World Bank and Government of Mozambique Country Portfolio Performance Review

1
World Bank and Government of MozambiqueCountry
Portfolio Performance Review

• September 17-18, 2008
• Susan Hume
• World Bank Country Program Manager

2
Overview of Presentation

• CPPR Objectives
• Overview of Mozambique Program
• Portfolio Snapshots
• Traffic Light Table
• Successes Over the Past Year
• Portfolio Challenges
• Going Forward in Fiscal Year 2009

3
CPPR Objectives

• Taking the temperature of the entire portfolio
  once a year (through traffic light table)
• Mini-CPPR (in March) focuses on selected
  projects, but also completes traffic light table
• Taking opportunity of participation of high-level
  and technical government staff to discuss with
  World Bank project-specific issues and action
  plans
• Focusing on key themes
• Last years focus was on the specifics of how the
  World Bank monitors the portfolio (copy
  distributed)
• This year we have a presentation on the Banks
  strategy for moving projects to on-CUT

4
Overview of the World Bank Program

• Pillar 1 Governance
• Increased citizen voice and demand for
  accountability
• Pillar 2 Access to Key Services
• Efficiency and transparency of service delivery
• Pillar 3 Sustainable and Broad-based Growth
• Rural Development
• Infrastructure Development
• Regional Integration
• Developing relevant skills for the labor market
  (higher education, science and technology)
• Cross-cutting
• HIV/AIDS
• Private Sector Development
• Capacity building

5
Portfolio Snapshot (1)

• 18 ongoing projects net commitments 853 m
• 8 Infrastructure (59)
• 4 Human Development (education health) (21)
• 4 Public Sector and Decentralization (13)
• 2 Agriculture and Rural Development ( 7)
• The above includes
• 3 Global Environmental Facility (GEFs) projects
• 2 regional projects
• 36 Trust Funds commitments 198 m

6
Portfolio Snapshot (2)

• Fiscal year 2008 disbursements 198 m (87 of
  forecast)
• Estimated disbursements FY09 220 m
• Six projects closing in FY09
• Higher Education
• HIV Treatment Acceleration
• Decentralized Planning and Finance
• National Water Development II
• Railways and Ports Restructuring
• Communication Sector Reform

7
Portfolio Snapshot (3)

• For next three years, about 225 m per year in
  operations
• 6-7 planned new projects for FY09
• Poverty Reduction Support Credit 5 (90 m)
• Health Service Delivery (38 m)
• Competitiveness and Private Sector Development
  (25 m)
• Market-Based Irrigation (50 m)
• National Decentralized Planning Finance (25 m)
  
• Regional Communications Infrastructure Program -
  Phase 3 (33 m)
• Energy APL2 (possible) (40 m)

8
Traffic Light Indicator Table
9
Key Trends in Table (1)

• Sept 2007 there were 3 problem projects Sept
  2008 there is only one problem project
• Six projects have maintained good performance
  since last September
• National Water Development II
• Financial Sector Technical Assistance
• Maputo Municipal Development
• Roads and Bridges Management and Maintenance II
• Railway and Ports Restructuring
• Technical and Vocational Education and Training

10
Key Trends in Table (2)

• The following projects have experienced a
  positive trend in their performance
• Energy Reform and Access from red to green
• Market-led Small-holders Project from red to
  orange
• Public Sector Reform Project from red to orange
  
• Decentralized Planning and Financing from orange
  to green
• Higher Education from orange to green
• Communications Sector Reform from orange to
  green
• Transfronteir Conservation Areas and Tourism
  Development from orange to green
• The following projects have experienced weak or
  worsening performance
• HIV / AIDS Response Project from orange to red
• Beira Railway from green to orange

11
Successes (1)

• Improvements in the Mozambique portfolio
• Problem projects reduced from three at start of
  fiscal year 2008 to one (HIV/AIDS Response
  Project/MAP)
• Quality of the portfolio is above Africa Region
  average
• Improved portfolio performance and better score
  on CPIA (Country Policy Institutional Assessment)
  has resulted in increase of IDA15 resources for
  Mozambique
• PIUs overwhelmingly expressed view that relations
  between them and WB and MPD are strong and
  effective
• Introduction of e-sistafe and CUT for one project
  (Market-led Smallholder Development in the
  Zambezi Valley)

12
Successes (2)

• Energy Reform and Access implementation pace has
  picked up and new energy commission in place
• Market-led Smallholders successful adherence to
  e-sistafe/CUT and using national district
  planning systems
• Communication Sector Reform strengthened
  telecommunications and civil aviation regulators
• Higher Education all key areas being
  successfully implemented including new quality
  and innovation fund

13
Successes (3)

• Transfronteir Conservation Areas and Tourism
  Development partnerships with local intl NGOs
  
