Document of The World Bank Group FOR OFFICIAL USE ONLY Report No. 123712 – BF INTERNATIONAL DEVELOPMENT ASSOCIATION INTERNATIONAL FINANCE CORPORATION MULTILATERAL INVESTMENT GUARANTEE AGENCY COUNTRY PARTNERSHIP FRAMEWORK FOR BURKINA FASO FOR THE PERIOD FY18-FY23 June 5, 2018 Country Management Unit, AFCF2 Africa Region The International Finance Corporation The Multilateral Investment Guarantee Agency This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank Group authorization. The date of the last Performance and Learning Review was May 18, 2015 CURRENCY EQUIVALENTS (Exchange Rate as of May 30, 2018) Currency Unit = CFA Franc (CFAF) US$1.00 = CFAF 550 FISCAL YEAR January 1 to December 31 ABBREVIATIONS AND ACRONYMS ASA Advisory Services and Analytics CPF Country Partnership Framework CPIA Country Policy and Institutional Assessment CPS Country Partnership Strategy CSA Climate Smart Agriculture DPF Development Policy Financing ECOWAS Economic Community of West African States EITI Extractive Industries Transparency Initiative ESP Education Sector Plan FY Fiscal Year GDP Gross Domestic Product GHG Greenhouse Gas GNI Gross National Income ICT Information and Communication Technology IDA International Development Association IE Impact Evaluations IEG Independent Evaluation Group IFC International Finance Corporation IMF International Monetary Fund IPP Independent Power Producer LIPW Labor-intensive Public Works MEF Ministry of Economy and Finance MIGA Multilateral Investment Guarantee Agency MFPTSS Ministry of Civil Service, Labor and Social Security NDC Nationally Determined Contribution OBA Output-based Aid PDO Project Development Objective PEFA Public Expenditure and Financial Assessment PFM Public Financial Management PIU Project Implementation Unit ii PLR Performance and Learning Review PNDES Plan National de Développement Economique et Social (National Plan for Economic and Social Development) PPP Public-private Partnership PfroR Program for Results PSW Private Sector Window REDD Reducing Emissions from Deforestation and Forest Degradation SCADD Accelerated Growth and Sustainable Development SCD Systematic Country Diagnostic SDGs Sustainable Development Goals SME Small and Medium Enterprise SUF Scale-up Facility TA Technical Assistance TUDIP Transport and Urban Infrastructure Development Project UNDP United Nations Development Program WAEMU West African Economic and Monetary Union WB World Bank WBG World Bank Group IDA IFC MIGA Vice President: Makhtar Diop Sergio Pimenta Keiko Honda Director: Pierre Laporte Cheikh Oumar Seydi Antony Barbour Task Team Leader: Cheick Fantamady Kanté Ronke Ogunsulire iii FY18-FY23 COUNTRY PARTNERSHIP FRAMEWORK FOR BURKINA FASO TABLE OF CONTENTS I. INTRODUCTION ...................................................................................................................................... 1 II. Country Context and Development Agenda........................................................................................... 3 2.1 Social and Political Context ................................................................................................................... 3 2.2 Recent Economic Developments ........................................................................................................... 4 2.3 Poverty Profile ...................................................................................................................................... 7 2.4 Drivers of Poverty and Development Challenges ................................................................................... 9 2.5 Development Agenda.......................................................................................................................... 13 III. World Bank Group Partnership Framework ......................................................................................... 13 3.1 New Framework for a new Context ..................................................................................................... 13 3.2 The Government’s National Plan for Social and Economic Development (PNDES), 2016-2020 ............. 14 3.3 Lessons from CPS Completion Report, Other Countries and Stakeholder Consultations ....................... 14 3.4 Overview of WBG Strategy .................................................................................................................. 16 3.5 Development Objectives supported by the WBG program................................................................... 23 Focus Area 1: Accelerate sustainable private-sector led growth for job creation ................................... 23 Focus Area 2: Invest in human capital and social protection systems .................................................... 31 Focus Area 3: Strengthen governance and support citizen engagement ................................................ 36 3.6 Financing Plan of the CPS .................................................................................................................... 39 3.7 Implementing the CPF ......................................................................................................................... 41 IV. Managing Risks .................................................................................................................................... 44 Annexes Annex 1: Burkina Faso FY18-23 CPF Results Framework................................................................................. 46 Annex 2: Completion and Learning Review of the FY13-16 Country Partnership Strategy for Burkina Faso ... 63 Annex 3: Spatial Distribution of the Bank’s Operations Portfolio in Burkina Faso ........................................... 93 Annex 4: Country Map................................................................................................................................. 101 Tables Table 1: Selected Economic Indicators: 2014-2020 .......................................................................................... 6 Table 2: WBG Selectivity Filters ..................................................................................................................... 18 Table 3: SCD Proposed Pathways, Actions and CPF Operational Response ..................................................... 22 Table 4: Burkina Faso Indicative CPF Program Financing (2018-2023) ............................................................ 40 Table 5: Summary of Knowledge Gaps Financed by WBG and Other Donors in Burkina Faso ......................... 41 Table 6: Systematic Operations Risk-Rating Tool (SORT) for Burkina Faso ...................................................... 44 Boxes Box 1: Key Constraints Identified in the SCD .................................................................................................... 9 Box 2: Gender is a key cross-cutting driver of the CPF .................................................................................... 39 Figures Figure 1: A booming economy since 1995........................................................................................................ 5 Figure 2: But more modest when adjusted by the population growth.............................................................. 5 Figure 3: The Determinants of the CPF Focus Areas ....................................................................................... 14 Figure 4: Spatial distribution of the World Bank’s operations portfolio by the number of projects in Focus Area 2 ................................................................................................................................................................... 20 Figure 5: Snapshot of the Burkina Faso CPF ................................................................................................... 21 iv v I. INTRODUCTION 1 This Country Partnership Framework (CPF) for the period FY18 to FY23, draws on the World Bank Group’s (WBG) 2017 Systematic Country Diagnostic (SCD) for Burkina Faso and feedback from in-country consultations with stakeholders. The SCD identified three top and seven second-tier priorities necessary to end extreme poverty and increase shared prosperity in Burkina Faso. These top priorities are: i) improving natural resource management; ii) promoting skills development, and iii) reducing gender bias against women. The second-tier priorities are: (i) building infrastructure to promote further local and regional integration; (ii) encouraging financial inclusion; (iii) increasing resilience through improved social protection to the poorest; (iv) ensuring fiscal efficiency and macroeconomic stability; (v) building up inclusive and transparent institutions; (vi) promoting competition and private sector development to stimulate efficiency and innovation; and (vii) managing urbanization with efficient urban centers. The SCD determined that the degree to which Burkina Faso achieves success will depend on its ability to facilitate economic transformation, expand the base of growth beyond the rapid expansion of the public sector – financed mainly by aid inflows and the booming mining sector – and share the positive impacts of economic growth with the majority of citizens. This CPF follows the Burkina Faso Country Partnership Strategy (CPS) FY13-FY161 and builds on the Performance and Learning Review (PLR)2 completed in May 2015. 2 The CPF is also aligned with Burkina Faso’s medium-term national development policy framework, embodied in the National Economic and Social Development Plan (Plan National de Développement Economique et Social – PNDES 2016-2020). The PNDES is the successor to the 2010-2015 Strategy for Accelerated Growth and Sustainable Development (SCADD), and aims for an average annual Gross Domestic Product (GDP) growth rate of 7.7 percent and a decline in the poverty rate from 40.3 percent in 2014 to 35 percent by 2020. The PNDES’ vision is one of structural transformation of the economy, inclusive growth and decent jobs for youth and women. 3 Drawing on the SCD, PNDES and IDA18 priorities, the CPF will have three Focus Areas. These are 1) accelerate sustainable private- sector led growth for job creation; 2) invest in human capital and social protection systems; and 3) strengthen governance and support citizen engagement. Leveraging its wide range of financial and advisory services while crowding in private sector investment, the WBG’s CPF will target selected economic and social interventions with the highest potential to support productive job creation for youth and women. The guiding principle of the CPF rests on helping the country follow the two pathways to sustainable growth and shared prosperity, as defined by the SCD: creating productive jobs and building human capital and productive assets. 1 Report No 78793-BF – Board Approval: August 21, 2013 2 Report No. 96513-BF – Board Approval: May 18, 2015 1 4 This CPF recognizes the prevalent security context in the Sahel Region which suggests that traditional growth and poverty alleviation alone may not be sufficient to sustain peace and long-term stability in Burkina Faso. A sharp deterioration in the security situation in the Sahel region has had multiple negative repercussions on Burkina Faso during the CPS period. For Burkina Faso in particular, risks have been building up, as evidenced by the March 2018 attacks against military command and the French embassy in Ouagadougou. With the establishment of the group of countries of the G5 Sahel (namely Mauritania, Mali, Burkina Faso, Niger and Chad) in 2014, Burkina Faso has assumed an increasingly prominent role in the regional military contingent engaged in northern Mali. The launch of the Sahel Alliance in 2017, propelled by Sahelian countries with support from donors, has provided the country with a platform to assert its leadership as a stronghold against terrorism in the Sahel, a role that has, nevertheless, heightened its security risk. In a rapidly-changing context, therefore, preventing the spread of violence will require an adapted approach to economic and social policies which prioritize inclusive solutions through dialogue, adapted macroeconomic policies, institutional reform in core state functions, and redistributive policies. Enhancing the meaningful participation of women and youth in decision making, as well as long-term policies to address the economic, social, and political aspirations of women and young people are fundamental to sustaining peace at all levels in a very fast-changing world. 5 The wide range of Burkina Faso’s economic and social challenges will not be covered by this CPF. Rather, the proposed set of analytical, financial and advisory services will seek to build on existing operations where the WBG has a comparative advantage and where its transformational impact is greatest. Use of new IDA18 instruments, such as the Scale-up Facility (SUF), the Private Sector Window (PSW) and the Refugee Window, will also be prioritized. Partnership and collaboration with other development partners and regional development organizations, meanwhile, will be nurtured. 2 II. Country Context and Development Agenda 2.1 Social and Political Context 6 Burkina Faso is one of the poorest countries in the world. Gross national income (GNI) per capita was just US$640 in 2016. Eight out of ten citizens live on less than US$3 per day. It also has the lowest mean years of schooling of all countries for which data is available – a mere 1.4 years. Indeed, Burkina Faso is ranked 185th out of 188 countries in the United Nations Development Program (UNDP) Human Development Index. 7 Burkina Faso has made significant progress in poverty reduction in the last 15 years. The poverty rate fell from 53 percent of the population in 2003 to 40.3 percent in 2014, and growth has been pro-poor. The bottom 40 percent of the population, meanwhile, reported an increase in consumption twice as large as that of the top 60 percent, as annual GDP growth averaged over 6 percent during this period. The quality of policies and institutions has been consistently rated among the highest in sub-Saharan Africa, with a Country Policy and Institutional Assessment (CPIA) of 3.6.3 Moreover, in 2015, the country made the transition from military dictatorship to a democratically-elected civilian president. 8 After 24 years of relative stability, the political and security situation gradually worsened between 2011 and 2014. This culminated in widespread protests that led to the ousting of President Blaise Compaoré in October 2014, marking a historic turning point for the country. Following these events, a Transition President and Government were appointed and a National Transition Council was installed to oversee general elections. In September 2015, elements of the Presidential guard loyal to the former President conducted a coup-d’état and held the transitional President for six days. The prisoners were eventually released, and elections were successfully held in late November 2015. Roch Marc Christian Kaboré was elected in a peaceful and transparent manner and the result was not contested. Local government elections were held successfully in May 2016. 9 Recent progress has been achieved, in spite of the context of an arid, land-locked country in one of the poorest and least stable regions of the world. Burkina Faso is 1,000 km from the ocean, access to which depends on other poor countries that suffer from weak governance and, occasionally, conflict. It is also a Sahelian country, but without the advantage of a major river for irrigation like many of its neighbors. These challenges are compounded by climate change, which has increased the risk of natural hazards (limited and unreliable rainfall, increased frequency of droughts and floods) exposing key economic and social development sectors to greater vulnerability, especially agriculture. It is estimated that 34 percent of the country’s land area – or more than 9 million hectares of arable land - has already been degraded 3 In fact, from 2009 to 2013, Burkina Faso had a CPIA of 3.8. 3 due to climate change and desertification, with an annual progression of around 105,000 ha to 250,000 ha4. 10 Recent developments, however, suggest that it may be difficult to sustain this economic, social and political progress. Governance indicators have deteriorated since 2008, as economic power has become increasingly concentrated through the capture of mining rents, which has exacerbated social tensions and driven demands for a greater share of this new wealth. Rapid population growth (3.1 percent per annum), particularly in the capital Ouagadougou (over 7 percent p.a. over the last ten years), posing major challenges for urban job creation and basic services. In the meantime, a weak education system leaves youth ill-prepared for the job market. 11 Growing security threats from Islamic extremists based in neighboring Mali and Niger to the north are having a dampening effect on investment, tourism and confidence in the State, generating doubts over long-held business-as-usual approach to development. Since the end of 2016, the security situation in northern Burkina Faso has deteriorated and remains highly volatile, with regular military interventions, terrorist attacks, hijacking of vehicles, targeted assassinations and kidnappings. Terrorist attacks have focused on ex-pat-frequented hotels and restaurants in Ouagadougou such as in January 2016 and August 2017, as well as the most recent attack on several key locations throughout the capital, including army headquarters and the French embassy, in March 2018. While Burkina Faso can no longer be considered the oasis of peace it once was in the conflict-affected Sahel region, the peculiarity of the current security situation is that the majority of the attacks in the country appear to be imported rather than home-grown, or reprisal for government policy, rather than based on community or sectarian divisions. 2.2 Recent Economic Developments 12 Burkina Faso has recorded a good macroeconomic performance over the past 15 years, though this is partially off-set by high population growth. After a long period of economic stagnation, the country recorded one of the best levels of macroeconomic performance in Africa between 2000 and 2013, with annual GDP growth averaging about 6 percent. Measured in constant US$, GNI increased by a factor of three between 1995 and 2013 (see Figure 1). However, once the high population growth rate is taken into account, the rate of increase is in fact lower than the average for all of sub-Saharan Africa and much slower than the global average (see Figure 2). 4 Second Report on the State of Environment in Burkina Faso (REEB2), Government of Burkina Faso, 2011. 4 Figure 2: But more modest when adjusted by the Figure 1: A booming economy since 1995 population growth GDP (constant 2010 US$) GNI per capita (constant 2010 12 1800 10500 US$) 10 1600 Sub-Saharan Africa 10000 1400 8 US$, 2010 US$, 2010 1200 9500 US$, 2010 6 World (right 1000 handed axis) 9000 4 800 2 600 8500 Burkina Faso 400 0 8000 200 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 0 7500 20002002200420062008201020122014 13 The most important structural change in the economy has been the growth of the mining sector. Mining’s contribution to GDP trebled from 3 percent in 2009 to 9 percent in 2016, while its share of exports increased from 43 percent to 69 percent. The sector provided about US$350 million in revenues in 2016, 9,000 direct jobs from 11 industrial mines and an estimated 1,000,000 jobs in artisanal and small-scale mining. 14 The economy has recovered from an economic slowdown in 2014 and 2015. GDP growth dropped to 4.2 percent in 2014 and 3.1 percent in 2015 following a decline in gold prices, flat agricultural output, a fall in aid and weakening investor confidence linked to political uncertainty. Nevertheless, GDP growth rebounded in 2016 to 5.9 percent and is estimated to have reached 6.4 percent in 2017 due to expanding cotton production, renewed political stability and increased public spending. 15 Fiscal performance has, however, sharply deteriorated, with the deficit widening to an estimated 8.2 percent of GDP in 2017. Revenue growth was strong but could only partially offset expenditure growth. Most of the fiscal expansion was related to increased public investment, in line with Burkina Faso’s ambitious national development plan (PNDES). The wage bill also increased (to 8.5 percent of GDP) as a result of weak controls over civil service recruitment, combined with rising social demands that have led to numerous strikes to push the Government to raise wages. 16 Burkina Faso has made some progress in its business environment. The Government recently launched a credit bureau and adopted the public-private partnership (PPP) Law and reforms regarding business licenses and financial infrastructure. However, the country’s 2018 Doing Business Report ranking deteriorated slightly to 148 th from 146th the previous year and further reforms are still required concerning access to electricity, tax payment, access to land and enforcement of contracts. 5 Table 1: Selected Economic Indicators: 2014-2020 2014 2015 2016 2017 2018 2019 2020 proj. proj. proj. proj. GDP growth (%) 4.2 3.1 5.9 6.4 6.0 6.0 6.0 GDP per capita growth (%) 1.1 0 2.8 3.3 2.9 2.9 2.9 Inflation (%) -0.3 0.9 -0.2 0.4 2.0 2.0 2.0 Fiscal balance/GDP -1.9 -2.2 -3.3 -8.2 -5.0 -3.0 -3.0 Total revenues/GDP 17.5 17.0 18.4 19.0 19.7 20.3 20.8 - Taxes/GDP 15.2 15.1 16.0 17.0 17.8 18.3 18.8 Total expenditures/GDP 23.4 22.9 24.4 29.9 28.1 27.0 27.2 - Current/GDP 14.5 15.0 16.7 17.3 17.4 16.1 15.8 - Capital/GDP 8.9 8.1 7.9 12.6 10.7 10.8 11.4 Current account balance -8.1 -8.5 -7.2 -8.4 -8.0 -7.0 -7.1 Total public debt/GDP 30.4 35.8 38.3 38.3 41.0 41.3 41.8 Source: IMF Staff Reports, various. 17 Prospects for the coming three years are generally good, though not without downside risks. GDP growth is expected to remain around 6 percent, supported by a good performance in agriculture, services and mining, together with sustained public investment. The Government’s development strategy (PNDES) aims for a somewhat-higher growth rate, but given the likelihood of one or more shocks, it seems prudent to adopt projections closer to the historical trend line. The economy is vulnerable to terrorism and civil unrest, as well as the vagaries of rainfall and fluctuating world prices for gold and cotton exports and oil imports. By contrast, production of both cotton and gold is expected to continue to grow and there is some upside potential for gold prices and production, with two new projects under construction and eight advanced ones in the pipeline. The main policy risk is related to projected fiscal adjustment – in the order of 5 percentage points of GDP over the next two years. While this is possible, political and social risks could be exacerbated by security incidents and may increase pressure on the Government to maintain its high level of spending and reduce its effort to mobilize more revenue. A key challenge will be to contain wage bill growth in a difficult social and security context ahead of the 2020 elections. Other risks are a narrower access to regional financing due to tighter liquidity conditions. 18 It will be important to create fiscal space for emergency spending in the face of shocks. This is all the more important considering that the Government does not enjoy the options provided by a flexible exchange rate or an independent monetary policy. Fiscal policy is therefore the only lever at its disposal. The fiscal deficit (including grants) is expected to converge to the West African Economic and Monetary Union (WAEMU) target of 3 percent of GDP by 2019 – assuming successful implementation of reforms that steadily raise domestic revenue mobilization. On the expenditure side, public investment is projected to fall (compared to the record spending in 2017) and a modest decline in both capital and current spending is planned, 6 notably through wage restraint and reduced transfers to state-owned enterprises. Wage restraint and improvements in the investment climate will also be critical to maintaining competitiveness in the context of a fixed exchange rate. 19 The country remains at moderate risk of debt distress. Public debt-to-GDP rose to 38.3 percent in 2017 but is expected to remain below 45 percent in the coming years. The Government has committed to relying on concessional borrowing to finance its ambitious investment plans of 9-10 percent of GDP. Nonetheless, it may be difficult to maintain this level, especially in the event of shocks, so it will be important to promote greater private investment. 2.3 Poverty Profile 20 In 2014, 40 percent of the population was living in poverty . This marked a notable improvement since 2003, when the poverty rate stood at more than 50 percent. However, with Burkina Faso's rapid population growth rate, the absolute number of poor people remained roughly the same at around 7 million. A significant proportion, furthermore, is clustered around the poverty line, meaning that small shocks can lead to sizable increases in the number of people living in poverty. 21 Rapid GDP growth rate has led to an increase in the levels of consumption among the poorest families. Indeed, the increase in consumption was significantly higher for the poor than for the non-poor, reducing consumption inequality. This positive performance was the combined result of: (i) increased income generation opportunities due to the improved performance of agriculture, and the urbanization process, which created an increasing number of non-farm jobs; (ii) redistribution policies in the cotton sector; and (iii) an increase in the overall value of remittances. 22 Nevertheless, the decline in the poverty rate must be understood in the context of high fertility rates and vulnerability. Burkina Faso has one of the highest fertility rates in the world. The average annual per capita GDP growth rate, therefore, stood at just 2.6 percent between 2005 and 2013. At these rates, it will take Burkina Faso roughly 25 years to double its average per capita income, compared to only seven years for Ethiopia or ten years for Rwanda. Furthermore, the level of vulnerability for the average Burkinabe is high, with two-thirds of households reporting that they suffer from shocks in any given year, generally due to natural hazards. 23 Poverty is largely a rural phenomenon, but urban poverty remains a concern. Approximately 90 percent of the poor live in rural areas. The lowest poverty rate is recorded in Ouagadougou, at less than 10 percent. This is somewhat misleading, however, as the definition of the poverty line is quite narrow. Using the Niger definition, for example, urban poverty in Ouagadougou jumps to 28 percent. Furthermore, with rapid rural-urban migration and hence urbanization (the urban population is growing at 5.7 percent p.a. compared to only 1.7 percent in rural areas), the number of urban poor will increase if jobs are not created in the cities. Given the greater geographic concentration of the urban poor, social and political tensions may rise. 7 Improving urban incomes will also have a positive impact on rural poverty due to substantial transfers made to rural households. 24 In Burkina Faso, a poor person is most likely to be employed on a farm, to have had little or no formal education and live in a household with at least six children. Female-headed households are more likely than male-headed households to be poor. Members of poor households remain almost completely excluded from basic services and access to infrastructure, with less than 5 percent of the poorest households connected to the national electricity grid. In terms of education, the poorest households enjoy almost no access to secondary education and even less to tertiary education. Significant discrimination exists against girls, especially after the primary cycle. Even when children attend primary school, furthermore only half of graduates have acquired basic reading and mathematics skills. In terms of access to health, water and sanitation, inequality is not as severe, but overall rates still lag significantly behind the sub- Saharan average. It should be noted that maternal and child mortality rates have declined significantly over the past decade, though the quality of services remains poor. 25 The main challenges affecting the Government’s ability to build resilience among vulnerable populations are: (a) limited knowledge on the scope of vulnerability and poverty; (b) scattered approaches to identifying poor and vulnerable households; (c) absence of coordination between numerous actors and multiple interventions in social protection, disaster risk management and resilience; and (d) lack of tools to effectively anticipate and promptly respond to shocks. 26 Despite the achievements of the last 15 years, the prospect of eradicating extreme poverty by 2030 is unlikely to be met.5 A simple simulation based on recent historical trends shows that the poverty headcount will only decline to 37 percent in 2020, 34 percent in 2026 and 32 percent by 2030. The country will therefore still count 9 million poor people among its population, up from 7 million today. The objective to eradicate extreme poverty will therefore require a significant increase in the average GDP growth rate and a substantial increase in the elasticity between this economic expansion and poverty alleviation over the next decade. In the short run, rural-oriented policies have the most potential to reduce poverty, while, in the longer run, the country needs to combine such policies with the vision of creating productive jobs in urban areas. 5 Poverty projections are made based on assumptions on economic growth, population growth and poverty-growth elasticity. The lowest economic growth is 5.8 percent growth of GDP, corresponding to the average annual growth rate of 2009-2014; the highest is 6.4 percent, corresponding to the projections of 2015-17. 8 2.4 Drivers of Poverty and Development Challenges Box 1: Key Constraints Identified in the SCD 1. Limited creation of productive jobs a. Low productivity of the agricultural sector, due to: - Poor risk management - Insufficient collective infrastructure - Limited access to external finance - Weak land management - Underdeveloped information mechanisms b. Limited expansion of productive non-farm jobs, due to: - Lack of access to external financial resources - Insufficient virtual and physical connective infrastructure - Complex tax system and barriers to entry - Underdeveloped training and education facilities and restrictive labor regulations 2. Insufficient human and physical capital a. Low and unequal level of access to social services, due to: - Lack of financial resource and weak financial management - Limited availability of qualified teachers, - Low rate of return on investments in education relative to the associated financial burden - Biases at the household level regarding the importance of girls’ education b. Low and access to health and nutrition - - Insufficient public financing of the health and nutrition sectors - Limited availability of qualified of doctors and nurses - High cost of health services and long distances to health centers - Lack of supervision of private health providers c. Lack of basic infrastructure (energy, water, transport, communications) provision to the poor, due to: - Financing gap exacerbated by low level of private sector participation - Poor planning and execution leading to sub-optimal projects and technologies - Poor financial management due to political interference and weak regulations - Limited technical capacities in both the public and private sectors - Lack of affordability Source: Burkina Faso SCD, World Bank, 2017. 27 Burkina Faso’s slow progress towards achieving the twin goals of eliminating extreme poverty and increasing shared prosperity can therefore be understood as the result of two over-arching constraints: (1) the failure to create enough productive jobs through structural transformation of the economy; and (2) insufficient growth in human and physical capital (see Box 1). The limited creation of productive jobs 28 The limited creation of productive jobs can largely be explained by the poor performance of the agriculture sector. With 80 percent of the labor force primarily employed in 9 this sector, the most direct means to reducing poverty is to increase the average income of rural households by creating opportunities for them to sell more and at better prices. Agriculture continues to suffer from low levels of productivity, with yields declining by 3 percent and crop production increasing by only 10 percent over the last decade. Diversification is also a challenge, as the overall structure of the sector has not changed in decades. Moreover, women in the agricultural sector suffer from persistent bias and discrimination, notably in terms of access to land and property tenure. This bias has significant costs, as women account for an estimated half of the labor force in rural areas and produce over two-thirds of food consumed in the country. 29 Burkina Faso has been unable to leverage the full potential presented by the rapid growth of non-farm jobs in urban centers. An increasing number of mainly young migrants have moved to Ouagadougou and, to a lesser extent, secondary cities. While these migrants have generally found better-paid jobs than those they left behind on the farm, most consist of small- scale, low productivity activities in the informal sector. On the demand side, firms are prevented from growing and hiring workers because of the non-conducive business environment and lack of access to finance, while on the supply side, the majority of workers do not have the necessary skills demanded by firms. Insufficient human and physical capital 30 The poor performance of the education and health sectors is explained by both supply- and demand-side factors. On the supply side, a lack of financial resources and limited autonomy among service providers have prevented the development of appropriate infrastructure, the provision of equipment and the recruitment and deployment of qualified staff. The ratio of qualified teachers and doctors/nurses to the population, meanwhile, is among the lowest in the world. Private services have emerged but the quality is sometimes poorer than in public services, and these are generally beyond the means of the poorest households. On the demand side, many families suffer from financial constraints, exacerbated by the distance between home and schools/ health facilities. Several free or subsidized healthcare policies have improved access, but they have failed to specifically target vulnerable populations. Low rates of return to education (still of relatively-low quality), combined with cultural bias, continue to discourage many parents from investing in their children’s education, particularly after the primary cycle. 