• Reference: P-TG-K00-006
• Approval date: 24/07/2006
• Start date: 02/11/2006
• Appraisal Date:
• Status: OngoingOnGo
• Implementing Agency:
• Location:

Context

After more than one decade of political crisis and of economic governance problems in Togo, the political and security situation is on the road to normalization. The authorities that took office following the April 2005 elections and the other stakeholders involved in Togo's situation showed their readiness and willingness to move towards gradual normalization of the country’s situation and of its relations with the different development partners. To that end the Government in December 2005 presented before the National Assembly a programme to begin lifting the institutional and structural constraints and resuming international financial cooperation. The Government’s programme comprised the following four components:

1. reengagement in political dialogue and improvement of the security environment;
2. stabilization of public finances and reorganization of the financial sector;
3. resumption of the structural and sector reforms; and
4. promotion of good governance and capacity building.

Therefore, UNDP has taken the lead in legal and judicial governance. The European Union is in charge of political governance, in particular the political conditions for the resumption of financial cooperation. The World Bank, through its LICUS, is providing assistance in legal and judicial governance, economic governance, preparation for economic recovery and assistance for the PRSP.

Regarding ADF, the Government of Togo submitted a request for financing in July 2005, in response to which the Bank fielded a preparation mission to Lome, Togo from 6 to 28 September 2005. This mission made it possible to gather information used to prepare the project. In addition, from end 2005 through early 2006, the Bank prepared the 2006 second dialogue paper for Togo proposing a strategy to strengthen dialogue with the Government and consultation with the other development partners with a view to facilitating the resumption of Bank Group operations in Togo. ADF assistance is channeled towards building the capacities of economic management structures, including the formulation and implementation of the poverty reduction programme and building the capacities of the control and budget monitoring structures.

Rationale

The project was designed to support government efforts to modernize the public administration and strengthen macroeconomic and budgetary management in order to promote good economic and financial governance in Togo. This project is the result of an assessment of the needs expressed by the structures concerned, discussions with the other development partners, a review of their respective contributions to resolving the problem of improving the budget execution planning and control system, and the mission's analysis of the data collected. The project’s rationale stems from the need for the Bank and other donors to help the country out of crisis, to promote transparency and enforce accountability in public finance management by strengthening public spending programming and control organs.  The project’s management structure has been discussed with the authorities and other stakeholders, particularly its institutional base, its composition as well as its organizational structure and the Steering Committee.

Objective

The objective is to:

1. build macroeconomic management capacities by improving economic forecasts, budget preparation, and public debt management;
2. strengthen budget execution and monitoring by improving cash flow management,  payment scheduling and financial control.

 

Description

The principal project components are: 

• Strengthening Macroeconomic Management;
• Improving Budget Monitoring, Execution and Transparency; and
• Project Management and Monitoring.

 

Impact

Economic and social benefits:

1. From the economic standpoint, building institutional, logistics, and human resource capacities will help make the economic and financial administration more efficient. In the area of public finance, this will be reflected in improved internal resource mobilization capacity and expenditure quality.  Also, application of the WAEMU directive on budget laws, with the single budget integrating investment and operation, will aid implementation of the Government’s programme. Implementation of the training component will also improve the efficacy of government action and help to strengthen transparency and the rationalization of public expenditure, thus facilitating the achievement of macroeconomic stabilization, as defined in the government program. 
2. From the social standpoint, the actions envisaged under the project will contribute in the long-term to establishing the new status for civil servants and consequently to upgrading human resources.  The measures concerning the PRSP Coordination Unit will contribute towards a better knowledge of poverty in Togo, and programmes designed for the most disadvantaged segments of the population will be better targeted.

TOTO SAME Achille Ch - OSGE1

Finance source	Amount
ADF	UAC 2,200,000
Government	UAC 270,000
Total	UAC 2,470,000