2) How to Double Sub-Saharan Africa's Agricultural Growth Rate Can Sub-Saharan Africa's annual agricultural growth rate be doubled from approximately 2 percent in real terms to 4 percent-the target sit in the World Bank's 1989 Long-Term Perspective Study for Sub- Saharan Africa? The rapid increase (nearly 4 percent per annum) in food imports since 1974), the high degree of environmental degradation, including rapid deforestation (3.7 million hectares per annum), and loss of soil fertility underscore the enormity of this challenge. Five critical priorities are identified in a strategy report just issued. 1. Encourage the private sector. The policy instruments for this are (a) price, exchange rate, and market policy reforms; (b) liberalization of the regulatory environrnent, financial market rehabilitation, and development of local private and cooperative banking (c) making the judicial system efficient and impartial; and (d) privatization and/or restructuring of agricultural parastatals and agricultural services that can operate commercially (veterinary, farm input supply, and some research and extension). A good example of successful private sector involvement has been Kenya's horticulture sector, which annually exports produce worth about US$ 108 million and was expanding at nearly 12 percent a year in the 1980s. Approximately 120 private sector companies contract with more than 30,000 farners to produce about 75 commodities. 2. Strengthen research. Technology advances at the farm and enterprise level are vital to support agricultural growth. Agricultural research systems must therefore be fine-tuned to farmers' needs, which means greater cooperation with the private sector, Egos, and university research centers. The link is through national extension systems, based on the training and visit (T&V) system now operating in twenty-seven African countries, especially targeting women farmers. In this way, Kenyan and Zimbabwean farmers have adopted hybrid maize and improved their crop husbandry. Extension played an important role in the dissemination of the CFDT (the French Cotton Company) cotton package in West Africa. SAPH, the rubber company in Cote d'Ivoire provides extension as its core service to outgrowers. 3. Promote farmer participation and empowerment. Cooperatives and farmers'groups should be supported to facilitate crop marketing, processing, input supply, credit, land management, infrastructure maintenance, and the management of many agricultural services at the field level. NGOs could play a vital support role, too. 4. Improve physical and social infrastructure. Better roads, rural water supply, rural education, and rural facilities, as well as efficient ports and telecommunications, are essential for agricultural growth. While roads are the main infrastructure needed for agriculture, investments in port facilities and telecommunications are also important. Investment in secondary towns is critical as well-there are often the first collection markets for agricultural produce and the wholesale points for agricultural inputs and services. 5. Improved natural resource management. To counter soil erosion and degradation, water pollution, siltation of irrigated areas, pasture degradation, forest destruction, and the disappearance of wildlands, the strategy calls for land and water-use planning, land tenure reforn, better wildlands and forest management to combine sustainable production with conservation, and better soil and water http://www.worldbank.org/afr/findings/english/findO2.htm 9/13/01 Petroleum Supply Reforms Could Yield Huge Savings Page 7 of 11 management by farmers. A number of reforming countries-notably Nigeria and Tanzania-achieved an annual 4 to 5 percent agricultural growth rate from 1986 to 90- with only a partial implementation of the strategic agenda outlined above. This is striking evidence that the 4 percent agricultural growth target is achievable if there is a will to persist with reform. (Source: A Strategy to Develop Agriculture in Sub-Saharan Africa and Focus of the World Bank, December 1992, Africa Region, World Bank. Upgrading Farming Systems in the Sahel Crop and livestock production are in crisis in the Sahelian countries. Shortage of fertile land and the population explosion are leading to serious environmental degradation. They constitute the major constraints to enhanced production in the Sahel. Usufruct rights to land increasingly are being allocated to cultivators, giving crop land priority over pasture lands, which are progressively lost to cultivation. A recent study has examined alternatives for integrating animal and crop production to intensify food and cash crop production to intensity food and cash crop production while maintaining soil fertility in the Shell region. Technical constraints, social factors, and economic incentives for livestock production and animal products were investigate through household and village surveys in Burkina Faso, Mali, Niger, and Senegal. These revealed the complex dynamics of the problem of sustainability, and led to some specific recommendations: - Land rights should be allocated to farmers and pastoralists who could then be assisted in the planning and implementation of rational land-use schemes. - More efficient manure use and composting techniques, together with the application of inorganic fertilizer, will reduce the problem of soil infertility. - Encouragement should be given to the production of fodder and schemes for the intensive fattening of stock to increase farmer's incomes. * Draft animals and carts should not be provided indiscriminately because the market for these is easily saturated. * More investment in imparting animal husbandry techniques to farmers and pastoralists could be a critical factor. * Finally efforts should be made to improve the organization and method of supplying savings and credit, extension services, crop marketing, and inputs. Improvements in the processing and distribution of animal products in West Africa would be part of this effort. (Source: Indigenous Integrated Farming Systems in the Sahel, by Mike Speirs and Ole Olsen, World Bank Technical Paper NO. 179, Africa Technical Department Series, 1992). Agricultural Research is Being Revitalized The quality and quantity of agricultural research in Africa has been well below that of Asia and Latin America, even