31 The limited and unequal provision of basic infrastructure in the energy, water and sanitation, transportation and Information and Communication Technology (ICT) sectors is the combined result of five key constraints. Access to finance has been exacerbated by the low level of private sector participation, especially in the energy sector. Poor planning and execution capacity, resulting in non-priority projects and sub-optimal technology, are most evident in the rural water, energy, and transport sector. Poor financial management and poor targeting of utility subsidies associated with political interference and a weak regulatory environment leads to unsustainable financial and efficiency losses in the energy sector and excessive prices in the ICT sector. Limited technical capacity applies not only to high-skilled jobs (engineers, planners) 10 but also among mid-level professionals (technicians). Lack of affordability poses challenges, particularly for connections to the national electricity grid, piped water and the Internet. Challenges in Governance 32 Public sector governance reforms have laid the legal and institutional foundation for a modern public administration. Notwithstanding these achievements, public sector reforms have not translated into significant improvements in service delivery. The sectoral context is characterized by a significant gap between the de jure legal arrangements and de facto practice. While the de jure legal and regulatory environment is generally satisfactory on paper, public sector performance continues to be hampered by weak application of laws, limitations in the processes and systems in place and significant capacity deficits. 33 Despite reforms, public administration in Burkina Faso is hampered by a series of shortcomings. First, the highly-centralized nature of decision-making and the concentration of financial and human resources at the center of government have hampered the administration’s capacity to respond to the needs and expectations of citizens. The administrative system is built on a notion of ex ante controls rather than ex post performance monitoring. Decisions on budget and human resources are made by key ministries, such as the Ministry of Economy and Finance (MEF) and Ministry of Civil Service, Labor and Social Security (MFPTSS), while the role of other ministries is largely confined to implementing these decisions. At the same time, the central ministries, most notably the MFPTSS, lack the capacity to provide strategic orientation to line ministries. 34 Decentralization/de-concentration has yet to yield measurable improvements in public service delivery. De-concentration of budget execution authority to line ministries, in accordance with the WAEMU directives, is moving more slowly than desired. Meanwhile central government, through its relevant authorities, still retains ex ante control over most decisions taken by local government. Local governments are therefore constrained from carrying out their mandates by the limited (and often delayed) resources provided by the center, while suffering from a limited supply of qualified civil servants. In addition, due to the slow and varied pace of de-concentration in the sectors, local governments do not receive adequate levels of support from regional offices of ministries, while de-concentrated departments have not consistently succeeded in bringing public administration closer to local populations. 35 The civil service environment also lacks the appropriate incentives to motivate administrators and front-line public service providers to deliver results. Various attempts have been made by successive governments to improve human resource management and strengthen the institutional capacity of public administration. However, these efforts have not been particularly successful in attracting and motivating a capable and performance–driven body of civil servants, nor in optimizing the use of human resources for the efficient provision of services. Civil servant performance tends not to be results-oriented or focused on individual accountability and civil servants have become increasingly disgruntled by their working conditions. 11 36 In terms of public financial management (PFM) reforms, sustained efforts have been made to shift towards performance management, in compliance with WAEMU PFM Directives. In line with WAEMU directives, for example, Burkina Faso adopted a Transparency Code in 2013 that requires public institutions to make information publicly-accessible to users. In addition, the National Transitional Committee enacted a directive on the Finance Act in November 2015. Nevertheless, the application of these laws and the changes to existing financial management systems and processes will create a new set of challenges. 37 At 17 percent in 2017, Burkina Faso’s tax revenue-to-GDP ratio is well below the WAEMU target of 20 percent. Weaknesses in revenue mobilization negatively impact budget reliability, creating significant gaps between planned and actual revenues. Low domestic revenue collection often results in delayed payments, high unpredictability in resource flows to service delivery agencies, low budget execution rates and the accumulation of arrears. 38 Transparency and accountability has been boosted through a series of reforms. The adoption of progressive laws to enhance accountability and transparency in public administration is a positive step towards strengthening accountability. The Anti-Corruption Law adopted in 2015 strengthened the legal framework on transparency and accountability in the public sector. The law requires public institutions to make information on operations and decision-making processes publicly-accessible to users, as well as effectively organize access to information for the media and the public at large. It also reinforces regulatory and legal measures, rationalizing and reinforcing existing anti-corruption tools, as well as law enforcement’s role in generating greater transparency. The Government joined the Open Government Partnership6 in 2016, in a bid to increase its accountability to citizens. The challenge, however, is the relatively limited capacity of accountability institutions, such as audit and anti-corruption institutions, as well as parliament, which should ensure effective implementation of governance policies. 39 Burkina Faso has been implementing the Extractive Industries Transparency Initiative (EITI) since 2009. The country was also declared EITI-compliant in 2013 and produced documentation and reports for 2009-2015. Burkina underwent a re-validation process in 2017 based on the new EITI standards and is awaiting results from the International EITI Board. The EITI Reports have so far disclosed legal owners of mining companies, including country of incorporation, percentage participation and the name of the stock exchange for listed companies. Burkina Faso has compiled a beneficial ownership-scoping study, which suggested supporting documents that could be requested from mining companies in the future to help verify the identity of beneficial owners, such as company registration, proof of residence, etc. The country is assessing the extension of EITI to the artisanal mining subsector. Some mining revenues are now earmarked for communities through the Mining Social Development Fund for 6 Open Government partnership is a multi-national initiative that aims to secure concrete commitments from governments to their citizens to promote transparency, empower citizens, fight corruption, and harness new technologies to strengthen governance. 12 which implementation regulations have already been adopted, but actual implementation, which will test the envisioned governance structure, is yet to commence. 2.5 Development Agenda 40 Three main priorities were identified by the SCD as critically important, due to their potential for significant impact, both individually and jointly, on job creation and the accumulation of human and physical assets. These are (i) improving the management of natural resources; (ii) promoting skills development; and (iii) reducing gender bias against women. The SCD also identified a second-tier of priorities: (i) building infrastructure to promote further local and regional integration; (ii) encouraging financial inclusion; (iii) increasing resilience through improved social protection to the poorest; (iv) ensuring fiscal efficiency and macroeconomic stability; (v) building up inclusive and transparent institutions; (vi) promoting competition and private sector development to stimulate efficiency and innovation; and (vii) managing urbanization with efficient urban centers. 41 Sustainable continued growth that facilitates shared prosperity requires the creation of more and better jobs. As the previous section made clear, Burkina Faso’s economy has grown rapidly over recent years and generated employment, but due to the poor quality of jobs created, poverty remains widespread. Many jobs were created to absorb the expanding labor force, but this has primarily occurred in farming and low-productivity activities. Unlocking the economy’s potential for the creation of better jobs remains a key challenge. Non-monetary indicators of living conditions are also poor: in 2014, 80 percent of the population had access to safe water but only 20 percent used electricity as a source of lighting and 5 percent a clean source of energy (electricity or gas) for cooking. Food insecurity (based on caloric intake) affected 43 percent in 2014. III. World Bank Group Partnership Framework 3.1 New Framework for a new Context 42 Fundamental changes have occurred in Burkina Faso since the last WBG CPS. The tale of a once stable, socio-economic context has shifted to the new reality of a country caught squarely in the crosshairs a volatile Sahelian sub-region’s security challenges, while dealing with its own historic and profound political and social mutations brought about by popular discontent. The persistence of poor socioeconomic conditions and growing risks from terrorism and civil unrest are therefore negatively impacting macroeconomic outcomes, putting the Government under pressure to deliver the tangible results promised by the national development plan. 43 With IDA18’s new transformational policy and financial package, the WBG is well positioned to provide meaningful support to Burkina Faso. The WBG’s renewed focus on the IDA18 themes of jobs and economic transformation, gender, climate change, fragility and institutions intersects perfectly with the priorities of the PNDES, as well as with the findings of the SCD. 13 Figure 3: The Determinants of the CPF Focus Areas IDA 18 Priorities - Jobs and Economic Transformation - Gender and Development - Climate Change - Fragility, Conflict and Violence - Governance and Institutions SCD Priorities PNDES Pillars - Improving the Management of - Governance and Institutions Natural Resources - Human Capital Development - Promoting Skills Development - Economic Transformation for - Reducing Gender Bias against Growth and Job Creation Women WBG CPF Focus Areas 1- Accelerate sustainable private-sector led growth for job creation. 2- Invest in human capital and social protection 3- Strengthen governance and support citizen engagement 3.2 The Government’s National Plan for Social and Economic Development (PNDES), 2016-2020 44 The three priorities of the PNDES are good governance and institutions, human capital development and economic transformation for growth and job creation. The PNDES highlights improved governance as its first priority, which will be achieved by reforming institutions and modernizing the administration. Good governance and institutions is to be promoted at the political and administrative level, as well as via better economic management and through meaningful decentralization to local government. The second axis is human capital development. This includes health, education and employment, but also research, water and sanitation, access to energy, housing and urban planning. A reduction in the population growth rate is also envisaged. The third axis supports key sectors for sustainable economic growth and job-creation. This is a comprehensive program involving employment-generating investments in basic economic infrastructure and processing capacity, as well as actions to ensure the economic model’s sustainability and mitigate environmental degradation. 3.3 Lessons from CPS Completion Report, Other Countries and Stakeholder Consultations 45 The CPS PLR identified several lessons which will be taken into account in the implementation of this CPF: x Project Design: Simplicity and clarity of design are important to facilitate implementation. Selectivity at project design toward fewer, prioritized activities reduces transaction costs. Complex multi-sectoral projects tax implementing agencies, especially when there are mixed objectives without strong linkages. Careful assessment of the capacity of all 14 stakeholders is critical. Policy dialogue and public awareness activities are also important to overcoming initial resistance to significant policy reforms. x Adapting to an evolving environment: It is critical to build flexibility into WBG engagement for successful project implementation. Indeed, political developments since October 2014 have highlighted the importance of adaptability, proactivity and flexibility in order to adjust to change and manage uncertainties quickly. In certain circumstances such as heightened insecurity, a quick adjustment by the WBG is necessary to get implementation back on track. x Project Processing: Delays in effectiveness and procurement can be reduced by better preparation of projects before approval. Most recently, approved projects incurred effectiveness delays due to their inability to meet technical and institutional pre- conditions. These issues could be resolved before Board presentation through better use of project preparation advances and by early preparation of terms of reference and specifications. x Monitoring and Evaluation: Project performance can be enhanced by regular contact between project implementation units (PIUs) and supervision missions. Monitoring indicators must be clearly linked to project development objectives (PDOs) and should be specific, realistic and measurable. Baseline indicators should be in place at the outset of the project. PDOs should also be reflected more often in specific outcomes, not just outputs. Involving civil society and academia in the task of monitoring difficult reforms could also speed up achievements. x Stakeholder consultation: Sustained engagement with multiple stakeholders is essential to building demand for and ownership of difficult reforms. The passage of anti-corruption legislation and the Mining Code have been slow and difficult to achieve because of lack of buy-in from key stakeholders; this was also the case for activities in the Bagré growth pole project. x Adaptability: Incorporating flexibility into WBG engagement is critical. Recent political developments have highlighted the importance of flexibility to adjust to changes and manage uncertainties. For example, the dissolution of communal councils and their replacement with Special Delegations slowed down the implementation of the communes’ development plans and other projects related to decentralization. A quick adjustment by the WBG was therefore necessary to get implementation back on track. 46 Lessons were also drawn from other countries. South-South exchanges have informed project design and implementation in Burkina Faso. The Brazil experience, for example, was used in the Government’s safety nets project. Under the Higher Education and Centers for Excellence Regional Project, a government team traveled to South Korea on a higher education mission. Under the Youth Employment and Skills Development Project, a team traveled to Côte d’Ivoire to learn from a similar project. A MEF team was also sent to Uganda and Tunisia to learn from 15 their results-based systems and a group from the Bagré PIU and irrigation canal users traveled to Senegal to learn how their water user associations are organized. 47 While the 2016 Country Survey suggests heightened concern about food security in the country, financial inclusion emerged as a key priority for small and medium enterprise (SMEs) from the latest consultation with private sector. While emphasis on public sector reform remains high, food security and related agriculture and rural sectors feature prominently among respondents as top development priorities. Education, jobs, domestic private sector development and energy are also considered important. Opinion leaders agree overwhelmingly that climate change is now a ‘very big problem.’ When asked how “Shared Prosperity” could be achieved, respondents point to education and training to ensure job opportunity, followed by good governance, economic growth and greater access to micro-finance for the poor. Across most stakeholder groups, the perception is that a key obstacle to reform is inadequate citizen participation. The World Bank’s top weakness in Burkina Faso was identified as overly-complex processes. In late 2017, the Country Office organized consultations around the proposed CPF. Invitees from civil society, the private sector, academics, and local and central government officials attended. The feedback was extremely positive, especially with regards to proposals for large, integrated projects that would create jobs for youth and women, as well as for greater financing for SMEs. 3.4 Overview of WBG Strategy 48 Selectivity filters: The selectivity filters applied to the WBG CPF program for Burkina Faso are: (i) the priorities identified by the SCD to help Burkina Faso reduce extreme poverty and boost shared prosperity; (ii) alignment with the Government’s PNDES; and (iii) scaling up support in key, transformative sectors while leveraging WBG comparative advantage. The proposed CPF is anchored in the broader Sahel Alliance and draws on the lessons of the closed CPS. It has been designed to ensure consistency with fifteen of the Sustainable Development Goals (SDGs) and five of the IDA18 themes. They are identified below in relation to each Country Program objective. i. Alignment with the SCD priorities: The proposed program in the CPF builds upon the diagnostic and recommendations of the SCD. It is broadly aligned with the SCD’s ten priorities towards achieving the twin goals of poverty reduction and shared prosperity through the: (i) creation of a sufficient number of productive jobs to raise incomes at the household level; and (ii) provision of a minimum package of services and physical assets that poor households need to escape poverty (see Table 2 below). ii. Alignment with the Government’s PNDES: Just as the previous CPS did with the SCADD, this CPF has sought both strategic and operational alignment with the PNDES. The process which led to this alignment was built on ongoing dialogue with the authorities, as well as on a long process of consultations, which started during the preparation of the SCD and continued throughout the formulation of the CPF. The three Focus Areas of the CPF are in full alignment with the Government’s vision of achieving structural transformation of 16 the economy through building human capital and strengthening governance and institutions. iii. WBG sector leadership and comparative advantage: The WBG’s ongoing sizable portfolio provides a good basis upon which this CPF will seek to build transformational actions in key sectors for accelerating private sector-led growth for job creation, developing human capital and strengthening governance and citizen engagement. The World Bank is already assuming leadership in Agriculture, Energy, Transport, Mining, Financial sector, Decentralization, Governance, Social Protection and Health/Nutrition. iv. Centrality of IDA18 Special Themes: Building on the ongoing portfolio, the new CPF program puts emphasis on the WBG IDA18 commitments including the focus on climate change, where IDA would play a key role in helping Burkina Faso translate and implement ambitious global agreements like COP21 at the country level; the importance of Bank’s support to addressing fragility, conflict and violence, including in innovative ways to deal with issues upstream to mitigate drivers of fragility; the innovative PSW that could help attract private capital; Jobs and Economic Transformation; Gender; as well as Governance and Institutions. 17 Table 2: WBG Selectivity Filters Filter 1 - SCD Filter 2: PNDES Filter 3: CPF response Binding Constraint Creation WBG comparative - Accelerate sustainable private of productive jobs advantage sector-led growth for job creation Identified priorities - Invest in human capital and social (Through depth of protection systems IDA18 themes SDG portfolio and - Strengthen governance and leadership role) support citizen engagement Insufficient creation of 1. Improve Natural Resource √ Focus Area 2: WBG leadership in: 1: Improve agriculture productivity SDG 1 productive jobs for Management Human capital and competitive value chains √ Agriculture SDG 2 sustainable growth 2. Promote Skills Development development 2: Improve energy access 3. Reduce Gender Bias against √ Energy SDG 3 3: Improve connectivity for better Women access to markets. 4. Build Infrastructure to √ Transport SDG 4 - Weak agricultural Focus Area 1: 4: Promote SMEs and access to Promote Further Local and inclusive finance performance: crops, cotton √ Institutional Mining 1: Jobs and Economic SDG 5 and livestock Regional integration reform and 5: Address management of Transformation - Undynamic non-farm 5. Encourage Financial Inclusion √ modernization of Financial sector SDG 6 extractives and sustainability of private sector 6. Increase Resilience through the public natural resources. Improved Social Protection to √ Decentralization SDG 7 administration 6: Support inclusive, high-quality the Poorest 2: Gender and √ Governance education and skills development SDG 8 7. Ensure Fiscal Efficiency and Development 7: Expand access to reproductive Insufficient access to a Macroeconomic Stability Social Protection SDG 9 and child health services and minimal package of physical 8. Build Inclusive and improved nutrition assets and social services Transparent Institutions √ Health/Nutrition SDG 10 Focus Area 3: 8. Expand social protection to the 3: Climate Change 9. Promote Competition and Boost sectors most vulnerable SDG 11 Private Sector Development with strong 9: Expand access to water and - Weak delivery of social to Stimulate Efficiency and √ economic and SDG 15 sanitation services 4: Fragility, Conflict services Innovation employment 10: Strengthen domestic resource and Violence SDG 16 - Unequal provision of 10. Manage Urbanization potential mobilization and public expenditure infrastructure with Efficient Urban Centers management - Extreme vulnerability 11: Strengthen citizen engagement 5: Governance and and public-sector accountability Institutions 12: Support decentralization 18 49 The proposed strategy builds on the three top priorities identified by the SCD: x Priority 1: Improving natural resource management - Burkina Faso must focus on its two main assets: land (soil) and mineral resources. It must also prioritize two scarce resources: water and energy. Good land management is crucial to developing a sustainable, commercial agricultural sector and increasing economic density in rapidly-expanding cities. Mining can help create synergies through joint infrastructure development projects and technological transfers, as well as contribute to raising public revenue. Good water and energy management is necessary to ensure sustainable development and better living conditions. Water is especially exposed to risks associated with extreme natural events and climate change. x Priority 2: Promoting skills development - About three-quarters of the labor force has never participated in formal education. In addition, the educational system continues to perform sub-optimally, with low rates of return and ineffective allocation of resources. Without a well-functioning educational system, the population cannot acquire the necessary skills to participate in productive employment. Unless they engage in productive employment, they cannot earn adequate incomes. x Priority 3: Reducing gender bias against women - Women are systematically disadvantaged in the education system and the labor market, experiencing relatively more difficulties in accessing land and owning productive assets. Meanwhile, Burkina Faso's fertility rate remains one of the highest in the world. Both economic and cultural factors are significant in determining these challenges. Unleashing the potential of women-owned farms and businesses and implementing a well-functioning family planning system are therefore essential to creating more productive employment and improving socio-economic conditions. 50 To further strengthen alignment with the SCD, this CPF is informed by an analysis of the spatial intersection between the distribution of the ongoing portfolio and CPF pipeline and the distribution of poverty (Annex 3). The ongoing portfolio in human development and social protection systems reaches some of the poorest areas in the country, particularly in the North- West (Figure 4). This pattern highlights the World Bank’s objective of expanding basic services such as health and education, water and sanitation, as well as social protection, to the poorest and most vulnerable. The analysis shows that WBG investments is highest in the two provinces with the country’s largest cities, Kadiogo and Houet provinces (Figure 4). A significant budget expenditure has also been allocated to the North-West, which suffers from both high poverty- headcounts and high concentration of the poor. Figure 4: Spatial distribution of the World Bank’s operations portfolio by the number of projects in Focus Area 2 51 The strategy also draws on the priorities identified in the PNDES and IDA18 and addresses the SDGs. The result is a strategy framed around three focus areas: accelerating sustainable, private sector-led growth for job creation, investing in human capital and social protection systems and strengthening governance and supporting citizen engagement. Gender considerations will play a central, cross-cutting role in the strategy. 52 As shown in Figure 5 below, each Focus Area has a set of objectives. The first priority of the SCD is reflected in the proposed CPF Focus Area 1, to accelerate sustainable private sector- led growth for job creation. Natural resource management will be enhanced via Objective 1.5 to increase sustainable agricultural productivity and Objective 1.1 which aims to address the management of extractives and natural resource sustainability, where security of land tenure and forest management will be highlighted. Energy and water management will be covered under Objective 1.2 related to improving energy access through renewables, as well as objective 1.5. 20 Figure 5: Snapshot of the Burkina Faso CPF Focus Area 1 Focus Area 2 Focus Area 3 Accelerate sustainable private Invest in human capital and Strengthen governance and sector led-growth for job social protection systems support citizen engagement creation Objective 1.1: Improve agriculture Objective 2.1: Support inclusive, Objective 3.1: Strengthen productivity and agribusiness high- quality education and skills domestic resource mobilization value chains in targeted areas development and public expenditure management Objective 1.2: Improve energy Objective 2.2: Expand access to Objective 3.2: Strengthen citizen access reproductive and child health engagement and public- sector services and improved nutrition accountability Objective 1.3: Improve Objective 2.3: Expand social Objective 3.3: Support connectivity for better access to protection to the most decentralization markets vulnerable Objective 1.4: Promote SMEs and Objective 2.4: Expand access to access to inclusive finance water and sanitation services Objective 1.5: Address management of extractives and sustainability of natural resources 53 The link between the second and third SCD priorities is also very clear. The promotion of skills – the second SCD priority – will be accomplished through Objective 2.1 of Focus Area 2 – supporting inclusive, high-quality education and skills development. Reducing gender bias against women – the third SCD priority – will be directly tackled through Objective 2.2. of expanding access to reproductive and health service and nutrition, as well as Objectives 2.3 and 2.4 which seek to expand social protection and access to water and sanitation services. Gender concerns, meanwhile, will be addressed throughout all the objectives. 54 The SCD also identified seven second-tier priorities. These represent additional priorities resulting from the constraints analysis but were ranked lower in the consultative process. In some instances, and as the SCD underscores, this may be because stakeholders are less directly affected by them, for example, in the case for fiscal efficiency and macroeconomic stability. Objective 3.1 - strengthening domestic resource mobilization and public expenditure management - under Focus Area 3 aligns with Priority 7 of the SCD. All of these are captured in the objectives of the CPF, as discussed in the next section. 55 International Finance Corporation (IFC) updated corporate strategy, “IFC 3.0”, will reinforce the WBG’s systematic and sequenced approach to market creation, scale up private sector solutions and catalyze private capital. In the spirit of the Maximizing Finance for Development (MFD) principles, the WBG will aim to promote private sector-minded regulatory reforms, pursue upstream engagement with the private sector, and foster synergetic joint 21 interventions in selected sectors. World Bank engagements would accompany IFC’s interventions designed to build momentum for private sector-oriented reforms, address the key impediments to private sector development, and raise domestic private sector capacities. IFC’s Creating Markets Advisory Window could be used to build private sector capacity. The WBG is undertaking a Country Private Sector Diagnostic to showcase under which circumstances increased private sector investment would help promote development objectives. The WBG is also supporting Burkina Faso’s with its G20 Compact with Africa with the objective of strengthening the country’s attractiveness to foreign investors. Table 3: SCD Proposed Pathways, Actions and CPF Operational Response Priorities Relevant CPF Objective Priority 1. Improve Natural Resources Management 1.5 First tier Priority 2: Promote Skills Development 2.1 Priority 3: Reduce Gender Bias against Women 2.2, Cross-Cutting Priority 4. Build Infrastructure to Promote Further Local and 1.2, 1.3 Regional integration Priority 5. Encourage Financial Inclusion 1.4 Second tier Priority 6. Increase Resilience through Improved Social Protection to 2.3 the Poorest Priority 7: Ensure Fiscal Efficiency and Macroeconomic stability 3.1 Priority 8: Build up Inclusive and Transparent Institutions 3.2, 3.3 Priority 9: Promote Competition and Private Sector Development to 1.4 Stimulate Efficiency and Innovation Priority 10: Manage Urbanization with efficient urban centers 1.3, 2.4 22 3.5 Development Objectives supported by the WBG program7 Focus Area 1: Accelerate sustainable private-sector led growth for job creation Relevant Sustainable Development Goals: SDG 1: End poverty in all its forms everywhere SDG 2: End hunger, achieve food security and improved nutrition, and promote sustainable agriculture SDG 5: Achieve gender equality and empower all women and girls SDG 7: Ensure access to affordable, reliable, sustainable and modern energy for all SDG 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all. SDG 9: Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation SDG 11: Make cities and human settlements inclusive, safe, resilient and sustainable SDG 13: Take urgent action to combat climate change and its impacts SDG 15: Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification and halt and reverse land degradation and halt biodiversity loss Relevant IDA 18 Special Themes: Special Theme 1: Jobs and Economic Transformation Special Theme 2: Gender and Development Special Theme 3: Climate Change Relevant PNDES Strategic Focus Areas: Focus Area 3: Boost sectors with strong economic and employment potential Objective 1.1: Improve agriculture productivity and agribusiness value chains in targeted areas 56 Agriculture remains the foundation of the Burkinabe economy. This sector employs 80 percent of the labor force and has much untapped potential. Only half of arable land is currently cultivated and just 12 percent of the country’s irrigated potential is developed, while yields could be greatly improved. Livestock-raising is widespread, with much room for increased value-added. With most of the poor living in rural areas, poverty reduction begins with rural development. The main challenges for the expansion of commercial agriculture are fertilizer, seeds and water. 57 The World Bank is placing renewed emphasis on livestock development. Burkina Faso has a comparative advantage in livestock because: (a) it contributes about 35 percent of the agricultural GDP; (b) its contribution to food and nutrition security is considerable; and (c) the export value of live animals, hides and skins more than compensates for milk and dairy, chicken and egg imports, resulting in an overall positive trade balance for livestock products. 