The World Bank Mauritania First Competition and Skills DPO (P167348) Program Information Document (PID) Appraisal Stage | Date Prepared/Updated: 14-May-2019 | Report No: PIDA26154 Page 1 of 10 The World Bank Mauritania First Competition and Skills DPO (P167348) BASIC INFORMATION A. Basic Project Data OPS TABLE Country Project ID Project Name Parent Project ID (if any) Mauritania First Mauritania P167348 Competition and Skills DPO (P167348) Region Estimated Board Date Practice Area (Lead) Financing Instrument Macroeconomics, Trade Development Policy AFRICA 22-Jul-2019 and Investment Financing Borrower(s) Implementing Agency Ministry of Economy and Ministry of Economy and Finance Finance Proposed Development Objective(s) Improving the regulatory environment and skills for boosting competition and inclusiveness of the Mauritanian private sector. Financing (in US$, Millions) FIN_SUMM_PUB_TBL SUMMARY Total Financing 50.00 DETAILS -NewFin3 Total World Bank Group Financing 50.00 World Bank Lending 50.00 Decision The review did authorize the team to appraise and negotiate B. Introduction and Context Country Context 1. This program document proposes a first Development Policy Financing (DPF) operation in a programmatic series of three operations. The series is designed to support the Government of Mauritania in improving the regulatory environment and worker skills for boosting competition and inclusiveness of the private sector. The proposed operation will be in the amount of US$50 million. It is aligned with the national development plan (SCAPP) 2016-2030, and supported by ongoing technical assistance (TA) activities as part of active projects implemented under the World Bank’s FY18-FY23 Country Partnership Framework (CPF). The operation has been prepared following extensive consultation with private Page 2 of 10 The World Bank Mauritania First Competition and Skills DPO (P167348) sector representatives and in coordination with other partners, including the IMF and the African Development Bank (AfDB). It builds on the results of the Systematic Country Diagnostic (SCD 2016), lessons from the previous DPF series (2016-2017) as well as results from past and ongoing analytical work. 2. Economic growth has been largely reliant on a volatile extractives sector that has gone through a boom and bust cycle over the past decade. Extractives industries have been the engine of economic development for over a decade, representing an average of 25 percent of GDP, 82 percent of exports and 23 percent of fiscal revenues. The commodity boom in 2009-2014 supported a state-driven development model with significant public investment in infrastructure and a large role for public enterprises. However, the boom did little to encourage economic diversification and private sector- led growth. Growth averaged 4.2 percent during that period, at par with Sub-Saharan Africa, and was primarily led by domestic demand for non-tradeable services supported by extractives revenues. The sharp decline in global commodity prices since 2014 has brought growth to a grind and exposed Mauritania’s vulnerabilities: a non-diversified economy facing significant challenges of job creation in the private sector. Moreover, the ambitious public investment program along with increased foreign borrowing compounded these pressures leading the country to a situation of high risk of external debt distress. Rigidities in exchange rate policies and a lack of monetary policy tools limited the ability of the central bank to address structural imbalances and respond to the terms of trade shock, thereby eroding competitiveness. 3. Slowing economic growth has put an end to poverty reduction. Rising per-capita GDP enabled Mauritania to reach lower-middle-income status in 2010, and the poverty rate declined from 44.5 percent in 2008 to 33 percent in 2014. Poverty reduction occurred principally in rural areas and was driven by rural-urban migration, changes in prices of agriculture products, as well as increased social and public capital spending. Income inequality declined substantially as the Gini coefficient fell from 35.3 percent in 2008 to 31.9 percent in 2014. While the income gap between rural and urban areas narrowed, the income distribution within each area remained largely unchanged. The slowdown in economic activity coupled with high fertility rates (4.5 children per woman) and droughts jeopardize these poverty gains. 