The Board of the World Bank Group today discussed a new Country Partnership Framework (CPF) for Togo covering the period from July 2016 to June 2020.
The CPF presents the World Bank Group's proposed strategy over the four-year period, including interventions to help the country pave the way to more inclusive and sustainable growth led by a more dynamic private sector and more effective government policies, public investments and services. This is the first medium-term strategy of the institution for Togo since resuming IDA* financing in the country in 2008.
"We are pleased the Board has endorsed the new framework for our cooperation with Togo which, since 2008, has been working hard to catch up and emerge from a 15-year period of donor disengagement," says Pierre Laporte, the World Bank Country Director for Togo.
A Systematic Country Diagnostic (SCD) for Togo prepared by the World Bank Group in 2016 concluded that weak governance impedes a more robust, inclusive and sustainable growth and has contributed to a stagnant per capita GDP.
Poverty rates remain high at 55%, despite having come down from 61 percent in 2011. Governance reforms aimed at engendering a more inclusive growth process led by private economic activity are needed to build an economy that is more productive, creates more jobs and leads to a virtuous cycle of rising incomes, expanded fiscal resources, and an increased ability to pay for public services to improve the well-being for a growing population. Strengthening public accountability to citizens and building stronger independent institutions at all levels are among the key governance reforms needed to ensure a more open and equitable distribution of resources. Other key challenges include weak health services which disproportionately affect the poor as well as significant risks related to macro-fiscal policies and environmental degradation linked to climate change.
The World Bank Group's new strategy emphasizes governance as a foundational, cross-cutting theme, with strengthening institutions and accountability as objectives integrated in three main focus areas: (i) private sector performance and job creation; (ii) inclusive public service delivery; and (iii) environmental sustainability and resilience.
Under the first focus area aimed at promoting the performance of the private sector and job creation, the Bank will assist the authorities to strengthen fiscal policy and debt management, including through a new series of development policy operations (budget supports) supporting reforms in tax policy and administration, public investment management, and in the governance of the energy and telecommunications sectors.
In addition, technical assistance and investment financing will support fiscal and regulatory reforms and investments aimed at growing the formal private sector and increasing agricultural productivity, access to markets and stronger value chains, and will help improve the quality of economic infrastructure services (energy, telecoms and logistics) and promote skills-building and employment opportunities.
The International Finance Company (IFC), the part of the World Bank Group that promotes private sector development, will particularly support this focus area, as it seeks to enhance its investment and advisory work to support trade and public-private partnerships (PPPs) and promote private investments in infrastructure, agribusiness, manufacturing, services, the financial sector and small and medium enterprises development. IFC and the Multilateral Investment Guarantee Agency (MIGA) -also a member of the World Bank Group promoting foreign direct investments into developing countries - will pursue opportunities to use the IDA Private Sector Window facilities to de-risk investment opportunities and attract private partners in key economic sectors, including agriculture, energy, telecommunications and transport.
The second focus area, promoting inclusive public service delivery, includes interventions to strengthen health systems, local and municipal basic infrastructure services, and social safety nets for the most vulnerable. "These operations emphasize empowering local governments and communities by building their capacity to plan, prioritize and implement basic services," according to Joelle Businger, World Bank Country Manager for Togo and Task Team Leader for the CPF. She adds that: "This will have a direct impact on people's lives, by giving them the tools and resources to improve their cities and communities."
Through the third focus area, the World Bank Group will help Togo strengthen the management of its productive natural resources, strengthen environmental resilience and reinforce its adaptation to climate change. Interventions will focus on helping urban and rural communities adapt to climate variability, change farming practices and improve the preparedness for natural disasters and other man-made risks, and policies and infrastructure to mitigate the impact of coastal erosion.
Togo will benefit from the new IDA18* replenishment which provides increased support for fragile states to scale up concessional financing and promote joint IDA, IFC and MIGA solutions. The increased poverty orientation of the performance-based allocation under IDA18 has also resulted in a doubling of IDA resources for Togo, with up to US$230 million available during 2018-2020. Combined with the US$113 million in IDA financing approved in 2017 and resources from the regional IDA envelope, the total IDA grant and credit financing is estimated at over $350 million during the CPF period. Trust fund grant resources would also be mobilized to provide additional support.
The new CPF will support the implementation of projects and programs currently underway and proposes eight (8) new operations in the areas of energy, competitiveness and skills development, urban infrastructure, logistics services, health, public services, coastal management and integrated disaster and land management. Besides the investments operations, a number of analytical studies and advisory services are planned, including among others on: (i) public private partnerships; (ii) tax framework; (iii) debt management strategy; (iv) land policy assessment; (v) sources of growth and competitiveness; gender assessment; decentralized service delivery; and (vi) blue economy strategic framework.
* The World Bank's International Development Association (IDA), established in 1960, helps the world's poorest countries by providing grants and low to zero-interest loans for projects and programs that boost economic growth, reduce poverty, and improve poor people's lives.