58 The World Bank will step up support to agriculture through its existing portfolio and a strong pipeline. The Agricultural Productivity and Food Security and the Agricultural Diversification and Market Development projects have been working for years to improve the capacity of poor producers in order to increase food production and marketing, including animal products. These are being supplemented by two recent livestock projects: (i) the Regional Sahel 7 The CPF lending envelopes for years beyond FY18 are indicative only. Referenced IDA18 volumes are indicative. Actual PBA allocations will be determined annually during the FY18-20 period and will depend on: (i) total IDA resources available; (ii) the number of IDA-eligible countries; (iii) the country’s performance rating, per capita GNI, and population; and (iv) the performance and other allocation parameters for other IDA borrowers. Availability of SUF resources is subject to availability and approval by the World Bank. 23 Pastoralism Support Project finances activities in Burkina Faso aimed at animal health improvement, rangeland and water management, market access facilitation and pastoral crisis management in the six regions bordering Mali and Niger; and (ii) the Livestock Sector Development Support Project is a complementary national project focusing on sedentary livestock systems. Another regional project (REDISSE) is supporting better surveillance of animal (and human) diseases. 59 Water management is critical to increasing agricultural productivity and food security . The joint World Bank–IFC Regional Sahel Irrigation Initiative Support Project aims to expand irrigated agriculture that is productive, sustainable and profitable, following the Dakar Declaration of the High-Level Forum on “Building Resilience and Accelerating Growth in Sahel and West Africa through Scaling-up Irrigated Agriculture” in 2013. The objective is to increase the irrigated surface in the Sahel from 400,000 hectares to 1 million hectares by 2020. The project creates a regional collaborative platform of technical assistance, knowledge, and data sharing, along with an output-based aid (OBA) scheme to help cotton producers become more resilient to short drought episodes. Additional cash crops, such as sesame and cashew, are also being considered. The project is funded by the Global Partnership for OBA and managed by IFC advisory services. IFC will promote PPP and infrastructure investments related to water/agriculture, as well as encourage uptake of private sector irrigation technologies through an integrated market development model. In addition, IFC hopes to develop innovative equipment and input-financing solutions through partnerships with local financial institutions. 60 Improved meteorological, hydrological and climate information and services (hydromet) can enhance agricultural productivity, reduce loss of production and promote food security. The new Strengthening Climate Resilience in Burkina Faso Project will support the modernization of hydromet services both at the national and regional level. The project will work with national and regional counterparts to support: i) capacity building and institutional development; ii) improvement of hydromet and early warning infrastructures; and iii) enhancement of service delivery and early warnings to communities and sectors, with a specific focus on agriculture and civil protection. The project will contribute to a more nuanced picture of the food-water nexus and facilitate the development of integrated mechanisms to prepare for, cope with, adapt to and recover from extreme natural disasters and climate change. 61 The structural transformation of agriculture will receive additional support from other projects. The Bagré Growth Pole Project supports sustainable agriculture and associated non- farm activities, with components to develop 5,500 ha of irrigated land and support livestock- raising and fish processing, while improving the investment climate, and services for farmers, SMEs, and eventually large agricultural producers. Additional funding will be provided in FY18 for road infrastructure, electric power, cash transfers for women entrepreneurs, job creation for women, health care for poorest households, and diagnostics for an industrial park. IFC plans to explore direct financing to larger producers and to SMEs through credit lines in local banks. The new Integrated Agriculture Development Program, meanwhile, will increase agribusiness services to farmers and SMEs; develop access to technological packages for increased yields; increase warehousing, transformation and access to national, regional and international markets; 24 and build feeder roads. The Regional West Africa Agriculture Transformation Project will strengthen the agricultural innovations system to facilitate mass adoption of climate-smart technologies by producers, enhance job creation for youth, and promote regional exports. Farmers’ access to key information, such as market prices and weather data, will be supported by the eBurkina Project. A new project will support the enhancement of meteorological, hydrological and climate services at the national and regional level. 62 IFC will seek new opportunities to finance SMEs along agribusiness value chains. IFC has existing trade finance lines with Ecobank and Coris Bank, and risk sharing facilities with United Bank for Africa Burkina and Bank of Africa Burkina to support SMEs, including in the agribusiness sector. IFC plans to continue to seek opportunities like these, through financial intermediaries and private equity funds, to support SMEs and the agribusiness sector. It will also explore alternative financing solutions, such as leasing. IFC plans to continue to use the IDA18 PSW for the first loss portion of risk sharing facilities with local banks to promote SME lending as it did with Bank of Africa Burkina. 63 IFC will also target large agribusiness interests. IFC is currently financing the Société Burkinabe des Fibres Textiles (SOFITEX), the largest cotton company in Burkina Faso, to support the timely payment for seed cotton procured from smallholder farmers. This financing provided under the Global Warehouse Finance Program is accompanied by a technical assistance (TA) project for water management, supplemental irrigation, and access to finance for 1,000 farmers. IFC will continue to seek similar opportunities to support large-scale commercial farming, as well as the modernization of the livestock value chain. Objective 1.2: Improve energy access 64 Burkina Faso has one of the lowest electrification rates in sub-Saharan Africa at 19 percent, standing at just 4 percent in rural areas. Electricity tariffs are very high (24 cents per kWh), yet do not cover the full cost of service. The resulting quasi-fiscal deficit represented 1 percent of GDP in 2014. The country’s high dependency on imported hydrocarbons for power generation results in significant exposure to fluctuating international oil prices and an extended logistics chain that is prone to disruptions. The Government aspires to provide secure and affordable electricity to all its urban, and 40 percent of its rural, population by 2025. There are two main challenges: (i) shifting the energy mix toward least-cost sources – imports and solar power – procured in a timely, transparent and cost-effective manner; and (ii) reducing the reliance on budget transfers through fuel subsidies. 65 The Electricity Sector Support Project received additional funding in 2017 to expand three components: (a) the introduction of low-cost solar resources; (b) reinforcement of the network to allow for integration of more intermittent solar power; and (c) TA for capacity building and transaction advisory services to develop independent power producer (IPP) projects. A small biogas project is promoting the use of bio-digesters, which will be further supported through new livestock development projects. 25 66 To complement direct investments, the World Bank financed a programmatic series of Development Policy Financing (DPF) operations to support energy and fiscal reforms. The series aimed at: (i) improving the financial sustainability of the energy sector; (ii) enabling private sector participation in the energy sector and diversifying the energy mix; and (iii) strengthening tax collection and public procurement processes. 67 The World Bank will support the sector through two new projects. It will improve access to affordable electricity imports through the First Phase of the Inter-Zonal Transmission Hub Project of the WAPP (North Core Regional Transmission Project) to facilitate trade between Niger, Nigeria, Benin and Burkina Faso. An Energy Access Project will improve services in targeted areas, notably rural, as well as a decentralized approach with renewable/hybrid systems. The project will comprise network extension to new localities, mini-grids and off-grid electrification in rural areas and the extension of existing peri-urban distribution systems. The project will also cover preparation of a masterplan for rural electrification. The World Bank will also support the feasibility study of a solar park in Burkina Faso. 68 As part of the WBG energy strategy, IFC plans to continue to support the sector. IFC arranged € 25 million in debt financing for Zina Solaire, a 27 MW solar IPP project and the first on-grid IPP to reach financial close in Burkina Faso. Multilateral Investment Guarantee Agency (MIGA) is also considering support for this project through its traditional political risk insurance covers. IFC also invested € 1 million of equity for early-stage development in a 17 MW solar IPP, Scatec Solar, and is mandated to arrange debt financing for the project. While working closely with the World Bank, IFC plans to seek other investment opportunities to promote private solutions, including through upstream engagements to support sector reforms, planning, and financial sustainability. Over the medium to long term, IFC could consider a Scaling Solar program, photovoltaic-tied storage, regional solar parks, and solar home systems/mini-grids. The IFC Risk Mitigation Facility and MIGA Guarantee Facility of the IDA18 PSW may be used to support such projects. Objective 1.3: Improve connectivity for better access to markets 69 Poor access to transportation and deficient transport infrastructure conditions affect private sector productivity. Due to its land-locked nature, Burkina Faso faces high transport costs combined with transport service delivery inefficiencies. The sector faces major constraints which include: i) inadequate investment in tertiary (rural) road networks causing inadequate rural mobility and connectivity; ii) inadequate road maintenance funding and truck overloading causing premature deterioration of road asset stock; iii) Non-tariff Barriers (NTBs) and port inefficiencies affecting performance of key regional road transport corridors; and iv) lack of intermodal transport systems (road-rail-air) leading to higher-than-necessary transport costs. 70 Urban mobility and linkages with rural hinterlands are becoming increasingly acute issues in light of high population growth in primary cities. For the two largest cities (Ouagadougou and Bobo-Dioulasso), which are growing at a rate of about 5 percent p.a., poverty reduction and job creation will require adequate urban logistics and public transportation. Rural 26 areas must be linked by good roads to towns, and small towns to the main cities, for internal trade to play its role in promoting competitiveness. The Donsin Transport Infrastructure Project is building the road infrastructure to link Ouagadougou to a proposed new airport, while supporting peri-urban development in the process. The Transport and Mobility Project will build on the Transport and Urban Infrastructure Development Project (TUDIP), to continue addressing urban mobility in Ouagadougou, and also improve connectivity with rural hinterlands through the development of economic corridors. The Transport Sector Modernization and Corridor Trade Facilitation Project will help address Burkina Faso’s land-locked constraint, by improving the efficiency and safety of road transport services on the Burkinabe side of the Ouagadougou- Abidjan corridor. This is being implemented in parallel with a similar project in Côte d’Ivoire and provides follow-up implementation of reforms supported under an innovative regional DPF series. 71 As the country urbanizes, it is critical to address urban inclusiveness and unlock the potential of urban areas for job creation and economic growth. A two-year programmatic ASA will run parallel to ongoing projects to deepen knowledge of the role cities play in the Burkinabe economy, as well as the drivers of migration and the barriers to inclusive urban growth. Building on initial work on sector governance carried out under the TUDIP, this ASA will lead to a spatially- integrated Urbanization Project. The project will strengthen institutions for urban governance, land management and integrated urban planning and land use. 72 IFC, working closely with the World Bank, plans to explore PPP projects. IFC will seek investment opportunities in areas such as airport, rail and broadband, all of which could benefit from the IDA18 PSW. On the advisory side - subject to government interest - IFC could provide advisory services for private sector participation in state-owned entities to improve their financial and operational sustainability. Together with the Public-Private Infrastructure Advisory Facility and the World Bank, IFC will continue to support the Government in the review of the legal, regulatory and institutional framework, and the Government’s PPP project list, and provide detailed analysis of the two most viable projects and PPP capacity building. MIGA is also open to support foreign investors into PPP projects, who are concerned about risks of Transfer Restriction, Expropriation, Breach of Contract and War and Civil Disturbance. As well as currently looking at opportunities into the energy sector, in the past, MIGA has supported foreign investment into the country’s tourism sector. Objective 1.4: Promote SMEs and access to inclusive finance 73 Domestic credit to the private sector represents less than 30 percent of GDP in Burkina Faso. Limited access to long-term funding is hurting the competitiveness of firms and their ability to create jobs. Less than 15 percent of adults have access to a bank account (just 12.6 percent of female adults) and less than 5 percent formally borrow from a financial institution (3.5 percent of female adults). Reasons for low financial intermediation include conditions in the financial sector which remain challenging and structural constraints (high-yielding government securities and inadequate financial infrastructure). Regional authorities are mindful that stability risks need 27 to be contained and financial deepening needs to be promoted. Burkinabe authorities agree that measures should be taken to ensure that these structural constraints are addressed. 74 IFC plans to continue to seek funding to support the improvement of Burkina Faso’s investment climate. IFC, together with the World Bank, will seek ways to assist the Government to regain momentum in its Doing Business reforms, in line with the country’s commitment to feature among the top reforming nations. 75 The eBurkina Project will reinforce existing business incubators and tech hubs. This will provide a critical mass of local entrepreneurs with affordable and reliable access to broadband internet, office space, training, business support services, and business incubation in a single facility. It will also develop techno-logical and entrepreneurial skills and knowledge for local content production. Communication services will be enhanced through additional financing for the WARCIP-Burkina Faso project, by extending access to broadband networks. 76 Two new joint World Bank-IFC projects will improve financial inclusion. The regional WAEMU Affordable Housing Finance Project will enable a regional mortgage refinancing company to increase the capacity of bank and non-bank financial institutions to provide small housing loans on a longer term to underserved clients, including the informal sector and low- income households. The Burkina Financial Inclusion Project will increase access to financial services for SMEs and households by: i) ensuring the availability of long term finance to market lenders, including leasing practitioners; ii) introducing more effective de-risking mechanisms, and iii) supporting the digitalization of payments to encourage financial inclusion. Burkina Faso will continue to benefit from IFC’s broader efforts to disseminate inclusive private sector solutions across West Africa, foster partnerships, trade, and capital flows. Burkina Faso is also expected to benefit from IFC’s anchor financing and advisory services to the Caisse Regionale de Refinancement Hypothecaire (CRRH), a mortgage refinancing company tasked with addressing housing needs in the WAEMU zone. In addition, the WBG plans to support development of local capital markets in WAEMU through the Joint Capital Markets Program (J-CAP). This program will mobilize the collective expertise of the Group to help provide additional domestic financing sources to fill the large gap in key sectors such as infrastructure, housing and climate. This engagement will involve advisory and analytical work, structuring and delivering key demonstrative financial transactions, and knowledge dissemination to attract additional private sector interests. 77 IFC will continue to focus on supporting under-served SMEs. IFC will prioritize long-term financing to local financial institutions and private equity funds, as well as products such as trade finance, risk-sharing facilities, leasing and warehouse financing. In addition to its active lines in banks (Coris Bank, Ecobank, United Bank for Africa and Bank of Africa), IFC plans to provide advisory services to support financial institutions. IFC will also explore strengthening credit bureaus, collateral registries, and the regulatory framework. 78 The eBurkina Project under the World Bank will reinforce existing business incubators and tech hubs. The Bagré Growth Pole Project is improving the business environment and 28 promoting SME development in the Bagré region. Furthermore, the importance of SMEs in the much-needed diversification of the country’s economy justifies the increased attention SME lending has received from the new Government. The country counts several state-backed SME- focused initiatives, although most have had limited success. In 2017, about 75 percent of SMEs interviewed via the World Bank SME finance survey for Burkina Faso considered access to finance their biggest growth constraint. When financing is available, it is often very short term. In this context, the IFC proposal to provide support to local commercial banks is intended to help address a critical need. Objective 1.5: Address management of extractives and sustainability of natural resource 79 The SCD highlighted the necessity to carefully manage the growth of the extractives sector. As many Burkinabe citizens are still waiting to see the material benefits of the recent discovery of minerals, the SCD suggested three complementary actions: (i) maximizing joint investment projects in infrastructure, such as roads and energy, through smart partnerships between multinational companies and the State (including communities); (ii) creating synergies through the development of backward and forward linkages between large multinational firms and local SMEs; and (iii) securing tax and non-tax revenue and using these resources efficiently through the implementation of fair and transparent mechanisms. 80 Going forward, Burkina Faso must move away from attracting mineral investments to leveraging the mining sector for sustained socio-economic development. For the sector to further boost the economy, the Government has set the following objectives: a) leveraging the mining sector for economic inclusion and diversification; b) formalizing artisanal mining to enable the estimated one million artisanal miners to adopt better practices; and c) improving governance and environmental and social sustainability. The World Bank will assist with a new operation to help leverage backward and forward linkages and corporate social responsibility (CSR) initiatives for SMEs, as well as improve local livelihood/community development and employment stimulation beyond the mining supply chain. Opportunities for efficient use of revenues earmarked for local communities and joint investment projects in infrastructure with the private sector will also be promoted. 81 IFC will continue to seek opportunities in the mining sector. IFC has invested over US$41 million in Burkina Faso’S mining sector in in the past few years including its most recent investment in Roxgold for the Yaramoko gold mine. Given the importance of the sector to Burkina Faso, IFC will continue to seek opportunities where it has a role. 82 Sustainable land and forest management are crucial for the long-term development of the agricultural sector and resilience to climate change . Forest conservation serves multiple purposes: erosion control, firewood and charcoal production for energy services, and non-timber forest products (e.g. bush meat, shea nut, food supplements, medicinal plants). Sound participative land use zoning and improved land governance reduce degradation and conflict over resources. These social processes are key underlying conditions for the development of 29 integrated agribusiness and livestock practices and a more productive and sustainable agricultural system. 83 Burkina Faso is a weak carbon-emitting country but is nevertheless highly vulnerable to climate change. The country is confronted with the degradation of ecosystems, the recurrence of food crises and adverse impacts of climate change on the environment, populations and livestock. Building on an earlier National Action Program for adaptation to climate change and variability, the Government has initiated a comprehensive approach to adaptation to climate change - the National Adaptation Plan. This plan is based on analysis of the vulnerability of priority sectors (agriculture, livestock, water, forests and natural ecosystems, energy, infrastructure and housing, health, etc.) for climate change scenarios in the 2025-2050 timeframe. Burkina Faso’s Nationally Determined Contribution (NDC)commitment comes about through three scenarios: i) a first scenario, Unconditional, the objective of which is to reduce Greenhouse Gas (GHG) emissions by 7,808 Gg per year in 2030, for ongoing investments of US$1.25 billion; ii) a Hybrid Conditional scenario, which aims to reduce GHG emissions by 11.6 percent, for investments of US$756,032,667; and a third scenario, Adaptation, which aims, among other things, to restore and develop 5,055 million ha of degraded lands at the 2030 horizon, corresponding to 55 percent of the total current area of degraded lands in the country and making it possible to feed more than 6 million additional persons at the 2030 horizon. 84 The Forest Investment Program and Climate Change agenda is supported by multiple Trust Funds. These include the Strategic Climate Fund, Forest Carbon Partnership Facility REDD+ 8 Readiness Grant, Terrafrica, Ci Dev. These are being used to test multiple approaches to sustainable natural resource management on a large scale, with a focus on: (i) participatory land governance; (ii) land tenure security; (iii) improvement of integrated production systems and (iv) reduction of forest and land degradation. Current operations are executed either through communes (Decentralized Forest and Woodland Management Project), local communities (Local Forest Communities Support Project) or the private sector (shea butter, bio-digesters). The lessons learned from these projects are helping the Government design a large investment program to reach PNDES objectives of reducing greenhouse gas emissions by 8 million tons eqCo2 and restoring 25,000 ha of degraded land by 2020, while supporting the decentralization process and improving land governance. This will help the country honor international commitments through its NDC to combat climate change. The pipeline Communal Climate Action and Landscape Management Project will aim to promote a green economy as a way to reduce both poverty and greenhouse gas emissions. By consolidating and expanding the results of the Forest Investment Program, the project will improve the practices and enabling environment for a decentralized and participative forest and landscape management, thereby reducing poverty, increasing climate resilience and developing selected low-carbon value chains (including shea butter). 8REDD+: Reducing Emissions from Deforestation and forest Degradation, conserving ecosystems, managing forests sustainably, and enhancing forest carbon stocks (e.g., through reforestation or forest regeneration). 30 85 The WBG will support Burkina Faso in establishing a country profile for Climate Smart Agriculture (CSA) and achieve its NDCs. The CSA profile will be crucial to responding to the following questions: (i) what is the nature and extent of current and future climate risks; (ii) what are the most important climate variables that targeted sectors may be sensitive to; (iii) what risk management strategies are being used to deal with current climate variability, what are the gaps; (iv) what are the promising CSA practices, and the priorities; (v) what are potentialities and barriers to the adoption of CSA; and (vi) what are the financing instruments available to finance CSA. Burkina Faso’s NDCs have identified agriculture, energy (including the transportation sector), waste, industrial processes, land use, land use changes and forestry and the reduced climate change impact from agriculture, waste and energy sectors as sectors for Mitigation Action. Identified Sectors for Adaptation Action are agriculture, energy, health, land use, land use changes and forestry, urban and water. The WBG proposed program will support the areas aligned with the Focus Areas. Focus Area 2: Invest in human capital and social protection systems Relevant Sustainable Development Goals: SDG 1: End poverty in all its forms everywhere SDG 3: Ensure healthy lives and promote wellbeing for all at all ages SDG 4: Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all SDG 5: Achieve gender equality and empower all women and girls SDG 6: Ensure availability and sustainable management of water and sanitation for all SDG 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all SDG 10; Reduce inequality within and among countries Relevant IDA 18 Special Themes: Special Theme 5: Governance and Institutions Special Theme 2: Gender and Development Special Thee 4: Fragility, Conflict and Violence Relevant PNDES Strategic Focus Areas: Focus Area 2: Human capital development Objective 2.1: Support inclusive, high-quality education and skills development 86 More intense investments in post-primary education, improved and relevant curriculum and staffing are urgently required to better align human development responses to the country’s economic needs and the job market. The Government's new Education Sector Plan (ESP) for 2017-2030 includes strategies for increasing access to and improving the quality of education at all levels, in line with the transformative needs of the economy and recognizes the problems of low quality of education and training provision, underscoring the key constraints of the education service delivery system: (i) formal basic education suffers due to overcrowding and low quality; (ii) low quality of non-formal education with regard to gender inequalities; (iii) mismatch between the supply of and demand for technical and vocational education and training (TVET); (iv) ongoing crisis in tertiary education due to low quality, limited relevance and inefficient investments; and (v) weak management of the education system as a whole. To address these constraints, the ESP provides a framework for achieving priority education outcomes by 2030. Among other objectives, a key area of emphasis in the Government’s strategy 31 is to adapt higher education to the needs of the economy and to strengthen overall governance to ensure that resources are translated into tangible results. 87 Skills development emerged as a top priority in the SCD. The unemployment rate exceeds 25 percent for educated youth due to the mismatch between the education system and private demand. The Education Access and Quality Improvement Project has two objectives: (a) to increase access to pre-school education in the two poorest regions, and to secondary education in the five poorest regions; and (b) to improve teaching and learning, with a focus on secondary education. Among the new secondary schools to be constructed, two will specialize in science education. A complementary project covers skills development, providing training, apprenticeships and literacy instruction. Emphasis is placed on the largest cities, but there is also a rural component. The institutional capacity of the ministry responsible for primary education is being strengthened through the Public-Sector Modernization Project, while its accountability mechanisms are being developed in the Economic Governance and Citizen Engagement Project. Substantial additional support for primary education is provided by the Global Program for Education. 88 Higher education is supported through a regional project and a national one. Improvements in education and health services require better trained teachers, doctors and nurses, and therefore strengthened post-secondary training programs for such professions. More generally, the poor quality of higher education has resulted in a mismatch between supply and demand in the labor force, and high levels of un- and under-employment among graduates. This is a huge economic loss to the country that is only worsening as the university population expands by 11 percent per annum. With little support from other donors, it is important for the World Bank to tackle this key link in the education chain. The Centers of Excellence Project has funded the International Institute for Water and Environmental Engineering, and Burkina Faso is expected to participate in the next phase of this program. A new national Higher Education Support Project is under preparation. The Sahel Irrigation Initiative Support Project will enhance vocational training capacity to increase the viability of irrigation and harness the potential for scale-up in the Sahel. Objective 2.2: Expand access to reproductive and child health services and improved nutrition 89 Burkina Faso is progressing well towards achieving its national health goals. Difficulties remain, however, including under-five malnutrition, high disease burden and vaccine- preventable diseases, which are among the main causes of infant mortality (under-five mortality rate: 81.7/1,000 live births and infant mortality rate: 42.6/1,000 live births). The country also faces a high prevalence of stunting (30 percent) and acute malnutrition (10 percent). Nearly half the deaths among children under 5 are still due to preventable diseases such as malaria, acute respiratory infections and diarrhea. Over one-third of child deaths, meanwhile, are due to under- nutrition, mostly from increased severity of diseases even though the rate of fully-immunized children reached 85 percent in 2014. HIV prevalence appears to be stabilizing (0.8 percent). 32 90 The Reproductive Health Project aims to improve the utilization and quality of maternal and child health, reproductive health, and HIV/AIDS services. It promotes activities that build the poor’s resilience to health shocks and supports interventions that address the needs of groups vulnerable to HIV/AIDS. The Sahel Women’s Empowerment and Demographics Project aims to increase women and adolescent girls’ empowerment and their access to quality reproductive and health services. Community-level services for the prevention and treatment of malaria and selected neglected tropical diseases in cross-border areas are being supported through a regional project for the Sahel. Two other regional projects are focused on health issues. The REDISSE Project, meanwhile, is designed to improve the availability of quality and safe medicines and vaccines in the Economic Community of West African States (ECOWAS) market by strengthening and harmonizing regulatory systems, improving efficiency and enhancing transparency in medicine, and vaccine registration. This will strengthen national and regional capacity for collaborative disease surveillance and epidemic preparedness. The new Service and Regional Disease Surveillance System Enhancement Project will seek to optimize health services with special emphasis on maternal, child and adolescent health, nutrition, and health security. Additional resources will be mobilized through the Global Financing Facility for Every Women, Every Child. The Health Services Reinforcement Project under preparation, finally, will seek to increase the quality and utilization of health services with a particular focus on maternal, child and adolescent health, nutrition and disease surveillance. 91 For activities targeting the Early Years, the operational portfolio in Burkina Faso includes two projects with specific funding for activities totaling US$27.5 million. These are the Education Access and Quality Improvement Project , which has a preschool component focusing on: (i) the development and delivery of an IAI program; and (ii) the piloting of a formal short- track teacher training program; the Reproductive Health/HIV-AIDS Project, which is funding the acquisition of equipment for pediatric services and laboratories and the Social Safety Net Project, which provides cash transfers to poor households for 36 months and includes community outreach on a variety of topics such as nutrition, child care and incoming-generating activities. The Health Nutrition and Population Impact Evaluation, to be completed by FY18, is a key analytical effort that is assessing information and awareness-raising activities on nutrition and young children’s development. 92 Through its Health in Africa initiative, IFC is helping to improve access to health services for poor people and unlock investments through PPPs. The objective of this advisory service is to reduce barriers to private participation in health, through regulatory and policy reforms, unlock investment in the sector and provide better quality health services. The project is expected to increase access to quality health services for over 150,000 people (of which, 100,000 will be women and youth) and unlock at least US$3 million in PPP investments. Objective 2.3: Expand social protection to the most vulnerable 93 Burkina Faso’s poverty structure should respond well to safety net interventions . Individuals are concentrated between the poverty lines of US$1.90 and US$3.10. Therefore, a targeted effort to elevate the consumption of this group could lift many people above the higher 33 poverty line. However, there is also a need to prevent households from falling into poverty as a result of shocks. The 2014 Household Survey shows that a shock, whether related to climate/harvest, health or otherwise, reduces the expenditure of an affected household on average by 11 percent. 