4. The bust prompted a severe fiscal adjustment that helped restore macroeconomic balance, but the challenge remains to accelerate structural reforms to boost growth and promote the private sector. In 2016-17, the Government realized the need to address the underlying macro-economic imbalances and it embarked on a fiscal consolidation plan that was successful in stabilizing the economy. It also initiated reforms to introduce exchange rate flexibility, improve the effectiveness of the monetary policy, and strengthen the supervisory framework for the financial sector. It has done so with support of an IMF Extended Credit Facility (ECF) program. This combined with some reforms in the business environment, irrigation, fisheries and livestock, have led to a moderate recovery with growth reaching 3.6 percent in 2017. The challenge ahead is to raise Mauritania’s potential growth rate by boosting competition and skills and enabling a much larger space for the private sector, while maintaining macroeconomic stability. 5. As macroeconomic stability is regained, the government has turned its focus to structural reforms in support of a private-sector led growth. Mauritania is attempting to recalibrate its development model through a diversification program focusing on improving the enabling environment for the private sector to operate, create jobs and drive growth. To achieve this, the country will need to overcome interlinked structural constraints. Challenges include a limited private sector that is dominated by SMEs and informality with a business environment that does not enable competition and lacks access to credit. A stark example of weak competition is observed in growth-enabling sectors like telecom and broadband. The situation is aggravated by the limited competition in the sector and the small pool of available skills to draw upon from the labor force given the overall low levels of human capital. Page 3 of 10 The World Bank Mauritania First Competition and Skills DPO (P167348) Relationship to CPF 6. The DPF is aligned with the objectives and proposed outcomes of the FY18-FY23 CPF for Mauritania. The World Bank Group strategy in Mauritania builds on the findings of the Systemic Country Diagnostic of 20171 , which identified weak participation of the private sector and low human capital including weak labor skills as a common theme across the eight binding constraints for growth and shared prosperity. These constraints are: weak management of extractives, failure to harness the livestock and fisheries sectors potential, rapid and outpaced urbanization, low and inequitable access to social services, inequitable distribution of land, and distorted food prices. The proposed operation seeks to address these constraints and reinforce the country’s regulatory environment and skills for improved competition, growth and inclusiveness. The operation is anchored around the second focus area of the CPF “building human capital and inclusive growth” by improving the quality and governance of basic education and vocational training; and the third focus area “strengthening economic governance and private sector-led growth” by improving access of local private firms to commercial justice services and to private credit, and by boosting competition and investments within the ICT sector. 7. The reform agenda supported by the DPF builds upon the achievements of several World Bank investment and technical assistance projects underpinned by the FY18-FY23 CPF. These include the Public-Sector Governance Project, the Public-Private Partnership Capacity-Building Project, the Nouadhibou Economically Competitive Seafood Cluster, the project WARCIP on ICT (P123093), the project for the Support of Basic Education (PASEB), and the project for vocational training. C. Proposed Development Objective(s) Improving the regulatory environment and skills for boosting competition and inclusiveness of the Mauritanian private sector. D. Project Description 8. The programmatic 3-years DPF series is designed in three pillars: ▪ Pillar 1 supports reforms in the business environment of small and medium enterprises (SMEs). This pillar focuses on strengthening access of economic agents to an efficient and transparent commercial justice system and to reliable information on companies and collateralized assets. These reforms will help modernize the economy, level the playing field among economic agents, reduce time and costs to enforce contracts for SMEs, improve commercial dispute resolution between economic actors, strengthen insolvency regimes, and improve access to credit. Ultimately, this will increase the attractiveness of the country for both national and international investors ▪ Pillar 2 supports reforms of broadband digital infrastructure. This pillar focuses on removing barriers to investment and competition in the internet broadband market and facilitating equitable access to ICT services. It does so through regulatory reforms that (i) open the internet retail and wholesale market up for competition and new entrants, (ii) promote access to dominant operators’ essential infrastructure and reduces the costs for deploying digital infrastructure, (iii) and boosts sustainable financing and more projects in underserved areas especially rural ones. Boosting competition enables the provision of low-cost, high quality access to the population for these services. Such reforms are key to unleash the growth