1

Governance Global Practice

Middle East & North Africa
Issue 5
February 2016

www.cvmena.org

CV MENA
In-a-Nutshell
Connecting Voices (CV) Middle East and North Africa (MENA) is a
regional initiative and partnership that promotes governance and
improved financial management practices in the public and private
sectors. The ultimate aim is to support the demands of citizens
throughout the Arab World for jobs, better governance, a voice in
public affairs, and social and economic inclusion as reflected in the
World Banks MENA Regional strategy. CV MENA plans to seize on the
windows of opportunity available in the region. It will support capacity
building in the area of governance, facilitate the development of a
professional community, as well as the sharing and transfer of
knowledge both within countries and within the region as a whole. CV
MENA will help foster greater transparency and accountability, thereby
engendering enhanced public trust. In addition, building public and
private sector governance and financial management capacity will also
help attract and provide comfort to much-needed foreign direct
investment in the region.

CVMENA won the World Banks 2013 MENA

Vice President Team Award

The Exchange is a major annual forum that provides a channel for dialogue,
enabling countries to share experiences and promote societal-governmental
consensus building. It fosters intra-regional cooperation and stimulates
interest in improving public sctor governance, public financial management,
and corporate governance and financial reporting in MENA. The Exchange
facilitates knowledge-sharing from transitional democracies and showcases
successful experiences from fragile and conflict states. The Exchange starts
where public sector and public financial management diagnostics leave off,
that is, in supporting the creation of an enabling environment for reforms to
move from concept to reality. It helps catalyze innovative activities to develop
regional public goods and enables the World Bank to fulfill its mission as a
Solutions Bank.

A Boot Camp is a practical and innovative concept. It involves gathering a

group of decision-makers and experts to address a particular issue through
focused and intensive discussion that takes into account both technical and
non-technical factors. After thoroughly examining the issue, the group
develops possible solutions and a work program to help implement them. The
experience is documented in a Solutions Papera brief note describing how
a specific challenge or problem is addressed in a collaborative and pragmatic
fashion. The Boot Camps, together with the Solutions Lab and discussions in
Maarefah (knowledge in Arabic), feed into the design of the Exchange and
CV MENAs workprogram.

In partnership with the Wold Banks Global Development and Learning

Network (GDLN), CV MENA connects participants across the MENA region
(once each quarter) in finding solutions on topics related to public sector,
financial management, and corporate governqance and financial reporting.
The Solutions Lab realizes that an answer is not necessarily the solution: a
time-tested best practice may not be optimal in a particular situation
because it may not be politically or socially feasible at the time. The Labs help
our clients fashion an attainable solutionan alternative answer to the
problemby bringing in other perspectives and different, yet relevant,
experiences from other countries. The Labs also feed into the design of The
Exchange.

Maarefah responds to the need to implement, sustain, and build on the

results of The Exchange, as well as to extend these benefits to those unable to
personally attend Boot Camps and Solutions Labs. Maarefah (knowledge in
Arabic) is a Community of Practice (CoP) that serves as a forum for ongoing
dialogue and continuous peer-to-peer and expert knowledge exchange. The
CoPestablished by the Financial Management Unit of the World Banks
Middle East and North Africa Region in 2011 as a response to popular demand
for change, accountability, transparency, and inclusivenessis designed to
serve as a robust base for extending the dialogue and refocusing it on the
needs of CV MENA.

www.cvmena.org
cvmena@worldbank.org

Publisher: Governance Global Practcie, MENA, The World Bank

Managing Editor: Hisham Waly
Art Director: Denis Largeron
Contributing Photographers: Denis Largeron
Images: World Bank Images, Shutterstock

Note: The posts in the Connecting Voices magazine should not be reported as representing the views of The World Bank.
The views expressed are those of the authors and do not necessarily represent those of the The World Bank or its policy.

Editors Note
Hisham WALY
Practice Manager
Governance Global Practice / MENA
The World Bank

Untying the Knot

The water crisis is essentially a crisis of governance
According to Greek and Roman mythology1, when Gordius, a poor
peasant, became king of Phrygia, he dedicated his ox cart to Zeus,
tying it up to a pole with a highly intricate knot - - the Gordian knot.
Although the knot was supposedly impossible to unravel, an oracle
predicted that it would be untied by the future king of Asia. Many
individuals came to Gordium to try to undo the knot, but they all
failed. Then when Alexander the Great visited the city in 333 B .C. he
tried unsuccessfully to search for the hidden ends of the Gordian knot
but failed so Alexander became impatient and in an unexpected and
bold move, he took out his sword and cut through the knot. Alexander
then went on to conquer Asia, thus fulfilling the oracle's prophecy.
Alexander's solution to the problem led to the saying, "cutting the
Gordian knot," which means solving a
complex problem through bold action.
The problems facing the water and
sanitation agenda are complex, urgent and
multidimensional thus requires a bold
action to unknot to develop sustainable
solutions. There is more than 700 million
people worldwide still lacking access to
improved sources of drinking water and
another 2.5 billion people do not use an
improved sanitation facility, and of these 1
billion people still practice open
defecation, which contribute to the spread
of diseases and suppresses economic
growth. For decades experts told us that
this is due to a number of reasons ranging
from ageing infrastructure to insufficient
funds for operations and maintenance. As a result to address these
challenges facing the water sector governments focused on
developing large-scale, physical infrastructure, such as dams and
reservoirs.
However, faced with increased water demands and competing
interests yet shrinking supply, inequitable access to water, high levels
of corruption, fragmented legal framework, unclear and overlapping
responsibilities, and centralized decision-making that marginalizes
lower levels of government, community, civil society organizations
and the private sector. All of these challenges made it clear that
focusing only on infrastructure is not sufficient to address persistent
water management concerns, and discourse about water governance
began to emerge in the early 1990s [Cooley, 2013]. Studies show a
direct correlation between the countries most lacking in water

Myths Encyclopedia.com

services and those with poor governance (UNDP 2004). However,

improving governance in water services is not just about government
systems and capabilities, it is about engaging civil society and
establishing a functioning social contract between government and its
citizens to bring effective basic services and it is ultimately about the
progressive achievement of agreed rights to water (ODI 2007)
Water governance encompasses several systems - political, social,
economic, environmental and administrative - that control the
decision-making process in relation to developing and managing
water resources and the delivery of water services at different levels
of society (Rogers & Hall, 2003). In its first Water Development
Report, the United Nations stated that the
water crisis is essentially a crisis of
governance. In other words, governance
has the potential of helping unknot the
Gordian knot facing the world in providing
universal access, affordable to citizens and
which are sustainable, efficient, equitable
and transparent.
This issue of CV MENA focuses on the
institutional underpinnings of water service
delivery and the role governance plays in
addressing the challenges faced by the
water and sanitation sector. Though the
role of governance in water is multifarious
ranging from how water shares of
transnational rivers and water bodies are
negotiated to utility reform to delivery of
water and sanitation services. In this issue, we discuss specifically the
role of governance in the delivery of water and sanitation services. In
addition we also highlight how the World Banks Governance and
Water Global Practices are working together in MENA to address
these critical institutional issues through the World Banks financed
operations as well as through knowledge products.
On the cover of this issue we decided to have a quotation by Junaid
Ahmad, Senior Director of the Water Global Practice, where he
eloquently and profoundly states the mission of the Water Global
Practice We dont fix pipes, we fix the institutions that fix the pipes.
I consider this an invitation for us in the Governance Global Practice
to engage hand-in-hand with our colleagues in water by taking bold,
innovative and pragmatic actions to "cut the Gordian knot which
would help us develop sustainable water solutions.