94 Adaptive social protection is an appropriate instrument in these circumstances. The Social Safety Net Project was approved in 2014 and received additional funding for an adaptive component in 2016. Adaptive safety net systems aim to protect poor and vulnerable households from climate-related and other shocks before they occur or help them cope with the impact of these shocks by building resilience. This project has two main components: (a) cash transfers and awareness building for poor households; and (b) elements of a basic national safety net system, such as targeting, registration, a payment system and a management information system which has the potential to grow into a national unified registry for all social protection programs. The additional financing expands the initial program of 42,000 households by another 11,000. Further financing will also enable expansion into the country’s Sahel region. In addition, the Youth Employment and Skills Development Project is organizing labor-intensive public works to provide cash-for-work for out-of-school youth. The Public-Sector Modernization Project supports reforms in the labor ministry focused on social security. 95 Burkina Faso is now home to over 34,000 refugees, primarily from Mali. Most of these refugees (87 percent) do not wish to return, primarily because the majority are Tuareg and therefore do not feel welcome in Mali. Eighty percent are women and children. Almost all refugees are living in the poorest region of Burkina Faso – Sahel – which suffers from its own security threats. Indeed, more than 500 schools have been closed while just one-third of refugee children are attending school. The World Bank will support the Government in its efforts to accommodate these refugees, drawing on the new IDA18 refugee sub-window, and building on the ongoing Social Safety Net Project. 34 Objective 2.4: Expand access to water and sanitation services 96 Two of the country’s biggest deficiencies are in water and sewage . The per capita availability of water is one of the lowest in the world. Progress has been made in providing access to water, though it still fell short of the Millennium Development Goals. The situation is worse in sanitation. But progress on sanitation is daunting: as of 2016 only 34 percent of the urban population and less than 14 percent of rural population had access to an improved sanitation facility, with significant regional disparities. Even worse are in rural areas where 75 percent of the population practice open defecation. In urban and rural areas, 60 and 95 percent respectively of wastewater is disposed of out in the open. 97 The WBG supports the Government's vision that by 2030, the country's water resources will be documented and effectively managed to achieve universal access to improved water and sanitation services, thereby contributing to sustainable development. The three priorities of the National Water Policy are: i) ensuring universal access to water and sanitation based on a human rights approach whereby the concerns of the poorest and most vulnerable populations are considered; ii) improving the knowledge and the management of water resources in the country through the development of research and the strengthening of the capacity of the actors of the water sector; and iii) promoting the long-term sustainability of the sector including increasingly engaging the private sector in the management of water supply systems, giving priority to maintenance and rehabilitation of existing investments, mobilizing internal resources for the sustainable financing of the sector, and finally promoting regional and international cooperation in the management of shared water resources. 35 98 The WBG will continue to be one of Burkina Faso’s key partners in the water and sanitation sector through the funding of major investment programs, supporting the development and implementation of sector reforms, and technical assistance. The Urban Water Sector Project and the Third Community-based Development Project are facilitating the sustainable access of over 1.9 million people to clean water and access to adequate sanitation services to 460,000 people. The new Water, Sanitation and Water Information Program for Results (PforR) financing (financed through SUF plus IDA resources) will improve access to water supply and sanitation services in targeted areas and improve information on water resources. Focus Area 3: Strengthen governance and support citizen engagement Relevant Sustainable Development Goals: SDG 1: End poverty in all its forms everywhere SDG 5: Achieve gender equality and empower all women and girls SDG 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all SDG 16: Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels Relevant IDA 18 Special Themes: Special Theme 5: Governance and Institutions Special Theme 2: Gender and Development Relevant PNDES Strategic Focus Areas: Focus Area 1: Institutional reform and modernization of the public administration Objective 3.1: Strengthen domestic resource mobilization and public expenditure management 99 Following a sharp deterioration of fiscal performance in 2017, Burkina Faso has committed to restoring fiscal sustainability, with the aim of attaining the WAEMU deficit target of 3 percent of GDP by 2019. The fiscal adjustment will be supported by a new three-year International Monetary Fund (IMF) Extended Credit Facility, approved in March 2018. The authorities will curtail their intentions to scale up investment through off-budget arrangements, including PPP investments and halt their recourse to bank pre-financing. Converging to a credible fiscal framework over 2018-2019 is achievable, albeit challenging. The Government will have to renew its efforts to increase revenue mobilization, which remains lower than observed in best performers within the sub-region. It will also have to increase the efficiency of its investment program, by selecting and executing the most important projects, and by controlling the fiscal risks associated with PPPs. Key challenges will be to raise domestic revenue in spite of a narrow economic base and containing the wage bill growth in a context marked by recurrent strikes and social as well as political volatility. The impact of recent terrorist attacks on security-related expenditure is also unclear. 100 The WBG will continue to support the Government in its efforts to create fiscal space for priority social and investment spending and to manage fiscal risks. Continuing reforms supported by the previous DPF, a new DPF series and an ASA on tax policy in the four countries of the CMU will support increased revenue mobilization through tax policy and administration reforms. The DPF will also promote improved efficiency of public spending by strengthening public investment management (through better project selection and public procurement), making local development more effective, and promoting efficiency gains in social spending. 36 Lastly, it will support reforms to strengthen management of fiscal risks related to PPPs to protect fiscal sustainability while harnessing private sector financing. Objective 3.2: Strengthen citizen engagement and public-sector accountability 101 Several projects are underway to strengthen institutions and promote economic governance. While progress had been made in PFM, there has been some regression in recent years. In addition, civil service reform has proven very difficult due to a combination of political inertia and strategic, coordination and implementation failures. The Government must restore public confidence by strengthening governance institutions as well as developing a modern and accountable administration capable of delivering quality services and tangible development outcomes. Burkina Faso has made modest progress in public sector management with progressive implementation of the Public-Sector Modernization Project, which is a results-based approach to support the Government’s reform program in three key ministries: civil service and labor, primary education and justice. The Economic Governance and Citizen Engagement Project supports domestic resource mobilization and improvements in PFM. It also builds capacity to fight corruption and develop accountability mechanisms in service delivery, as does the Local Government Support Project. Work under the latter project led to the creation of a municipal performance monitoring survey which tracks basic service delivery and institutional capacity indicators at the municipal level annually and is being scaled-up nationwide under the eBurkina Project. This project further promotes public sector efficiency and accountability by improving the use of ICT by public administration and agencies. 102 Burkina Faso has made progress in strengthening citizen engagement in public policy processes, but this is likely to result in increased demand by citizens for better public services and government accountability. Linking public sector reforms to service delivery will contribute to improved satisfaction with delivery of services, as well as increase government accountability for the outcomes of public services. As the Government looks to modernize its public administration, the World Bank will continue to support these efforts, in particular to scale-up the PforR instrument under the Public-Sector Modernization Program. The additional intervention could expand the geographic scope and thematic areas of the PforR. The CPF will support an ASA to review civil service and wage bill issues to inform World Bank support during the CPS period. 103 Despite progress in the last decade, Burkina Faso’s statistical system is still weak. The National Accounts are still produced under the 1993 System of National Accounts and there are important data gaps in areas like livestock. The labor statistics system, meanwhile, is non- existent. Poverty monitoring is based on household surveys, but problems of comparability over time remain. Moreover, these surveys do not always address important issues of economic policy like shocks, gender, agriculture, livestock, etc. 104 The World Bank is involved in modernizing household surveys and the analysis of the distributional impact of public policies. A regional project for WAEMU countries is strengthening the capacity to conduct harmonized living conditions surveys that meet international standards. 37 A national project provides additional funds to conduct experiments to assess comparability with past surveys and encourage consistency in poverty numbers. On the poverty analysis side, the World Bank is involved in analyzing the distributional impact of taxes and subsidies. This work will be used in the policy dialogue on taxes and subsidies. In addition, the World Bank is examining the possibility of financing the 2018 population census. Objective 3.3: Support decentralization 105 The PNDES has upheld the Government’s stronger commitment to decentralization. Under the PNDES, the target for the share of central Government resources transferred to local governments has been raised to 15 percent from the existing level of only 5 percent. It also finalized a long-term vision for decentralization in 2017. On this basis, the World Bank has provided significant additional resources to its Local Government Support Project in order to expand coverage from the six initial regions to all 13. Increasing fiscal resources to local governments could substantially contribute to effective delivery of local services. However, Burkina Faso needs a more transparent, predictable and rule-based fiscal framework. During the CPF period, the World Bank will focus on strengthening the national capacity for decentralization, the institutional capacities of communes and increasing citizen participation in local governance. Support will also include improving the intergovernmental fiscal framework, which is expected to result in a progressive increase in the proportion of the central government budget transferred to communes from 5 percent in 2018 to 15 percent in 2021. The CPF aims to achieve an improvement in the proportion of citizens’ rating the commune governments’ performance as satisfactory, with an increase from 52 percent in 2017 to 70 percent in 2021. Gender as a cross-cutting issue 106 The WBG’s CPF for Burkina Faso addresses several groups of gender-related constraints to poverty reduction and shared prosperity that were highlighted in the recent SCD. These are: (1) girls’ lower access to education, especially beyond primary level; (2) high fertility, which impedes the country’s ability to capture the demographic dividend; (3) gaps in the quality of maternal health services and their proximity to the rural poor; and (4) women’s lower land tenure security and access to farm labor and other productive inputs, with negative impacts on agricultural productivity, vulnerability to climate change and access to finance (through land as collateral). 38 Box 2: Gender is a key cross-cutting driver of the CPF Gender is a common theme running throughout the WBG Burkina Faso program, including specific projects dedicated to addressing women’s unique development challenges that are listed below. The Sahel Women’s Empowerment and Demographics Project covers reproductive, child and maternal health services. Meanwhile, the Early Access and Quality Improvement Project encourages poor girls to remain in secondary school using subsidies. Its pre-school component will benefit mothers by the time burden of caring for young children. The Agricultural Productivity and Food Security Project supports lowland rice production and expects 40 percent of beneficiaries to continue to be women. The Social Safety Nets Project targets poor households, a disproportionate share of which are female-headed. It also empowers women in male-headed households since cash transfers are paid to them. The Decentralized Forest and Woodland Management Project targets the preservation and expansion of non-timber forest products that are primarily exploited by women. In the Youth Employment and Skills Development Project, meanwhile, 30 percent of the positions in labor-intensive public works and training programs are reserved for young women. The Bagré Growth Pole Project also targets female entrepreneurs and jobs for women. Finally, the pipeline Water Supply, Sanitation, and Water Resources Knowledge PforR will address the time and health burdens related to poor water and sanitation access that disproportionately impact women and girls, who tend to be tasked with responsibility for water collection. Various instruments are being used to improve understanding, diagnoses and analyses of gender issues. A project gender analysis combined with a gender-sensitive approach to citizen engagement will help ensure that the different needs and concerns of women and men are considered in project design and implementation. The TUDIP, for example, has been informed by consultations with local stakeholders, including women, and includes specific attention on increasing access to infrastructure that is especially beneficial to women, including basic social services and markets used by cross-border traders, the majority of whom are women. Efforts to ensure that project implementation is in line with the needs of both women and men will be further informed by the Social monitoring and evaluation Surveys that will generate a gender-disaggregated picture of how the project is responding to road users’ and communities’ needs. IFC’s work in agribusiness and SME finance has a strong gender component, including the development of financing products specifically targeting women . IFC, in partnership with SOFITEX, just completed an assessment to identify gender gaps in the company’s supply chain and constraints to women’s participation. The results will be used to design targeted interventions to increase their participation in cooperatives and SOFITEX’s supply chain. IFC will continue to work with its clients to close gaps between men and women in corporate leadership, employment (recruitment, retention and promotion of women), the supply chain and access to assets (finance, technology, insurance). 3.6 Financing Plan of the CPS 107 IDA18 instruments: In addition to the national performance-based allocation (PBA) earmarked for Burkina Faso, the CPF will seek to use the new financing windows available under IDA18. As well as an initial SUF approved for Water and Sanitation, the CPF will propose two additional transformational operations in agriculture and infrastructure for future SUF financing. The CPF also plans on seeking resources to support the Government’s efforts in supporting 39 Malian refugees under the new Refugee window. Finally, together with IFC, the World Bank will pursue investment opportunities in leveraging the PSW. Table 4: Burkina Faso Indicative CPF Program Financing (2018-2023)9 IDA Cylcle (all indicative) Other sources IDA18 IDA19 Refugee Total CPF Indicative CPF Program FY18-FY23 (in millions US $) FY18 FY19 FY20 FY21-FY23 TF SUF WindowRegional IDA18 IDA19 TOTAL Focus Area1: Accelerate sustainable private sector-led growth for job creation 1,219 54% Objective 1.1: Improve agriculture productivity and competitive value chains 151 58.5 30 150 47 150 40.5 239 150 626 Objective 1.2: Improve energy access 91.5 50 15 106.5 141.5 15 263 Objective 1.3: Develop transport and trade for improved access to markets 10 85 60 35 95 60 190 Objective 1.4: Promote SMEs and access to inclusive finance 50 50 0 50 Objective 1.5: Address management of extractives and natural resources sustainability 30 60 30 60 90 Focus Area 2: Invest in human capital and social protection systems 734 32% Objective 2.1: Support inclusive, high- quality education, and skills development 70 16 130 16 86 130 232 Objective 2.2: Expand access to reproductive and child health and nutrition 80 20 80 0 100 Objective 2.3: Expand social protection to the most vulnerable 44 25 8 25 69 0 102 Objective 2.4: Expand access to water and sanitation services 50 250 50 0 300 Focus Area 3: Strengthen governance and support citizen engagement 325 14% Objective 3.1: Strengthen domestic resource mobilization and public expenditure management 75 50 50 175 0 175 Objective 3.2: Strengthen citizen engagement and public- sector accountability 30 60 30 60 90 Objective 3.3: Support decentralization 60 60 0 60 Inclusive Urbanization Project TOTALS 2,278 100% 416 420 270 475 67 400 8 223 1,106 475 2,278 108 A full program of ASA will also be supported. These will serve to fill some of the knowledge gaps identified in the SCD, while other gaps are being met by other donors. The complete list of SCD knowledge gaps, current responses from the WBG and other donors, and additional studies to be done by the WBG are summarized in Table 5 below. The most notable achievements in FY18 include a series of comprehensive Policy Notes to help inform dialogue with the Government and four ongoing Impact Evaluations (IEs) to provide evidence on what works in maternal health, local governance and nutrition safety nets. Other knowledge products to help inform ongoing and upcoming operations include studies of adaptive social protection, agro-processing activities, mining and support to land policy and the financial sector. 9Referenced IDA18 volumes are indicative. Actual PBA allocations will be determined annually during the FY18-20 period and will depend on: (i) total IDA resources available; (ii) the number of IDA-eligible countries; (iii) the country’s performance rating, per capita GNI, and population; and (iv) the performance and other allocation parameters for other IDA borrowers. Availability of SUF resources is subject to availability and approval by the World Bank. 40 Table 5: Summary of Knowledge Gaps Financed by WBG and Other Donors in Burkina Faso Knowledge Gaps Identified in the SCD Corresponding Analysis by the WBG and Other ASA in the WBG Portfolio Other Donors Climate risk profile study in the sector Maternal and Child Health Impact Impact of climate change on different of Agriculture in Burkina Faso Evaluation (P143984) (ongoing) development scenarios (P162616) (ongoing) Impact Evaluation of Burkina Faso Local Impact Evaluation of PES and PFM Government (P148392) (ongoing) approaches on Forest conservation and livelihoods in Burkina Faso (P155240) ECD Nutrition Safety Net Impact (ongoing) Evaluation (P150067) (ongoing) NDC on GHG-emissions reductions and Adaptive Social Protection in Burkina alternative scenarios for Burkina Faso Faso (P153352) (ongoing) development (UNDP) (delivered in FY18) Study on Agro-processing Improving Water Resources knowledge Water availability, use and respective Opportunities (P158578) (ongoing) and management in Burkina Faso economic, social and environmental (P162723) (completed in FY18) Financial Sector Support (P162952) values of water (ongoing) The Jobs Agenda in Burkina Faso Support for the PPP Institutional Education services and private sector (P151365) (completed in FY18) Framework and Development of the PPP Project Portfolio for Burkina Faso Rebase of national accounts (999) Covered by EU (ongoing) (P163053) (ongoing) Time series of disaggregated public Covered by GTZ (ongoing) Support to Burkina Faso Land Policy spending at the regional level (P165025) (ongoing) Impact of migrants on the economy, Covered by IOM/OECD (ongoing) Procurement System Assessment using including the impact of brain drain and MAPS II (P166408) (ongoing) of their remittances Support the Power Mining Integration Not yet covered to extend Access to Electricity Gender-disaggregated quantitative data in key sectors and the limited (P165245) (ongoing) reporting of violence against minorities IFC-WB Country Private Sector Analysis on the market structure of key Diagnostic sectors of the economy. Partially covered by EU (Independent Aid Effectiveness in Burkina Faso Evaluation of General Budget Support on social and economic development in Burkina Faso) 3.7 Implementing the CPF Agile approach to project preparation 109 Burkina Faso already has experience as an agile pilot-country with the TA for Transport Industry Reform Project. Following this conclusive pilot and the keen interest of the authorities, the new Higher Education Support project is also using the Agile approach. To the extent possible 41 and in agreement with the Government, teams will be encouraged to pursue the agile approach in new project preparation. Financial Management and Procurement 110 Burkina Faso has a good legal framework and detailed procedures for procurement and financial management; however, there is much work to be done on compliance and implementation. Burkina Faso completed the transposition of WAEMU directives into national laws, but key reforms have yet to be operationalized at the central and decentralized level: greater budget transparency, moving to accrual accounting, performance orientation of the budget, simplification and e-procurement systems and strengthened internal controls in line ministries, as well as internal and external oversight. The 2016 Public Expenditure and Financial Assessment (PEFA) highlighted a marked deterioration since the last assessment in 2013. Out of the 28 indicators for which it was possible to make a comparison, 20 had registered a deterioration while only one showing any improvement. Moreover, half of all indicators received a mark of D. In a few cases, such as the rating of budget transparency, the decline appears to have been due to different analysis of similar information by the 2013 and 2016 assessment teams. A deterioration was noted in the credibility of budget spending allocations, predictability of funding availability and payroll and internal controls. By contrast, the performance of the procurement system and external controls remained the same. The World Bank is assisting in reforms in PFM through several projects and the budget support program. Portfolio Management 111 Most World Bank projects are implemented using a ring-fenced approach (parallel system). This holds risks for the sustainability of the projects’ development impacts and has high transaction costs. In 2010, the World Bank conducted an assessment for the possible use of country systems, after which the World Bank agreed to a gradual approach to implement the use of country systems in Bank-financed operations. 112 The World Bank has also utilized partial delegation of project implementation to other development partners. This was done under the Youth and Employment Project to leverage the Swiss Cooperation Agency’s comparative advantage in labor-intensive public works (LIPW) at the regional level. Thanks to this experience, the World Bank signed an agreement with the organization in 2015 to provide immediate employment for youth with little or no education through LIPW. A percentage of LIPW jobs is reserved specifically for women. 113 The majority of projects in the upcoming CPF period will be implemented using the ring- fenced approach. However, the World Bank will continue to work with the Government to better coordinate development partner-funded operations and gradually implement the use of the country’s fiduciary system including the new procurement code. The World Bank will explore the option of scaling up PforR financing instruments in future operations as well as the inclusion of result-based and performance-based financing, taking into account the lessons learned from past projects. Based on the review of the fiduciary performance of the World Bank portfolio in Burkina 42 Faso, the rationalization of project coordination units and steering committees to manage and oversee all donor-supported activities within a sector will be increased. 114 The low disbursement rate of World Bank operations is being addressed through: (i) enhanced project preparation leading to efficient decision-making and improved readiness for implementation; (ii) adequate contract management arrangements to improve execution, and reduce time and cost overruns; (iii) addressing the inadequacies resulting from the “5 decrees” governing the modalities of donors-financed project implementation in Burkina Faso; and (iv) effective project oversight by the institutions of controls. Development Partners Mapping and WBG Comparative Advantage 115 The World Bank provides a considerable share of development financing in Burkina Faso (21.78 percent) and supports nine sectors of the PNDES. The European Union provides 19.4 percent and also intervenes in nine sectors, while the African Development Bank (11.2 percent) and the United States (9.5 percent), respectively cover five and three sectors. According to the National Directorate of Cooperation, four sectors of the PNDES account for the highest concentration of financing: (i) Economic Governance (US$233.79 million), due primarily to the large volume of general budget support; (ii) Environment, Water and Sanitation (US$156.22 million); Industrial and Artisanal Processing (US$120.33 million); and Agribusiness and Livestock Production (US$ 106.06 million). The World Bank is active in all these sectors and coordinates closely with other partners to ensure that its funding is complementary. Sahel Alliance 116 As part of the group of countries in the Sahel Alliance Burkina Faso, together with the World Bank and other development partners, has agreed to a dedicated partnership framework to further institutionalize and scale up results in the crisis-affected Sahel. The priority sectors identified by the Alliance partners are: a) youth employment, education and training; b) agriculture and food security; c) climate, energy access and green energy; d) governance, including judicial systems and countering corruption; and e) provision of basic services and support for decentralization. These sectors are aligned with national priorities defined in the national priority program for the Sahel (Programme d’urgence pour le Sahel - PUS), and with the focus areas of the CPF. Climate Co-Benefits 117 Several projects in the CPF pipeline have been assessed and marked to have potential for climate co-benefits if climate change is integrated into project design at an early stage. As of March 2018, Burkina Faso is projected to have a climate share over commitment of 5 percent in FY18. The FY17 climate share was 45 percent, and the average over FY14-FY16 was 4 percent. Assessed projects having the most potential to maximize co-benefits include: Strengthening Climate Resilience in Burkina Faso, Health Services Reinforcement Project, Burkina Faso Electricty Access Project (FY20). Please see excel sheet attached.” 43 IV. Managing Risks Table 6: Systematic Operations Risk-Rating Tool (SORT) for Burkina Faso Risk Categories Rating 1 Political and governance Moderate 2 Macroeconomic Substantial 3 Sector strategies and policies Moderate 4 Technical design of program Moderate 5 Institutional capacity for implementation and sustainability Moderate 6 Fiduciary Substantial 7 Environmental and social Substantial 8 Stakeholders Moderate 9 Other (security) Substantial Overall Substantial 118 Macroeconomic risks are substantial. Historically, Burkina Faso has been characterized by prudent macroeconomic management. However, a recent combination of circumstances has raised new challenges. The fiscal deficit climbed to 8 percent in 2017. The security threat and social tensions are pushing up spending, and the Government remains committed to further wage increases as it agreed to in a 2016 agreement. Domestic resource mobilization is slowly rising but continues to fall short of official projections, without a clear strategy going forward. Moreover, the authorities had great difficulty coming to an agreement with the IMF on a new program in 2017. The decision to focus on public investment may also have negative consequences for economic growth. The World Bank will work with the authorities on both revenue generation and expenditure rationalization in order to reduce the deficit and limit the rise in public debt, while protecting GDP growth. 119 Fiduciary risks have increased and are now substantial. The recent PEFA report documents a substantial slippage in many of the indicators of PFM, as noted above. The Government’s reform program (Programme de Réforme de la Gestion Budgétaire ) has been updated with the support of most of the donors in the Multi-Donor Budget Support Group. This group also funds an annual audit of the flow-of-funds arrangements between the Central Bank and the Treasury. The WBG is working with the Government through the Economic Governance and Citizen Engagement Project to strengthen audit institutions and improve public expenditure management, including procurement system efficiency and the predictability and control of budget execution. 120 Environmental and social risks are also substantial. Climatic shocks represent a serious threat to agriculture and consequently to rural livelihoods and food security. As a landlocked country in the environmentally-vulnerable Sahel region, Burkina Faso suffers from an extreme and variable climate, with the possibility of both flooding and drought occurring within a few months of each other. Weather-related shocks could affect the achievement of results in agriculture projects and may affect the pace of reform implementation more broadly by reducing fiscal space. Social risks are also significant as the number of strikes increases. These can affect the delivery of public services, notably but not limited to education and health. Subsequent wage 44 agreements could impinge on public investment budgets, with negative consequences for growth. 121 Security has become one of the biggest concerns. The situation in neighboring Mali remains unstable, and violence and insecurity have spread into northern Burkina Faso, with occasional attacks in Ouagadougou, including most recently in March 2018. The cost of increasing security measures and accommodating refugees is putting a strain on the budget. Moreover, the development of the northern region is being directly hampered by the discouragement of investment and closing of schools, among other impacts. While the instruments available to the WBG in this area are limited, implementation will be adapted to insecure areas, in addition to continued budget support as well as assistance with the refugee crisis. IFC will continue to seek to play its counter-cyclical role to support private and commercially-run businesses during periods when other investors are reticent due to security and other concerns. 