potentials stemming from ICT. It constitutes an opportunity to boost the overall productivity of the economy, enhance new business opportunities for private sector development, and utilize 1 Mauritania Systemic Country Diagnostic 2017, World Bank, Report No. P116630-MR. Page 4 of 10 The World Bank Mauritania First Competition and Skills DPO (P167348) technology in service delivery. ▪ Pillar 3 supports reforms in basic education and vocational training. This pillar tackles reforms to improve teachers’ training and competence, recruitment systems, and effective deployment. It supports measures to overhaul the Technical and Vocational Education Training (TVET) governance systems especially for financing, training and curriculum. It also crowds-in the private sector in the education sector decision making to boost the relevance of the training offered and align it with labor market demands. These reforms are essential to improve the quality and relevance of skills provided by the national education system and as a result boost the competitiveness of the private sector and long-term productivity. E. Implementation Institutional and Implementation Arrangements 9. The MEF will be responsible for managing the proposed operation. Day-to-day coordination, program monitoring and evaluation, and the measurement of specific outcome indicators will be the responsibility of the MEF, which will also verify the completion of all DPF prior actions through the central DPL implementation committee. The Government will review the status of the overall reform program, and IDA will undertake regular missions to ensure that the macroeconomic policy framework remains adequate. The MEF will continue to participate in World Bank TA projects designed to improve the quality of its statistics. The authorities have agreed that the MEF is responsible for collecting unpublished statistics and providing them to the World Bank for the purposes of monitoring and evaluation. The MEF will do so through a DPF reforms committee that will coordinate with relevant line ministries to secure the needed information, and to follow-up on prior action execution. F. Poverty and Social Impacts and Environmental Aspects Poverty and Social Impacts 10. The DPF program supports reforms that affect the poor and the bottom 40 percent of the welfare distribution through access to commercial justice services for small enterprises (pillar 1), access to ICT services (pillar 2) and access to education and vocational training (pillar 3). The ex-ante assessment of these impacts suggests that reforms under Pillar 1 will enhance access to commercial justice services for small enterprises and lift the growth potential of the economy. Reforms under Pillar 2 are expected to boost access for households and firms to ICT services, which has the potential to increase internet penetration among all segments of the population, and enhance affordability of internet through lower consumer prices. Reforms under Pillar 3 will allow Mauritanian youth access to better quality education and vocational training, and through better human capital accumulation lays the foundation for higher earnings from labor market activities. 11. Access to commercial justice services (Prior action #1) enables private sector parties to reach faster and simpler settlements of a dispute through newly introduced mediation services. These alternative modes of settling commercial disputes are typically cheaper and faster than conventional judicial process. While large corporations have the means to pursue a classical judicial process without affecting their daily operations, smaller companies will benefit from having a lower cost option to settle their commercial disputes. It will also be a tool to encourage them to formalize their dealings, which is expected to support higher economic activity and job creation. 12. Reforms under pillar 2 are designed to support economic activity and household welfare by removing barriers Page 5 of 10 The World Bank Mauritania First Competition and Skills DPO (P167348) to competition in the ICT sector. Prior actions #4 and #5 create a market environment where additional internet service providers are expected to provide internet alongside existing operators, thus contributing to higher internet penetration, which is expected to boost economic growth through higher productivity.2 In other countries, similar reforms have shown that higher competition reduces prices for ICT services and allows for larger investments in research and development,3 and for Senegal, Katz and Koutroumpis (2012) find that every 1 percent increase in mobile penetration (resp. mobile broadband penetration) was associated with a 0.061 (resp. 0.022) percent growth of GDP.4 Higher internet penetration is also expected to have a positive impact on household welfare effect through better access to internet services, and lower consumer prices. Cheaper services will make internet services more affordable across all groups of the population, while better quality services enable the development of complementary services like internet banking and e-learning, and might even improve public service delivery.5 Better access and higher affordability of ICT can empower poorer households and vulnerable groups, like women and youth, offering access to new services and markets. 