Content
Public Financial
Management (PFM)
06 Tax Reform
A tool at the right time
for tax reform

Corporate Governance
& Financial Reporting (CGFR)
17 Education
The Value of National Qualifications

Cover

Governance
&
Water

19 The IFRS for SMEs

Recent Developments
07 Accounting Reform
Cash versus Accrual Basis Accounting
in National Accounting

11 Navigating through Fragility

Procurement Solutions
for Iraqi Education

21 Doing Business Report

Business Reforms Pick Up in MENA

Public Sector
(PS)
22 Government Spending
Achieving More with Less

14 Internal Audit
Enhancing Public Financial Management in
MENA through developing Internal Audit
Functions in the Public Sector

25 Corruption
Around the world, in 5 charts
26 Public Investment Management
Selecting and prioritizing

15 In Their Own Words

29 Overview
The Role of Governance
in the Water Sector

30 Interview
Junaid Ahmad: Senior Director
Water Global Practice

5
Maghreb

Story

44 Interview
With World Bank Country Director for the
Maghreb, Marie Francoise Marie-Nelly

Gulf
68 Kuwait
Embedding a tax culture
69 Bahrain
Training Vocational Accountants
71 The World Government Summit
Shaping Future Governments

35 Insight
Steven Schonberger & Hisham Waly
Water & Governance

46 Morocco
Social Contract and Civil Liberties
47 Morocco
Government more Accountable to Citizens
49 Morocco
Overhauling a Fragmented System

Events

50 Tunisie
Le Budget Participatif
52 Libya
A debate show keeps discussion alive
53 Libya
Governance and Public Administration
38 Institutions & Incentives
Strengthening Sector Performance

Mashreq

78 The Exchange
From Vulnerability to Resilience
84 Audit Process
Advancing Public Participation
87 State Building
Strong, effective and accountable state
90 Bootcamps

56 Jordan
Poverty and Legal Problems
58 Jordan
Public Investment Management System
63 Jordan
Ending Violence against Women

Cross-Cutting
94 Syrias Displaced Women
Why the G20 Needs to Pay Attention

39 From Across the Bank

Modernizing Uzbekistans Water
Sector with Citizen Engagement
41 Governance in Action
Egypt Sustainable Rural Sanitation
Services (SSRS) Program for Results

64 Lebanon
Accounting Profession

95 Through a Camera Lens

Capturing the Refugee Crisis
97 What is the Social Contract?
Perspectives from the Arab World
100 Year in Review: 2015 in 12 charts
103 Books Tour

43 Operations
43 Books

Water
67 Offering a Public Good:
Support for Syrian Refugees

107 Comic Relief

Public Financial
Management

Tax Reform 06
Accounting Reform 07
Fragility 11
Internal Audit 14

Tax Reform
A tool at the right time for tax reform
Jim Brumby
Director, Governance Global Practice
In todays world, international aid is fickle,
financial flows unstable, and many donor
countries are facing domestic economic
crises themselves, driving them to apply
resources inward. In this environment,
developing countries need inner strength.
They need inner stability. And they deserve
the right to chart their own futures. This is
within their grasp, and last week the launch
of an unassuming-but-powerful tool marked
an important step forward in this quiet
independence movement. Its called the
TADAT, or Tax Administration Diagnostic
Assessment Tool. At first glance, this tool
may look inscrutable, technical, and
disconnected from development. But
listen. Research shows that if developing
countries could simply increase their tax
collection by 2 percent to 4 percent of GDP,
the amount they raised would eclipse the
amount of foreign aid they are receiving. This
small relative increase would represent
three times the amount of official
development assistance distributed in the
world. Thats a big deal. And we know that
having more taxpayers registered and having
more directly contribute to the tax system
makes for a more effective state. And the
idea is catching on, globally. At the United
Nations Financing for Development
conference in Addis Ababa in July, the World
Bank Group and the International Monetary
Fund committed to a joint initiative to help
client countries strengthen their tax systems.
In addition: Thirty countries signed the Addis
Tax Declaration, calling for more
international support and coordination in
this area. In September, the UN included in
its Sustainable Development Goals this

target: Strengthen domestic resource

mobilization, including through international
support to developing countries, to improve
domestic capacity for tax and other revenue
collection. Last week, G20 leaders endorsed
the so-called Base Erosion and Profit Shifting
(BEPS) package, designed to curb tax evasion
and other illicit tax-related behavior. Enter
TADAT, a diagnostic tool that can help
nations figure out where to start. Launched
publicly on Wednesday by the IMF, World
Bank, and a number of other partners, the
TADAT is a framework designed to evaluate
systematically the performance of a
countrys tax administration. It looks at areas
of good outcomes, using factors such as

transparency, the percentage of taxpayers

who pay on time, and whether an
independent, accessible dispute-resolution
system exists. It can help countries identify
concrete reforms and measure progress. Its
a vital, pragmatic first move away from
promises and toward action. As I said at the
TADAT launch event, this tool comes at
exactly the right time. The international
community is paying attention, and our
clients are hungry for technical assistance.
This tool will change for the better how we
deliver that assistance. It is a move toward
transparency, openness, and clarity in how
we do analysis. In the past, that assistance
has been largely bilateral and uncoordinated

7
while this is not necessarily bad, it meant
that different countries got different types of
advice. TADAT brings uniformity to the focus
and scope of assessment. With TADAT, even
if a regular citizen in Canada or Burundi
couldnt use the tool, she would at least
know the categories in which her
government is being evaluated. Yes, Canada.
Thats because this tool is equally applicable
to developed countries. It looks at all
countries, regardless of their level of
development, in terms of performance. At
the launch event, we heard from two
countries that had pilot-tested TADAT:
Norway and Zambia. Hans Christian Holte,
director general of the Norwegian Tax
Administration, said he appreciated that the
assessment is evidence-based, and said it
was useful in pointing out areas for
improvement. He noted that the process was
demanding and should be done by people
who have a solid understanding of the tool.
Berlin Msiska, commissioner general of the

Zambia Revenue Authority, said TADAT

showed his administration had a strong
governance structure. It validated previous
reforms, and identified successful practices.
The tool also showed some weaknesses,
including in areas that had not received
much attention, such as bottlenecks caused
by the use of third-party information. He said
it should be embraced like a health check,
and planned to sign up for a re-assessment
early next year. We also heard some debate
about how it should be implemented. One
audience member suggested opening up
TADAT training to people without deep
expertise in tax administration, including civil
society. Another suggested extending the
tool to other agencies that collect revenues,
such as those tied to natural resources or
taxes charged at the border. And I think that
in time, we should be looking at TADAT at a
subnational level, where the tax types are
different, but the quest for performance is
very similar. One of our jobs now, as

development partners, is to guide the use of

TADAT in a wide range of contexts those
that include data gaps, corruption, and
capacity constraints and to make sure that
we can adapt it to our clients needs. Tax
policy and tax administration are complex.
But we believe they are also essential
elements of a well-functioning state. Taxes
can strengthen a legitimate relationship
between citizens and the state. When
theyre well designed, they can help reduce
inequality and enable countries to chart their
own future. Smart taxation helps growth and
development. TADAT may seem part of a
specialized world, but it drives forward a
critical, global movement: increasing the
financial independence of developing
countries. While theres a long way to go
from analysis to policy reforms to material
changes in reducing poverty and improving
lives the movement cant progress without
tools such as this one.

Accounting Reform
Cash versus Accrual Basis Accounting
in National Accounting
Michael Schaeffer
Senior Public Sector Specialist

Pierre Messali
Senior Public Sector Specialist
This article has benefitted from
consultation with Manuel Vargas
(Lead Public Sector Specialist
MENA). The Authors also
benefitted from reviewing
Patrick Mordacqs Why Cash
IPSAS matters? Unpublished
Article.

An international public sector

reform trend has seen many
governments of most developed
countries, and many developing
countries, adopt some aspects of
accrual accounting as the basis for
their reporting. Supporters of
accrual accounting argue that: i)
at the aggregate level, accrualbased fiscal indicators provide better
information about the sustainability of fiscal
policies; ii) provide a stronger basis for
government accountability; iii) provide a
better measure of the effects of government
policies on aggregate economic demand;
and iv) at the organization level, accrual
based financial statements provide better
measures of organizational efficiency and

effectiveness, and reduce opportunities for

fraud and corruption. Opponents of accrual
reporting contend, among other things that:
i) few countries have implemented accrual
accounting;
ii)
implementation
and
operation is difficult and expensive; iii) the
emphasis should be on getting the basics of
public financial management right first; and,
iv) accrual accounts are more difficult to
understand. Whatever the case, lessons

regarding the implementation of

accrual accounting in many
countries have been identified
including the importance of
communication,
quality
assurance, and the use of
commercially
available
accounting software. This article
considers the various lessons
learned from international
experience and provides the
primary tools for understanding
the nature of cash versus accrual
basis of accounting. This article
provides that for the successful
implementation of accrual
accounting: i) implementation
strategies and timing should be
carefully considered; ii) political
commitment is essential; iii)
suitably qualified accounting
personnel are necessary; iv) a
financial management system
should be in place and fully
operational; v) supreme audit
agencies must be suitably staffed and
resourced; and, vi) the exercise of moving
towards accrual accounting should be seen
as part of a wider public sector management
reform. The authors also describe the nature
of the various accounting arrangements;
examine the features that support or impede
accounting reforms; and suggest criteria for
evaluating proposed accounting reforms.

