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Benin Country Financing Parameters Note
This note provides the supporting analysis and background for the country financing parameters under the new policy framework for expenditures eligibility. The new policy framework, approved by the Bank in April 2004, makes development objectives the primary determinant of Bank financing, while making sure that risks, such as those to fiscal sustainability and the use of Bank funds, are appropriately addressed. In doing so, it reduces the disconnect between the types of expenditures that borrowers need to incur to implement their development programs and those that the Bank may finance. Also, within broad country-specific financing parameters, it offers more flexibility and lower transactions costs in setting cost sharing arrangements. Benin should make full use of the greater flexibility of this framework that should simplify and modernize investment lending.