Date of agreement: March 2008
Current total volume of the fund (million): UA 1,411.79
Volume of the fund disbursed: UA 374.60 million
Financial contributors: ADF-11 Allocation (UA 408.43 million), ADF 12 Allocation (UA 764 mil-lion); Post Conflict Country Facility (PCCF) Carry-Over (UA 165.64 million), and UA 13.72 million net income on PCCF funds
Background and Objectives
The three-pillared Fragile States Facility (FSF) was established as an operationally autonomous spe-cial purpose entity within the Bank to provide eligible fragile states with: i) supplemental grant re-sources to support their post conflict rehabilitation and reconstruction efforts; ii) clear arrears of eligi-ble countries; and iii) provide technical assistance and capacity building support in an effort to contri-bute to accelerated state building.
Areas of Focus / Sub-Sectors
The Fragile States Facility is structured into three pillars:
- Pillar I provides supplementary support for funding recovery operations, infrastructure develop-ment, building state capacity and accountability, and financing regional projects.
- Pillar II provides arrears clearance for eligible countries.
- Pillar III provides targeted support resources through the secondment mode of capacity building, interventions through non-sovereigns (e.g., NGOs, UN agencies), and knowledge building (e.g. economic and sector work).
The FSF provides support in the key priority areas of infrastructure development, promoting im-proved financial and economic governance; supporting employment generation and private sector de-velopment as well as higher education through Pillar I. Under Pillar III, the support focuses mainly on building state capacity to get back on track on some of the key macro economic and financial perfor-mance indicators as well as assist in making available reliable national statistics and data.
The FSF is designed to assist fragile states, in their efforts to consolidate peace, stabilize their econo-mies, and lay the foundation for sustainable poverty reduction and long-term economic growth. The Bank has identified 17 states that fall into the fragile states criteria. Nine are considered “core” fragile states while 8 are considered “moderated” fragile states.
- Core fragile states: Burundi, Central African Republic, Comoros, Democratic Republic of Congo, Côte d‟Ivoire, Guinea Bissau, Liberia, Sierra Leone, Togo.
- Moderated fragile states: Chad, Congo, Djibouti, Guinea, Sao Tome and Principe, Somalia, Su-dan, Zimbabwe.
Results and Milestones
The FSF has proven effective in providing integrated financing, institutional capacity building, and policy supports for eligible fragile states. Through the FSF, a rapid response mechanism, the Fragile States Unit (OSFU) has (i) channeled additional financial resources to nine fragile states, (ii) cleared the arrears of Togo and Côte d‟ Ivoire; (iii) and provided targeted technical assistance and institution-al capacity building operations to some fifteen fragile or conflict-affected countries .
In 2009, the resource envelope of the FSF amounted to UA 647.80 million, from UA 511.4 million in 2008. At end December 2009, UA 544.74 million or 84.1% of the total Facility resources had been committed or disbursed to support operations. For example, FSF is financing an infrastructure project (port) in Sierra Leone (UA 26.026 million), poverty reduction programs in Liberia (UA 9 million), economic governance reforms in Burundi (UA 12 million), a community development project in CAR (UA 8 million)), and health a project in Guinea Bissau (UA 6 million).
OSFU cleared arrears, under FSF Pillar II, for Togo and Côte d‟Ivoire. The total costs of the two op-erations amounted to UA 255.58 million.
Administration and Governance Structure
Under Pillar I, fragile states are considered to be “en route” to stability and economic recovery. At this stage, the unit coordinates, with sectoral and regional programming departments the generation of a combination of capacity building and socio-economic infrastructure rehabilitation and construction that straddles political recovery, economic recovery, social recovery and security.
Under Pillar II, the unit liaises closely with the Bank‟s finance complex and other partners to initiate and monitor the arrears clearance processes in the relevant countries. Together with partners, the unit initiates policy dialogue and develops road maps for arrears clearance.
Under Pillar III, the unit focuses targeted support to all countries moving from fragility and to those already recovering from conflict or crisis.
Major Activities in 2011-2012 / Additional Resources Required
In 2010, OSFU has undertaken four major economic and sector works (ESW), namely: i) operational strategies to improve service delivery in fragile and conflict affected countries, ii) youth unemploy-ment and conflicts in Africa, iii) Strategies for mobilizing African Diaspora to support the recovery and development process in fragile and conflict-affected countries, and (iv) the drivers of conflicts and fragility in Africa. These ESW are expected to support the design and implementations of addi-tional and innovative programs and projects in fragile states.
Moreover, in 2011, OSFU will undertake an assessment of the performance of beneficiary countries to determine: i) the FSF-beneficiaries that are potentially eligible for graduation from the Bank‟s list of fragile and conflict-affected regional member states; and ii) countries that meet the criteria for second cycle of support under ADF 12 cycle, 2011-13. The exercise will be expanded to include an assessment of potential new entrants into the FSF. In line with this, the FSF will be requiring addi-tional resources for accelerated capacity building support to such countries as Sudan, Zimbabwe and Somalia. Moreover, resources will also be mobilized for arrears clearance of eligible countries. As such, and as per the FSF mandate, voluntary donor contributions from donors are invited towards this Facility.
Experiences, Challenges, and Ways Forward
Moving forward, the OSFU faced at least four serious challenges:
- The lack of resources for countries under AFD 11 cycle that are potentially eligible for support from the FSF, but not included for Pillars I and II. This constraint will be addressed within the on-going assessment of eligible countries.
- The weak implementation capacity in beneficiary countries tends to slowdown the utilization of Pillar III resources. The OSFU is working closely with the beneficiaries to ensure that the resources are committed in carefully selected operations and will yield the expected development outcomes and results.
Technical Department and Task Manager
Sunita Pitamber, Head, Fragile States Unit
Tel: (216) 7110 2310
Partnerships and Cooperation Unit Focal Point
Veronica Giardina, Principal Cooperation Officer
Tel: (216) 7110 2519