world bank iraq trust fund update on progress irffi donor committee meeting naples, italy, february...

World Bank Iraq Trust Fund World Bank Iraq Trust Fund Update on ProgressUpdate on Progress

IRFFI Donor Committee IRFFI Donor Committee MeetingMeeting

Naples, Italy, February 18, 2009Naples, Italy, February 18, 2009

The World Bank in IraqThe World Bank in Iraq

How Can the Bank Make a Lasting Impact?How Can the Bank Make a Lasting Impact?

The Bank’s main objective is to help Iraq The Bank’s main objective is to help Iraq

use its public resources use its public resources

more effectively and transparentlymore effectively and transparently, ,

and support Iraq’s efforts to:and support Iraq’s efforts to:

• Build efficient and accountable institutionsBuild efficient and accountable institutions

• Improve delivery of basic servicesImprove delivery of basic services

• Lay groundwork to strengthen the private Lay groundwork to strengthen the private sector and medium-term economic sector and medium-term economic developmentdevelopment

World Bank Iraq Trust FundWorld Bank Iraq Trust Fund

World Bank finances projects designed to World Bank finances projects designed to

improve Iraq’s delivery of basic services, improve Iraq’s delivery of basic services,

while strengthening Iraqi institutions and while strengthening Iraqi institutions and

building systems building systems

to help Iraq manage public resources, create to help Iraq manage public resources, create

jobs, and improve governance.jobs, and improve governance.


World Bank Emphasizes Iraqi OwnershipWorld Bank Emphasizes Iraqi Ownership Identification & PreparationIdentification & Preparation

• Iraq designs projects, with Bank assistance

• Iraqi Strategic Review Board reviews projects to ensure consistency with Iraq’s development priorities

• Bank appraises project

• Bank and Iraq jointly negotiate legal agreements

ImplementationImplementation

• Iraq implements projects

• Iraq contracts private companies to carry out the work, using World Bank competitive procurement procedures and financial management policies

• Bank supervises the implementation of projects

• Fiduciary monitoring agent helps Bank monitor physical progress and compliance with policies


World Bank Iraq Trust Fund Portfolio

18 projects totaling US$482 m

Bank executes 3 projects (US$13 m) at request of GoI

GoI executes 15 grants (US$469 m)

78% of GOI-executed grants has been contracted or disbursed (US$364 m)

45% of grant financing has been disbursed for project expenditures (US$212m)

Procurement and Disbursement Progress over Time

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Dec-04 Jun-05 Dec-05 Jun-06 Dec-06 Jun-07 Dec-07 Jun-08 Dec-08

Per

cen

t o

f V

alu

e G

ran

ted

Tendered

Committed

Disbursed

Sectoral Distribution of ITF Projects

Electricity, 1%

Capacity Building &

Public Administration

6%

Health, 11%

Private Sector, 13%

Rural Development,

10%

Water Supply,Sanitation & Urban, 36%

Education, 22%

Environment, 1%

Iraq Trust Fund Projects at a Glance


Sources and Uses of Funds


Donors have deposited US$494.4 million

Investment income totals US$74.3 million

Total value of ITF almost US$568.7 million

ITF finances 18 grants valued at US$481.6 million, obligating 97% of donor deposits

Disbursement Status


Total disbursements stand at US$241.3 million.

Project expenditures total US$221.9 million (46% of the value of grants)

Expenditures to cover costs of project appraisal and supervision total US$16.4 million

Expenditures for trust fund management and administrative fees total US$3.0 million

Resource Availability


ITF Project Implementation


Iraq implements projects and the Bank supervises implementation

Iraq contracts private companies to carry out the project, according to Bank procurement and financial management procedures

The Bank employs local staff and consultants to train and advise executing agency before and during project implementation

ITF engages a fiduciary monitoring agent (FMA) to monitor physical implementation and compliance with procurement and financial management procedures

Oversight and Controls


Annual project audit

Annual external audit of trust fund

Annual trust fund “single audit”, representation letter

Quarterly unaudited financial statements

Periodic internal audits of the country program

Special measures introduced when the Bank initiated work in Iraq to mitigate fiduciary risks (e.g. use of FMA)


Implementation Issues

Obstacles

• Institutional capacity and high turnover

• Financing shortfalls due to currency fluctuations / price escalation

• Payment delays for Iraqi Dinar payments

Action Taken

• Training and providing on-the-job support

• Restructuring projects to maximize impact with available resources

• Provide additional financing for projects having impact

• Pilot designated (advance) accounts

• Eliminate commercial banking links

Impact of ITF Projects


Strengthen project management, fiduciary governance

Collect & analyze data to design evidence-based policies

Develop sector strategies and investment programs

Promote sustainable systems and institutions to deliver services to population

Help settle communities through employment opportunities and other services

Results to Date of ITF Projects


Printed and distributed over 82 million textbooks, exceeding the original objective of distributing 69 million books.

Rehabilitated 133 schools.

Constructed 46 new schools.

Rehabilitated 8 hospital emergency units and trained 60 doctors and 60 nurses.

Improved 88,000 hectares of irrigated land, benefiting over 146,000 farmers.

Results to Date of ITF Projects


Completed the first nationwide household income and expenditure survey since 1998, covering 17,000 households. Results will help Iraq make data-based policy decisions.

Conducted 22 workshops for 600 Iraqi officials providing project implementation tools and build professional networks.

Carried out more than 60 workshops for over 1,200 Iraqi officials in procurement reform, PFM, audit and judicial reforms, and social safety nets.

Project Pipeline


Public Finance Management (PFM) Reform Project (US$18m) - help Iraq implement effective, accountable, transparent PFM

Banking Reform Project (US$10m) – help CBI implement the financial & operational restructuring of the 2 state-owned banks

Pension Reform Project (US$6m) – help MOF/National Board of Pensions implement the pension law, undertake analysis to develop old-age income protection strategies

Education Reform Project (US$3m) – help Iraqi education ministries develop a national education strategy for Iraq

World Bank Presence in Iraq


In Baghdad Office

Country manager and senior public sector specialist

Recruiting, with help from DFID, a senior private sector specialist

Hiring an Operations Officer

Outside Baghdad Office

28 Iraqi staff/consultants provide daily support for project implementation nationwide

May hire national staff in Basra to support implementation of PFM project

world bank iraq trust fund update on progress irffi donor committee meeting naples, italy, february...

Documents

project bank

iraq trust fund projects

bank procurement

projects us

trust fund management

bank monitor physical

project expenditures

fma slide