45 Annex 1: Burkina Faso FY18-23 CPF Results Framework Focus Area 1: Accelerate sustainable private-sector led growth for job creation To address the slow progress towards the achievement of sustainable economic growth for job creation, as outlined in the PNDES and the NDC on GHG-emissions reductions, Burkina Faso will need to pursue a structural transformation of its economy by exploiting opportunities in key sectors through private sector leadership. Both the SCD and the PNDES identified five priority measures to address the critical constraints impeding achievement of the Twin Goals: (i) improve access to external financial resources mainly by startups and small enterprises in the informal sector; (ii) improve access to virtual and physical connective infrastructure; (iii) remove the main constraints to agricultural growth which include low agricultural productivity and limited commercialization; (iv) alleviate the complex tax system and barriers to entry by private sector to stimulate job creation; and (v) promote training and educational facilities and reduce limitations of labor regulations. The CPF presents a multi-sectoral approach to addressing these constraints while supporting the priorities of the PNDES. CPF Objective 1.1: Improve agriculture productivity and agribusiness value chains in targeted areas Intervention Logic Agriculture is the most important sector of the economy, employing 80 percent of the active population, with only a small proportion earning decent incomes. The high rate of poverty can be explained by the low level of productivity of agriculture with yields declining by 3 percent and crop production increasing by only 10 percent over the last decade. Moreover, diversification remains a challenge as the structure of agricultural output has changed little over the past 40 past years, while available cultivable lands could have been used to promote high-value crops. In order to achieve productivity gains, and address high vulnerability linked to natural hazard (climate change) and sustainable natural resource management, constraints related to access to water resources, infrastructure, human capital formation, and land tenure accessibility by women and youth will be key in the forthcoming years. Addressing gender bias through access to land will be especially important. Enhanced female empowerment in the economic and political domain is essential for achieving greater equity. The PNDES has a special commitment to the creation of productive jobs for women and gives priority to the promotion of decent employment for women, as well as access to assets like land, finance and livestock. All WBG projects are sensitive to gender bias and the Livestock Sector Development Project also seeks to promote women’s access to assets and services in the sector. WBG support to agricultural development accounts for the largest share of the portfolio. The Bagré Growth Pole is focused on land tenure, agriculture value chains and job creation for women and youth. The Agriculture Productivity and Food Security, Diversification and Market Development, Livestock Sector, Sahel Irrigation Initiative and Sustainable Agriculture intensification for Food and Nutrition Projects are supporting similar issues in other regions. The upcoming Integrated Agriculture Development Project will help address productivity as well as access to markets by farmers through a sustainable infrastructure package. In addition, the Improved Meteorological, Hydrological and Climate Information and Services (hydromet) Project will support agricultural productivity enhancement, reduction in loss of production and promotion of food security. A new project, Strengthening Climate Resilience, will support the modernization of hydromet services both at national and regional levels. IFC is providing support to irrigation and water management project, TPMEs for industrial agribusiness value chains and industries agribusiness for SOFITEX. Both IDA and IFC are providing capacity building and advisory services to strengthen the client’s capacity. CPF Objective Indicators Supplementary Progress Indicators WBG Program Indicator 1.1.1: Incremental sales in targeted Livestock farmers reached with agricultural Ongoing (WB Operations) livestock value chains by both male and female assets or services (number) x APL 3 Com Based Rur Dev III (P129688) farmers Baseline: 0 (2017) x Bagré Growth Pole (P119662) Baseline: 0 (2017) Target: 30,000 (2019); 281,000 (2022) of x Ag. Productivity & Food Security (P114236) Target: 20% increase (2022) which female, 85,000 x Ag. Diversification & Market Dvt. x AF Agricultural Productivity and Food Indicator 1.1.2: Average yield of maize Share of animals vaccinated against priority Security Project (P149305) Baseline: 1.7 ton/ha (2017) animal disease CBPP’ x Regional Sahel Pastoralism Support Project Target: 2.12 ton/ha (2022) Baseline: 33% (P147674) Target: 40% (2019); 50% (2022) x Livestock Sector Development Support Indicator 1.1.3: Average yield of rice Project (P159476) Baseline: 2.2 ton/ha (2017) Land area where sustainable land x Livestock Sector Project (P159476) Target: 2.75 ton/ha (2022) management practices were adopted as a result of projects (ha) Pipeline (WB Operations) Indicator 1.1.4: Average yield of mango Baseline: 0 x Bagre Growth Pole Project AF (P161234) Baseline: 12 ton/ha (2017) Target: 200,000 (2019); 400,000 (2022) x Sahel Irrigation Initiative Support Project Target: 17 ton/ha (2022) (P164810) Area provided with new/improved irrigation x Sustainable Agricultural Intensification for and drainage service (ha) Food and Nutrition Project (P164049) Baseline: 1880. (2017) x West Africa Agriculture Transformation Target: 5,500 (2019); 11,000 (2022) Project (P164810) x Integrated Ag Development Project (TBD) Agricultural loans outstanding thanks to World Bank funded program (number) x Study on Agro-process Opportunities Baseline: 0 (2016) (P158578) Target: 1,500 (2019) IFC Investments x Global Warehouse Finance Program (GWFP) Burkina Faso (803172) IFC Advisory x Burkina Faso Smallholder Water Management and Irrigation program (601113) x Agricultural value chain study 47 CPF Objective 1.2: Improve energy access Intervention Logic In order to address the significant gap in accessible and reliable energy for the poorest and to facilitate structural transformation of the economy, the PNDES sets ambitious objectives in the energy sector. While access to electricity in the Africa region is about 35 percent on average, Burkina Faso is lagging at just 18 percent. The ambition stated for the energy sector consists of increasing national electric coverage rate, electrification rate respectively at 80 percent and 45 percent in 2020, through reinforcement of thermal production, increase of renewable energies contribution compliant with the NDC including promotion of energy efficiency. These will help boost installed electricity capacity and improve supply reliability for both urban and rural areas. The WBG is supporting the country in this area with a national electricity project in 11 regions out of 13 with the objectives of increasing access to electricity, improving the reliability of electricity supply, and enhancing the efficient use of energy in targeted areas. The additional financing of the Bagré Growth Pole aims at providing electricity to the intervention zone to promote structural transformation of agriculture outputs. Through the West African Power Project (WAPP), the WBG is supporting improving the country’s energy capacity by promoting connection between Burkina Faso and neighboring countries (Ghana and Nigeria). Following on with this approach, the upcoming WAPP-North Core/Dorsal Nord project will help diversify electricity imports from Nigeria/Niger to Burkina Faso. Moreover, the WBG is providing sustainable energy sector through policy dialogue under the DPO’s focus on improving the financial sustainability of the energy sector; diversifying the energy mix and improving the supporting legal and institutional framework. Under the NDC GHG-emissions reductions to climate change, renewable energy is central to the government strategy for the sector. In this regard, the solar project will be helpful in achieving the Co2 reduction target by 2030. CPF Objective Indicators Supplementary Progress Indicators WBG Program Indicator 1.2.1: People provided with new or Reduction of cross arrears between the Ongoing: (WB Operations) improved electricity service Government, SONABHY and SONABEL. x Electricity Sector Support Project (P160344) Baseline: 26,230 (2017) Baseline: CFAF 140 billion. (arrears x WAPP: The First Phase of the Inter-Zonal Target: 786,000 (2023) accrued by June 30, 2016) Transmission Hub Project of the WAPP (APL3) Target: CFAF 60 billion (2018) (P094919) Indicator 1.2.2: Solar lanterns deployed in x Bagré Growth Pole Project AF (P161234) public schools (off-grid) Reduction in customer’s outstanding bills x Energy and Fiscal Management DPF (P157060) Baseline: 0 (2018) due to SONABEL (as measured by client Pipeline (WB Operations) Target: 25,000 (2023) receivables). x Electricity Access Support Project Baseline 2015: CFAF 55 billion (2015) x Regional Solar Park Indicator 1.2.3: Generation capacity of Target: below CFAF 39 billion (2018) IFC renewable energy constructed since 2017 x Zina Solaire 27 MW Independent Power Project (MWp) 808775) Baseline: 0 (2017) Power outages in targeted substations x Scatec Solar Infraventures investment Target: 30 (2022) Baseline: 129 (2017) 48 Target: 2 (2019); 2 (2022) Annual quantity of energy imported from Ghana to Burkina Faso (GWh) Baseline: 0 (2017) Target: 100 (2023) Number of IPP projects having been signed and successfully negotiated. Baseline: 0. (2015) Target: 1 (2018) Percentage of IPPs under standardized competitive process. Baseline: 0 percent. (2015) Target: 50 percent (2018) CPF Objective 1.3: Improve connectivity for better access to markets Intervention Logic In order to link the country to the global economy, the PNDES has prioritized the transport and trade sectors as key elements for economic growth and poverty reduction. The transport of products to urban areas and from surrounding zones to regions in shortage is jeopardized by a poor road infrastructure and deficient transport services. As a landlocked country, Burkina Faso faces the challenge of access to global markets for both exports and imports, yet it lags behind the sub-Saharan African average in both road infrastructure and access to paved roads. The PNDES includes actions to reduce the proportion of the urban population living in informal land subdivisions from 17 percent to 14 percent in 2020, through improved access to services and better governance. It also includes, as part of the structural transformation agenda, a better planned and guided urban development process. The WBG is supporting the PNDES through projects focused on urban and regional roads to improve transport connectivity by reducing travel times for business and social services and to open up production zones and improve access to markets. The upcoming Connection Roads and Mobility Project, to be developed in complementarity with the integrated Agriculture Development Project, will help increase the proportion of asphalted roads, rural feeder roads, and paved roads, linking farmers’ ability to access markets, and reducing mobility issues that threaten urban areas’ economic and social development, mainly in Ouagadougou and Bobo-Dioulasso. Policy dialogue and TA for a performing corridor for international transport needs will continue. The WBG has improved the legal framework in axe load, truck renewal, customs modernization and trade operations portal through a two-year regional trade facilitation DPO between Côte d’Ivoire and Burkina Faso, with follow-up TA projects. The regional WARCIP project seeks to increase the geographical reach of broadband networks and reduce costs of communications services in West African countries, 49 thereby supporting regional and international trade. A new urban ASA and subsequent project will help address urban governance issues and contribute to reducing informality and improving inclusion in cities. IFC is pursuing PPPs in transport. CPF Objective Indicators Supplementary Progress Indicators WBG Program Indicator 1.3.1: People provided with Cities with improved livability, Ongoing (WB Operations) improved urban living conditions sustainability and/or management in five x TUDIP (P151832) Baseline: 0 (2017) regional cities x Donsin Transport Infrastructure Project Target: 41,000 (2022) of which 18,000 within Baseline: 0 (2017) (P120960) 500 meters of all-season roads. Target: 5 (2022) x Transport Sector Modernization and Corridor Trade Facilitation(P156892) Indicator 1.3.2: Average transit time for Inter-urban roads rehabilitated x Western Africa: WARCIP Burkina Faso-AF imports from entry to the Border Post with Baseline: 19 km (Donsin) (2017) (P161836) Côte d’Ivoire to customs clearance in Target: 118 km (2023) x Transport and Mobility Project AF (P 152832) Ouagadougou (hours) Baseline: 92 (2017) Person-days of employment created Pipeline (WB Operations) Target: 59 (2022) through road rehabilitation x BF – Connection Roads and Mobility Project (WB Indicator 1.3.3: Number of rural population Baseline: 0 (2017) New Operation) Preparation in FY19. with access to practicable rural roads linking Target: 300,000 (2023) x Inclusive Urbanization Project them to the selected agriculture production ASA basins (linked to new operation) Number of new long-haul trucks put in x TA for transport sector industry reform Baseline: 0 (2017) service (number) (P156892) Target: (TBD) (2022) Baseline: 102 (2016) x Urbanization for growth and inclusiveness Target:450 (2022) of which 150 through x Tema-Ouaga Economic Corridor (WB new TA) Indicator 1.3.4: Average monthly price of PAMOSET and 300 from DPF reforms wholesale international E1 capacity link from capital city to Europe (US$ per month per 2Mbps) Baseline: 1,513 (2017) Target: 700 (2021) CPF Objective 1.4: Promote SMEs and access to inclusive finance Intervention Logic The PNDES clearly stated the constraints impeding SME promotion and attracting foreign investors. Structural transformation of the economy and productive job creation require improvement in critical areas, including access to adequate electricity services, commercial justice/enforcing 50 contracts, access to land by women, and sustainable credit.10 The PNDES actions are focused on capacity building for the private sector, especially SME/SMI, and setting up financial mechanisms adapted to the needs of SMEs. One of the most important findings of the SCD regarding the key constraints behind the low productivity of the non-farm sector is the lack of access to external financial resources which resulted in insufficient investment in capital and low creation of enterprises. The WBG, through the Inclusive Finance Project, will help address the main constraint facing SMEs by expanding access to transaction accounts by unbanked people in the poorest rural and urban regions. Targeting youth and women in these areas through a credit mechanism and guarantees will ensure SMEs development and contribute to reducing gender bias against women. To complement these investments, IFC is providing advisory services to address business environment issues, including the development of PPPs. The e-Burkina project aims to foster entrepreneurship in the digital economy, with a specific focus on agriculture and rural areas. CPF Objective Indicators Supplementary Progress Indicators WBG Program Indicator 1.4.1: Agri-business and SME Startups, SMEs, Civic Techs incubated Ongoing (WB Operations) proposals financed by the matching grants and (eBurkina) x Bagré Growth Pole Project Additional Financing cash transfer fund (Bagré) Baseline: 0 (2017) (P161234) Baseline: 821 (2017) Target: 20 (2022) x WAEMU Affordable Housing Finance Project Target: 900 (2019); 1000 (2021) (P161658) x eBurkina Project (P155645) Indicator 1.4.2: Irrigated area in Bagrépole SMEs with access to financial services: Pipeline (WB Operations) allocated to private companies with land title Baseline: TBD x Burkina Faso Financial Inclusion Project or under a lease Target: TBD ASA Baseline: 0 (2017) x Tax Study (P163693) Target: 200 ha (2019); 1000 ha (2023) x Support for the PPP institutional Framework and Indicator 1.4.3: Outstanding IFC SME Portfolio (P163053) (US$) x Burkina Faso Financial sector support (P162952) Baseline: 720,000 (2016) x BF-Study on Agro-processing Opportunities Target: 16,900,000 (2022) (P158578) IFC x Coris Bank (731077) x Ecobank Burkina Faso x UBA Burkina Faso (1017322) x Bank of Africa Burkina Faso (1029677) 10 The projects described in Objective 1.2 will support improvements in key infrastructure services to enterprises. 51 CPF Objective 1.5: Address management of extractives and sustainability of natural resources Intervention Logic The SCD identified natural and extractives resources management as one of the most important challenges that leads to increased inequality among the population. Land remains the main asset for the poorest though access by women is also challenging due to cultural factors, while an appropriate legal framework is lacking to address this socio-economic issue. Less than 10 percent of inhabitants of rural areas are landowners and compliance with the legal framework is extremely costly and unpredictable for businesses. The national rural development policy recognized that land is the most important asset for economic and social development. Efficient land rights registration should be conducive to the development of the Burkinabe economy, yet insecure land rights remain a constraint on investment and development initiatives in various areas: social cohesion, agriculture, environment, urban development and decentralization. The innovative land legal framework is hardly implemented, though the Government has committed to improve land use through a massive registration of men and women’s land use and property rights. The increasing intensity of climate risks and accelerating urbanization may lead to conflicts between pastoralists and farmers in rural areas and among citizens in urban areas. Despite a sharp increase in mining activities, representing roughly 50 percent of exports and 7 percent of GDP in 2016, mineral activities recorded insignificant results. Poor governance and weak capacity have limited equitable share of mining revenues among the population. In addition, increasing mining activities can lead to environmental challenges. To achieve the sustainable management of natural resources and promote a green economy, the Government has committed to a revised mining code which focuses more on protecting the environment through limited use of prohibited products (Cyanuric). The PNDES stressed natural resource management as top priority for sustainable development. The WBG is working closely with local governments to achieve sustainable land use and natural resource management through the Forest Investment Program-Decentralized Woodland Management Project. The upcoming Communal Climate Action and Landscape Management Project (CLAP), will promote a green economy as a way to reduce both poverty and greenhouse gas emissions. By consolidating and expanding the results of the Forest Investment Program, the project would improve practices and the enabling environment for a decentralized and participative forest and landscape management, thereby reducing poverty, increasing climate resilience, and developing selected low-carbon value chains (including shea butter). Ongoing WBG-funded analytical work is assisting the Government in taking stock of the current bottlenecks that slow down the implementation of land reform and this will pave the way for a dedicated operation on urban and rural land. The REDD and readiness preparation grant aims at reinforcing the country’s capacity to coordinate the REDD+ readiness process including a socially and environmentally-sound national strategy and other key governance systems. In addition, the Mineral Development Project in the mining sector is well aligned with government priorities and aims at strengthening the capacity of key institutions to manage the industrial mineral sector. The policy dialogue on mining seeks to improve transparency in the sector through two DPO series resulted in a revised mining code promoting transparency and fair redistribution of mining tax revenues between the central government and the communes where mining companies are intervening. The WBG will support the Government in improving land tenure through an ASA as well as technical assistance. This support will provide an insight on the access issue (including gender) as well as the legal framework through best practices and experiences from other countries. 52 CPF Objective Indicators Supplementary Progress Indicators WBG Program Indicator 1.5.1: Reduced emissions from land Communes have improved the Ongoing (WB Operations) use and forestry (including reduced management of their natural resources by x Forest Investment Program – Decentralized deforestation and forest degradation relative enforcing land-use zoning and planning Forest and Woodland Management Project to 2012 tools and implemented (P143993) Baseline: 0 (2012) Baseline: 32 communes currently x REDD+ Readiness Preparation Grant (P149827) Target: 3 million tCO2 eq. (2022) supported by the FIP) (2018) x Mineral development Support Project (P124648) Indicator 1.5.2: Number of registered artisanal Target: 80 communes (2022) x DPOs on mining governance (P163283) and small miner cooperatives or associations Pipeline (WB Operations) with access to finance, of which 30% are Local content of food consumption by x Land Policy Implementation Project (P165025) women-led. mines x Strengthening Climate Resilience in Burkina Faso Baseline: 0 (2018) Baseline (2015): CFAF2 billion (P164078) Target: 100 (2023) Target (2020): CFAF5 billion x Communal Climate Action and Landscape Management Project Indicator 1.5.3: Land parcels with use or Development of pilot artisanal mining ASA ownership rights (gender-disaggregated) centers for non-mercury gold recovery x Tax Study (P163693) Baseline: 17,376 Land Titles and 3,000 Land Baseline (2018): 0 x Support for the PPP institutional Framework and Use Certificates (Attestation de Possession Target (2023): 3 (P163053) Foncière) x Burkina Faso Land Policy (P165025) Target: 50,000 Land Use Certificates (2022) Share of women with recognized, formal x Climate Change Risk Profile (P162616) land use or property rights (Women’s IFC names on official land documents) x Roxgold I & II (712360) Baseline: 0.8% (2017)11 Target: 20% increase (2022) Focus Area 2: Invest in human capital and social protection systems One of the most important challenges faced by Burkina Faso is its rapid population growth, with an estimated 5 children per woman. This demographic context, combined with multiple climate and external shocks, has slowed the rate of poverty reduction. Some progress in both education and health has been recorded, but the country is still facing many constraints. Insufficient financial resources result in unequal infrastructure in rural areas where more than 2,472 schools were still housed in temporary shelters in 2017, and 92 percent of household heads in the lowest income quintile never attended school compared to 51 percent for the highest quintile. Tertiary education is inaccessible for the 11http://www.focusonland.com/countries/burkina-faso/ Share of women in agriculture: 87.2 percent; share of women’s ownership rights: 0.8 percent. Visited on February 4, 2018. 53 majority and there is a mismatch between the education system and private sector demand. In the health sector, the PNDES focuses on improving nutritional status, the needs of women and children and the acceleration of the demographic transition to benefit from the demographic dividend. With almost 64 percent of households being affected by shocks every year, the social protection system is a priority for the Government. The recurring conflicts in the sub-region have resulted in more than 30,000 Malian refugees displaced near the border of the Sahel region. The WBG supports the country in achieving human capital development, including social protection to reduce social and economic inequalities among regions and between boys and girls, in accordance with the SDGs. CPF Objective 2.1: Support inclusive, high-quality education and skills development Intervention Logic The PNDES has a strategic objective of accelerating demographic transition through access to quality education, employability and higher education adapted to the needs of the economy structural transformation. This requires eliminating the constraints identified in the SCD. Three-quarters of heads-of-household have failed to attain any formal education. In addition, few children who have completed primary school acquire basic reading skills, and weak governance in the education sector has resulted in inadequate financial resources among regions and socio-economic groups. The WBG and other donors are helping to address these constraints. The ongoing IDA allocations have been channeled to complement government and other donors’ activities on access to pre-school education in the two poorest regions, secondary education in the five poorest regions and to improve teaching and learning. Burkina Faso has achieved better indicators on gender over the last decade with an increase in girls’ enrollment rates at the primary and secondary level. The projects in support of these objectives have been designed to complement other activities financed by the Government and other development partners. The regional African Centers of Excellence Project, for example, has been tailored to support recipients to promote regional specialization among participating universities in areas that address regional challenges by strengthening the capacities of these universities to deliver quality training and applied research. The forthcoming project on Secondary and Higher Education will help in strengthening the achievements in primary schools and providing inclusive patterns of education in Burkina Faso. CPF Objective Indicators Supplementary Progress Indicators WBG Program Indicator 2.1.1: Grade 9 promotion rate in the Share of lower and upper secondary Ongoing (WB Operations) 5 targeted regions teachers that have participated in in- x Education Access and Quality Improvement Baseline: 79.4% (2014) service training Project (P148062) Target: 82% (2019) Baseline: 0 (2014) x Africa Higher Education Centers of Excellence Target: 60% (2019) Project - 2IE (P126974) Indicator 2.1.2: Gross intake rate in first x Youth Employment & Skills Development grade of lower secondary in the 5 targeted Share of lower secondary schools in the (P130735) regions targeted five poorest regions that have x Public Sector Modernization Project (P132216) Baseline: 46.2% (2014) and 45% for girls agreed School Improvement Plans Pipeline (WB Operations) Target: 62% (2019) and 61% for girls Baseline: 0 (2017) x Higher Education Support Project (P164293) Target: 90% (2019) x Improving education of children with disabilities Indicator 2.1.3: Out of school youth enrolled (P166596) in skills development program 54 Baseline: 8,201 (2017) Share of public primary school classes with Target: 13,700 (2019) at least 770 hours of instruction time annually in the Sahel, Upper Basin and East regions Baseline: 0 (2016) Target: 55% (2023) Share of public primary schools having at least 2 visits per academic year by circuit supervisor in the Sahel, Upper Basin and East regions Baseline: 25% (2016) Target: 65% (2023) CPF Objective 2.2: Expand access to reproductive and child health services and improved nutrition Intervention Logic According to the last poverty survey, Burkina Faso has a relatively good track record in the health sector. Maternal mortality has declined over time compared to the average of the Africa region (371 against 547 per 100,000 live births). In the same vein, child mortality has declined. Despite this progress, the SCD found that constraints remain in achieving the SDGs. Governance in the health sector has resulted in gaps in staffing and infrastructure between regions and socio-economic groups. Access to health care services by the poorest both in term of distance and affordability, including feeding young children mainly in rural areas, are key weaknesses leading to poor health outcomes. The PNDES sets a strategic objective consisting of ensuring access to quality health services to all. Under the current portfolio, the WBG is providing roughly 8.8 percent of the IDA envelope to support the health sector. The Health Project seeks to improve the utilization and quality of reproductive health services in selected regions and is being complemented by the Sahel Women Empowerment and Demographics Project. In order to address the threat of malaria, which impacts negatively on the labor force with deaths of young people of working age, the Sahel Malaria and Neglected Tropical Diseases Project is providing comprehensive support to government priorities. The new project on health systems strengthening is under preparation (agile pilot) and will help in achieving the Government’s ambition of providing universal health coverage and maintaining its recent good record in the heath sector. To improve maternal and child health outcomes for accelerating progress towards reaching SDGs, the WBG is also supporting the Government with analytical work under the HRITF Impact Evaluation project. At the same time, IFC - via its health in Africa initiative - is contributing to reducing barriers to private participation in healthcare, thereby unlocking sustainable investment in the private health sector and providing better quality health services. CPF Objective Indicators Supplementary Progress Indicators WBG Program Indicator 2. 2. 1: New acceptors of modern Pregnant women receiving at least two Ongoing (WB Operations) contraceptive methods (number) antenatal care visits during a pregnancy x Reproductive Health Project (FY12) (P119917) Baseline: 450,130 persons in 2016 Baseline: 69.5% (2017) 55 Target: 1,200,000 (2023) Target: 77% (2020) x Sahel Malaria and Neglected Tropical Diseases (P149526) Indicator 2.2.2: Percent of children under Births assisted by skilled personnel x Sahel Women’s Empowerment and Demographic age five stunted: (height-for-age is more Baseline: 80.9% (2017) Dividend Project (P150080) than two standard deviations below the Target: 88% (2020) x HRITF Impact Evaluation (P143984) WHO Child Growth Standards median x Regional Disease Surveillance System Enhancement Baseline: 27.3% (2016) Project (P159040) Target: 22.3% (2023) Pipeline (WB Operations) x Health Services Reinforcement Project (P164696) IFC Burkina HIA (586807) CPF Objective 2.3: Expand social protection to the most vulnerable Intervention Logic Burkina Faso has a large population exposed to extreme vulnerability with roughly two-thirds of households affected by shocks annually. The natural hazards of droughts and floods impact significantly on population welfare. The national social protection policy aiming to offer collective insurance mechanisms to the most vulnerable groups has shown some limits. The insufficient provision of the national budget allocation, inadequate targeting mechanism due to unavailable statistics, and late transfers of direct interventions have limited the coverage of significant numbers of vulnerable groups and regions. However, the strategic vision of the PNDES is to reduce significantly social and gender inequalities and promote women’s participation in the structural economic transformation of the country. The safety net program and its additional financing, including the Youth Employment and Skills Development Project, are the key tools that the WBG is using to support the Government in addressing low incomes and increasing access to temporary employment and skills development opportunities for out-of- school youth. A TA to strengthen both the statistical capacity in poverty numbers, as well as better knowledge of adaptive social protection, is under implementation. Nonetheless, more than 30,000 refugees are living along the border with two neighboring countries affected by insecurity. The WBG refugee response envisages a Sahel emergency project to improve the well-being of these refugees, as well as the hosting population, mainly by improving access to basic social services and leveraging more economic activities. CPF Objective Indicators Supplementary Progress Indicators WBG Program Indicator 2.3.1: Beneficiaries of cash transfers Beneficiary households participating in Ongoing (WB Operations) Baseline: 80,000 (2017) accompanying measures x Social Safety Net project (P124015) Target: 255,000 (2020) Baseline: 0 (2017) x LSMS-ISA Burkina Faso Panel Surveys Target: 75% (2020) (P157034) Indicator 2.3.2: Youth employed through labor x Social Safety Net Project AF (P160371) intensive public works (person-days) Government contribution to safety net x Youth Employment & Skills Development Baseline: 4.35 million (2017) programs (P130735) Target: 4.8 million (2019) Baseline: 3.3% (2017) 56 Target: 24% (2020) x Burkina Faso-ECD Nutrition Safety Net IE (P150067) Establishment of a temporary shock- x Adaptive Social Protection in Burkina Faso response benefit, with well-defined (P153352) operational parameters based on shock x Strengthen institutions and systems data (P154921) Baseline: No (2017) Pipeline (WB Operations) Target: Yes (2020) x Refugee & Sahel Emergency Project x BF Social Protection AF x Strengthening Climate Resilience in Burkina Faso (P164078) ASA x Burkina Faso ECD Nutrition Safety Net IE (P150067) x Adaptive Social protection in Burkina Faso (P153352) x Strengthen institutions and systems TA (P154921) CPF Objective 2.4: Expand access to water and sanitation services Intervention logic Despite the water sector’s sound record in the past years, the SCD highlighted that the water sector is one of the primary bottlenecks to human capital and private sector development. High evaporation rates lead to 60 percent losses of retained water in dams, threatening productive jobs out of the rainy season in rural areas as well as drinking water availability throughout the year. The country has a big lag on the sanitation front with only 1.7 percent of the population having access to decent sanitation assets, compared to 29.7 percent for the Africa region. The PNDES set ambitious targets of corvée d’eau for access to water in rural areas to help women devote more time to other household activities, along with an increase to 80 percent access rate to potable water while strengthening capacity for sustainable water management compliant with the NDC. Improving sanitation through a functional solid waste management system is also identified as top priority in the PNDES, with the objective of addressing diarrheal diseases in children. The WBG supports the PNDES objectives of improving water and sanitation access and management, with 9 percent of the country portfolio. The ongoing Water and Sanitation Project’s development objective is to increase access to sustainable water and sanitation services in selected urban areas to contribute to the achievement of the water and sanitation MDGs. The project will achieve this objective by facilitating access to services through programs for constructing social water service connections, public standpipes, and on-site sanitation facilities, as well as consolidating the 57 achievements of the urban water supply sub-sector reforms and strengthening capacities to deliver and manage services. Moreover, the WBG will build on the project’s achievements by designing a PforR water and sanitation project (SUF of US$300 million). Using the PforR mechanism will help facilitate quicker results on the ground. The ASA related to water resources and water resources management will support the Government in the adoption of strategic reforms in the sector aiming to reduce barriers faced by the poor, in urban (mainly peri-urban settlements), small towns and rural areas, as well as accessing sustainable services delivery and better knowledge and management of water resources. CPF Objective Indicators Supplementary Progress Indicators WBG Program Indicator 2.4.1.: People provided with