13. Reforms are expected to bring access to ICT services at cheaper rate for poor households. Under the current market structure for ICT services in Mauritania, the main effect of the sector’s policy on household welfare are expected to come through (i) decreasing barriers to entry (consumption) for poorer households, (ii) expanding the coverage to additional households, (iii) and welfare gains arising from a reduction in consumer prices.6 Official statistics for the year 2016 report that 18 percent of the population use Internet.7 Data from the 2014 Household Survey in Mauritania provide a much lower estimate for the year 2014 - share of households consuming internet services is 1.8 percent - but it is expected that the regional divide and disparities between relatively poorer and richer households remain. 8 In 2014, coverage for IT services was lower for rural areas, with 0.5 percent of household consuming internet services in rural zones, and 3 percent in urban areas. Internet usage is also lower among relatively poorer households, with 0.5 percent of poor households compared to 2.4 percent for households above the poverty line. Conditional on being an internet user, expenditure on internet services account for 2.6 percent of total household expenditure. Poorer households spend disproportionately more on Internet, as do those in rural areas: expenditure shares of internet on total expenditure are 6.3 percent for households in rural areas (against 2.0 percent for urban), and account for 5.2 percent of household expenditure for poor households (against 2.3 percent for non-poor). This pattern is consistent with neighboring countries, such as Senegal,9 and highlights that better access and higher affordability will benefit all households, with a particular focus on poor and rural households. Yet, greater access alone does not guarantee an effect on growth and income, as returns are conditional on the population being equipped with the relevant digital skills. 14. Reforms under pillar 3 aim at enhancing access to better quality education and technical training (TVET). Henceforth it is expected to strengthen human capital formation, which is required for higher productivity and earnings 2 Katz, R. (2012). “Impact of broadband on the economy: Research to Date and Policy Issues.” April 2012, ITU; and Minges, M. (2015). “Exploring the relationship between broadband and economic growth.” 3 Jerbachian, Vahagn and Kochanova, Ana (2017). “The Impact of telecommunication Technologies on Competition in Services and Go ods Markets: Empirical Evidence”. The Scandinavian Journal of Economics. 4 Katz, R and P. Koutroumpis (2012). “The economic impact of telecommunications in Senegal.” 5 West, D. M. (2004). “E‐government and the transformation of service delivery and citizen attitudes.” Public Administration Review, 64(1), 15-27; Bennett, G. G., & Glasgow, R. E. (2009). “The delivery of public health interventions via the Internet: actualizing their potential.” Annual Review of Public Health, 30, 273-292; and Buckley, J. (2003). “E-service quality and the public sector.” Managing Service Quality: An International Journal, 13(6), 453-462. 6 The most recent household survey for Mauritania is from 2014. Country reports on telecommunication suggest that between 2014 and 2018 the share of household accessing ITC services and total expenditure increased substantially, and data from 2014 are not credible to simulate the welfare impact of these policy reforms. Using a micro simulation tool to estimate the welfare impact of higher competition based on the 2014 data (main channel: lower prices due to higher competition), results seem to underestimate the true effect and more up to date survey is needed to prepare a meaningful assessment. 7 International Telecommunication Union (2018): World Telecommunication/ICT Development Report. 8 Data from the Mauritania Household Survey EPCV (2014) includes information on (a) Frais de connexion à Internet sans fil à internet (Clé internet), (b) Frais de connexion à Internet sans fil à internet (boite de connexion wifi), (c) Frais de connexion à Internet par ligne fixe, and (d) Frais de connexion dans un Cybercafé, which all relate to consumption of internet services. As this excludes access to internet through mobile phones, this number possibly describes a lower bound estimate of the true expenditure on internet services. 