• Regional HIV Treatment Acceleration Program
  improved data collection in provinces, and
  contracting of NGOs for HIV/AIDS treatment
  provision
• Roads and Bridges Management and Maintenance II
  harmonization of financial management procedures
  Road Fund (PRISE) established
• Technical and Vocational Education and Training
  developed four curriculums, and standards for
  evaluation and certification

14
Sucesses (4)

• Decentralized Planning and Finance community
  participation in district planning is accepted by
  all
• Railways and Ports Restructuring components
  being successfully implemented
• National Water Development II improved quality
  in service delivery to cities and increase in the
  water access period
• ProMaputo project management is fully integrated
  into institutions structure promotes ownership
  and clear leadership
• Financial Sector Technical Assistance maintained
  satisfactory performance throughout the past year

15
Challenges Cross-Cutting

• Improve coordination between implementing
  agencies and oversight agencies (especially MPD)
  to ensure smooth transactions with WB
• Strengthen ministry oversight/ownership of
  project at decision-making level (i.e. the change
  of a Minister should not affect the course of the
  activities agreed in the project)
• Give ministry staff needed time to focus on
  project delivery
• Build capacity at district and provincial levels
  (part of broader government challenge)
• Ensure simple project design based on local
  capacity and the governments reform program
• Harmonize donor procedures budgeting,
  reporting, financial management, monitoring and
  evaluation

16
Challenges Procurement

• Acquire and maintain better knowledge on WB
  procedures
• Align procurement plans with the preparation of
  operational annual plans
• Ensure International Competitive Bidding (ICB)
  documents are prepared in English
• Consider higher thresholds for no-objection
  approval in some projects, depending on the
  capacity and associated risk

17
Challenges Financial Management

• Improve quality and timely submission of
  financial management reports (IFRs)
• Improve quality and timely submission of annual
  audit reports
• Build capacity for financial management in
  provinces and within implementing partners
• Increase availability of Internal Auditors for
  provincial operations

18
Challenges Monitoring Evaluation

• Improve and maintain technical capacity within
  PIU and implementing partners (civil society and
  private sector) and at provincial level
• Create capacity in data analysis at central and
  local levels, also promote culture and motivate
  staff to do ME
• Ensure consistency in data collection
• Improve communication networks in order to
  collect and transmit data between implementing
  partners and PIU
• Consolidate indicators for projects that have too
  many sub-indicators

19
Challenges Recruitment Retention

• Improve skills in provincial and district labor
  markets
• Increase retention at central and provincial
  level staff complains of low salaries, poor
  housing, lack of benefits
• Ensure salary parity between staff sponsored by
  different donors but performing similar work
  leads to disharmony and contributes to high
  staff turnover
• Improve staff allocation at central and
  provincial levels
• Recommendations from PIUs
• Recruit staff early in project cycle
• Adopt 2-3 year contracts for PIU consultants (vs.
  one year renewable contracts based on the annual
  assessment)
• Pair contracted staff with regular staff to
  ensure transfer of knowledge and skills within
  the implementing agency
• Ensure competitive salary and benefit package for
  PIU contracted staff (e.g. medical assistance

20
Challenges Training Needs

• Train on WB specific reporting and procedures
  (particularly related to Common Funds)
• Implement GOM training program in the provinces
• Conduct (in Portuguese) more frequent financial
  management, procurement and disbursement
  workshops for project staff in Maputo (and
  possible for regional centers)
• Recommendations from PIUs
• Offer training at beginning of project when needs
  are greatest especially on results framework
• Use case study examples
• Include other project and ministry staff in
  training, even if they are not active in the same
  area e.g. procurement knowledge is valuable to
  more than procurement staff
• Provide on-the-job training for procurement and
  financial management

21
Specific Challenges for MPD

• Need for more frequent interaction between PIUs
  and MPD
• Apply policy that establishes parity for PIU
  contract staff among all donors (and in
  collaboration with donors)
• Improve coordination and planning with different
  sectors, especially regarding counterpart funds
  (still an issue for some projects)
• Improve processing time for
• CREE, TA and other BM approvals
• Regular WB requirements (signatures, refunds, etc)

22
Specific Challenges for World Bank

• Increase World Bank involvement in SWAps and
  other program based approaches for better donor
  alignment and harmonization
• Design new projects to fit within the
  implementing agencys structure of projects (eg
  more horizontal vs vertical approach)
• Ensure prompt response to review financial
  management reports and no-objection requests

23
Going Forward in FY09

• Put new projects on-CUT also consider putting
  existing projects on-cut
• Proactively address potential problems in
  projects to ensure a healthy portfolio
• Make PIUs better aware of training opportunities
• consider an integrated training course for new
  projects