access to an Percentage of complaints resolved within Ongoing (WB Operations) improved water source by the IDA project the established time frame x Urban Water Sector Project (P106909) Baseline: 0 (2018) Baseline: 0 (2018) Target: 1,150,000 (2023), of which 52% women Target: 70 (2023) Pipeline (WB Operations) Indicator 2.4.2.: People provided with access to x Water Supply, Sanitation and Water improved sanitation facilities by the IDA project Adoption of new water supply tariff Resources Management Project (P164345) Baseline: 0 (2018) structures x E-Burkina II (ID4D) Target: 1,350,000 (2023), of which 52% women Rural water supply: 2020 x PforR in Water sector (P164345) Urban water supply: 2023 ASA x Improving Water Resources Knowledge and Management in Burkina Faso (P162723) Focus Area 3: Strengthen governance and support citizen engagement While defining the top priorities for Burkina Faso, the SCD’s key finding was that governance was the primary driver. During the consultation process, the steering committee (former ministers and civil society representatives) argued strongly that governance is the foundation of the country’s development. There is a high demand for accountability from the population, which greatly contributed to political changes since 2014. The Government has adopted several reforms including asset declaration of ministries, accountability and transparency on public spending to address the weaknesses in government effectiveness, quality regulations, rule of law and control of corruption. These reforms seek to improve outcomes in public service delivery mainly for the poorest households and reduce inequality. Public sector reforms will contribute to improved satisfaction with services, as well as increase government accountability. The PNDES has identified governance as its first strategic objective with ambitious objectives in political and administrative good governance, economic governance, decentralization and local governance. CPF Objective 3.1: Strengthen domestic resource mobilization and public expenditure management Intervention Logic Both the SCD and PNDES placed fiscal discipline as a key element for the macroeconomic sustainability and the root driver of achieving the MDGs. Burkina Faso is exposed to frequent economic risks due to a continued recession in Europe, both through changes in commodity prices and through potential volatility from its exchange rate peg to the Euro. As a price taker on international markets, agriculture, cotton and mining remain vulnerable to adverse exogenous shocks. In addition, public workers strike in line ministries have resulted in a sharp increase to the wage bill representing about 50 percent of tax revenues, which increased the fiscal deficit well above the WAEMU threshold. The new PPP approach for 58 investments may also jeopardize public debt sustainability in the medium term and increase uncertainties on the macroeconomic side. To address the fiscal sustainability issue, the PNDES has set ambitious targets of tax revenue collection at 22 percent of GDP by 2020 and a range of PFM reforms to ensure value-for-money on public spending. The WBG is fully engaged with other donors providing budget support, including the IMF in monitoring the macroeconomic and supporting fiscal management reforms. The objective is also to help the country improve its PEFA, PIMA and CPIA records to past scores. The current project on Economic Governance and Citizen Engagement’s component on domestic revenue mobilization and public expenditure management seeks to support these ambitious reforms on both domestic revenue mobilization and public expenditure effectiveness. The ongoing ASA on tax covering Côte d’Ivoire, Burkina Faso, Togo and Benin will help streamline an analysis of domestic revenue mobilization gaps and opportunities in these countries, with a view to identifying options to increase domestic revenue. The study will follow a standard tax policy framework to examine the main revenue sources while emphasizing different tax policy issues and options specific to each country, while also comparing countries, benchmarking them with regional peers, and examining policy issues common to all countries, especially in relation to regional policies (WAEMU and ECOWAS). The wage bill study will help improve dialogue with trade unions and provide recommendations to streamline salary package and civil service productivity. In addition, the PPP TA will help insure the legal framework compliance with international standards and enhance capacities within the Ministry of the Economy and Finance and some line ministries, including public investment management improvement. This TA has supported the country in designing the PPP for the energy sector. CPF Objective Indicators Supplementary Progress Indicators WBG Program Indicator 3.1.1: An increase in the ratio of tax Number of registered taxpayers Ongoing (WB Operations) revenue to current expenditures. Baseline: 100,000 (2018) x DPO series on Energy and PFM (P163283) Baseline: 1.03 (2018) Target: 130,000 (2023) x Economic Governance and Citizen Target: 1.10 (2023) Engagement Project (P155121) Execution rate for public investment x Local Government support project (P162742) Indicator 3.1.2: A reduction in the number of days, spending: on average, to complete a public procurement Baseline: 83% (2017), but with temporary ASA from the invitation to bid to contract signed and suspension of the public procurement code x Tax Study (P163693) approved. Target: 90% while respecting the x Support for the PPP institutional Framework Baseline: 100 days. (2017) procurement code and (P163053) Target: 80 days (2023) x Study on public sector wage bill CPF Objective 3.2: Strengthen citizen engagement and public-sector accountability Intervention Logic The PNDES foundation is related to strong governance and public accountability to build a solid social and political space for the structural transformation of the economy. Lessons learned from the social uprising of 2014, as well as weak service delivery and accountability in public finance, have all resulted in strengthened civil society. Civil society pushed for the adoption of the anti-corruption law and the revised mining code in order to generate more transparency in the use of public resources. While the law requires public institutions to make information on their 59 functioning and decision-making processes publicly accessible to users, the role of citizen engagement remains crucial to achieving a full application of this law. Citizen engagement including media freedom will help anti-corruption tools and law enforcement be more effective, generating greater transparency and limiting opportunities for social tensions. Public sector modernization via greater efficiency and better service delivery is presented as the first step in the PNDES to achieving structural transformation of the economy, while the SCD emphasizes the importance of empowering civil society and other stakeholders to become more involved in decision-making and monitoring processes. The PNDES outlines a range of ambitious targets for improving public administration users’ satisfaction by 75 percent in 2020, as well as the monitoring rate by civil society organizations (CSOs) from 20 percent in 2015 to 100 percent in 2020. On the accountability front, the PNDES focuses on the State’s internal and external control system, promoting citizen’s involvement at all levels and improving transparency in public administration. Moreover, the Open Budget Index (OBI) target will be increased from 43/100 in 2015 to 55/100 in 2020, along with the Corruption Perception Index (CPI) being expected to rise from 38/100 in 2015 to 60/100 in 2020 and the Mo Ibrahim Index for Governance in Africa from 52.2/100 in 2015 to 65/100 in 2020. The WBG will support the PNDES’ ambitions in complementarity with other bilateral and multilateral donors. To achieve this, about 21 percent of the financial envelope of the portfolio is dedicated to governance. Moreover, the Economic Governance and Citizen Engagement Project (via component 1) has the objective of improving public sector transparency and accountability and strengthening civil society capacity to monitor public sector performance and service delivery. This project is being complemented by the Local Government Support Project and Public Sector Modernization program (PforR) with the objectives of scaling up citizen participation in local governance, as well as strengthening national capacity for decentralization and the institutional capacities of communes in all regions. In the same vein, the Public Sector Modernization program and related additional financing support will help improve selected service standards in targeted areas among ministries responsible for primary education, justice, labor and the civil service across the 13 regions of Burkina Faso, while the e-Burkina project will insure connectivity among public administration offices and speed processing time for service deliveries. On the knowledge front, the WBG will support an ASA to review civil service and wage bill issues as part of its support to the ongoing policy dialogue in the country and to provide sound recommendations for fiscal sustainability and civil service productivity. CPF Objective Indicators Supplementary Progress Indicators WBG Program Indicator 3.2.1: Increase in Citizen satisfaction with Citizen’s budget published by the end of Ongoing (WB Operations) quality of public service delivery the first quarter of the budget year Base line: TBD (2018) Baseline: No x Local Government Support Project Target: 15 percentage points higher (2023) Target: Yes (P162742) x Economic Governance and Citizen Indicator 3.2.2: Percentage of grievances Government and CSOs staff trained in new Engagement Project (P155121) addressed by beneficiary ministries using new accountability, citizens engagement x Public Sector Modernization Program mechanism mechanisms, and PFM (20% of whom are (P132216) Base line: 0 (2017) women) x e-Burkina Project (P155645) Target: 40 (2022) Baseline: 0 (2016) ASA 60 Target: 600 (2020) x Support to Burkina Faso land policy Indicator 3.2.3: Share of identified officials who (P165025) have declared their assets Share of civil services transactions x Study on public sector wage bill Baseline: 30% (2017) involving hiring or promotion completed x IE of BF local Government Support Project Target: 100% (2021) within 28 calendar days (P143984) Baseline: 4.5% (2016) x IE of BF local Government Support Project Target: 50% (2020) (P148392) People using the Digital Platform for eService Delivery Baseline: 0 (2016) Target: 5000 (2021) CPF Objective 3.3: Support decentralization Intervention Logic From the PSRSP to the SCADD and the PNDES, the Government has been engaged in the decentralization process for a decade. Progress has been achieved on the political front with more than 352 urban and rural communes created. The recent successful and peaceful elections at the municipality level resulted in the establishment of powerful entities at the grassroots level. However, weak management capacity, delays in transmission of budget support from the central to decentralized entities have resulted in poor service delivery in basic education, health, roads and an overall low profile of the decentralization process. Achieving the MDGs requires that all the line ministries have efficient offices in the field to support decentralization. The political will to support decentralization has resulted in the Government’s commitment to transfer more than 10 percent of the central budget to the communes for improved service delivery to the population. To address the quality of service delivery and empower rural communes, two-thirds of donors in Burkina Faso are engaged in supporting the decentralization process. The WBG is involved through the Local Government Support Project and its additional financing with the objective of supporting local governance stakeholders, including locally-elected officials (commune councilors) and representatives of local populations, in developing robust accountability and transparency practices. Support will include improving the intergovernmental fiscal framework, which is expected to result in a progressive increase in the proportion of the central Government’s budget transferred to communes from 5 percent in 2018 to 15 percent in 2021. In addition, the Economic Governance and Citizen Engagement Project and Public Sector Modernization program will support capacity building in the 13 regions and the 352 urban and rural communes over the next four years. The e-Burkina Project is designed to computerize administration from central to decentralized units with the objective of reducing the processing time of decision-making and delivering faster services to the population. The two IEs carried out recently will help assess the strengths and weaknesses and improve the decentralization process, while an ASA on land will provide best practices and advise a suitable legal framework for land tenure in the communes. 61 CPF Objective Indicators Supplementary Progress Indicators WBG Program Indicator 3.3.1: Share of central government Deviation of budget implementation from Ongoing (WB Operations) budget transferred to communes initially approved communal budget x Local Government Support Project Baseline: 5% (2017) Baseline: 40% (2017) (P162742) Target: 15% (2021) Target: 15% (2021) x Economic Governance and Citizen Engagement Project (P155121) Indicator 3.3.2: Citizens rating performance of Proportion of municipal officials who x Public Sector Modernization Program commune governments as satisfactory assess the collection of communes’ own (P132216) Baseline: 52% (2017) taxes by regional MINEFID agencies as x Burkina Faso e-Government Project Target: 70% (2022) effective (P155645) Baseline: 0 percent (2017) ASA Target: 7.0 percent (2021) x Support to Burkina Faso land policy (P165025) Communes that established local budget x Study on public sector wage bill committee x IE of BF local Government Support Project Baseline: 40 percent (2017) (P143984 and P148392) Target: 100 percent (2021) Number of communities that adopted the Community Score Card Baseline: 0 (2016) Target: 50 (2020) 62 Annex 2: Completion and Learning Review of the FY13-16 Country Partnership Strategy for Burkina Faso (Report No 78793-BF – August 21, 2013) PLR Report No 96513-BF – May 18, 2015 I. INTRODUCTION 1. This Completion and Learning Review (CLR) is a self-evaluation of the Country Team’s implementation of the World Bank Group’s (WBG) Country Partnership Strategy FY13-16 (CPS) for Burkina Faso. The CPS was endorsed by the WBG’s Board of Executive Directors on September 19, 2013 and supported the government of Burkina Faso’s Strategy for Accelerated Growth and Sustainable Development (SCADD; 2011–2015). The CPS had three strategic objectives: (a) accelerate inclusive and sustained economic growth; (b) enhance governance for more efficient social services delivery; and (c) reduce social, economic, and environmental vulnerabilities. Two cross-cutting themes embedded in the WBG’s activities were good governance and gender equality. 2. The Country Team prepared a mid-term Performance and Learning Review (PLR) in May 2015. The main conclusions of the PLR were that the strategic objectives of the CPS remained relevant and were broadly attainable, although the CPS was adjusted in a number of areas, to take account of the socio-political developments in the country and their root causes; progress under the WBG’s engagements in the country; and discussions with a broad range of stakeholders. In particular, the portfolio was strengthened in the area of governance, and outcomes were disaggregated into a larger number of more specific and realistic objectives. 3. Overall performance of the CPS program (FY13-16) is rated as Moderately Satisfactory. Two CPS Strategic Objectives were rated Mostly Achieved, with four out of seven outcome indicators either mostly achieved, or achieved under the first strategic objective of accelerating inclusive and sustainable economic growth ; and two out of four outcome indicators under reducing social, economic and environmental vulnerabilities rated achieved. The second strategic objective of enhancing governance to deliver social services more efficiently is rated as Partially Achieved. Progress was registered for every CPS objective, but some were too broad and extended beyond the scope of WBG interventions. The first pillar aimed to accelerate inclusive and sustained economic growth, which was probably too ambitious as the economy was already growing at 9 percent in 2012. The first outcome in this pillar included macroeconomic stability and the second one called for less unemployment. The problem with these outcomes was recognized during the PLR and adjustments were made to emphasize domestic resource mobilization and training for employment, although the first of these remained too broad. 4. The Bank delivered a sizable lending program of US$1.586 billion during the CPS period, including a US$109.8 million contribution to regional integration projects, US$76.7 million in Trust-Funded operations, and a special response to the food security crisis in 2014 through an increase in the amount of the Growth and Competitiveness Credit for budget support, and a fast-track disbursement targeting the affected regions using the Third Phase of the Community Based Rural Development Project (P129688) , and the Agricultural Diversification 63 and Market Development Project. The Bank also stepped up its support during the political transition following the ouster of the former regime. The Bank’s indicative envelope for the CPS period was US$1.299 billion in IDA resources, and US$21.5 million in Trust Funds. 5. IFC scaled up its engagement over the CPS cycle, through investments and advisory services, contributing substantially to progress towards WBG targets. In 2013, IFC had active investments in power, mining, telecommunications, trade finance, housing finance, and food retail amounting to a total commitment of US$32 million. New investments during the CPS period included agribusiness, trade finance, and mining. As part of its short-term trade finance investments, IFC committed approximately US$200 million to the Burkina program between FY13 and FY16. IFC’s new long- and short-term commitments during the CPS period reached US$281 million, all of which was through its own account. At end-FY16, the total commitment amount of investments in IFC’s portfolio had grown to US$7 3 million. Long-term investments during the CPS period accounted for 33 percent of cumulative IFC investments in the country. This scale-up demonstrates effective support to CPS objectives and an IFC decision to remain engaged in the country throughout the politically difficult period despite many investors’ reticence to engage. 6. This scale-up will continue under the CPF, as IFC plans to continue deepening its engagement in Burkina Faso through advisory and investment services . IFC has a strong pipeline of investment projects in SME, agribusiness, and women’s finance, power, and agribusiness; it will seek advisory and investment opportunities in infrastructure development through PPPs. 7. The WBG performance is rated as Good. The strategy of the CPS was well-aligned with the country’s development priorities, as laid out in the Strategy for Accelerated Growth and Sustainable Development -SCADD, and its emphasis on economic growth, social services, and reduced vulnerability, with a cross-cutting attention to good governance and gender equality. The overall objectives of the CPS were closely aligned with the WBG twin goals of reducing extreme poverty and boosting shared prosperity. Particular attention was given to ways in which the WBG could better address the issues of poor governance, weak capacity in public institutions, social exclusion, and pro-poor growth. The flexibility in the WBG response following the political developments in October 2014 was critical for adapting the strategy (an increase of US$20 million of the fourth and last operation of the Growth and Competitiveness Credit series to help mitigate the post-insurrection social tensions during the transition regime) to the new country context, as well as to project implementation. II. COUNTRY CONTEXT 8. Following two decades of relative political stability, President Compaoré resigned in October 2014 after widespread civil unrest. The political and economic context became less favorable than anticipated at the time of the formulation of the CPS. The new political environment has had, and will continue to have, significant implications for the WBG’s program and areas of engagement. The 2015 coup attempt shows the fragility of the political system while the country will need to adapt to the reconfiguration of the political forces. Also, civil society, unions, and 64 other interest groups have gained a much stronger voice in public issues than before, requiring more participation and consultation in the formulation of policies. 9. A sharp deterioration in the security situation in the Sahel region had multiple negative repercussions on Burkina Faso during the CPS period. On the humanitarian front, early during the Mali crisis of 2012-13, large numbers of those forcibly displaced from Mali fled across the border to Burkina Faso, adding to an earlier wave of refugees who were unable to return to Mali after previous crises in the 90s, when Burkina Faso played a leading mediating role. With the establishment of the group of countries of the G5 Sahel (which includes Mauritania, Mali, Burkina Faso, Niger and Chad) in 2014, Burkina Faso assumed an increasingly prominent role in the regional military contingent engaged in Northern Mali. In 2017, the launch of Sahel Alliance propelled by Sahelien countries with support from France, the European Union, and the World Bank Group offered the platform to Burkina Faso to assert its leadership as a stronghold against terrorism in the Sahel, a role that heightened security risks, as shown in the March 2018 attacks against its military command, carried out in conjunction with attacks that hit France in Ouagadougou. 10. The unsettled political and security situation had a negative impact on economic activity, which was further aggravated by sharp declines in the world prices of Burkina Faso’s main export products of cotton and gold. Moreover, regional developments also impacted Burkina Faso negatively, including a large influx of refugees from the political crisis in Mali and fall-out from the Ebola epidemic in West Africa. Security concerns were exacerbated by terrorist attacks in the country. Investors and tourists were discouraged, and the government budget was put under considerable strain due to rising expenditures on military. As a result, economic growth was lower than projected (see Table 1). Table 1: Difference between CPS projections and actual outcomes, 2012-16 2012 2013 2014 2015 2016 Actual Proj. Act. Proj. Act. Proj. Act. Actual GDP growth (%) 9.0 7.0 5.7 7.0 4.2 7.0 3.1 5.9 Revenues/GDP (%) 17.7 18.6 18.5 18.3 17.5 18.5 16.2 17.7 Expenditures/GDP 25.8 25.9 27.4 26.0 23.4 26.1 22.9 23.6 (%) Fiscal deficit/GDP 3.1 2.3 3.6 2.8 1.9 2.8 2.2 3.3 (%) Gold price ($/ounce) 1,657 1,760 1,411 1,790 1,266 1,830 1,161 1,249 Cotton price 77.7 97.5 91.0 98.0 83.2 93.0 70.4 74.2 (cents/lb) Source: WB CPS for projections, IMF staff reports and WB data bases for actuals. 11. GDP growth fell short of expectations. Real GDP growth declined from a peak of 9 percent in 2012 to 4.2 percent in 2014 and 3.1 percent in 2015. Government revenues fell by 2.4 percentage points of GDP between 2013 and 2015, while expenditures fell by 4.5 percentage points. FDI fell by half, from 3.6 percent of GDP to 1.9 percent. On the other hand, declining oil prices helped contain the cost of petroleum subsidies, cotton and cereal production continued to increase, and inflation was virtually non-existent. Abundant rainfall and successful interventions in the 65 agriculture sector contributed to strong agricultural growth and a decrease in food prices. Sound macroeconomic management limited the fiscal deficit to only 2.2 percent of GDP in 2015. 12. Poverty has declined moderately but the challenge of poverty reduction remains central to Burkina Faso’s development. The latest poverty survey carried out by the government in 2014 showed that poverty had declined from 46.7 percent in 2009 to 40.1 percent in 2014. A new Household Survey is under preparation with data collection expected to start in the first quarter of FY19, supported through the regional Household Survey Modernization and Harmonization Project in WAEMU Countries (P153702). Growth has been inclusive, with consumption levels rising faster among the poor than the non-poor, leading to a decrease in consumption inequality. However, progress has not been strong enough to achieve a drop in the absolute number of poor, which remains at 7.1 million in 2014, the same as in 2009. This is due to the high rate of population growth. Poverty declined twice as much in urban areas, from 25 to 13 percent, compared to a decline from 53 to 48 percent in rural areas. Consequently, 90 percent of the poor now live in rural areas. 13. The level of human development remains very low. Burkina Faso is ranked 185 th out of 188 countries on the UNDP Human Development Index. It has the lowest mean years of schooling of all countries for which data is available – a mere 1.4 years. According to the 2014 household survey, the literacy rate (population of 15+) was 33.8 percent, 43.6 percent for men and 25.5 percent for women. far below the Sub-Saharan Africa (SSA) average of 60 percent. The primary completion rate is 63 percent, again less than the regional average of 69 percent. However, maternal and child mortality rates have declined significantly over the past decade, and are now better than the SSA average. The quality of health services nonetheless remains poor. 14. Burkina Faso has made progress towards improving gender equality although progress is slower than anticipated. Despite a concerted effort, women continue to lag behind men in terms of human capital and labor market participation. Boys are twice as likely as girls to complete secondary education. The literacy rate of men age 15 and older is 10 percentage points higher than for women. Women are treated unequally in the labor market. In 2014, 8.3 percent of men worked for a wage versus only 3.6 percent of women. In agriculture, women continue to have less access to micro-credit, land rights, technology and know-how. Female-headed households are significantly more likely to be poor. III. Progress in Achieving CPS Outcomes 15. Despite the changed environment, progress towards reaching the objectives of the CPS is rated as Moderately Satisfactory. Individual outcome indicator ratings are listed in Table 2, and in the Results Matrix (see Annex 1). The ratings reflect the degree of progress achieved in the strategic objectives and indicators in the CPS Results Framework, some of which were affected by the socio-economic developments that took place in Burkina Faso mid-way into the CPS’s implementation. Also, these ratings do not fully capture the overall impact of the WBG engagement in Burkina Faso during the CPS period, or the quality of the dialogue, and how the Bank is viewed as a trusted partner by Government, other development partners and stakeholders. While the PLR made some adjustments to the Program of objectives of the concluded CPS, there 66 are still shortcomings in the Results Framework, which did not fully reflect the changing circumstances and limited progress towards indicators in certain cases. Table 2: Strategic Objectives and Results Indicators Rating Strategic Objective 1: Accelerate Inclusive and Sustained Economic Growth MA Outcome 1.1: Increased domestic resource mobilization PA Outcome 1.2: Improved access to finance by SMEs/SMIs A Outcome 1.3: Improved vocational skills and training for employment PA Outcome 1.4: Increased production and access to energy MA Outcome 1.5: Increased access to all-weather roads PA Outcome 1.6: Improved access to information and communications technology A Outcome 1.7: Increased agricultural productivity and marketing of selected value chains MA Strategic Objective 2: Enhance governance to deliver social services more efficiently PA Outcome 2.1: Strengthened public accountability and resources management PA Outcome 2.2: Expand access to quality education for the poor PA Outcome 2.3: Increase access to quality health services for the poor PA Outcome 2.4: Expand access to quality water and sanitation facilities for the poor A Strategic Objective 3: Reduce social, economic and environmental vulnerabilities MA Outcome 3.1: A more efficient targeted safety net and cash transfer program piloted A Outcome 3.2: Increased production and storage of staples for food security PA Outcome 3.3: Better disaster and risk management A Outcome 3.4: Better climate change adaptation PA Note: A - Achieved; MA – Mostly Achieved; PA – Partially Achieved 3.1 Pillar I: Accelerate Inclusive and Sustained Economic Growth CPS outcome 1.1: Domestic resource mobilization increased on the back of tax administration reforms 16. Total revenue was 17.7 percent of GDP in 2012, rising briefly in 2013 before dropping to 17 percent of GDP in 2015. This setback was largely due to falling gold prices and the slowdown in the economy during the political transition period (2014-2015). Starting in 2016, tax revenue rebounded as the economy recovered and government started implementing tax administration reforms. Non-tax revenue was also aided by increasing gold prices. Overall, revenue was estimated 67 at 17.7 percent of GDP in 2016. Revenue growth continued in 2017, on the back of strong economic growth, increased tax controls, and continued improvements to tax administration. In retrospect, this outcome was too broad compared to the limited interventions in domestic resource mobilization supported by the WBG. CPS outcome 1.2: Improved access to finance by SMEs and SMIs 17. Over the CPS period IFC increased its trade finance support to banks with a total amount of approximately US$200 million (see Table 3). IFC doubled its trade finance support in Burkina Faso on an exceptional basis at the peak of the 2014 political crisis which led to international investors/financial institutions closing business in/with Burkina Faso. At that time, confirming banks would not accept letters of credit issued by Burkinabe banks. IFC’s trade lines allowed banks to continue vital trade financing operations (including importation of much-needed food stuffs, medication and fuel) with no interruptions during a crisis period. 18. Successful experiences include the Maison de l’Entreprise du Burkina Faso (MEBF), a business incubator, offers a model to emulate by other countries that don’t yet have similar bodies. In its free advisory role, MEBF is like similar agencies in developed countries, such as the Score association of business mentors supported by the US Small Business Administration (SBA). As with Score, MBEF provides a one-stop-shop for new entrepreneurs, as well as business advisory services for existing businesses. MEBF goes one step further, as it can take on projects to follow in-situ operations and turn them into formal SMEs. A formal SME enhances its chance to access credit and compete in public bids. In this role, MEBF is an effective business incubator. With its successful collaboration with the Agricultural Diversification and Market Development Project (P081567), MEBF has shown that it can expand entrepreneurship, including in rural areas. Table 3. Results relating to SME finance: FY13 FY14 FY15 FY16 Total Trade Finance for SMEs (in US$ million) 9.8 32.7 80.1 76.9 199.5 CPS outcome 1.3: Improved vocational skills and training for employment 19. Out-of-school youth have been supported through short-term employment and training. The Youth Employment and Skills Development Project (P130735) funded employment through labor-intensive public works (LIPW) as well as apprenticeships, and vocational, literacy and entrepreneurship training. The two largest cities were targeted along with a few of the regional capitals identified as growth poles, but rural LIPW were also supported. Primary beneficiaries of the project are about 46,800 out of school youth between 16 and 35 years and including at least 30% women. The youth participate in Labor Intensive Public Works (LIPW), skill-building activities (apprenticeships and training) and entrepreneurship programs. In the urban part of the LIPW component, more than 70 percent of the participants are mothers, some of whose children are toddlers and require supervision or, in some cases, permanent psychosocial care and stimulation. Many mothers usually take their children to work and have them wait under a nearby tree or in makeshift shelters, sometimes guarded by an older child or one of the mothers. A trust fund from the Umbrella Facility for Gender Equality (UFGE) was obtained to improve this model of childcare developed by mothers. There is also an "apprenticeship" component in which 3500 68 apprentices are being trained in 6 sectors / 29 careers, but the number of graduating apprentices is not known and a survey is planned to shed light on the situation. 20. The Youth Employment and Skills Development Project started slowly with little measurable progress in 2016. However, activity picked up and the total number of person-days in LIPW substantially exceeded project targets by 2017, though the number of youth involved was less than half the target. The skills development program was not yet operational in early 2016, yet, by 2017, 7,000 youth had participated (just over half of the target), of which 42 percent were young women, exceeding the target. Post-training employment is likely more difficult than expected. One year after the employer-led training component, only 36 percent of youth were employed or self-employed, as compared to the project target of 60 percent. Meanwhile, the medium-term employment of youth transitioning from other components of the project is very hard to measure. A tracer survey of the LIWP participants during 2018 will shed light on their pathway into the labor market. CPS outcome 1.4: Increased production and access to energy 21. The supply of and access to energy improved significantly. Total capacity increased from 250MW in 2012 to 315MW in 2015. The Government’s strategy promotes a dramatic scale -up of renewable energies by 2030. The Government had planned on commissioning 120-megawatt peak (MWp) of solar capacity by the end of 2018, but reaching an economically and financially sustainable agreement on projects has proven challenging. The WB supported construction of a turnkey diesel power station of at least 7.5 MW convertible to heavy fuel oil (HFO) to reinforce the capacity in Fada—one of the country’s regional growth poles—and provision of technical advisory services for construction and supervision. Commissioning is expected in late 2018. 