8
Basis of Accounting
The basis of accounting refers to the
processing mechanism that is adopted by an
entity, corporation or governments to
determine when, where and how a
transaction or events should be recognized,
processed and recorded for financial
reporting purposes. The basis of accounting
that is adopted by any government will
determine the extent of information that an
accounting system can collect, process, and
therefore report. As an example, a pure
cash-based system can only report on a cash
balances and cash flows (inward and
outward), while cash payment or receipt is
usually only a small element in the history of
a governmental financial transaction. For
instance a purchase transaction might go
through the following stages, each of which
could generate specific different accounting
information: Commitment of funds; Issue of
purchase order for the supply of goods;
Receipt of the goods and of the invoice
claiming payment; Payment of invoice; and,
De-commitment of excess funds committed.
Pure cash accounting does not provide
useful information for managing payables
and receivables. In the preceding paragraph,
an accrual system would show the amount
owing to the supplier, and then when full
payment occurred, the amount owing would
be extinguished. An additional shortage with
the cash accounting base is the lack of
accounting sub-systems for receivables, and
without this, managing revenues is far less
efficient. For instance if sums due are noted
only in files, and not entered into a doubleentry accounting system, they can easily
escape attention. Moreover the files may be
displaced or lost. An accrual accounting
system provides a systematic method of
recording and managing sums due,
something which many governments sorely
lack.
Figure 1 above illustrates the path from
cash basis to full accrual accounting. The
primary classification and definitions for the
accounting basis are as follow:

Cash Basis:
under cash basis
accounting transactions will be
recognized and recorded when the cash
is received or paid, therefore all the
information and reports that prepared
according to this basis will inform about
the cash transactions that receipt and
paid during certain period, as well as
the available cash balance at the
beginning and end of the accounting
period.
Cash basis accounting
measures the financial results of the
accounting period as difference
between the cash payments and
receipts. In spite of the capability to
record the non-cash transactions
(flows), most of the accounting systems

that use cash basis do not record the

non-cash transactions, because the
concern is focusing about the cash
management not about the flow of
resources.

Accrual Basis, according to this basis

the transactions will be recorded at the
time of economic value occurring or
transferred or replaced or ownership
handover. In other words, the recording
of the economic events (expenditures
or revenues) will be made at the time of
occurring, regardless if there any cash
received or payment was occurred. It
records assets and liabilities and is
therefore
associated
with
the
production of balance sheets. It is also
associated with providing depreciation
on assets with finite lives. Table 1
below attempts to summarize the
comparative usefulness of accrual and
cash accounting in government.

Status of Accrual Accounting in OECD

Countries
Table 2 below, reviews the status of accrual
basis accounting in a number of countries.
Table 2 reveals that many countries have
introduced aspects of accrual accounting
and more intend to do so in the future.
European Union (EU) member countries are
required to prepare government forecasts
and financial statements in accordance with
the European System of Accounts (ESA 95).
ESA 95 uses an accrual-based financial
reporting framework to calculate budget
balance (the economic balance set forth
under the Maastricht Treaty). This balance
combines
all
central
government
departments, social security funds, and local
government units. However, as the balance
does not consider estimated expenditure
(i.e. depreciation and provisions), it might
best be described as a modified accrual basis
of accounting.
Lessons Learned from International
Experiences
To varying extent, many countries have
implemented accrual accounting over the
past decade. However, wide adoption is
likely to take a longer period, for the
following reason(s):

Implementation is difficult and

expensive. Some aspects of actual
accounting implementation are more
difficult than cash implementation. For
example, it is difficult for a government
organization to know the full amount of
tax revenue that it is likely to receive at
a given time.

Emphasis should be on getting the

basics right first. There is a view that
countries should get the basic
(foundations) of public financial

management right before attempting

more advanced reforms, such as accrual
accounting. This reflects the experience
that basic record keeping and cash
accounting should be strengthened first
before moving forward with more
extensive reforms.
There are a number of pre-implementation
issues that need to be considered before
the actual transition to the accrual basis
which may lead to a successful
implementation, some of the essential
technical and conceptual elements that need
to be already exist or are created and
developed later before starting new accrual
accounting implementation, these basic
elements can be outlined as follow:

Reliable cash accounting based system

that
include
adequate
budget
classification, chart of account (CoA),
double entry based general ledger
recording system, and adequate fiscal
reporting are essential starting point for
accrual framework.

Legislative and executive ownership of

the transition concept is crucial to be
accepted, adopted, and supported by
the
highest
levels
of
both
parliamentarians and governmental
officials.

Adequate technical capacities and

capabilities
is
more
essential
requirements before moving to accrual
accounting, this include human
resources skills (accounting, IT, etc.).

Institutional and professional grounds

(e.g. well-established and regulated
national professional accounting body;
a well-functioning supreme board of
audit; effective parliamentary public
accounting and financial committees).

The scope of automation, computing

and networking is a key element to
implement a successful transition to
accrual, although cash or accrual
accounting can be implemented with
manual systems, but the existence of a
modern
governmental
financial
management information system
(FMIS) will support and simplified the
transition to accrual.

While recognizing the benefits of accrual

accounting, it should be noted that there
are a number of barriers and constraints
faced by many countries in attempting to
upgrade their accounting framework.
Figure 2 provides possible transition steps
that many countries have used in moving
towards accrual basis accounting. Significant
efforts have been made by a number of
countries in improving their basic record
keeping and cash reporting, but many of
these efforts have also failed due to a lack of
ongoing commitment, resource constraints,

9
and complexity. The following are general
conclusions for consideration:

Gradual transformation from cash basis

accounting to the accrual basis
accounting, through setting of a
medium-term strategy (3-10 years) that
include the commencement of
adoption the international accounting
standard for financial reporting in
accordance with the cash basis,
followed by the adoption of modified
forms of accounting bases (modified
cash and modified accrual) up to the
adoption of the international public
sector accounting standards (IPSAS)

that based upon full accrual basis of

accounting.
For the success of government
accounting reform efforts, political
support and assistance from the
decision-makers in the appropriate
government levels is a necessity,
developing the necessary plans which
include allocating sufficient funds,
recruitment of qualified staff, change or
issue supporting legislations, as well as
the
development
of
national
appropriate accounting standards that
are compatible to the international
standards or adoption of related
international standards e.g. (IPSAS).

Logical and practical transition paths

that aim to achieve successful
budgeting basis reforms include the
following
sequential
scenarios:
Implementation of a full accrual
accounting system should not be
attempted until the governments
existing cash-based systems are
soundly based with continuation of
cash budgeting framework; and,
Implementation of accrual budgeting is
more complex and generally should not
be attempted until accrual accounting
systems have been firmly established
and functionally utilized.

The Accounting Continuum

Figure 1: The Path from Cash Basis to Full Accrual Accounting

Modified Cash
Accounting

Cash Basis
Accounting

Full Accrual
Accounting
Modified Accrual
Accounting

Table 1: Summary Comparison of Cash and Accrual Accounting

Criteria
Ease understanding
Ease of manipulation

Comprehensiveness
Usefulness for Managing Liquidity
Non-financial asset management
Comparability

Measuring sustainability of fiscal

policy
Credibility

Cash Accounting
Simpler
Relatively easy to manipulate, but the
issuance of Cash Basis International Public
Sector Accounting Standards (IPSAS)
Regulations is a step forward
Cash information only
Provides only basic information
No information provided
Countries use a range of cash accounting
practices, policies are general not explained
well, not consistent with Government
Financial Statistics (GFS) IMF
Very limited usefulness
Limited

Basis for Determining Fiscal

Strategy
Accountability

Limited

Disincentives for Fraud and

Corruption
Implementation

Limited

Limited

Information system cost can be higher

(because of customization and limited
availability)

Accrual Accounting
Greater complexity
Ease of manipulation depends upon accounting and auditing
standards

Includes cash information together with other information

Provides cash information and commitment information (e.g.,
payment arrears)
Provides information on asset use
Countries use different accrual accounting standards; Consistent
with GFS

Useful, but needs to be supplemented with additional information

(e.g. demographic profiles)
Credit rating agencies and lenders are more familiar with accrual
statements. Can lead to lower borrowing costs.
Good in conjunction with cash information
Provides information on accountability for resources (e.g., fixed
assets)
Better than cash, but depends on the internal control
environment, etc.,
Although information system costs may be initially be lower,
additional efforts and costs are required to identify and value
assets (etc...)

