Multi-Donor Governance Trust Fund
- Date of agreement: 29 September 2010
- Current volume of the fund: Equivalent to US$ 4.3 million
- Financial contributors: Norway: NOK 6,420,000 (approx. US$ 1 million), Switzerland: CHF 3,000,000 (approx. US$ 3.1 million)
Background and Objectives
- The AfDB has a long history of engagement in the field of governance through policy based lending, institutional support projects, policy dialogue and economic and sector work. In recent years, this work has received increased support by donors, including the Nordic Trust Fund for Governance, which mobilized over US$5 million for about 40 governance activities between 2002 and 2007, targeting a variety of recipient organizations from regional networks of government officials to local civil society organizations.
- Building on the experience of this and other related trust funds, the Multidonor Governance Trust Fund (GTF) will serve as an instrument to improve the Bank's effectiveness in governance and as a complementary vehicle to implement the 2008-2012 Bank Governance Strategic Directions and Action Plan (GAP). It is aligned with the governance sector strategy in support to country governance reforms and the strengthening of country governance systems. It will complement existing Bank instruments to improve operational effectiveness and quality at entry of Bank governance operations, including budget support, especially in fragile states.
- The GTF's ultimate development objective is to assist the Bank's RMCs to build capable and responsive states by strengthening transparency and accountability in the management of public resources through improved management of public finances and an enabling environment for the development of the private section. Specifically, the GTF aims to:
- Become a catalyst for funding and a platform for knowledge, where diverse development partners are encouraged to harmonize efforts to promote good economic and financial governance across the continent.
- Transform the way development assistance has traditionally been provided by stretching the frontier of knowledge and testing, as well as documenting, innovative approaches in the area of economic and financial governance.
- Serve as a vehicle to incorporate new development actors, and stimulate the search for innovative solutions to the problem of weak governance at both country and regional levels.
- Enhance and upgrade the Bank's own capacity to deliver assistance and provide advice to RMCs in economic and financial governance through upstream analytical work, including governance assessments and fiduciary risk reviews, knowledge products (AGO), and complementary initiatives, as well as support to field offices to engage in country policy dialogue in governance, in particular in multi-donor budget support groups (including support to the Bank chairmanship of those).
Areas of Focus / Sub-Sectors
Funded activities shall focus on one or more of the areas below:
- Support to enhanced knowledge and special initiatives to strengthen country governance systems through improved capacity to analyze, measure and improve governance and reduce corruption, including enhanced accountability mechanisms and oversight institutions
- Support good financial management, including revenue governance and domestic taxation, public budgeting, public procurement, and debt management, government auditing and external oversight
- Support to investment climate and the business environment
- Support to sector governance, particularly in high risk areas such as infrastructure and extractive industries, as well as participatory development and civil society engagement.
The ultimate target beneficiaries are the citizens of Africa who would benefit from improved governance in their country as a result of the fund's initiatives.
The intermediate beneficiaries (i.e. the implementing agencies eligible for grants) are:
- AfDB organizational units (Bank executed): these include Bank's sector departments, regional de partments and field offices
- Public institutions and their collective representations (recipient executed): local, provincial and central government institutions; oversight bodies and accountability institutions; parliaments; institutions that are the result of regional integration agreements (APRM); African networks of government officials and technical networks (e.g. CABRI, ATAF, AFROSAI); chapters of international African networks of government officials; and regional organizations
- Civil society organizations (recipient executed): national and regional peer networks and communities of practice, women's associations, NGOs, media, policy think tanks, etc.
Indicative Timeframe and Proposed Activities and Outcomes
Duration: 3 years (3 November 2010 - 2 November 2013)
Within the priority areas outlined above, GTF financed activities will fall under one or more of the following levels of interventions of the Bank's Governance Strategic Directions and Action Plan:
- At the country level, activities may include: country governance diagnostics and local knowledge (PSIA, PEFA, PEMFAR, PER, PETS, FSAP); support to special initiatives in the area of economic governance and public financial management; capacity building projects; outreach, training, information and civil education programs; participatory and gender budgeting
- At the sector level, activities in this area may include: sector governance reviews including risk mapping, cost benchmarking, sector governance guidelines, stakeholder consultations, sector public expenditure tracking surveys and technical assistance to sector ministries; support to EITI and EI governance activities
- At the regional level, activities may include: cross country governance diagnostics and benchmarking; best practice compendia; support to regional networks of senior budget officers, accountant generals and auditorgenerals; regional training and lesson sharing events.
2011 call for proposals covered areas such as: internal and external audit, procurement, as well as tax and domestic revenue mobilization. Eight proposals for USD 2,534,043 are under consideration for approval.
Proposed Administration and Governance Structure
The GTF is governed by the interaction of two main bodies: (a) an Oversight Committee (OC); and (b) a Technical Committee. The technical committee will be responsible for approving all operations submitted for amounts under US$500 000. Oversight Committee The OC, composed by a Bank representative and representatives of the financing partners, is responsible for approving the operational guidelines of the Fund as well as verifying the conformity of the use of resources in accordance with the objectives of the Fund. The OC approves operations with budgets between US$500 000 and US$ 1 million equivalent.
Operations that cost more than US$ 1 million equivalent will be submitted to the Board of Directors for approval. The first OC meeting was held in March 2011 to review the work plan for 2011.
Technical Department and Task Manager
Cam Do, Senior Macro-Economist & Public Financial Management Specialist, Governance Division, Governance, Economic and Financial Reforms Department , Tel: (216) 7110 2441
Partnerships and Cooperation Unit Focal Point
Veronica Giardina, Principal Cooperation Officer, Tel: (216) 7110 2519