9 Findings based on the 2011 official household survey (ESPS 2011). Page 6 of 10 The World Bank Mauritania First Competition and Skills DPO (P167348) in labor markets. Prior actions #7 to 10 push towards improving the competence of teachers and enforcing their presence in classrooms, a widespread issue across African schools.10 In 2018, 23.5 percent of teachers in public school were absent from class, whereby rural areas show relatively higher rates of absenteeism of 27.1 percent .11 15. Data from the 2014 household survey suggests that access to better services in education will affect many students and could reduce the education gap experienced by poor households in rural areas. School enrollment and levels of educational attainment differ across locations, as individuals in rural areas are twice more likely to be illiterate (do not know how to read and write) than those in urban areas.12 This also reflects that in rural areas around 80 percent of children between 7 and 19 years old were enrolled in school, whereas the corresponding share for urban areas is 87 percent . For individuals between 20 and 25 (included) disparities between rural and urban areas increase further, and school enrollment drops to 19 percent in rural areas and 37 percent in urban areas. While disparities between rural and urban areas are large, enrollment rates seem to differ less between relatively poorer and richer households: for children between 7 and 19 years, chances of being enrolled increase from 82 percent for the poorest quintile to 85 percent for the richest quintile, but the gap increases for the older cohorts.13 The majority of students (around 79 percent for both age cohort) was enrolled in public schooling, especially in rural areas where this figure goes up to 84.7 percent Low schooling outcomes in Mauritania being predominant for poor households in rural areas, the DPF reforms are expected to contribute to higher quality educational and thereby contributes to a reduction of poverty, especially for vulnerable which are currently reporting low levels of education. 16. Previous research suggests that access to better quality education has a positive gender effect. This comes by closing existing gaps in school enrollment rates between boys and girls – higher in rural areas and for secondary education – and contributes to better access to labor markets for men and women, which allows women to take more control over their fertility decisions.14 Around 85 percent of boys between 7 and 19 years old were enrolled in school in 2013/2014, whereas the corresponding share for girls was 82 percent. This gender gap is fully driven by disparities across location, as boys and girls of urban areas have similar chances of being in school (resp. 87 percent and 86 percent ), while only 77 percent of girls in rural areas are enrolled (against 83 percent of boys). Disparities are also visible for individuals between 20 and 25, with a percentage of school enrollment of 43 percent for men and 38 percent for women. The gender gap is more striking for rural areas with enrollment rates of 40 percent of men and 14 percent of women. The household survey data hence suggest not only that girls in rural areas have lower chances to be enrolled in school when young, but that the gap widens for the cohort in their early twenties. 17. One concern could be that preventing teachers from practicing simultaneously in public and private institutions would reduce their incomes and drive them below poverty levels. Based on statistics from the household survey, 3.6 percent of workers participated in the education sector in 2014, whereby the large majority was non-poor. Indeed, among those employed in the education sector, 80.5 percent are above the poverty line, and 75 percent in the top three quintiles.15 While it is possible that income from labor markets will drop for teachers who are no longer allowed to double- dip by receiving incomes from multiple employers, it is unlikely that these teachers will fall below the poverty line. 10 Studying seven Sub-Saharan African countries, Bold et al. (2017) estimate that due to a teacher absenteeism rate of 44 percent, students receive around half of the teaching scheduled per day. 11 See World Bank (2018): “Mauritania Service Delivery Indicators of Education”, Mimeo. 12 Illiteracy rates are of 33 percent in rural areas (resp. 16 percent in urban areas) for children between 7 and 19, and 38 percent in rural areas (resp. 20 percent in urban areas) for individuals between 20 and 25. 13 26 percent of the bottom quintile was enrolled, against 37 percent of the top quintile 14 The World Development Report on Education (2018) suggests that higher education reduces poverty through various channels, both monetary (probability of employment, productivity and higher earnings) and non-monetary (social norms, health outcomes at the individual and household levels). The literature also suggests that higher education is associated with lower teen pregnancy rates, and increases the control that women have over the size of their families. 