10
Table 2: Status of Accrual Accounting in Various Countries

Figure 2: Cash to Accrual - Possible Transition Steps

11

Navigating through Fragility

Procurement Solutions for Iraqi Education
Elisa Mosler,
Nazaneen Ismail Ali,
and Rachel Lipson1
While the Iraqi education system was widely
regarded as one of the best in the Middle
East and enjoyed near-universal primary
enrollment until the 1980s, the next decade
marked a serious downturn in results.
Beginning in the 1990s, the education
system in Iraq deteriorated sharply as two
decades of conflict and economic sanctions
took their toll. The sector witnessed low
primary and secondary enrollment and
attendance, outdated curriculum content,
and deteriorating learning outcomes. Behind
this was a collapse in public investment in
education and a resulting standstill in policy
and system development in the sector.
After the 2003 regime change, the new
government had many critical service
delivery needs and was struggling to meet
them. Among the most urgent were those in
education. In order to get children back to
school, the government needed large, fast,
and quality investments in the education
system. In this context, $100 million was
allocated to the education sector under the
World Bank Iraq Trust Fund (ITF), set up
jointly by the World Bank Group (WBG) and
the United Nations Development Group
(UNDG) to administer donor funding for Iraqi
reconstruction. However, in order to
implement these investments, efficient and
effective public contracting and purchasing
processes were needed.
This Note summarizes how innovative
approaches to procurement led to
exemplary service delivery results in Iraqs
education sector. The focus is on two
breakthrough achievements: large-scale
textbook printing and delivery under the
Emergency Textbook Provision Project, and
school construction in the newly
rehabilitated marshlands of Southern Iraq
under the Marshlands School Construction
Project. By developing a unique strategy for
procurement that was responsive to local
conditions, the Bank was able to support the
government in issuing printing contracts,
securing book delivery arrangements, and
acquiring the construction materials and
supplies needed to achieve the projects
development
objectives.
Portfolio
implementation in a fragile and conflictaffected state (FCS) like Iraq is not business
as usual. It calls for a delicate balance of

realism, effective risk management, and

flexibility. Given the insecurity and
weakened capacity at the time, the Bank
made sure that these concepts, along with a
keen understanding of the market, were key
tenets of its program.

The Emergency Textbook Provision Project

Among the urgent reforms passed by the

Iraqi government in the post-2003 era was
revisions to the countrys national
curriculum. This required a set of primary
and secondary school textbooks to be
updated, printed and delivered across the
country. A grant of US$40 million was given
to the Iraqi Ministry of Education (MOE) to
finance the printing and distribution of
approximately 69 million textbooks,
benefitting 6 million students for the 20042005 school year. Before the war, the Iraqi
government had used the same set of
textbook printers and suppliers for decades
without competitive methods to award
contracts. As a result, local printing houses
dominated the textbook market but with
high prices, and unreliable delivery and
quality. Moreover, given the ongoing
emergency situation in the country, other
risks to procurement were identified
throughout the project. For instance, Iraq
does not have a real procurement law2 or, at
the time, standard bidding documentation.
Both of these factors impacted efficiency
and left space for potential corruption.3
Other risks included:

The inability of Bank staff to supervise

the projects in the field due to the
security situation;
The weak capacity of the project
management team in procurement and
management of large contracts;
The high-risk and weak-control
environment;
The low capacity of local companies to
provide needed supplies;
A lack of interest of international
contracting companies to do business in
the country because of security
restrictions; and
Major delays in implementation
because of the lack of experience in
procurement planning in the ministry.

Faced with the time-sensitive task of

reprinting millions of textbooks within a few
months in fragile security conditions, an
urgent intervention was needed. To address
the identified risks, a number of measures
were taken to facilitate effective
implementation. First, the team ensured
that World Bank procurement guidelines and
the Iraq Master Implementation Manual
(MIM) were followed. Second, a local Bank
consultant based in Iraq assisted in the
supervision of the project and conducted
spot physical inspections. Bank staff from
outside Iraq also closely supervised the
procurement. Third, a dedicated and
qualified procurement manager was
assigned to manage the project. Fourth, the
project design was kept simple. And, fifth,
the team introduced flexibility in bidding
documents to encourage international and

12
local bidders. In addition, to meet service
delivery needs, the Bank helped the
government introduce a number of
important changes to the way in which the
Ministry
of
Education
managed
procurement. These changes would increase
supplier competition, reduce supplier prices,
and increase transparency while also
building MOE capacity.

documents for procurement of textbooks to

improve national procurement practices,
and produce its own standard bidding
documents,
including
conditions
of
contracts.

The following methods and strategies were

critical to the projects success:
Encouraging local involvement: Provisions
that encouraged the hiring of local

[Photo] Iraqi marshlands areas in the 3

governorates of Basrah, Thi Qar and Missan.
The measures taken included:
Opening the market to international
competition: Based on the assessment of
the capacity of the local printing industry
to deliver large quantities of textbooks
within a very short timeframe, the
decision was made to use both
International Competitive Bidding (ICB)
and National Competitive Bidding (NCB)
procedures. The Bank used regional
newspaper
advertisements
(in
neighboring countries) and other methods
to attract new suppliers to take part in the
bidding process for textbook printing.
Procurement was carefully packaged to
encourage international as well as local
bids.
Use of stocks of paper procured by the
previous government: Without this, local
printers could not have received paper
deliveries in time to meet printing and
distribution deadlines for the 2004-2005
academic year.
Dividing printing contracts between those
involving printing and distribution only
(paper supplied by the MOE), and
contracts requiring the procurement of
paper: The number of lots for printingonly contracts was determined by the
amount of paper available in Baghdad,
and adjusted at appraisal when evidence
of more available paper came to light.
Strengthening MOE capacity: Frequent
training, skills transfer and onthe-job
guidance was provided to the project
team and MOE staff for procurement and
project management both before and
during project implementation.
These actions had significant effects, most
notably resulting in lower prices. The use of
ICB attracted international firms (mainly
Jordanian and Lebanese), and brought
millions in cost savings through lower unit
costs. In the first round of procurement, the
unit costs of textbooks printed through the
NCB contracts were higher than the unit
costs obtained through ICB. As a result, the
MOE used ICB for the second round and Iraqi
companies still won contracts, as they
lowered prices to match international
bidders. Second, it resulted in standardized
procedures and bidding documents. The
projects focus on capacity building led the
MOE to standardize procedures and bidding

Marshlands School Construction Project

Starting in 1991, the Iraqi government at the
time drained the southern Iraqi marshland
areas of Basrah, Thi Qar and Missan, a
wetland ecosystem covering some 20,000
square kilometers. The draining was
intended to drive out indigenous
communities and ensure that opposition
militias did not take refuge in the
marshlands. Thousands of people were
forced to abandon their homes and
livelihoods and were displaced to other
areas of Iraq and Iranian refugee camps.
The marshlands have since been
rehabilitated and are now protected zones.
Some 36 communities have resettled and
the government has had to urgently provide
them with social services, including primary
education. Contract management and
procurement capacity in the local MOE
governorate staff was predictably low and
hampered by a fragile security situation.
Given the importance of quickly stabilizing
the resettled communities, the MOE sought
Bank support to construct the schools. An
amount of $6 million was allocated from the
Iraq Trust Fund to the MOE for the
construction of 36 new schools in the three
marshlands governorates in a 12-month
period. The Bank focused on supporting the
government in introducing procurement
processes that would rapidly implement a
school construction project, as well as help
build the capacity of local MOE staff.

companies and labor were part of the

project bidding documents. This was key
to the projects success, as it ensured local
and community buy-in.
Decentralizing authority: The central
government authorized the local
municipality to manage the procurement
process by introducing decentralized
bidding. This allowed for simultaneous
contracting locally and in Baghdad, for
example, by issuing bidding documents,
bid submissions, and bid openings. Having
this occur at the local level was very
important in encouraging participation by
local construction companies.
Strengthening local MOE capacity:
Training and skills transfer helped to
increase project management and
stakeholder engagement capabilities.
Utilizing civil society and local NGOs for
site improvement small works: these
actors were contracted to find local
stakeholders to assist in school site
selection, construction monitoring and
building maintenance.
The focus on local engagement increased
community ownership for the project,
enabling smooth delivery. It also boosted
employment as locals carried out works and
other activities, thereby strengthening local
SMEs that participated in government
contracts for the first time. Capacity building
measures enabled local MOE staff to drive
activities, such as site selection and project
management. As a result of these measures,

13
the MOE also improved its performance
indicators, for example, including enrollment
by gender for the first time. The project
successfully adapted procurement to the
local market by changing procurement
packages to numerous smaller-value
contracts; encouraging local labor; and
removing constraints such as bid guarantees
and stringent financial requirements to
encourage participation by local firms.
Tangible results included:

Emergency textbook provision: The

projects main success factors were its
simple design, capacity-building focus
and multi-sectoral management using
both operational and technical
advisors. Furthermore, the integration
of project management measures
guaranteed Project Management Team
stability despite ongoing changes to the
MOE. This was key to delivery success.

