The Board of Directors of the African Development Bank Group (AfDB) has approved a US $7.03-million operation to support economic and financial reforms in Guinea Bissau. The US $5.34-million concessional loan and US $1.69-million grant from the African Development Fund (ADF) will provide critical financing for the Emergency Economic and Financial Reform Support Programme (PUAREF), which will help restore basic public financial management foundations and strengthen public sector capacity, both of which are essential for the country's transition from a post-conflict crisis situation to that of reduced fragility, inclusive growth, and poverty reduction.
Its operational objectives are to: (i) strengthen transparency, internal and external control of budget execution and the fight against corruption; and (ii) improve the fiscal balance by increasing tax revenue and controlling the wage bill.
The programme's direct beneficiaries will include the Audit Office, which will would be enabled to fully perform its task of controlling budget execution, thereby enhancing its credibility; the Higher Anti-corruption Inspectorate, whose autonomy will be strengthened to enable it to fully play its role; the Public Procurement Regulatory Agency, which is expected to become operational; and public financial entities, whose efficiency will be improved.
PUAREF is aligned with Pillar I of the Bank's 2015-2019 Country Strategy Paper (CSP) for Guinea Bissau, which focuses on "Strengthening Governance and State Foundations". It is also aligned with the priorities of the Bank's 2013-2022 Ten-Year Strategy, particularly the core operational priority of governance and accountability; as well as, the Bank's strategy for "Addressing Fragility and Building Resilience in Africa", which focuses on strengthening state capacity and supporting effective institutions.
The Bank's budget support will assist the country in meeting its 2015 budget financing needs and support the implementation of structural reforms initiated since the restoration of constitutional order, following legislative and presidential elections in April and May, 2014, respectively.