though the average research expenditure per scientist has been no lower. To tackle this problem, a Framework for Action to strengthen the National Agricultural Research Systems (NARs) of the members states in Southern Africa (SADCC Region) recently has been prepared. This is the first in a series of such frameworks designed to cover Africa's different ecological zones. http://www.worldbank.org/afr/findings/english/findO2.htm 9/13/01 Petroleum Supply Reforms Could Yield Huge Savings Page 8 of 11 The SADCC region is probably the richest in Sub-Saharan Africa in terms of its renewable natural resources of land, water, livestock, forests, wildlife, and fish. The agricultural potential of the region is under-used-much of it by low-input subsistence farming. To move from subsistence to higher value commercial labor-absorbing enterprises will require the continuous development of new technical packages. Donors are active supporters of agricultural research in the region, but there has been duplication of research effort and overemphasis in some areas. Most SADCC countries undertake research on their major commodities, but they need to do more on sustainability (soil fertility and management); crop loss reduction (particularly pests and diseases); marketing, processing, and utilization; as well as on some aspects of livestock research. Insufficient money is allocated for recurrent expenditure since few donors or external agencies make adequate provision for funding recurrent costs. Although the assumption is that governments will be able to take on the responsibility for recurrent funding of nonincremental activities, this has not proved to be the case. Scientists lack the operating funds to be effective researchers. The centerpiece of the proposed framework is to ensure sustainable recurrent funding for the operational costs of priority research programs. The following six interactive elements are proposed: 1. Establish a consolidated programming and funding mechanism for each NARS to support a clearly articulated national agricultural research masterplan. 2. Develop a capacity for policy analysis within each NARS to assist governments in setting sound market-oriented agriculture policies. 3. Encourage private sector involvement in the formulation and implementation of the national and regional agricultural research programs. Such a pluralistic approach to agricultural research will draw on the relative strengths of the public private, and academic sectors. 4. hnprove the quality of science and technology in the region through the establishment of specialized regional centers of excellence in which African scientists can establish leadership in selected scientific fields and to participate more fully in the global research agenda. 5. Intensify existing farming systems in the arable farming areas and diversify the commodity base with the goal of increasing and sustaining the agricultural growth rate. 6. Assist the rural poor in the arid and marginal areas of the region through on-farm research and extension on crops and livestock, through the application of biotechnology, and through support for wildlife management and utilization programs. Tanzania has been ;made the focus of the first effort to coordinate donor efforts in support of agricultural research within a country. A national masterplan for agricultural research has been drafted and proposals elaborated for the creation of a consolidated funding mechanisms. The reinvigoration of Tanzanian agricultural research is well underway. (Source: Agricultural Research in Southern Africa: A Framework for Action, by Andrew Spurling and others, World Bank Discussion Paper No. 184) Incentives are needed to Improve African Transport http://www.worldbank.org/afr/findings/english/findO2.htm 9/13/0 1 Petroleum Supply Reforms Could Yield Huge Savings Page 9 of 11 Sizable donor aid for training and technical assistance for African transport organizations has had little sustainable impact. Programs designed to improve management and efficiency have offered neither the carrots not the sticks needed to encourage staff to change long-standing behavior. While programs have concentrated on skill acquisition and on introducing management systems and procedures, they have not dealt with staff incentives and accountability. Overall, institutional objectives and responsibilities have often not been set out clearly, leaving the door open to interference and lack of managerial accountability. Research carried out under the Human Resource and Institutional Development (HRID) Project under the auspices of the Sub-Saharan African Transport Program (SSATP) has found that increased institutional effectiveness would require institutional reforms over a long period emphasizing clarity of goals, commitment, continuity, and monitoring-an approach quite different from that previously pursued. The study showed that the poor performance of most public transport agencies can be traced to mutually reinforcing deficiencies: * Lack of qualified senior managers . Lack of autonomy with widespread government interference in management * Lack of accountability-both within organizations and without, that is, with respect to the government and customers * Unattractive salaries and lack of career development opportunities. Donor efforts have typically addressed one or another constraint in a piecemeal fashion. Staff development programs have often been initiated without recognizing institutional barriers to effective deployment and utilization of staff and without attention to compensations and career issues. A more comprehensive approach would require more attention to the preparation of capacity building interventions to identify issues, constraints, and options as well as to engage key stockholders and then develop a clear vision of the mission and capability of the organization to guide the reforms. The various actors-governments, sector organizations, donors, and users-must be involved in the preparation and be committed to the new vision so that they will support related reforms. Higher level policy topics must be adequately resolved before other issues can be addressed. For example, training cannot succeed if the issues of autonomy, accountability, and incentives are not resolved. The study has proposed a hierarchy of interventions, calling for the use of methods that