The project achieved its main objective

and closed on time. Experience has
shown the value of early and visible
impact, and the importance of
resuming normal schooling operations
to focus on wider systemic issues.

The objective of the project was the

printing of about 69 million textbooks
for the 2004-2005 school year. The
project exceeded this objective. In fact,
80.25 million textbooks were printed
and distributed on time.

Approximately $9 million of savings

were made from competitive bidding
for the 2004-2005 school year. These
savings were used to print additional
textbooks for the next school year.

The government standardized bidding

documents and contract conditions for
textbook purchases.

With regard to the Marshlands school

construction, the projects strong focus on
capacity building for local MOE staff and
community consultations was key to success.
This latter emphasis was especially crucial,
reducing local concerns, building ownership
and facilitating timely implementation.
Achievements included:
30 primary schools were built without
major cost or time overruns;
5,400 local students benefitted;
There was a 53 percent increase in schoolage girls school enrollment; and

Civil society was involved in site

improvement and small works for school
sites.
The success of these projects helped
establish the Banks credibility in Iraq,
establishing good precedents, and setting
the stage for World Bank support to the
education sector. This was the first World
Bank project in Iraq since the 1970s, and a
model for subsequent Bank-funded projects
in terms of implementation arrangements. It
also represented the first public bid opening

in Iraq, as well as the first time the Ministry

of Education managed its own procurement.
Conclusion
Many MENA countries have relied on
uncompetitive and inefficient procurement
strategies for many years. Iraqs education
sector was an example of such practices,
including
outdated
and
opaque
procurement procedures that inflated costs,
slowed delivery times, and hampered
effective service delivery. Yet, the World
Banks experience in Iraq shows that
adopting different approaches can deliver
rapid results that help thousands of citizens
to meet their everyday needs, even under
very challenging and unstable conditions.
These projects also demonstrate that there
are long-term positive spillovers effects from
the use of procurement systems and
practices introduced through World Bank
projects. For instance, the Projecct
Management Teams in Iraq have cited
positive impacts from the use of the Master
Implementation Manual (MIM) on Iraqi

government procedures, including, among

others, guidance on good practices for
financial management and procurement, a
breakdown of the procurement process
(with detailed step-by-step guidance),
standard
bidding
documents
for
procurement, model forms of contracts, and
general conditions of contracts. In addition,
the Iraqi government has developed, with
Bank support, general Standard Bidding
Documents (SBD) and Specialized sector
SBDs (based on MIMs bidding documents)
for education and other sectors, as well as a

National Implementation Manual (again

based on the MIM), for use in governmentfinanced projects. Finally, in both projects,
the Iraqi MOE at the local and national levels
considerably strengthened their capacity in a
number of crucial procurement areas. This
increase in national capacity was crucial
because it improved the long-term prospects
for sustainability of these projects and for
future successes in the Iraqi education
sector.

The authors are all members of the Public

Integrity and Openness Department of the World
Banks Governance Global Practice, supporting the
MENA region. This note was prepared under the
guidance of and clearance by, Yolanda Tayler,
Practice Manager.
2 CPA Order 87, imposed by the Transitional
Authority, is not generally regarded as applicable
and is for the most part ignored by practitioners.
3 Iraqs vulnerability to corruption is demonstrated
by the countrys poor rankings in Transparency
Internationals Corruption Perception Index. It
ranks lowest of all countries in the region.

14

Internal Audit
Enhancing Public Financial Management in MENA
Through the Development of Internal Audit Functions in the Public Sector
Walid Al-Najar
Internal Control Technical Practice (IATP)
MENA Co-Leader and Financial Management
Specialist.
The year 2015 was quite a turbulent and
unstable year in the Middle East and North
Africa (MENA) Region. It was also a year of
interesting milestones for the internal audit
practice. The failure to provide the expected
levels of public services combined with
insufficient progress on development
agendas in some countries have contributed
to an increase in the awareness by high
public officials and civil societies of the
necessity of finding internal assurance
systems and sound internal controls.
Governance specialists consider the
development of internal audit (following
international standards and best practices)
in MENA countries, vital for efforts to reform
public financial management (PFM). Good
internal audit practices help to ensure
economy, cost-effective internal controls,
transparency and accountability of PFM
policies and transaction-based execution.
Promoting
the
establishment
and
maintenance of local professional bodies in
member countries facilitates work in
developing internal audit roles in the public
sector. It helps to bring together
professionals acquainted with the rich local
context and PFM officials in building internal
audit (assurance) functions and engaging in
policy dialogues. Aware of key elements of
PFM
and
corporate
effectiveness,
professional interaction within and among
MENA countries has helped to reinforce
several internal audit associations and
profession development organizations.
Advanced associations such as those in
Lebanon, Tunisia and the United Arab
Emirates (UAE) have worked on helping
other associations in the formation stages.
Although internal audit practitioners
throughout the region are affiliated in one
way or another with the Global Institute of
Internal Auditors (IIA), which is leading the
development
of
the
profession
internationally, practitioners have also found
it very useful to come together and affiliate
with local associations. The advantages
include thriving exchanges of domestic
experiences, recognition and agreement on
professional development, and promotion of
local experts to the public and private
sectors. In the second half of 2015, Jordan
established its first professional body for
internal auditors, the Jordan Internal Audit
Association (JIA), with a membership of
more than 200 professionals. JIA approached

the IIA for international recognition toward

becoming an IIA chapter in Jordan after
fulfilling requirements that are usually
processed and agreed to by IIA over a span
of 1-2 years. The JIA is also outreaching to
policy makers and opening a dialogue with
public sector officials on the role of internal
audit in Jordan, including the added value
such a function can bring to the
achievements of the governments mid-term
strategies. Another success story comes
from Yemen, where despite the ongoing war
that started end of March 2015, The Yemeni
Association for Internal Auditors (YAIA), with
more than 300 members, has worked hard to
obtain IIA status of its IIA International
Chapter-under-Formation, which is the
initial step toward the full IIA international
affiliation. Similar formation of associations
took place in Saudi Arabia and Kuwait, which
interestingly started with high momentum
and dedication toward initiating policy
dialogue and fostering discussions on
advanced professional topics. Furthermore,
the professional bodies in MENA explored
the the idea of establishing an Arab
Federation for Internal Auditors during the
UAEs 5th Internal Audit conference, an oldnew initiative. The Arab Federation is
expected to become the regional
professional body that supports MENA
countries developmental efforts, assuming
the position of a key player in the
international arena. The head of delegates
that met in the 5th Conference agreed to

expand discussions on the draft formation

constitution with other MENA countries
bodies and accelerate the formation of this
Federation in the near future.

World Bank support for the development

of the IA function in MENA can help public
sector entities achieve organizational
objectives, identify opportunities for
improvement in operations, reduce risk
exposure, as well as enhance citizens
confidence in public organizations.

The World Banks support to enhanced

governance, PFM reforms and strengthening
programs in the MENA region takes into
account the vital role of internal audit. It
recognizes the need to mobilize expertise
and disseminate world-class knowledge to
member countries, working side-by-side
with counterparts on development of
internal audit in the public sector. The World
Bank team can offer professional and
evidence-based analysis and advice on
establishing an audit function that best fits a
country and its institutional circumstances.
World Bank support consists of technical
assistance to support the: strengthening of
internal audit functions; enhancing the role
of internal audit in the implementation of
the
Bank-supported
projects;
and
development of local professional internal

15
audit associations. The World Bank MENA
region works with other international
development organizations, such as the
European Union and the IIA Global in
providing customized support and technical
assistance to governments. Ongoing support
to Iraq, Lebanon and Tunisia is characterized
by excellent collaboration with governments
in taking public sector internal audit to the
next level. The Internal Audit and Internal
Control Technical Practice (IATP) in MENA
was launched with the objectives of
providing clients with expert knowledge and

global experience and helping them to build

regional knowledge platforms, including
communities of practice. The IATP has set a
strategy with specific objectives, activities to
be carried out, and expected results along a
projected timeline. The IATP advocates
stronger internal controls, enhanced
assurance systems, risk management,
transparency and accountability. The key
challenges faced by the IATP in its work
include: (i) getting each countrys internal
audit basics right; (i) bridging the internal
audit awareness and knowledge gaps

through assistance in dealing with rapid

changes in risk landscapes and anticipating
the needs of stakeholders; (iii) raising
awareness of benefits of using professional
standards designed for flexibility in internal
audit work; (iv) helping with technology use;
and (v) supporting internal audit human
capital formation to ensure sustainability of
interventions,
while
promoting
the
understanding
that
internal
audit
development is an incremental process.

