• Reference: P-DJ-IE0-002
• Approval date: 17/10/2008
• Start date: 05/08/2009
• Appraisal Date: 15/06/2008
• Status: OngoingOnGo
• Implementing Agency: GOUVERMENT DE DJIBOUTI MINISTERE DE L'ECON. DES FIN. ET DE LA PLANIFICATION
• Location: NATIONAL

Context

Implementation of  the policies and reforms embarked upon since 2002 has enabled the country to improve its macroeconomic framework, record good progress in social areas, and to improve the business climate. In certain urban areas of Djibouti City, and in centres in the country’s interior; the situation has sometimes deteriorated due to the economy’s structural constraints as well as successive droughts in rural areas and the inflows of people fleeing political instability and miserable conditions in neighbouring countries.

Against this backdrop of strong urbanization (more than 80% of the population), major regional towns are unable to ensure a catalytic role in hinterland development and there is deepening inequality between Djibouti and the rest of the country.

Rationale

Almost 80% of the population lives in urban centres, with the majority concentrated in Djibouti City. 

In Djibouti about 45% of the population lives below the poverty line and almost 80% in the rest of the country. While the social indicators (health and education) are steadily improving, youth unemployment and growing regional disparities are the major constraints on the country’s development.

The Government has decided on a programme to fight unemployment and regional disparities by developing human resources, access to basic services, and the promotion of harmonious local development.

Objective

The objective of the ADF project in support of the PREPUD is to improve the living conditions of the urban communities which represent 85% of the country’s population.

The objective is to promote and consolidate socioeconomic development in the 5 major regional towns and reduce regional disparities with Djibouti City.

Description

The project proposes an integrated, strategic approach which focuses simultaneously on the following three thrusts:

1. actions aimed at long-term development of the major regional towns and their regions (vision),
2. thematic thrusts combining immediate outputs and short-term investments in response to urgent needs, and finally
3. communication and participation.

ADF intervention covers the 5 major regional towns outside Djibouti City. It will be implemented through the following three components:
 
The capacity building component comprises:

1. creation of management, urban governance, and regional development mechanisms and instruments; 
2. improvement of access to financial services through training in management, supervision and advisory support for entrepreneurs; and
3. upgrading of microfinance control and supervision services at the BCD.

The ‘facilitation of access to developmental infrastructure and community facilities’ component comprises: 

1. rehabilitation of developmental infrastructure and opening up of poor neighbourhoods and reducing floods related to overflowing of wadis;
2. construction of commercial and production support infrastructure (motor parks, markets, parking areas, slaughterhouses, livestock yards); and
3. promotion of endogenous development through the establishment of a development fund aimed at financing regional community initiatives.

 

Impact

The activities planned under the project will help to reduce the proportion of poor people throughout the country by:

1. improving technological and vocational skills and building urban management and regional development promotion capacities;
2. building income-generating capacity through microfinance and local community institutions; and
3. improving the population’s living conditions.   

Skills and capacity building in institutions both in the areas of central services and regional committees as well as microfinance institutions will contribute to increased: 

1. efficiency in promoting regional investment;
2. microfinance service penetration;
3. endogenous development  and participation of the population, while consolidating and enhancing women's position in the local economy.

EYEGHE Ali - OSHD1

Finance source	Amount
ADF	UAC 5,820,000
Government	UAC 500,000
Delta	UAC 2,480,000
Total	UAC 8,800,000