15 Statistics from the national household survey suggests that households whose head member is employed in the educational sector have on average a lower probability of poverty, along with workers in health, mining, administration, and some type of manufacturing. Page 7 of 10 The World Bank Mauritania First Competition and Skills DPO (P167348) 18. Improving the quality of TVET and aligning the curriculum more with labor market requirements will enable the youth to build better skills and improve their access to high productivity jobs. Hence, raising their expected income from labor markets. The 2014 Household survey data in Mauritania shows a very low take up rate of TVET education, suggesting that the DPF reforms would mainly affect household welfare through better the access to technical education. The National Statistical Office (2014) records an unemployment rate of 23.1 percent when the head of household has received a TVET education (“enseignement technique ou professional”), suggesting that TVET training yield good employment returns. They were more likely to be employed in the sector of services (40.8 percent), health (16.5 percent), construction (12.9 percent ) and transport (6.4 percent ), which is also associated with higher earnings. It is expected that an expansion of TVET will increase worker’s productivity, and contribute to higher income from labor markets. 19. As the DPF program is being implemented, the monitoring of progress towards expected outcomes requires access to high quality data. For the baseline, lack of data (or outdated information) complicates an assessment of the current situation, especially when it comes to heterogeneity beyond national averages. The Office Nationale de la Statistique (ONS) in Mauritania is working closely with the World Bank to strengthen technical capacity and collect more and better data, which will be necessary to close existing gaps. For the year 2019, the ONS is planning to revise the methodology with support from the World Bank for the national household survey EPCV and then collect new data which provides a more accurate view of the current situation and future changes. Environmental Aspects 20. The reforms and policy actions supported by the proposed operation are not likely to have significant impact on environment, forests, and natural resources. Over the last 14 years, the Government has made significant strides in developing a framework for environmental management and mainstreaming environmental sustainability in projects, starting first with the environmental protection decree no. 94.2004 of November 4, 2004 concerning Environmental Impact Assessment (EIA). The Mauritanian EIA regulatory framework allows for public consultations and disclosures. The decree no. 2007-105 of April 13, 2007 (modifying the decree No.2004-094) specifies the content and the procedures of preparing a limited EIA and a comprehensive/detailed EIA, as well as how to monitor their implementation. The Ministry of Environment is institutionally saddled with reviewing and clearing EIA documents. 21. As per OP 8.60, the World Bank assessed whether specific country policies supported by the DPF are likely to cause significant effects on the country’s environment, forests, and other natural resources. The assessment concluded that the policies supported by the proposed DPF are not likely to have negative impacts on the country ‘s natural assets. All the actions supported throughout the operation are policy-oriented; they do not support direct investment in environmentally impactful investments or involve policy actions with significant environmental consequences. The assessment of potential impacts related to actions supported by the DPF will rely on the existing national legal and regulatory framework, and will be monitored and addressed through the national procedures in place in Mauritania. 22. The reforms included in this operation will not cause significant direct environmental effects as they are primarily aimed at (i) removing barriers for companies to access more efficient commercial justice services and building the foundations for a reliable and transparent information on companies and collateralized assets through commercial registry; (ii) removing barriers to investment and competition in the internet broadband market, and facilitating equitable access to ICT services; and (iii) improving quality and relevance of skills provided by the national education and training systems. G. Risks and Mitigation Page 8 of 10 The World Bank Mauritania First Competition and Skills DPO (P167348) 23. The overall risk rating for the DPF is substantial. This reflects a range of political and governance, macroeconomic, implementation capacity, and fiduciary risks, all of which could compromise the success of the proposed operation. The most salient risks are described in greater detail below. 