Highlights of World Bank Activities

Supportive of Public Sector Internal Audit in the MENA Region
Country
Tunisia

Internal Audit Activities

Strengthening the IA function in the Ministry of Finance.

Iraq

Improving governance through strengthened financial management, including internal audit.

Lebanon

Support for a pilot of a modern internal audit function in the Ministry of Finance.

Yemen

Egypt

Policy dialogue, establishment and capacity building of modern Internal Audit

Departments (IADs).
Enhancing the role of IA in Project Implementation Units (PIUs).
Use of Independent Audit Firms to provide IA services in projects.

Support for a first pilot of a public sector internal audit function.

In Their Own Words

World Bank Group President Jim Yong Kim Congratulates Tunisia
on the 2015 Nobel Peace Prize
World Bank Group President Jim Yong Kim
congratulated the Tunisian National Dialogue Quartet
on being awarded the 2015 Nobel Prize for Peace in Stockholm, Sweden:

"The Tunisian National Dialogue Quartet embodied the spirit of the Nobel Peace Prize
through their tireless efforts to promote a more inclusive society and
advance the full potential of all Tunisians after the Jasmine Revolution of 2011.
Tunisia demonstrated to the world the value of building institutions
that allow the broadest participation of society,
showing that people can come together to resolve political challenges
through compromise and consensus.
The National Dialogue Quartet was instrumental to this remarkable achievement.
The Nobel Peace Prize is a fitting recognition of the social and
political accomplishments of the Quartet and the Tunisian people.
Dr. Jim Kim,
President,
World Bank Group

16

Join the WBG

Integrated Reporting <IR>
Community of Practice
Value Creation through
an Integrated Thinking Process

What?
A holistic approach to better governance
and sustainability in the public sector
through reporting on value of financial,
natural, manufacturing, intellectual,
human, and social capital

Why?
To breakdown traditional management,
decision-making, and reporting silos

Who?
Peer-to-peer and expert knowledge
exchange

Want to hear about

upcoming events and
join the conversation?
Send your name, organization,
and valid email address to:

CoPIR@worldbank.org

17

Corporate Governance
& Financial Reporting

Education 17
IFRS for SMEs 19
Doing Business Report 21

Education
The Value of National Professional Qualifications:
Perspectives from the Institute of Chartered
Accountants in England and Wales
Nicola Maher,
ICAEW Capacity Building Executive

Mark Campbell,
ICAEW Head of International Capacity
Building

Increasing
globalization,
competitive
markets and a shortfall in the number of
accountants characterize the landscape that
most professional bodies in developing
countries face. The strengthening or
launching
a
national
professional
qualification (PQ) is essential if local
accounting institutes are to withstand the
challenges from foreign competitor bodies.
Such qualification also aids in developing a
vibrant
and
growing
accountancy
profession. Students who qualify through
the national PQ will be the local institutes
most dedicated members, helping to ensure
its future. However, in order to stay relevant
and compete for the best and brightest
students, the national PQ must also be
aligned with international standards and

benchmarks. A PQ prepares the students of

today to be the professional accountants of
tomorrow. A successful PQ requires an
internationally-aligned modern syllabus, a
rigorous examination regime, good learning
materials, tuition providers, pathways into
the PQ for suitable students, a practical work

experience
regime,
and
successful
marketing and communications of the PQ. A
foreign PQ does not typically offer local tax
and law training, and the registration and
examination fees paid leave the country and
are instead invested in countries that will
generate higher returns for the foreign
professional
body.
Subsequently,
investment in aligning a national PQ with the
local university syllabus, tailoring it to the
needs of the market, and investing in
market-specific continuing professional
development courses may be lost. Investing
in a national qualification helps to improve
the quality of local accountants, thereby
improving audit quality, international
recognition,
reliability,
and
greater
transparency
and
accountability
of

published financial data. This in turn can

increase investor confidence and ultimately
the climate for inward investment.
Importance of partnering
Many national professional accountancy
organisations (PAOs) in developing countries
find it helpful to seek the support, guidance
and mentoring of longer established
professional bodies. Benefitting from the
experience of another reputable body helps
it to improve its accountancy professions
qualifications, thereby enabling it to
successfully compete in the market place.
The Institute of Chartered Accountants in
England and Wales (ICAEW) has been
working in the international development
space for nine years. During that time, its
dedicated capacity building team has
undertaken about 35 projects with PAOs,
financial regulators and government
agencies revising and launching
professional
qualifications,
reforming
regulatory and legal landscapes, and
assisting with the adoption of international
accountancy standards and best practices.
The ICAEWs main goal is to work closely
with counterpart bodies in developing
nations to strengthen their institutional
capacity and the capacity of the accounting
profession. The ICAEWs own chartered
accountancy qualification, the Associate
Chartered Accountant (ACA), is one of the
most advanced learning and professional
development programs available. With
more than 20,000 students worldwide,
ICAEW has developed much relevant
international experience. In this context, it

18
understand the value and importance of
having a high quality national PQ. The ICAEW
partners with counterpart bodies in
developing nations and does not compete
with them. Its strategy is to build a network
of partnerships with other professional
bodies to encourage the adoption of
international standards and good practice.
ICAEW wants PAOs in developing countries
to become stronger and remain
independent.

Creating a high-quality PQ
The ICAEW believes there are eight key
dimensions to developing a high-quality PQ.
These include: (i) a modern and up to date
syllabus; (ii) an examination system that is
reliable, credible and consistent; (iii) highquality training provision and learning
materials; (iv) a range of pathways to entry;
(v) a practical work experience regime; (vi)

many developing countries, the public

sector is often at a disadvantage with the
private sector in the recruitment of
accountants. Therefore, it is also imperative
that areas of public finance management,
International Public Sector Accounting
Standards or public sector auditing and
assurance be included in the syllabus.
Establishing a practical work experience

capable administrative capacity in the

professional body; and (vii) a brand known
and trusted in the market place.

regime to reinforce classroom training

should not be overlooked. Indeed, it is a
requirement of the international education
standards of the International Federation of
Accountants (IFAC). Ideally, partnering with
both private and public sector organizations
will help to meet demand and balance the
needs of employers. The key element of
such a scheme would be that only employers
capable of offering the appropriate range of
experience should be authorized, and an
individual within the firm would take
responsibility for the student. The
examination setting and marking process is
crucial to the credibility and reputation of a
PQ, the organization(s) responsible for it, as
well as that of the profession as a whole.
Therefore, examiners and markers must be
trained to ensure that the examinations and
the marking are of an appropriate standard.

Furthermore, the ICAEW is now working

with many national PAOs to evaluate and
implement or improve the national PQ,
focussing not only on the syllabus, but on
other international benchmarks for
improving the outcomes for students in
learning and qualification.
The ICAEW has assisted developing nations
across Africa, Asia, Europe and the Middle
East to implement or improve a PQ.
This work typically involves a series of logical
sequential steps:

Carrying out a diagnostic review of the

local environment and current
qualification.

Reviewing the qualification (including

the curriculum) against international
benchmarks.

Recommending appropriate reforms to

the syllabus, exam system, training
contracts and work experience regime,
and so on.

Assisting in the implementation of the

recommendations.
In Myanmar, for example, since 2013 the
ICAEW has been working in partnership with
the Myanmar Institute of Certified Public
Accountants (MICPA), the Auditor General,
and Myanmar Accountancy Council on a
United
Kingdom
Foreign
and
Commonwealth Office-funded project
aimed at enhancing transparency through
strengthening the accountancy profession.
The project included the preparation of a
strategic plan and roadmap (20142016) to
strengthen accountancy capacity and the
overall accountancy profession in Myanmar.
A key area of the strategic plan involves the
training and certification of accountants. As
such, an important recommendation was to
reform the current PQ, or develop a new one
in line with international standards and
benchmarks. After much analysis and
consultation, there was consensus that a
new PQ should be introduced for a first
intake of students in 2016. The ICAEW has
provided implementation support in
reaching this goal, including drafting a new
syllabus, assisting with an implementation
plan and engaging a suitable learning
materials provider.

