World Bank aid to Madagascar has increased by 85 percent to about 260 million USD per year for 2009- 2011
New priorities include health and education, private sector development, infrastructure, rural development, environment and governance
The current portfolio of the World Bank in Madagascar consists of 21 projects
ANTANANARIVO , November 26, 2008 -- The World Bank Group in Madagascar has begun the process of updating its Country Assistance Strategy (CAS). The current CAS was discussed in April 2007 by the World Bank Board, and has been established for a five-year period (2007-2011).
The CAS relies on two pillars: first, the achievement of growth by eliminating bottlenecks to investments and growth in rural and urban areas; and second, sharing growth through the improvement of access and quality of services to populations. Good governance is the cross cutting issue.
Changes in the current global environment led to the document’s update. First, many crises are affecting the global economy (oil prices, food prices, and the global financial crisis). Secondly, a record $41.6 billion raised by the International Development Association in its 15 th installment -- the allocation for Madagascar has increased by 85 percent, and will go from about $140 to $150 million per year (2006-2008) to $260 million, annually (2009-2011). Finally, the available analytic base for Madagascar has been strengthened. For example the Country Economic Memorandum (CEM), which seeks to inform more effective donor assistance within a country, will be presented in the coming weeks.
The update process is not aiming at the development of a new CAS, but to adjust the current one by focusing more on priorities, performance and results. The mission will therefore review the evolution of the implementation of the CAS to see whether tangible results were achieved, to discuss the results of the CEM and its consequences on the World Bank program, and to start thinking of the 2009-2011 World Bank program.
A Portfolio of 21 Projects
The current World Bank portfolio in Madagascar consists of 21 projects, for a commitment of $1.153 billion. Commitments are focused on infrastructure (28 percent), private sector development (23 percent), and human development (23 percent). The average annual disbursements amount to about $230 million. This figure does not include debt relief – around $32 million in 2007 and $36 million in 2008 – and, will continue to gradually increase to $50 million by the year 2012. The disbursement ratio is above the World Bank average of 33 percent.
The major orientations of the update will focus around four issues:
Selectivity, through the reduction of the number of areas and projects, but an increase in their size;
Focusing on the World Bank’s comparative advantage;
Increasing the number of joint programs with other donors and improving coordination; and
Restructuring the projects that did not achieve the expected results.
The following will be considered as priority areas: human development (including health and education), improvement of competitiveness through support to the private sector, infrastructure, rural development, environment and governance.
The update of the CAS is jointly undertaken with the Government of Madagascar, and will consist of consultations with key partners, including the private sector, civil society and financial partners. The process will consist of different steps before the submission of the proposal to the World Bank Board in July 2009.
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