22. Rural access to electricity improved. The Electricity Sector Support Project (P128768) supports improved access to electricity in about 120 rural communities through: (i) grid expansion and installation of connections in selected communities through existing and new 33 kV transmission lines and the existing 34.5 kV Bobo-Dioulasso-Ouagadougou line; (ii) installation of hybrid mini grids and solar home systems in remote and poor localities; and (iii) installation of multifunctional platforms to foster income-generating activities in poor localities. By 2016, 40 rural communities had been electrified, comprising about 600 households and almost 4,000 people, well above the target of 2,410 people by 2016 (Outcome 1.4, second indicator). CPS outcome 1.5: Increased access to all-weather roads 23. The Transport Sector Project obtained additional financing to expand rural access to all- season roads. It adopted the Road Access Index for the project impact area as one of its results indicators, with a target of 26 percent. However, it closed in the first year of the CPS and there was no follow-up project with the same objective. Hence, the CPS goal of 33 percent access nation-wide seems inappropriate. That said, some progress has been made, with access rising from 22 percent to 27 percent between 2012 and 2016. 69 CPS outcome 1.6: Improved access to information and communication technology 24. Access to ICT accelerated beyond expectations. Access to telephone services reached 81 percent of the population in June 2016 (compared to 64 percent in June 2013). Internet access exploded to 15 percent (while access rates were negligible in 2013), but both achievements were largely driven by the investments of telecommunications operators and the expansion of mobile networks (especially mobile broadband), due to factors beyond World Bank project interventions: the regulatory support contributed to a more competitive environment leading to price decreases, but major infrastructure investments were not operational in June 2016. CPS outcome 1.7: Increased agricultural productivity and marketing of selected value chains 25. The Bank successfully completed a long-standing project to promote agricultural exports. The Agricultural Diversification and Market Development Project sought to increase the competitiveness of selected agricultural sub-sectors that target national, sub-regional and international markets. The project initially focused on cotton, mangoes, onions, beef and poultry, later adding sesame. CPS export targets for cotton, mangoes, onions and sesame were exceeded, some by a wide margin (sesame). While cotton production in the 2012-16 period substantially exceeded that of 2009-11, there was no clear upward trend over the course of the CPS time frame. Cotton production averaged 600,000 tons between 2012 and 2016 and remained steady between 2015-16. Delays in developing the Bagré pole area represented a constraint to large and medium size investments (more than 500 hectares and even 100 hectares) by agri-business firms. 26. The Bagré Growth Pole project (P119662) encountered some difficulties and agri-business investments are expected to grow as implementation of the Bagré Growth Pole Project accelerated towards the end of the CPS period and a $50 million Additional Financing operation was prepared and approved in March 2018. This ambitious project set out to support private-sector-led growth in commercial agriculture by investing in actions in a number of mutually supportive areas: irrigation, roads, energy, water, business environment, matching grants for SME, access to land, vocational training, public-private partnerships, investment promotion, natural resource management and social infrastructure. Investment flows and SME creation have exceeded targets and employment generation is progressing well: since its inception in 2011, the Bagré Growth Pole Project has contributed to creating 25,020 jobs and it is expected to create 33,000 jobs by project closing in 2020. However, large-scale investors have not been forthcoming as originally envisaged in the CPS results framework. Delays with the construction of large-scale irrigation infrastructure (which is now on-track for completion by the end of FY18), lack of coordination between the investment promotion agency and Bagrepole, and the need to postpone transport and electricity infrastructure due to cost overruns were responsible for the delays. Progress during implementation was delayed by incidents on construction sites that resulted in fatalities. These have been investigated and an action plan agreed and implemented by the project team. The project was included in the corporate risk list as a result during this period. In favor of the good turnaround of the project, an additional financing of US$50 million has been prepared under the new CPF (P161234, approved on March 30, 2018), to complete the transport and electricity infrastructure component that could not be covered under the initial funding. 70 3.2 Pillar II: Enhance Governance to Deliver Social Services More Efficiently CPS outcome 2.1: Strengthened public accountability and resource management 27. Considerable support was provided on decentralization. The WBG, through the third phase of the Community-Based Rural Development Project and the Local Government Support Project (P120517), helped to lay a solid foundation for local governments to better manage development issues at the local level. Commune development plans, including institutional aspects, have been funded by these projects. Although fiscal decentralization is still weak, and merits attention, institutional capacity for decentralization has improved. A strong legal foundation has been established, and has enabled formulation of policies to support the transfer of competencies to local governments in a bid to enhance their capacity for local service delivery. The Government has proposed to transfer up to 15 percent of national revenues to local governments by 2020. In the meantime, notable results have already been attained by Government, including: x An increase in the percentage of resources transferred to local governments; x A more predictable and transparent intergovernmental transfer system, as measured through publication of indicative allocations of the transfer amounts to local governments and early disbursement of funds to region/commune accounts during the fiscal year; and x A relaxation of a priori financial controls over local governments and a simplification of the procurement process at the local level. 28. Progress was achieved in Burkina Faso’s core public administration and management capacity. The Bank’s first Program for Results in Burkina Faso provides targeted support to the country’s Ten Year Strategic Plan for Modernization of Administration. The government achieved all, except one, of the Program targets in less than two years, and the instrument has provided the necessary incentives to achieve results on service delivery outcomes. An important achievement was a structural improvement in the Integrated Human Resource Management System. Significant consolidation was achieved relating to human resource processes and a modest improvement in the recruitment, career management and retirement processes, although a recent World Bank review12 identified weaknesses in internal ministerial controls. Line ministries now possess easily accessible and up-to-date information on the civil service for planning, budgeting and monitoring of public sector spending. The World Bank support following the 2014 political crisis has broadened investments in governance and accountability instruments, fostering government accountability to citizens, while addressing economic governance issues such as PFM and revenue mobilization under the Economic Governance and Citizen Engagement Project (P155121). Important achievements include active civil society participation in sector policy processes, particularly in Education, Health and Finance, although Burkina still provides limited opportunity for public participation in budget processes. The transfer of funds from the central government to communes have been substantially accelerated, with funds available to communes by January 19 12 A World Bank scoping mission on wage bill management and civil service review conducted from November 27 to December 2, 2017. 71 in 2017 compared to April 30 five years earlier. The PforR instrument has proven effective to support these efforts and will be continue through a scale-up of the Public-Sector Modernization Program under the CPF. CPS outcome 2.2: Expand access to quality education for the poor 29. The World Bank chose to focus on secondary education, with some additional support to pre-school education. This decision was taken in the context of a sector-wide approach and in light of on-going support from other partners, including the Global Partnership for Education which focuses on the primary level. The Education Access and Quality Improvement Project (P148062) aimed to: (a) increase access to pre-school education in the two poorest regions, (b) increase access to secondary education in the five poorest regions, and (c) improve teaching and learning. Gross intake in upper secondary doubled for both boys and girls, thereby exceeding targets. For lower secondary education for example, and regarding the increase in the grade promotion rate disaggregated by gender in the 5 targeted regions, the indicator has risen from 59.1 percent at the baseline to 65.1 percent currently and the final target of 66.0 percent will certainly be exceeded. Regarding the increase in the girls' promotion rate in lower secondary education in the 5 targeted regions, from 59.7 percent at the baseline, the project has currently reached 65.9 percent effectively reaching the final target of 66 percent. CPS outcome 2.3: Increase access to quality health services for the poor 30. The Bank has focused on maternal and child health services. The Reproductive Health Project (P19917) involved contracting health facilities to provide key maternal and child health services to target populations in their vicinity through results-based financing. Health services included outpatient consultations, immunization of children, acute malnutrition treatment of children, antenatal care services, assisted deliveries, family planning services, and prevention and treatment services for Prevention of Mother-to-Child Transmission, HIV/AIDS treatment, malaria and tuberculosis. The Project also supported critical inputs for reproductive and family planning services. The proportion of births assisted by skilled personnel rose from 67 percent in 2010 to 80.9 percent in 2016. However, the percentage of pregnant women receiving at least one prenatal visit fell from 85 percent to 80.3 percent despite the free health care scheme for mothers and children under five implemented since April 2016, while women receiving at least four prenatal visits progressed moderately from 22.3 percent to 34.1 percent over the same time period. Targets were met or exceeded for the treatment of children with severe acute malnutrition, and for child vaccinations, at least until 2016 when a national shortage of vaccines hampered the program, as well as HIV-positive pregnant women on ARV prophylaxis. CPS outcome 2.4: Expand access to quality water and sanitation facilities for the poor 31. A significant increase in sustainable access to improved water and sanitation in urban areas has been achieved through the implementation of the US$160 million Urban Water Sector Project (P106909) (2008-2018). The project benefited more than 600,000 people in Ouagadougou, Bobo- Dioulasso, Koudougou, and Dedougou, including in informal and peri-urban areas, with access to improved water supply services through the provision of household connections and standing posts. And thanks to the reforms and investment made in the reinforcement of the urban water 72 supply system (including in storage, pumping, and distribution networks), the national water distribution agency (ONEA) has improved its operational and financial performance, as demonstrated by increased continuity of services, labor productive, and operational cost recovery. 32. The Urban Water Sector Project has also been essential at improving sanitation services in Ouagadougou, Bobo-Dioulasso, Koudougou, and Dedougou. Through the project more than 430,000 urban residents have benefited from access to an improved household sanitation facility and more than 120,000 students enjoyed access to adequate sanitation in schools, reducing the reliance on open defecation. As close to 100 percent of sanitation services in Burkina are on-site, the project has dramatically contributed to change the disposal of sludge by financing the first two sludge treatment plants in Burkina (one in Ouagadougou, one in Bobo-Dioulasso) where sludge can be adequately treated avoiding unsafe disposal in open fields. 3.3 Pillar III: Reduce Social, Economic and Environmental Vulnerabilities CPS outcome 3.1: A more efficiently targeted safety net and cash transfer program piloted 33. The Social Safety Nets program (P124015), which provides cash transfers to the extremely poor and vulnerable population, became effective. In September 2015, the first 15,000 cash transfer payments started in two provinces (Yatenga and Zondoma) of the Nord region. At the end of December 2017, the beneficiaries of these two provinces received the 8th quarterly payment. The program expanded to the other two northern provinces (Lorum and Passore), with more than 9,000 identified beneficiaries. 5,000 beneficiaries were also identified in Central West (Boulkiemde province) and receive seasonal transfers. In the Eastern (29,000 beneficiaries) and Central East (19,000 beneficiaries) regions, the payment of the first quarterly transfers is planned for the first quarter of 2018. Under another government program (PADEL), it is planned to extend payments to 20,000 beneficiaries in the four provinces of the Sahel administrative region. 34. In each of the communities covered, accompanying measures have been developed (information, training and coaching) to increase beneficiaries' resilience in relation to food shocks and poverty. Furthermore, the foundations were laid for a basic national safety net system. A registry database has been developed so that it can incorporate households that are being targeted by other programs. In addition, the targeting and data collection methods that are being implemented by the program are incorporating information relevant for other Government and partner safety net programs to select households that have a variety of poverty and vulnerability characteristics. Since a new management team was established, the project is progressing towards its objectives. This successful operation was identified as platform by the Government for a scale- up program in areas hosting refugees. CPS outcome 3.2: Increased production and storage of staples for food security 35. Reforms supported by the Growth and Competitiveness programmatic series of DPOs enabled the government to strengthen food security and food crisis preparedness. The Transition Government awarded a contract for the purchase of 35,000 tons of reserve stocks and 10,000 tons of emergency intervention stocks. In addition, owing to good rainfall, and agriculture projects 73 supported by the Bank and other donors, food crop production increased by 50 percent if 2011 is used as the base year, or 24 percent if 2010 is used instead. 36. The Bank provided additional financing to the Agricultural Productivity and Food Security Project (P114236). This project primarily targeted the supply side of food security with substantial investments to increase sustainable food availability in quantity, and improve distribution and exchange. More than 10,000 ha of lowlands have been developed, 11,000 ha of degraded land have had its fertility restored, and poultry vaccination coverage against Newcastle disease increased from 26 percent in 2013 to 41 percent in 2016. The Warehouse Receipt System ( Warrantage) promoted under the project improved the access to rural credit by smallholders. Production of staple food crops increased from an average of 4.0 million tons in 2010-2011, to 5.4 million tons in 2016.The project also addressed affordability through activities that improve rural producers’ revenues. At the same time, such activities diversify the daily diet and improve the nutrition value of food which contributes to meeting the physiological requirements of consumers. CPS outcome 3.3: Better disaster and risk management 37. The Government of Burkina Faso began the process of establishing sound mechanisms for disaster management. It obtained a grant from the Global Facility for Disaster Reduction and Recovery (GFDRR) to build capacity in emergency response and disaster management. Multiple components of an Integrated Disaster Response Management system were strengthened, as the project provided support to the meteorological services, hydrological service, health department and for the establishment of contingency planning and emergency response plans in seven regions and at the national level. CPS outcome 3.4: Better climate change adaptation 38. The WBG has been helping to address climate change challenges to strengthen economic resilience and reduce vulnerability to shocks. Burkina Faso has been promoting integrated natural resource management in order to support both its adaptation and mitigation agenda – assuming that improved soil carbon and biomass simultaneously increase carbon sequestration and reduce the vulnerability to climate change and desertification. Thus, in 2014, Burkina Faso has been accepted as a beneficiary of the Forest Carbon Partnership Facility and received a first grant to build national capacities and design a national strategy to reduce emissions due to deforestation and forest degradation (REDD+). In addition, Burkina Faso received a grant from the Forest Investment Program to test this approach in 32 communes through the Decentralized Forest and Woodlands Management Project (P143993). This project supports participatory processes to create and implement “REDD+ integrated development plans” in 32 communes aiming to reducing the emissions and strengthening the climate resilience. 3.4 Cross-cutting Objectives: Governance and Gender Equality 39. Under cross-cutting themes, gender has been consistently mainstreamed in CPS implementation. A Gender Assessment was conducted as part of the PLR. Overall, the targeted priorities of increasing women’s access to economic opportunities, basic social services and infrastructure, increasing gender equity in the agriculture sector, and monitoring gender inclusion 74 indicators in the Bank’s projects, have been achieved. However, the limited a ccess of women to secondary education, finance, and land, and the decline in prenatal visits, are major concerns. Special attention has been paid to the inclusion of appropriate gender-sensitive indicators in project results frameworks and increasing the use of gender-relevant analysis, in order to build the gender knowledge base and provide important inputs to current and future operations. 40. On the WBG’s work on governance as a cross-cutting theme, political events led the WBG to rethink and strengthen its support for governance as part of the mid-term adjustments. At the macro level, the WBG’s fiduciary and procurement teams provided technical advice and support to reforms. On the financial management side and in line with WAEMU directives, the WBG supported the government in setting up a clear roadmap that will lead to full adoption of public financial management (PFM) reforms related to the transparency and predictability of public expenditure. 3.5 Regional Integration 41. Regional projects are critical to achieving Burkina Faso’s development objectives, given its landlocked nature and key linkages with neighboring countries. The Bank is therefore supporting a significant number of regional projects. Burkina Faso was included in the Sahel Program jointly launched by the WBG and the UN in November 2013. Over US$1 billion was delivered through this program to countries in the Sahel space. In particular, the Regional Sahel Pastoralism Support Project (US$30 million for Burkina Faso), the West Africa Agricultural Productivity Project (US$15 million for Burkina Faso), and the Sahel Women’s Empowerment and Demographic Dividend project (US$34,8 million for Burkina Faso). In addition, regional operations delivered included the African Centers of Excellence project (US$32 million including national and regional IDA), a two-year Regional Trade Facilitation and Competitiveness DPO series (two times US$ 50 million) was prepared to promote reforms that would reduce transport costs on the Abidjan-Ouagadougou corridor. IV. WORLD BANK GROUP PERFORMANCE 4.1 Quality of design 42. The strategy was well-aligned with the country’s development priorities . In December 2010, the government adopted the SCADD with a broad goal to achieve solid, sustained, and quality economic growth that will have a multiplier effect on income generation, the Burkinabe quality of life, and sustainable development. The SCADD identified four strategic pillars: (a) promotion of growth and reduction of economic vulnerability; (b) investment in human capital and social protection to increase resilience; (c) good governance that makes the public sector more effective and efficient; and (d) incorporation of crosscutting priorities, such as gender, demography, planning, and building capacity to implement development policies and programs. The CPS was clearly well-aligned with the SCADD, given its emphasis on economic growth, social services, and reduced vulnerability, with a cross-cutting attention to good governance and gender equality. 75 43. Choice of objectives. The overall objectives of the CPS were closely aligned with the WBG twin goals of reducing extreme poverty and boosting shared prosperity. The emphasis on agriculture and social protection was particularly important in contributing to these goals in the short run, while other projects help ensure further success in the medium to long-term. Some of the CPS objectives were too broad and extended beyond the scope of WBG interventions. The first pillar aimed to accelerate inclusive and sustained economic growth, which was probably impossible as the economy was already growing at 9 percent in 2012. The first outcome in this pillar included macroeconomic stability and the second one called for less unemployment. The problem with these outcomes was recognized during the PLR and adjustments were made to emphasize domestic resource mobilization and training for employment, although the first of these remained too broad. The objectives of improved access to rural roads and to ICT services did not have strong links to WBG activities. 44. Choice of indicators. A similar problem existed for some of the indicators, and again adjustments were made. But the problem persisted in a few cases. The first objective was changed to focus on resource mobilization, with indicators related to revenues/GDP and mining revenues/GDP, but the WBG did not have the type of comprehensive project which could ensure success. Furthermore, the country was vulnerable to external factors such as a fall in the price of gold. A third indicator, focused on gold production, was not coherent with the objectives of the WBG mining project, which did not include this indicator in its own results framework. Furthermore, the baseline data on revenues/GDP and gold production were not accurate. All the indicators for ICT focused on national measures which went well beyond the scope of the one project – a regional one – supported by the WBG in this sector. Access to internet services was growing fast for reasons that had little to do with the WBG, and as a result the outcome achieved was 3000 percent above the target. The choice of national targets for food and cotton production probably surpassed the objectives of WBG projects. 45. In the second pillar, quality of services and targeting of the poor were emphasized in the various outcomes. However, the indicators did not include estimates of the success in reaching the poor. The education indicators focused on secondary education, which is typically less accessible to the poor, and on enrolment rates, which do not help measure quality. Initially, the CPS did have an indicator to measure second grade reading and math skills, which is a good measure of quality, but this was dropped. National targets were used for health which went beyond the scope of the WBG project, which concentrated on selected regions of the country. The one health project was primarily devoted to reproductive health and so was not well-placed to reduce malnutrition or improve vaccination rates nationally. On the other hand, the objectives in water and sanitation were closely linked to the corresponding project. The same is true for the three components under the third pillar. 46. Performance and Learning Review adjustments. Adjustments were made after the PLR based on: i) an increased understanding of the political developments in Burkina Faso and their political, economic and social root causes; ii) the review of progress in WBG engagements in the country; and iii) consultations with a broad range of stakeholders. Particular consideration was given to ways in which the WBG could better address the issues of poor governance, weak capacity in public institutions, social exclusion, and pro-poor growth. A new project on Economic Governance and Citizen Engagement was prepared and approved in early 2016. Another project, 76 e-Burkina, was approved at the end of the year to enhance government transparency and citizen engagement through ICT. 47. Changes were made in the results framework during the PLR. Some of the objectives in the first pillar were separated out into more clearly defined components. Several indicators were dropped. The education indicators moved away from national targets to focus on the regions covered by WBG interventions. But some of the weaknesses remained. The Government ’s new Education Sector Plan (ESP, 2017-2030) provides a strategy to address overcrowding and quality of education, and improve the alignment between higher education and the job market. 48. Donor collaboration: The Bank undertook a collaborative CPS preparation process with the African Development Bank, in which the two institutions: (a) worked together in the field and shared common diagnostics of the country context, development challenges, and the government vision in their strategy documents of December 2011; and (b) made concerted efforts to identify synergies during the strategy period for investments, analytic work, and policy dialogue with the government. Throughout the CPS, the Bank also organized annual joint country program performance reviews (CPPR) with the African Development Bank, and the International Fund for Agriculture Development (IFAD). The joints CPPRs were presided by the Minister of Finance. Finally, during the closed CPS period, the Bank served as President of the Troika of Development Partners. In that capacity, the Bank led the organization of the Burkina Faso Consultative Group meeting in Paris in December 2016. The event was a success in that it allowed Burkina Faso to secure strong donor endorsement for the country’s new economic and social development plan (PNDES). 4.2 Quality of response 49. By the time of the PLR in May 2015, the delivery of planned lending and non-lending programs was on track, and progress towards CPS objectives was broadly satisfactory despite challenges of delays in project effectiveness and implementation. However, the abrupt political and social changes which took place in the country in 2015 dictated adjustments to the program with flexible and tailored responses to facilitate the political and social transition in anticipation of engagement with a new government after elections in October 2015. Hence, the WBG proposed an enhanced focus on, and a holistic approach to, governance in combination with new lending and non-lending programs, using a mix of instruments including PforRs. 50. The flexibility in WBG response following the political developments in October 2014 was critical for adapting the strategy to the new country context, as well as to project implementation. For example, as a result of the political change, the dissolution of the communal councils and their replacement with Special Delegations slowed the implementation of the communes’ development plans and projects related to decentralization. A quick adjustment by the WBG was necessary to get implementation back on track. Analytical and TA work 51. Knowledge products were delivered as planned and helped inform the policies and reforms in a number of sectors. The report on Leadership and Governance in Burkina Faso’s Health Sector 77 provided important insights into the health sector with actionable recommendations. A Poverty and Social Impact Assessment and a political economy analysis of the trucking industry were completed prior to approval of a regional DPO on transport and trade facilitation (P156892). V. EMERGING LESSONS Adapting to an evolving environment 52. Building in flexibility in WBG engagement is critical for successful project implementation. The political developments since October 2014 have highlighted the importance of adaptability, proactivity and flexibility to adjust to change and manage uncertainties. For example, as a result of the political change, the dissolution of the communal councils and their replacement with Special Delegat ions slowed the implementation of the communes’ development plans and projects related to decentralization. 13 A quick adjustment by the WBG was necessary to get implementation back on track. 53. Early lessons from implementing the WBG program during heightened insecurity in the final period of the CPS can be draw with regard to (i) program content, (ii) delivery mechanisms and (iii) partnership arrangements. (i) Since the first terrorist attack struck Ouagadougou during the final year of CPS implementation, the program has shifted to building resilience of vulnerable communities, in particular at the border with Mali, and in scaling up the ongoing successful Safety nets operation. Taking advantage of the IDA18 architecture, lessons from implementation during the end tail of the CPS have led to design an Additional Financing to the Safety Nets project as a Refugee operation benefitting forcibly displaced population from Mali and the receiving communities. (ii) Lessons from adapting delivery mechanisms to insecurity are being drawn and point towards the importance of building on strong existing social cohesion and community-based decision making and implementation mechanisms. Such mechanisms have been tested in several ongoing operations, namely: the Local Government Support Project, Decentralized Development Project, Forest Management Support Project and eBurkina Faso, in addition to the Safety Nets Project. (iii) Partnerships are expected to become central to preparing and supervising new and ongoing activities in rural isolated areas and urban centers, where security threats are different and require strong intelligence and knowledge of local context. Strong cooperation with agencies such as UNHCR are proving instrumental to reaching refugee communities and operating in remote areas. The Bank will look to broaden partnerships for more effective supervision arrangement in a context where all agencies are reassessing their footprint. Finally, Burkina Faso will adopt the Iterative Beneficiary Monitoring approach that has been successfully tested in Mali to create 13 These projects include the Second Community Based Rural Development Project (CBRD II-3), the Decentralized Development Project, and the Youth Employment and Skills Development Project. 78 a revolving reporting mechanism from beneficiaries in insecure and remote areas, an approach that is expected to contribute to strengthening citizen engagement. Portfolio implementation 54. Delays in effectiveness and procurement can be reduced by better preparation of projects before approval. Most of the recently approved projects incurred effectiveness delays averaging six months due to their inability to meet technical and institutional conditions, including key staff to run the projects. These issues could be resolved before Board presentation through the better use of project preparation advances, and by teams preparing terms of reference and specifications early in the process. Many lessons of project preparedness have been learned. 55. Project performance can be enhanced by regular and disciplined interactions with project implementation units (PIUs) and the authorities. Regular reviews and contacts with PIUs in the periods between supervision missions would help to improve project implementation by identifying and resolving emerging problems in a timely manner. 56. Sustained engagement with multiple stakeholders is essential to build demand for and ownership of difficult reforms. The passage of the anti-corruption legislation and the Mining Code has been slow and difficult to achieve because of lack of buy-in from key stakeholders. Similarly, the slow start of activities in the Bagré growth pole project is attributed to weak stakeholder engagement and buy-in. Monitoring Results 57. Progress registered for the different CPS objective was uneven, Monitoring development results under the CPS proved challenging with respect to progress towards broad objectives, in particular when extending beyond the scope of WBG interventions. 