24. Political and governance risks are substantial. The political economy is complex, and previous reform efforts have been delayed or derailed by powerful interest groups. While the Government has signaled a credible commitment to the DPF-supported reform agenda based on a broad political consensus, the effectiveness of this commitment and the government’s ability to manage political and institutional pressures are not assured. In effect, reforms like those on boosting competition in the ICT sector or reforming the vocational training sector eliminate strong vested interested of many political groups. This would create political pressure to reverse the reforms or hinder their implementation, which can affect the results targets set. To mitigate these risks, the measures supported by the DPF have been carefully selected to focus on areas where the Government has already initiated reforms, or which are the subject of ongoing TA projects by the World Bank and other development partners. Moreover, the DPF will benefit from the success of the previous DPF series 2015-2017, the national consensus around the SCAPP, and the consolidation of the MEF, which has built a strong multi-stakeholder coalition to support the reform agenda. The DPF series reform implementation assumes a successful democratic transition in 2019 with Presidential elections scheduled to take place per the new constitution. This follows the completion of a successful parliamentary and regional elections in the second half of 2018. 25. Macroeconomic risks are substantial. This is due to large public debt stock, the potential for unidentified fiscal risks emerging from the broader public sector, and monetary policy constraints in managing liquidity and minimizing financial sector risks. Exogenous shocks affecting any of these variables could prevent the government from meeting its fiscal objectives or maintaining adequate foreign exchange reserves. This will derail the structural reforms agenda, erode fiscal space, and weakens the appetite for private sector investment, which jeopardizes the expected results from the DPF program. The successful implementation of the IMF program is expected to be an important mitigation measure over the next three years. The program not only indicates the government’s commitment to limit/avoid non-concessional borrowing but would support sound monetary and exchange-rate policies for macroeconomic stability. 26. Institutional capacity for implementation and sustainability risks are substantial. Despite recent progress in institutional capacity-building, the effectiveness of public agencies remains variable, which constrains the government’s ability to implement complex reforms. The reforms supported by the proposed operation span multiple ministries and departments, and the challenges involved in inter-agency coordination compound existing capacity risks. This could affect achieving the targets set under all three pillars of the program, which requires deep collaboration across line ministries and build-up of technical expertise. However, the MEF’s expanded authority and the newly established technical coordination and follow-up mechanisms, including the enhanced role of the government DPF follow-up committee, will enable the authorities to more effectively and comprehensively implement its reforms. While not all identified risks can be mitigated directly, the TA and capacity-building support provided through ongoing World Bank projects in the areas of doing business, ICT, education and vocational training will continue to facilitate the sustainable implementation of the DPF-supported reform agenda. 27. Fiduciary Risk: The fiduciary risk associated with the proposed operation is rated substantial. This rating is based on the status of the PFM system and the central bank’s safeguard framework, accounting systems and auditing arrangements. However, the dedicated US-dollar account at the BCM for the operation and the continuing efforts to reinforce the public financial and budgetary management the World Bank Public Sector Governance Project are important risk mitigation measures. . Page 9 of 10 The World Bank Mauritania First Competition and Skills DPO (P167348) CONTACT POINT World Bank Wael Mansour, Arthur Denis Pascal Foch, El Hadramy Oubeid Senior Economist Borrower/Client/Recipient Ministry of Economy and Finance Mohamed Salem Nany Director General of Public Investment and International Coop msalemnany@gmail.com Implementing Agencies Ministry of Economy and Finance Mohamed Salem Nany Director General of Public Investment and International Coop msalemnany@gmail.com FOR MORE INFORMATION CONTACT The World Bank 1818 H Street, NW Washington, D.C. 20433 Telephone: (202) 473-1000 Web: http://www.worldbank.org/projects APPROVAL Task Team Leader(s): Wael Mansour, Arthur Denis Pascal Foch, El Hadramy Oubeid Approved By APPROVALTBL Country Director: Louise J. Cord 15-Apr-2019 Page 10 of 10