It is a rigorous task to undertake and one

that needs careful consideration if it is to be
successful. While the PQ will be targeting
national students, it should be a
combination of international and national
components so the qualification remains
competitive internationally. One of the
biggest issues faced by developing countries
is the shortfall in the number of professional
accountants. For example, in Myanmar
there are only about 3,000 qualified
accountants in a country of 66 million
people. It is therefore vital that more
pathways are established into studying for
the qualification so as to attract the best and
brightest students and professionals. An
obvious solution is a non-graduate route.
Many professional accountancy bodies
permit entry of non-graduates to the
profession. This is often via a technician
qualification. This provides access for
excellent candidates who, for various
reasons, may be unable to follow a more
traditional academic career into the
accountancy profession. The syllabus which
incorporates both local topics and those that
would be expected in any internationally
recognised accountancy qualification should
be modern and up to date. The papers
covering the local area (generally tax and
law) must be developed to a high standard,
as these are often a key differentiating
feature from foreign competitor bodies. In

The aspirations of all PAOs for their PQ is

that they should have:

Good demand from students

entering the professional body.

High pass rates (good students

recruited and properly prepared
and trained).

Attaining such a good reputation

that it is easy to achieve
reciprocal arrangements with
other professional bodies.
While it may seem a daunting task to
undertake, with the right guidance and
support, developing nations can take on this
challenge. It is therefore crucial that capacity

19
building within the accountancy profession
continue and the value of having a national
PQ aligned to international benchmarks
voiced.
The ICAEW notes eight dimensions of a
successful PQ, as listed in box 1.

1.
2.
3.
4.
5.

The PQ syllabus and curriculum vis--vis

international standards/benchmarks.
The quality of examinations and related
student regulations
The quality of tuition providers.
The quality of learning materials.
The quality of practical work
requirements and ethical training.

6.
7.

8.

The quality of pathways into the PQ and

the quality of university degrees.
The quality of the education and
training department in supporting
students.
The perceived strength of the brand by
students and employers.

The IFRS for SMEs

Recent Developments
Michael Wells
Director, IFRS Education Initiative, IASB
In May 2015 the International Accounting
Standards Board (IASB) made a limited
number of changes to the International
Financial Reporting Standard for Small and
Medium-sized Entities (IFRS for SMEs). The
amendments are effective for annual periods
beginning on or after January 1, 2017.
However, earlier application is permitted.
This paper discusses the changes made and
draws attention to the support being
prepared for those affected by them.
Implementation support
The IFRS Foundation Education Initiative
supports those implementing and applying
the IFRS for SMEs by:

Publishing comprehensive training

material and, with the support of others,
translating that material into widelyspoken languages, including Arabic (see:
http://go.ifrs.org/SME-trainingmodules); and
Facilitating multi-day regional IFRS for
SMEs train the trainer workshops, with
the support of the World Bank and
others, as set out in the following world
map. (The presentations used in those
train the trainer workshops are
available from: http://go.ifrs.org/SMEppts-workshops).

To support the implementation of the recent

amendments, the education staff are now
updating the 35 training modules to take
account of the 2015 amendments to the IFRS
for SMEs. The updated training material is
expected to be posted on the IFRS website in
2016.
Use of the IFRS for SMEs

To assess progress towards the goal of global

accounting standards, the IFRS Foundation is
developing profiles of application of IFRS and
the IFRS for SMEs in individual jurisdictions
(see: http://www.ifrs.org/Use-around-theworld/Pages/Analysis-of-SME-profiles.aspx).
Of the 140 jurisdictions whose profiles are
posted so far, 73 require or permit the IFRS for
SMEs, including Bahrain, Iraq, Israel, Jordan,
Palestine, Saudi Arabia, United Arab Emirates,
and Yemen in the MENA region. In Saudi
Arabia, the IFRS for SMEs will be the financial
reporting framework for unlisted companies
starting in 2018. Use of the IFRS for SMEs is
also currently under consideration in a further
14 jurisdictions. In requiring or permitting the
IFRS for SMEs, 64 of the 73 jurisdictions made
no modifications to its requirements.

Options to use:

the revaluation model for property, plant

and equipment; and

the equity method for investments in

subsidiaries, associates and jointly
controlled entities in separate financial
statements, if presented.

Amendments that change requirements

Changes most likely to affect SMEs:

alignment of the main recognition and

measurement principles for income tax
with IFRS;

modification of the criteria to be a basic

debt instrument to ensure that most
simple loans qualify for amortized cost
measurement; and

Requirement that if the useful life of

goodwill or another intangible asset
cannot
be
established
reliably,
managements best estimate is used, but
must not exceed 10 years. Previously, a

Recent amendments
The May 2015 amendments to the IFRS for
SMEs are discussed as follows:
Amendments that introduce accounting
policy options (available in IFRS)

20
default 10-year life was presumed in
such cases.
Changes to the requirements for the following
less commonly encountered transactions by
SMEs (not expected to affect most SMEs):

liabilities extinguished by issuing the

entitys own equity instruments, such as
shares;

leases with an interest rate variation

clause linked to market interest rates;

compound financial instruments with

complex characteristics; and

Exploration and evaluation assets.

Amendments that add undue cost or effort:

exemptions and requirements

issued in a business combination of

entities under common control; and

An exemption that simplifies the accounting

requirements when part of an item of
property, plant and equipment is replaced.

measurement of investments in equity

instruments at fair value;

recognizing intangible assets separately

in a business combination;

offsetting income
liabilities; and

tax

assets

The IASB has also added guidance to

emphasize that an undue cost or effort
exemption is not intended to be a low hurdle.
In particular, an entity is required to carefully
weigh the expected effects of applying the
exemption on the users of its financial
statements against the cost or effort of
complying with the related requirement.
Amendments that add other exemptions
(based on similar exemptions in IFRS)
Two common control exemptions:

an exemption from the fair value

measurement requirements for equity

that

provide

minor

The remaining amendments are minor and

are not expected to result in changes in
practice, or to affect the financial statements
for most SMEs.
Such amendments are of the following types:

clarifying definitions or guidance;

clarification of the scope of a few

sections; and

redrafting of unclear requirements or

removing minor inconsistencies.

A requirement that an entity must

disclose its reasoning for using any
undue cost or effort exemption;
A requirement that investment property
measured at cost less accumulated
depreciation and impairment is
presented separately on the face of the
statement of financial position;

A requirement that entities group items

presented in other comprehensive
income on the basis of whether they are
potentially reclassifiable to profit or loss;

A requirement that an entity must

disclose the factors that make up
goodwill recognized in a business
combination and the useful life of
goodwill;

and

Measuring the liability to pay a non-cash

dividend at the fair value of the assets to
be distributed.

Amendments
clarifications

Amendments that modify presentation or

disclosure requirements

Amendments that exempt an entity from the

following requirements when application
would cause undue cost or effort:

an exemption from the fair value

measurement
requirements
for
distributions of non-cash assets
controlled by the same parties before
and after the distribution.

The IASB has included three options and two

new areas of guidance for first-time adopters
of the IFRS for SMEs based on amendments to
IFRS issued since the IFRS for SMEs was
issued.

A requirement to disclose the carrying

amount of subsidiaries acquired and
those held for sale or disposal;

An alignment of the definition of a

related party with IFRS. The revised
definition is unlikely to affect most
related party relationships; and

A relief from disclosing prior year

reconciliations of balances for biological
assets and share capital and from
disclosing the accounting policy for
termination benefits (for consistency
with other requirements of the IFRS for
SMEs).

Amendments for first-time adopters

Transition and effective date

Entities reporting using the IFRS for SMEs are
required to apply the amendments for annual
periods beginning on or after January 1, 2017.
Earlier application is permitted provided all of
the amendments are applied at the same
time.
Amendments
must
be
applied
retrospectively, unless impracticable, with
the following exceptions:

if an entity chooses to apply the

revaluation model to any classes of
property, plant and equipment, it must
apply the
related requirements
prospectively from the beginning of the
period (that is, the period in which it first
applies the amendments);

an entity is permitted to apply the

revised income tax requirements
prospectively from the beginning of the
period; and

an entity must apply the clarified

terminology date of acquisition
prospectively from the beginning of the
period (only applicable if an entity has
business combinations).