differ from those traditionally applied to technical assistance projects. More time will be needed to organize collaboration and participation and develop commitment, which would require changes in donor's approaches. (Source: Human Resource and Institutional Development in the Road Sector: Modal Summary Report, by Philip W. Moeller. HRID of the SSATP, World Bank Africa Technical Department Infrastructure Division, November 1990.) Protecting Health Expenditures Public health expenditures were cut less than other expenditures as part of structural adjustment during the 1980s. This is the conclusion of a study of eleven African countries pursuing structural adjustment in that decade. The average health share of government expenditure was 7 to 8 percent higher in the years when adjustment programs were on course than in the years when they were not being successfully executed. Across all African countries the unweighted average of real per capita http://www.worldbank.org/afr/findings/english/findO2.htm 9/13/01 Petroleum Supply Reforms Could Yield Huge Savings Page 10 of Il government expenditure on health actually grew slightly in the 1980s. The countries analyzed were C6te d'Ivoire, Ghana, Kenya, Madagascar, Malawi, Mali, Nigeria, Tanzania, Togo, Uganda, and Zambia. The analysis compared health expenditure levels of each of these countries during adjustment periods with periods when tranche release did not occur. Tranch release during a given year was taken as an objective measure that the adjustment program was on course. The analysis was limited to countries with three successive years of tranche release to exclude countries with a fluctuating adjustment performance. The average levels of public expenditure for health (around $4.30 per capita per year in constant 1987 dollars in the 1980s) were still not adequate to meet needs. While sufficient to finance the recurrent expenditures for a basic package of health care services through health centers and first referral hospitals, it would not be enough to cover the complementary interventions in other sectors such as water supply and sanitation, or the national support services provided by ministries of health. A major policy paper under preparation, Better Health in Africa, suggests that a district-based health system expected to cover 98 per cent of health care needs could cost around $12 per capita per annum in low-income African countries. While cost sharing by beneficiaries could cover part of these costs public expenditure levels on health in Africa clearly remain inadequate. The efficiency of public expenditures for health appears to have declined in the 19800s. Losses on pharmaceuticals are so pronounced that on average for every $100 spent only $7 worth of drugs actually reach the patients. Because of lack of public confidence in local health centers, patients go directly to hospitals, where the costs per patient seen are far higher. Only around 10 percent of cases should go to hospitals, yet the numbers that do go range from 24 percent in Senegal to as high as 62 percent in Cameroon. Poor use, too, is made of manpower. A study in one state in Nigeria concluded that the public sector employed 60 percent more support staff per health worker than the private sector. A study in Ghana found that the non technical staff employed by the ministry of health could be reduced by a third without adversely affecting services. Consequently, not only should health expenditures be protected during adjustment but they should also be restructured and reallocated to achieve greater efficiency. (Source: "Structural Adjustment and Health in Africa in the 1980s," by I. Serageldin, A.E. Elmendorf, and E.EI-Tigani; Better Health in Africa (policy paper in preparation), World Bank Africa Technical Department). Rapid Way Found to Assess AIDS Risk The presence of common sexually transmitted diseases (STDs) such as gonorrhea or syphilis are strong indicators of susceptibility to the spread of HIV infection. The measurement of STD prevalence levels in a population is therefore an important planning tool for prevention of AIDS. The challenge is to find a quick and cheap way to measure STD levels, using an accepted and proven methodology. A study completed in Uganda and Senegal has shown than the most effective low-cost test for STDs is rapid plasma reagin, or RPR. The research was funded by the World Bank and the Global Program of AIDS and was undertaken jointly by the Belgian Institute of Tropical Medicine and the U.S. Centers for Disease Control, with WHO oversight. The RPR test for syphilis proved to be both highly sensitive and specific, unaffected by gender http://www.worldbank.org/afr/findings/english/find02.htm 9/13/01 Petroleum Supply Reforms Could Yield Huge Savings Page 11 of 11 differences, easy to perform in the field and affordable-costing as little as 10 to 25 U.S. cents. Other indicators that were evaluated, such as histories of STD symptoms, clinical signs, or standard laboratory tests, were much less satisfactory, both in terms of sensitivity and cost. Moreover, through using RPR, those who test positive for syphilis can be immediately treated, their partners screened, and prevention messages reinforced. National AIDS programs and the World Bank now propose to undertake rapid assessment studies based on the RPR test in the Sahel Region as a key step in planning AIDS prevention. (Source: Rapid Assessment of Sexually Transmitted Disease Prevalence, by Wendy Roseberry. World Bank Africa Technical Department, Population, Health and Nutrition Division, October 1992) Innovative Petroleum Exploration Planned in East Africa. Building on the successful new approach to petroleum exploration in the Red Sea and Gulf of Aden (see Findings NO. 1, June 1992), a meeting was held in the Seychelles in September 1992, attended by the Indian Ocean countries and representatives of Canada, Norway, the United Nations, and the World Bank to explore replicating the experience in the East Africa Passive Margin (including the Samali Basin and Mozambique Channel). The outcome was a request for the World Bank to mobilize and coordinate donor funding as well as assume responsibility for overall project direction for work to start as soon as possible. htt:/wwwwoldan gaFEnlsACK S"f MAP SH3OWCASE http://www.worldbank.org/afr/findings/english/find02.htm 9/13/01