Q&As

1.  IS REGIONAL INTEGRATION SOMETHING NEW IN THE REGION ?

No. During the 2000 Annual Bank/Fund Meetings in Prague, African governments and other development partners called for more structured regional approaches to mitigate the fragmentation of the continent. Following the meetings, a program manager was appointed to coordinate the Bank’s support to regional integration in Africa. In July, the Regional Integration Department was created to step up Bank assistance to regional integration and bring regional integration into the mainstream of country programs.

2.  WHAT IS THE ROLE OF THE REGIONAL INTEGRATION DEPARTMENT?

The role of the Regional Integration Department is to assist the Bank clients to deliver additional impact at the national level through regional approaches. Its specific objectives are to (i) step up Bank assistance to regional integration, (ii) mainstream regional activities in Bank’s operations, and (iii) strengthen dialogue with regional organizations as well as with the main cooperating partners involved in regional integration in Africa.

3. WHAT IS THE RATIONALE FOR REGIONAL INTEGRATION?

Increasingly, African leaders and the donor community recognize that regional cooperation and integration can help bring Africa into the global economy. African countries recognize that purely national programs will not achieve the growth rates needed to combat poverty.

4. DOES THE REGIONAL INTEGRATION DEPARTMENT FINANCE PROJECTS?

The Department’s activities include (i) advocacy; (ii) knowledge building; (iii) capacity building; and (iv) financing of priority regional and sub-regional projects and programs.

5. WHAT CONSITUTES A REGIONAL PROJECT?

under IDA13 and 14 pilot, a regional projects is an operation that (i) involves three or more countries, all of which need to participate for the project’s objectives to be achievable (i.e., the project would not make sense without the participation of all countries); (ii) has benefits, either economic or social, that spill over country boundaries (i.e. that generate significant positive externalities or mitigate negative ones); (iii) show clear evidence of country or regional (e.g. ECOWAS, SADC) ownership which demonstrates commitment of the majority of participating countries; (iv) provides a platform for a high level of policy harmonization between countries (this is key to the success of a regional initiative); and (v) is part of a well-developed and broadly supported regional strategy.”

6. ARE REGIONAL PROJECTS EXCLUSIVELY INFRASTRUCTURE PROJECTS?

No infrastructure projects represents 35% of the current portfolio as of end FY05 and about 70% of the projects pipeline. The Bank Regional Integration approach places a strong emphasis on infrastructure scale-up (within the NEPAD Short Term Action Plan) balanced with support for human development and the management of regional natural resources. Actually, regional projects under preparation include projects in Transport, Energy, Water, Human Development, Trade Facilitation, Telecommunications, Capacity Building and Environment. While infrastructure and trade facilitation have been identified as priorities by the clients and AFC16, the CD funds projects in all sectors such as the Malaria Booster Program.

7. WHAT IS AN EXAMPLE OF A REGIONAL PROJECT?

The locust invasion is a regional issue that requires a coordinated approach. It is useless to spray in one country if the neighboring country does not. The Emergency Locust Program is a seven-country project that was put together in just three months this fiscal year. As a result of the program, the participating countries were able to complete spraying to manage the locust crisis, help farmers to recover, and now prepare for better management of locust invasions this year and in the future.

8. WHAT IS THE SIZE OF THE REGIONAL INTEGRATION PORTFOLIO?

The RI Department had a portfolio of 16 projects (including 4 GEF projects) for a total commitment amount of $632 millions. Projects include Regional Trade Facilitation, BEAC Regional Payment System, Southern Africa Power Pool (APL1), WAEMU capital markets development, HIV/AIDS Lagos Transport as well as FY05 products: West Africa Gas Pipeline, West Africa Power Pool (APL1), HIV/AIDS Great Lakes (GLIA), HIV/AIDS Kenya Tanzania Uganda, Regional HIV/AIDS Treatment Acceleration Program (TAP) and the Desert Locust Control and some GEF projects SADC Groundwater & Drought Management, Niger River Basin, Senegal River Basin and Lake Chad Basin.

9. WILL THE PORTFOLIO CONTINUE TO GROW?

The regional projects approved in FY05 represented about $250 millions. This number is expected to reach US$ 400-500 millions/year in the following fiscal years. The regional projects pipeline now includes more than US$ 2 billions of projects.

10. HOW ARE PROJECTS SELECTED?

Sub-regional strategies will be developed this fiscal year. These strategies will be developed with Country Teams within the respective Country Assistance Strategies and will provide the framework under which priority regional projects will be selected. The specific purpose of these tasks is thus to generate a dialogue around national strategies and the needed regional intervention to complement and strengthen their national efforts to increase growth and reduce poverty.