58. Using countrywide data from national agencies to show evidence of a project’s performance is fraught with risks. Attribution to the project may be questioned when the counterfactual evidence is not available. For example, at the beginning, the Agricultural Diversification and Market Development Project (P081567) limited its coverage to nine regions because two other important operations were covering the rest of the country. Yet, the project still claimed that the results were achieved at the country level, thus including the achievements of the two other projects. Another problem arising from outsourcing data collection to a national agency is that data from official agencies are often delayed, so that timely assessment of project’s performance may become an issue. In addition, data is often revised, sometimes drastically, so that time series analysis becomes difficult. At the very least, projects should keep up-to-date the detailed information coming from official agencies to adjust them as necessary. WBG Instruments 59. In Development Policy Loan operations and for prior actions involving a law to be submitted to parliament, it is important that the borrower and the Bank teams ensure that all key stakeholders have been considered before submission. During the Growth and 79 Competitiveness Credit series, for example, the transition government submitted to Parliament a mining code that had not been adequately vetted by the mining sector. The protest of the sector against the new code forced the government to withdraw the code and engage in negotiations with the sector. Although the code was revised and submitted successfully to Parliament, the lack of appropriate vetting led to unnecessary delays, loss of staff time and required changes in the trigger for the next operation. The Bank could have taken greater care in reviewing the mining code. There is also a risk that countries, like Burkina Faso, that have a thorough understanding of Bank processes, may be able to take short-cuts with respect to some prior actions. 60. The Bank should be cautious in supporting the establishment of a guarantee funds in vulnerable countries, where capacity is low and financing scarce. The renewal of the trucking fleet which was a trigger in the Growth and Competitiveness Credit series was not successful because the government did not have the means to follow through on the fund. To remediate, the Government ended up supporting the fleet renewal by exempting customs fees and the VAT on imported new truck (through adoption of laws and decrees). 61. South-South exchange activities are important and have inspired and informed project design and implementation in Burkina Faso. With support from Bank project teams, the Brazil experience was used in the government’s safety nets project. Under the Higher Education Project (P164293) and the Centers of Excellence Regional Project (P126974), a government team traveled to South Korea to learn about higher education. Under the Youth Employment and Skills Development Project, a government team traveled to Cote d’Ivoire to learn from the experience of a similar project led by the same task team leader. A Ministry of Finance and Economy team traveled to Uganda and Tunisia to learn from their results-based systems and frameworks. All of these South-South learning exchanges enhanced project design. 80 ANNEX 1: Burkina Faso—CPS FY 13-16 Completion Report—Summary of CPS Self-Evaluation Summary of CPS Self-Evaluation Lending and Non-Lending CPS Outcomes and Outcome Status of CPS Outcomes and Lessons for the New Issues and Challenges Operations that contributed to Indicators Evaluation Summary CPS outcomes CPS Pillar 1: Accelerate Inclusive and Sustained Economic growth Outcome 1.1 Increased domestic resource mobilization x Burkina Faso has many - Increase revenue as proportion Total revenues were 17.7% and x Growth and Competitiveness Outcomes should be mineral deposits that need to be of GDP tax revenues were 15.5% of Credit 4 (GCC4) (P151275) selected more exploited and well managed to 2012: 13% GDP in 2016, but they were x Mineral Development Support carefully to reflect benefit the poor in the local 2016: 15% already 17.7% and 15.8% Project (P124648) goals which are more communities; respectively in 2012. So, the x Regional Trade Facilitation & closely related to the x While the mining sector - Mining revenue as a proportion baseline appears to have been Competitiveness - (P129282) WBG portfolio. has been expanding recently, a of GDP increased to 5%. wrong and no improvement Targets which depend critical challenge is for the sector 2012: 2.5% observed. Pipeline operations on external factors to sufficiently contribute to 2016: 5% x Public Sector Modernization such as world prices government’s fiscal accounts and Mining revenues were 2.8% of Project (approved June 2015) should be avoided. economic development of the - Annual increase in gold GDP in 2016. (P132216) country; production and exports (in Ton) x Negative externalities 2010: 21.082 tons ESW/TA/AAA resulting from mining activities 2016: 45 tons x Public Expenditure Review such as: land use conflicts, (dropped) environmental pollution and 2012: 2 companies at exploration Gold output was 38 tons in 2016 x BF Support for the disruption of social cohesion, etc. stage but was the same in 2011 so no Implementation of PFM reforms 2016: 1 company at exploration real change. (P151597) stage and 1 company at x West Africa Customs Union TF exploitation stage instrument - (P144707) Burkina Faso Policy Notes - (P160225) Little progress has been made on the first three indicators. 81 Summary of CPS Self-Evaluation Lending and Non-Lending CPS Outcomes and Outcome Status of CPS Outcomes and Lessons for the New Issues and Challenges Operations that contributed to Indicators Evaluation Summary CPS outcomes Outcome 1.2. Improved access to finance by SMEs/SMIs x Low capacity of SMEs - Increase in portfolio of SMEs due to limited access to financial borrowing from IFC-client banks. IFC Trade finance for SMEs x IFC Trade Finance services 2012:US $6 million 2013: US$ 9.8 million x Bagré Growth Pole Project x Quasi absence of access 2016: US$10 million 2014: US$ 32.7 million (P119662) to finance in rural areas to 2015: US$ 80.1 million x Growth and Competitiveness promote agriculture and small Increase financial institution 2016: US$ 76.9 million Credit 4 (GCC4) (P151275) scale agro-processing support to SMEs through Private sector interest in the dedicated credit lines or financial economy is limited thus reducing products: employment opportunities for the 2012: 1 bank The number of service providers poor 2016: 3 banks has increased to 86. Target seems low given that the project Number of service providers target was 80. operating in the Bagré zone 2010: 0 FAARF portfolio amounted to 2016: 15 CFAF8.1 billion by end 2015 FAARF has a total loan portfolio Number of active borrowers of more than CFAF 5 billion stood at 119,416 (increase of 49 percent) The Number of active borrowers increased by at least 10 percent Targets have been greatly (from 79, 937 in 2012) exceeded for two of the indicators, though they were perhaps not sufficiently ambitious. Outcome 1.3. Improved vocational skills and training for employment x Acute skills deficit in Youth trained who are employed Training is not a major high productivity sectors of or self-employed one year after In June 2017, only 36% of youth x Growth and Competitiveness guarantee of the economy across the country completion of training (overall, in were employed one year after Credit 4 (GCC4) (P151275) employment, which and particularly in the East and project area) completion of their training. also depends on the North March 31, 2013: 0% health of the economy. 82 Summary of CPS Self-Evaluation Lending and Non-Lending CPS Outcomes and Outcome Status of CPS Outcomes and Lessons for the New Issues and Challenges Operations that contributed to Indicators Evaluation Summary CPS outcomes x The skills development June 30, 2016: 100%. x Youth Employment and Skills system is limited, low quality, and Development Project (P130735) the curriculum does not prepare Number of person days in Labor The number of person days was x Africa Centers of Excellence youth for working life Intensive Public Works created only 262,735 in April 2016 but (P164546) Traditional apprenticeships, March 31, 2013: 0 it had reached 4.35 million by x Education Access and Quality which are the primary source of June 30, 2016: 1,650,000 June 2017. Improvement Project skills development in Burkina (EAQIP)(P148062) Faso, are not amenable to Out of school youth enrolled in standardization and established professional training The number of youth enrolled in norms. March 31, 2013: 0 professional training rose from 0 June 30, 2016: 800 in April 2016 to 495 by June 2017. One indicator surpassed and some progress made on the others. Outcome 1.4. Increased production and access to energy x Total generation capacity - Electricity production capacity Total installed capacity was x WAPP: The First Phase of the Modest targets closely is insufficient to meet peak increased 315MW in 2015. Inter-zonal Transmission Hub aligned to a WB demand which is growing at 10 2012: 256MW Project (APL3) (P094919) project enabled percent per annum. 2016: 300MW x Electricity Sector Support satisfactory results. Project (P128768) x Limited access to - Number of households 3,984 households were x AF-Electricity Sector Support electricity particularly in rural connected to electricity under the connected to electricity by Project (P128768) areas constrains economic growth Electricity Sector Support Project 2016. (only 20 percent of the population 2012: 0 ESW/TA/AAA has access to power with less than 2016: 2,410 x Burkina Faso Energy Mix 5 percent for rural populations); Diversification (P149893) - Increased renewable energy and x High tariff s averaging off-grid lighting available in at 40 rural communes were 25 US cents per KWH hampers least 50 rural communes. served. 2012: 0 2016: 50 83 Summary of CPS Self-Evaluation Lending and Non-Lending CPS Outcomes and Outcome Status of CPS Outcomes and Lessons for the New Issues and Challenges Operations that contributed to Indicators Evaluation Summary CPS outcomes private development and competitiveness; - Increased private sector investments in electricity x Grid expansion and generation and distribution (IFC’s installation of connections is still energy program) Two out of three targets limited to small number of 2012: 0 surpassed and good progress communities 2016: 17 MW on the third. Outcome 1.5. Increased access to all-weather roads As the relevant WB x Road network especially x Transport Sector Project project closed in 2013, those linking rural areas with high Share of rural population with Rural access to all-season roads (P151832) this indicator was potential of production, mining access to an all-season road reached 27% in 2016. x Donsin Transport Infrastructure probably not the best and tourism are poorly 2012: 22.30% project (P120960) one to use. maintained thus reducing their 2016: 33.30% x West Africa Regional Transport connectivity to markets and urban and Transit Facilitation Project consumption areas (P079749) x Road maintenance fund x Regional Trade Facilitation & not financially autonomous. Target met half way but was not Competitiveness - (P129282) x 60 percent of the 8,230 appropriate given WB portfolio. villages in Burkina Faso have no Pipeline operations access to all-weather road x Transport and Urban Infrastructure Project (approved May 2016) (P151832) ESW/TA/AAA x GEF Ouagadougou Transport Modal Shift (P087630) 84 Summary of CPS Self-Evaluation Lending and Non-Lending CPS Outcomes and Outcome Status of CPS Outcomes and Lessons for the New Issues and Challenges Operations that contributed to Indicators Evaluation Summary CPS outcomes Outcome 1.6. Improved access to information and communications technology x Limited access to - Volume of international traffic The target of 74 kbit/s/person x West Africa Regional The ICT sector is internet and broadband services (Kbit/s per person): was reached in 2016. Communications Infrastructures expanding rapidly in slows down productivity 2010: 28 Project (P122402) Burkina Faso and x High tariffs for mobile, 2016: 74 more broadly, but it is broadband and international Pipeline operations important to choose bandwidth limits private sector Access to telephone services Access to telephone services x Public Sector Modernization outcomes which are development. (fixed mainlines plus cellular reached 79% in 2016. Project (approved June 2015) attributable to WBG Weak regulatory framework to phones per 100 people) (P132216) interventions. spur competition and broadband 2010: 37.2% penetration 2016: 62% Access to internet services far ESW/TA/AAA Access to internet services exceeded the target, reaching x BF Support for Open Data (number of subscribers per 100 19% in 2016. (P152063) people) 2010: 0.2% Thus, all targets were reached 2016: 0.6% or significantly exceeded. Outcome 1.7. Increased agricultural productivity and marketing of selected value chains x Burkina produces large Agricultural exports on regional Regional exports have reached x Bagré Growth Pole Project Given the annual quantities of mangoes, sesame, market for the targeted supply 10,960 for mangoes, 36,216 for (P119662) fluctuations in and shea nut that could be chains (onion, mangoes, and onions, and 103,315 for sesame. x Agriculture Productivity & agricultural output, it exported to international markets, Sesame) However, mango exports to the Food Security Project AF would be better to use but the country is trading these Mangoes: 2014: 3,300 tons; 2016: sub-region were already 12,000 (P149305) results from more than products at the lower levels of the 4,000 tons tons in 2010 so there has been x Agricultural Diversification & one year as baselines value chain due to limited Onion: 2014: 17,000 tons; 2016: no real progress here. Market Development Project and targets. However, participation of the private sector 21,000 tons (P081567) taking the average for to spur agro value chains Sesame: 2014: 33,000 tons ; x Third Phase of the Community 2012-16 makes it 2016 :45,000 Based Rural Development Project difficult to assess the x Low crop and livestock Cereal production reached 4.8 (P129648) impact of a CPS for productivity due to predominant - Average cereal production million tons in 2016. FY13-16. subsistence agriculture and increase at least 20%: 85 Summary of CPS Self-Evaluation Lending and Non-Lending CPS Outcomes and Outcome Status of CPS Outcomes and Lessons for the New Issues and Challenges Operations that contributed to Indicators Evaluation Summary CPS outcomes inadequate supply of water and Average of the last five years x West Africa Agricultural agricultural inputs limit (2008-2012): 4,100,000 tons Productivity Program (WAAPP- productivity 2016: 4,800,000 tons 1B) (P164810) x Cotton is a major cash - Increase in irrigated land by at Irrigated land increased by crop in Burkina hence long term least 20% 10,776 ha. investments in value added 2011: 50,000 ha ESW/TA/AAA production needs to be 2016: 60,000 ha x Burkina Faso Cotton Sector maintained. No such firms have invested yet. Dialogue (P153435) Number of Agri-Business firms In fact, the project target has investing in more than 500 been revised to focus on firms hectares (in the Bagre pole area) investing in 100 ha., but still 2012: 0 there were no such firms in 2016: 3 2017. Average minimum cotton Cotton production averaged production is at least equal to above 600,000 tons during 500,000 tons 2012-16. However, there was 2009-2011: 375,000 tons no change between 2012 and 2012-2016: 500,000 tons 2015-16. All targets have been met except in Bagré. CPS Pillar 2 — Enhance Governance to Deliver Social Services More Efficiently Outcome 2.1. Strengthened public accountability and resources management x Delays in the transfers of - Improved actual availability of funds committed from central funds to communes committed by Funds were available for x Local Government Support government to communes reduces the central government earlier in communes by January 19 in Project (162742) local level ability to provide basic the budget cycle. 2017. x Growth and Competitiveness social services particularly to the 2012: April 30, 2012 Credit 4 (GCC4) (P151275) poor 2016: No later than February 28, 2016 86 Summary of CPS Self-Evaluation Lending and Non-Lending CPS Outcomes and Outcome Status of CPS Outcomes and Lessons for the New Issues and Challenges Operations that contributed to Indicators Evaluation Summary CPS outcomes x Low budget execution x Third phase of the Community capacity in the social sectors due - Increase in the number of Based Rural Development Project to governance and procurement communes submitting their This indicator is not considered (P129648) weaknesses candidacy documents for the relevant as the approach has good governance competition changed and communes no x Information asymmetries 2012: 0 longer have to submit their Pipeline operations continue to limit the extent to 2016: 60% candidacy. x Economic Governance and which civil servant and local Citizen Engagement Project populations can actively - Increased in percentage of (approved January 2016) participate in decision-making citizens rating commune Citizen approval had improved (P155121) and demand good governance and government’s performance but only to 52% by 2017. x Public Sector Modernization social accountability satisfactory Project (approved June 2015) 2012: 47.3% One of the two targets was (P132216) 2016: 70% achieved, and some progress was made on the other one. ESW/TA/AAA x Public Expenditure Review (Dropped) x Mainstreaming Governance and Anti-Corruption (P151597) Outcome 2.2. Expand access to quality education for the poor Increase in gross intake rate in In 2016, the gross intake rate x Primary completion rate first grade of lower and upper remained at 41.2% for the first x Third phase of the Community remains low with wide disparities secondary education in the five grade of lower secondary Based Rural Development Project between urban and rural and targeted regions disaggregated by (41.6% for girls) but climbed to (P129688) between girls and boys gender 14.2% for the first year of upper x Growth and Competitiveness 2013-2014: secondary (10.9% for girls) in Credit 4 (GCC4) (P151275) x Low access to pre-school Lower Secondary: 41.1 (40.3) the 5 targeted regions. x Education Access and Quality education in the two poorest Upper Secondary: 6.5 (4.1) Improvement Project (P148062) regions, secondary education in 2015-2016: Thus, the targets for upper the five poorest regions and low Lower Secondary: 51 (50) secondary were exceeded but Pipeline operations quality in teaching and learning. Upper Secondary: 10 (7) 87 Summary of CPS Self-Evaluation Lending and Non-Lending CPS Outcomes and Outcome Status of CPS Outcomes and Lessons for the New Issues and Challenges Operations that contributed to Indicators Evaluation Summary CPS outcomes Wide gender disparities in there was no progress in lower Public Sector Modernization enrollment rate persist at the secondary. Project (approved June 2015) secondary education level. (P132216) ESW/TA/AAA x Technical support on post-basic education (P158802) x Post Primary Education Development (P148478) Dropped Outcome 2.3. Increase access to quality health services for the poor - Proportion of births assisted by The proportion of births assisted National level x High maternal mortality skilled personnel: by skilled personnel had risen to x Reproductive Health Project indicators should be rates. 2010: 67% (DHS 2010) 80.9% in 2016. (P119917) avoided when the 2016: 76% (DHS 2015) x Third phase of the Community WBG program is x High infant mortality Based Rural Development Project limited to certain rates. - Pregnant women receiving 80.3% of pregnant women (P129688) regions. antenatal care during a visit to a received at least 1 prenatal visit x Fourth Growth and x Under-five malnutrition, health provider (Core indicator) in 2016. Competitiveness Credit series malaria and vaccine preventable 2010: 85.3% (DHS 2010) (P151275) diseases are among the main 2016: 95% cause of infant mortality. Pipeline operations - Children under five with a x Sahel Malaria and Neglected severe acute malnutrition being 64% of these children were Tropical Diseases Project treated according to the new being treated according to the (P149526) protocol: new protocol by 2017. x Sahel Women Empowerment 2010: 30% and Demographic Dividend 2016: 50% Regional Project (P150080) Child fully immunized (IDA Core ESW/TA/AAA indicator): The immunization rate fell x Health Procurement and Risk 2010: 81% (DHS 2010) temporarily to 57% in 2016 due Management (P145375) 2015: 96% to a shortage of vaccine 88 Summary of CPS Self-Evaluation Lending and Non-Lending CPS Outcomes and Outcome Status of CPS Outcomes and Lessons for the New Issues and Challenges Operations that contributed to Indicators Evaluation Summary CPS outcomes supplies, but in 2015 it achieved x Demography challenges in the a rate of 96%. Sahel region(P150080) A mixed picture with two targets exceeded while two indicators suffered a reversal. Outcome 2.4. Expand access to quality water and sanitation facilities for the poor - Additional number of persons in The number of persons in urban Infrastructure x Access to potable water urban areas having access to safe areas with access to safe water x Urban Water Project AF indicators are less limited in the urban and rural water: under the project had increased (P106909) risky since they are areas. 2012: 304,505 to 609,784 by end 2016. x Third phase of the Community less susceptible to 2016: 527,000 Based Rural Development Project external factors and x Low rate of access to The number of persons in urban (P129688) less dependent on sanitation services urban area. - Additional number of persons in areas with access to adequate human responses. urban areas having access to sanitation under the project had ESW/TA/AAA x Weak capacities have adequate sanitation services: increased to 437,200 by end limited the development and 2012: 203,905 2016. x Enabling Env for WSS access sustainability of water services in 2016: 351,600 to Poor- BF - (P163056) rural areas. The number of students in urban - Additional number of students areas with access to adequate x Burkina Pro-Poor Sector in urban areas having access to sanitation in their schools had Reforms - (P131998) school latrines: increased to 120,600 by end x Burkina Domestic Private 2012: 29,480 2016. Sector in Water - (P131922) 2016: 120,000 Thus, all targets have been met or exceeded. 89 Summary of CPS Self-Evaluation Lending and Non-Lending CPS Outcomes and Outcome Status of CPS Outcomes and Lessons for the New Issues and Challenges Operations that contributed to Indicators Evaluation Summary CPS outcomes CPS Pillar 3—Reduce Social, Economic, and Environmental Vulnerabilities Outcome 3.1. A more efficient targeted safety net and cash transfer program piloted x The scope and coverage - Number of households 15,000 households were Targets well calibrated of existing social safety net benefiting from targeted safety receiving cash transfers in 2016. x Social Safety Nets Project to WBG projects can program is limited, with most net programs (cash transfers and Another 6510 benefited from (P160371) yield satisfactory interventions being small scale, cash for work cash for work. results. temporary in nature and 2012: 0 ESW/TA/AAA externally financed; 2016: 20,000 The total therefore was 21,510 and the target was met. x Burkina Faso: Strengthening x Lack of a strong and safety net response to crises harmonized national strategy (P121419) aimed at targeting extremely poor and vulnerable persons. Outcome 3.2. Increased production and storage of staples for food security x Agriculture and food crop - Percentage increase in food Using the baseline of 2011 (3.59 Choice of base year is production are vulnerable to crop production in targeted zones million mt), the target would x Third phase of the Community important and multi- (droughts, floods, locusts, (millet, sorghum, maize, rice and have been 4.85 million mt. But Based Rural Development year averages should wildfires, and wind); cowpea): using 2010 as the baseline Project (P129688) probably be used for 2011: 15% (4.36m mt) the target would be x Fourth Growth and agriculture. x Over 20 percent of the 2016: 35% 5.89m mt. The actual output in Competitiveness Credit series population (over 3.5 million) 2016 was 5.4million mt. (P151275) is food insecure and live Minimum food stock in the x Agriculture Productivity & permanently in chronic SONAGESS reserves and Food stocks had risen to 59,000 Food Security Project AF poverty. intervention stocks mt by end 2013 before falling to (P114236) 2011: 35,000 for reserve stocks 31,400 mt by end 2015 x Agricultural Diversification & and 5,000 for intervention stocks. Emergency food stocks rose to Markets Development Project AF 2016: 50,000 tons for reserve 10,972 by end 2015. (P147978) stocks and 10,000 for x Bagré Growth Pole Project intervention stocks (P119662) 90 Summary of CPS Self-Evaluation Lending and Non-Lending CPS Outcomes and Outcome Status of CPS Outcomes and Lessons for the New Issues and Challenges Operations that contributed to Indicators Evaluation Summary CPS outcomes x Emergency Livestock Feed Access Project (P143192) x FIP Forest management (P143993) Outcome 3.3. Better disaster and risk management x Agricultural productivity is - Additional land area under The additional land under vulnerable to desertification sustainable land and water SLWM or SFM reached 209,000 x Global Environment Facility and other environmental risks management (SLWM) or acres in 2016. x Third phase of the Community that need to be managed; Sustainable Forest Management Based Rural Development Project (SFM) practices (hectares) (P129688) x Lose of natural vegetation 2012: 0 and natural habitat due to 2016: 8000 x GFDRR for Disaster Risk land degradation and Management & Climate Change deforestation negatively - Participatory management plans Project (P126109) affects the livelihoods of the developed and implemented in 23 plans were being x FIP Forest management poor. targeted communities shared implemented by March 2016. (P143993) forests in targeted zones x Local Forest Communities 2012: 0 Support Project (P149434) 2016: 16 So all targets were substantially exceeded. Pipeline operations x Sahel Regional Pastoral Livelihoods Resilience Project (P147674) 3.4. Better climate change adaptation x Climate change and REDD+ The Reducing Emissions from REDD+ has been included in the Due to its Sahelian strategies not defined nor Deforestation and Forest new Rural Development Sector x GFDRR for Disaster Risk landscape, Burkina mainstreamed in sectoral Degradation (REDD+) strategy is Plan (PNSR2) and linked with Management & Climate Change Faso is pioneering an frameworks and strategies. defined and institutions the PNDES. Institutional Project (P126109) approach to address arrangements are defined for its arrangements for REDD+ have x FIP Forest management carbon sequestration implementation been validated by the Council of (P143993) both inside and outside 2014: No Ministers. The analytical studies x Local Forest Communities the forest areas as part 2016 : Yes preparing the strategy have been Support Project (P149434) of a broader Climate 91 Summary of CPS Self-Evaluation Lending and Non-Lending CPS Outcomes and Outcome Status of CPS Outcomes and Lessons for the New Issues and Challenges Operations that contributed to Indicators Evaluation Summary CPS outcomes launched, including a Strategic Change mitigation A database with relevant Environmental and Social • REDD+ Readiness Preparation strategy. This would information on climate resilient Assessment to address the Project (P149827) directly connect agricultural practices is potential long-term social and REDD+ and Burkina operational, accessible easily cultural implications of REDD+. Pipeline Faso’s international within the country and broadly The strategy is expected to be Sahel Regional Pastoral engagements as part of known (adapted manual and validated end of 2018. Livelihoods Resilience Project the Paris Agreement trainings) (P147674) (Nationally 2014: No Training modules have been Determined 2016: Yes created for 9 climate resilient Contribution - NDC) agricultural practices and over 300 farmers have been trained. The modules will be disclosed on the National Observatory for Sustainable Development (ONEDD) website mid-2018. 92 Annex 3: Spatial Distribution of the Bank’s Operations Portfolio in Burkina Faso The World Bank’s current operations portfolio is present throughout the country, including the poorest provinces. As of FY18, each province has at least 5 projects that are either active or in the pipeline. The highest number of projects concentrates in Boulgou province in the South, bordered with Ghana (Figure A1). In terms of financing, Kadiogo, Houet, and Boulgou are the three provinces attracting the largest investment budget, which mostly consists of investment in infrastructure projects (Figure A2). Kadiogo and Houet provinces also host the country’s largest urban cities, Ouagadougou and Bobo Dioulasso, respectively. The poorest provinces, however, tend to receive smaller amounts of lending. Figure A1: Spatial distribution of the World Bank’s operations portfolio by the total number of projects 93 Figure A2: Spatial distribution of the World Bank’s operations portfolio by the total budget Projects supporting private-sector led growth concentrate more in the South, specifically, in Boulgou and Zoundeweogo areas, and less so in the North-West (Figure B1). When budget spending is considered, Boulgou and provinces surrounding the capital, namely Kadiogo, Boulkiemde, and Sanmatenga receive the largest financial support (Figure B2). To accelerate private-sector led growth for job creation, the World Bank has invested in projects on agricultural productivity, energy access, infrastructure for market access, natural resource management, and business environment. Many of these are infrastructure investments that depend heavily on the unit costs which in turn are largely determined by the density of users. This suggests that locations that have high density of the poor and have not yet received substantial investments on job creation may deserve more attention in the upcoming CPF. These areas are situated in the North-West. 94 Figure B1: Spatial distribution of the World Bank’s operations portfolio by the number of projects in Focus Area 1 Figure B2: Spatial distribution of the World Bank’s operations portfolio by the total budget spent on Focus Area 1 Note: Due to the bubble scale, investments lower than US$200,000 are not shown. 95 The current investment portfolio in human capital and social protection systems reaches some of the poorest areas in the country, particularly in the North-West (Figure C1). This pattern highlights the Bank’s objective of expanding basic services such as health and education, water and sanitation, as well as social protection to the poorest and the most vulnerable. The amount of spending is highest in the two provinces that host the largest cities of the country, Kadiogo and Houet provinces (Figure C2). A significant budget expenditure has also been allocated to the North-West which have both high poverty-headcounts and high concentration of the poor. Figure C1: Spatial distribution of the World Bank’s operations portfolio by the number of projects in Focus Area 2 96 Figure C2: Spatial distribution of the World Bank’s operations portfolio by the total budget spent on Focus Area 2 One of the World Bank’s priorities is to strengthen governance and support citizen engagement. While projects supporting this focus-area spread throughout the country, the Center and the East regions tend to have higher numbers of projects, particularly in Bazega, Gourma, Sanguie, Ziro, and Tapoa provinces (Figure D1). The amount of budget spending is relatively equally distributed across regions (Figure D2). 97 Figure D1: Spatial distribution of the World Bank’s operations portfolio by the number of projects in Focus Area 3 Figure D2: Spatial distribution of the World Bank’s operations portfolio by the total budget spent on Focus Area 3 98 Projects considered for this analysis. Availability Availability of of budget Project geographical Project Name Lead GP/CCSA allocation ID coverage by by provinces provinces P106909 Urban Water Sector Project Water Yes Yes Ag. Productivity US$ Food P114236 Agriculture Yes No Security Proj Finance, Burkina Faso - Bagre Growth P119662 Competitiveness & Yes Yes Pole Prj Innovat Health, Nutrition & P119917 BF-Reproductive Health Project No No Population Local Government Support P120517 Governance Yes Yes Project Burkina Faso Donsin Transport Transport & Digital P120960 No No Infrastructure Project Development Social Protection & P124015 Social Safety Net Project Yes Yes Labor Mineral Development Support P124648 Energy & Extractives No No Project Burkina Faso Electricity Sector P128768 Energy & Extractives Yes Yes Support Project Third Phase Community Based P129688 Agriculture No No Rural Development Project Sustainable land and forestry P130568 Agriculture Yes No management Project BF-Youth Employment & Skills Social Protection & P130735 No No Development Labor Burkina Faso Public Sector P132216 Governance No No Modernization Program FIP - DECENTRALIZED FOREST Environment & Natural P143993 & WOODLAND MGMT Yes Yes Resources PROJECT B. Faso - Education Access and P148062 Quality Improvement Project Education Yes Yes (EAQIP) Transport and Urban Social, Urban, Rural and P151832 Infrastructure Development Resilience Global Yes No Project Practice Economic Governance and P155121 Governance No No Citizen Engagement Project Burkina-Faso eGovernment Transport & Digital P155645 Yes Yes Project Development 99 BF-Transport Sector Transport & Digital P156892 Modernization and Corridor Yes No Development Trade Facilitation Prj. BF - DPO series on Energy and Macroeconomics, Trade P157060 No No PFM & Invest Livestock Sect Depmt Support P159476 Agriculture Yes No Project BF - DPO2 series on Energy and Macroeconomics, Trade P163283 No No PFM & Invest Pipeline Burkina Faso - Bagre Growth Pole Project Additional Trade & Comp Yes Yes P161234 Financing Water Supply, Sanitation and Water Resources Management Water No No P164345 Project Burkina Faso Higher Education Education No No P164293 Support Project Sustainable Agricultural Intensification for Food and Agriculture No No P164049 Nutrition Western Africa: WARCIP P161836 Burkina Faso-Additional Transport & ICT No No Financing 100 Annex 4: Country Map 101