11. HOW ARE REGIONAL PROJECT FUNDED?

The financing of regional projects started with a pilot under IDA13 and continues with IDA14 in a scaled-up manner. However, this envelope might fall short of priority needs, even allowing for strong participation by other donor partners, and that the absence of regional grants under IDA14 will be a significant impediment to to scaling up support for priority regional projects.

12. WHAT IS AN EXAMPLE OF A PIPELINE PROJECT?

The Africa submarine cable's goal is that, by the end of the program (2012), all capitals and major cities in Eastern and Southern Africa will be linked to the global networks through competitively priced high-bandwidth connectivity. Among other components, it will provide partial financing for (i) the E&SA submarine cable connecting South Africa, Madagascar, Mozambique, Tanzania, Kenya, Somalia, Djibouti, Eritrea, Sudan , (ii) the Northern loop network connecting Kenya, Tanzania, Uganda, Rwanda, and Burundi to the submarine cable, and (iii) the Southern loop network connecting Mozambique, Malawi, Zambia, Botswana, South Africa, Zimbabwe, Lesotho and Swaziland.

13. ARE REGIONAL PROJECTS EXPENSIVE?

Yes. Regional projects are expensive projects for the Bank to develop, typically with budget requirements in excess of $1m compared with an AFR average of about $0.5m.

14. DOES THE DEPARTMENT FUND ANALYTICAL WORK?

Yes. The RI Department is engaged in sector work in a number of areas, the most prominent being the trade sector (support to the establishment of customs union in all sub-regions, support to EPA negotiations process). Other sectors in which ESW have been conducted include: (i) education sector (harmonization of tertiary education in the SADC region); (ii) telecommunications (status of the telecommunications sector and market in SADC region); (iii) environment and water management, and (iv) financial sector. The Department plans to scale-up its AAA work program, in partnership with regional institutions, with the aim of creating knowledge and providing depth to the Bank’s engagement in priority regional investment, and equip RECs with the capacity required to drive regional policy debate and policy formulation.

15. HOW IS PROGRESS MEASURED ON REGIONAL INTEGRATION?

Measuring progress on regional integration is not easy since it involves quantifying the impact that various activities, policy measures and programmes have on regional integration. Regional integration can actually be measured along three dimensions:

• geographic scope illustrating the number of countries involved in cooperative initiative (variable geometry),
• the number of sectors that are governed by a regional arrangement (trade policies, labor mobility, macro-policies, sector policies, etc.), and
• the depth of integration to measure the degree of sovereignty a country is ready to surrender, that is from simple coordination or cooperation to deep integration.

16. WITH WHOM DOES THE DEPARTMENT WORK WITHIN THE BANK ?

The Regional Integration Department is implementing its regional programs through four (real – not virtual) Sub-Regional Teams (SRT): Western Africa, East Africa, Central Africa, and Southern Africa. Each SRT comprises core country teams members to ensure alignment between country and regional programs. Each SRT operates in an analogous manner to a Country Team, interfacing with sub-regional clients and constituent governments . Each SRT is led by a management team, comprising the concerned Sector Managers and the Director, Regional Integration.

17. ARE REGIONAL INSTITUTIONS THE COUNTERPART OF THE RI DEPARTMENT?

Yes, but not exclusively. The RI Department considers that its counterparts are the member states and the regional institutions. The Bank has been working for a long time with institutions in Southern Africa (SADC and COMESA), Eastern Africa (EAC, IOC), central Africa (CEMAC) and West Africa (ECOWAS and WAEMU).

18. DOES THE BANK COLLABORATE WITH OTHER INSTITUTIONS ON REGIONAL INTEGRATION?

Yes. Donor harmonization and cooperation in regional integration is a priority, both because donors cannot risk overwhelming the limited capacity of regional institutions and because the complexity of scaling-up deliveries in trans-national engagements requires better operational coordination and effectiveness among donor partners. CD16 is closely collaborating with most partners including DFID, France, the EU and particularly AfDB.

19. WHAT IS THE LINK BETWEEN REGIONAL INTEGRATION AND NEPAD?

Regional integration is one of the NEPAD priorities for establishing conditions to sustainable development; and the regional economic communities are the implementers of its programs. Many of the regional flagships projects are in power systems (Inga, Southern Africa Power Pool, West Africa Power Pool), trade corridors (CEMAC, EAC), international telecommunications (EASSy project) are part NEPAD Short Term Action Plan priorities.

For more information, please refer to the Issue Brief.