Note: ABWA= Association of Accountancy Bodies in West Africa; ACS= Accounting Standards Council (Singapore); ACSA= Association of Chartered System Accountants; ADB= Asian
Development Bank; BNDES= Brazilian Development Bank; CA= Chartered Accountants of Sri Lanka; CAPA= Confederation of Asian and Pacific Accountants; CCC= Chilean College of
Accountants; CPAS= Institute of Certified Public Accountants of Singapore; DED= Department of Economic Development (Abu Dhabi); DUOC UC= Pontificia Universidad Catlica de Chile;
ECCB= Eastern Caribbean Central Bank; ECSAFA=Eastern Central and Southern African Federation of Accountants; FACPCE= Argentine Federation of Professional Councils in Economic
Sciences; FMITI= Federal Ministry of Industry, Trade and Investment (Nigeria); FRC= Financial Reporting Council (Nigeria); HKICPA= Hong Kong Institute of Certified Public Accountants;
IASCA= International Arab Society of Certified Accountants; ICAB= The Institute of Chartered Accountants of Bangladesh; ICAB= Institute of Chartered Accountants of Barbados; ICAC=
Institute of Chartered Accountants of the Caribbean; ICAEC= Institute of Chartered Accountants of the Eastern Caribbean; ICFM= Institute of Certified Financial Managers (Ukraine);
MASB= Malaysian Accounting Standards Board; MIA= Malaysian Institute of Accountants; MICPA= Myanmar Institute of Certified Public Accountants; MoF= Ministry of Finance; PAFA=
Pan-African Federation of Accountants; SAFA= South Asian Federation of Accountants; SCAAK= Certified Accountants and Auditors of Kosovo; TASB= Turkish Accounting Standards Board;
TURMOB= Union of Chambers of Certified Public Accountants (Turkey); UAE= United Arab Emirates.

Doing Business Report

21

Despite Conflict, Business Reforms Pick Up in the Middle

East and North Africa, says Doing Business Report
The pace of business regulatory reforms picked up during the past
year in the Middle East and North Africa (MENA), despite conflict and
turmoil in the region, according to the World Bank Groups annual
ease of doing business measurement.
Doing Business 2016: Measuring Regulatory Quality and Efficiency
finds that 11 of the regions 20 economies implemented a total of 21
reforms facilitating the ease of doing business. This is a significant
increase compared to the annual average of 16 reforms during the
past five years.
The United Arab Emirates (UAE) is the regions top ranked economy,
with a global ranking of 31, while countries experiencing conflict and
violence are among the worlds lowest ranked, including Iraq (ranked
161), Libya (188), Syria (175) and Yemen (170).
Despite the turmoil in several economies in the Middle East and North
Africa, the pace of business reforms activity in the region is
encouraging, said Rita Ramalho, Manager of the Doing Business
project There is a lot of room for improvement, however. The share
of economies reforming in the region remains lower than the global
average, and Getting Credit is harder in the Middle East and North
Africa than anywhere else, partly due to the absence of comprehensive
credit bureaus that provide information relevant for assessing creditworthiness.
Morocco and the UAE continue to lead the region in reform activity,
as both economies undertook four reforms each during the past year.
Morocco made starting a Business easier by eliminating the need to
file a declaration of business incorporation with the Ministry of Labor.
The UAE was the only economy in the region that reformed in the area
of Enforcing Contracts. As a result, commercial disputes in the UAE
are now resolved in 495 days, which is less than the average of 538
days in the high-income Organisation for Economic Co-operation and
Development (OECD) economies.

Both Saudi Arabia and Oman improved the most globally in the areas
of Registering Property and Getting Electricity, respectively. Saudi
Arabia introduced a new computerized land registry system. It now
takes an entrepreneur only six days to register property in Saudi
Arabia, faster than in the Republic of Korea. Oman enhanced its
measurements and tracking of power outages, making it is easier to
assess the reliability of the electrical grid and its effect on the
productivity of firms.
Economies in the region carried out the most reforms in the area of
Getting Electricity (4 reforms), followed by Starting a Business (3),
Dealing with Construction Permits (3) and Trading across Borders (3).
However, challenges remain in a number of areas. For example,
regarding Starting a Business, it costs an average of 26 percent of
income per capita for local entrepreneurs to start their business,
compared to 3 percent in the OECD.
This years Doing Business report completes a two-year effort to
expand benchmarks that measure the quality of regulation, as well as
the efficiency of the business regulatory framework, in order to better
capture realities on the ground. With respect to the five indicators
that saw changes in this report Dealing with Construction Permits,
Getting Electricity, Enforcing Contracts, Registering Property and
Trading across Borders the MENA economies do not perform well.
On Getting Electricity, for instance, the new dataset finds that several
regional economies face either frequent outages or do not track them
adequately.
The ranks of other large economies in the region are Algeria (163),
Egypt (131), Iran (118), Morocco (75), Qatar (68), Saudi Arabia (82)
and Tunisia (74).
The full report and accompanying datasets are available at
http://www.doingbusiness.org/

22
Government Spending 22
Corruption 25
PIM 26

Public Sector

Government Spending
Achieving More with Less in Government Spending:
Can Efficiency Units be Part of the Solution?
Robert Beschel
Global Lead, Center of Government
Government Global Practice [1]
The significant decline in oil prices with little
prospect of near-term reversal is prompting
many hydro-carbon rich states in the Middle
East to look for expenditure savings
wherever they can find them. In Qatar, the
Emir Tamim bin Hamad al-Thani noted in the
2016 budget discussions that citizens should
no longer be dependent upon the state to
provide for everything and argued that the
new budget will focus on efficiency in
government spending. In October 2015,
Kuwaits Emir called for speedy actions to
adopt serious and fair measures to
complete economic reforms and reduce
public expenditures. In November, the IMF
warned that the Saudis, Omanis and
Bahrainis need to adjust their spending or
they risk running out of financial assets
within the next five years.[2] Governments
throughout the GCC and beyond are
responding to these challenges in a variety of
ways. Some are looking to delay major
capital projects; reform costly subsidy
schemes; float bonds; and even to revisit the
implicit social contract, in which many of
their citizens are given comfortable jobs for
life within the public sector. But a broader
question remains as to how MENA
governments can use the current downturn
to institutionalize the quest for greater
efficiency within government. One approach
that a number of OECD countries have
pursued, which is being scrutinized for
possible adoption in other oil-dependent
economies such as Nigeria, is the creation of

efficiency units in the center of

government. This note briefly summarizes
comparative experience with efficiency units
(or the broader effort to institutionalize the
quest for efficiency) within government in
five settings: Canada, France, Hong Kong, the
United Kingdom and the United States. Only
two of these countriesthe United Kingdom
and Hong Konghave actually established
dedicated efficiency units. Two others,
Canada and France, created program review
units that were more specialized but served
a similar function. The United States has
sought to drive efficiency gains through
existing
agencies
and
institutional

mechanisms, making modest changes in

their role and function to strengthen their
focus on cost savings. Taken together, these
countries provide a wealth of experience as
to how governments grounded upon
differing administrative and bureaucratic
traditions have structured themselves to
pursue their shared goal of greater efficiency
in government expenditure. The differing
paths they took illustrate many of the
possibilities and tradeoffs involved in such
exercises. Their experience is worth
studying for Arab governments now
confronted with a similar need to rationalize

23
expenditure to achieve optimum value for
each dirham, dinar or riyal spent.
Canada [3]
In the mid-1990s, the Canadian government
was facing a series of unsustainable budget
deficits and anemic economic performance
that required drastic action. Through a
series of program reviews in the 1995 and
1996, budgets, the federal government was
able to achieve significant reductions in
program spending (on the order of 8.8
percent over a two year period) in every area
save interest payments. The net result was
that the national debt ultimately declined by
over half, from 68 percent of GDP in 1995-96
to 29 percent in 2008-09, while economic
growth was robust and unemployment
declined. The crux of Canadas spending
transformation centered upon a number of
highly successful program reviews that took
place over two rounds in the 1995 and 1996
budgets. The program reviews were
explicitly aimed at fiscal consolidation to
reign in high deficits and reduce debt. Tough
agency-specific savings targets were
established, with some as high as 50 percent
and others ranging between 15-25
percent. Within the context of their overall
expenditure ceiling, line departments were
then asked to review their programs and
activities in accordance with six established
criteria: (1) does the program area or activity
continue to serve a public interest; (2) is
there a legitimate and necessary role for
government in this area; (3) is the current
role of the federal government appropriate,
or should it be realigned with the provinces;
(4) should the program or activity be
transferred in whole or in part to the private
or voluntary sectors; (5) if the program
continues within the public sector, how can
its efficiency be improved; and (6) is the
resulting mix of programs and activities
affordable
within
current
fiscal
constraints? Throughout the process, the
Prime Minister strongly and visibly
supported his Minister of Finance against
spending ministers. The process was
overseen by a Cabinet subcommittee of
deputy ministers chaired by the Clerk of the
Privy Council.[4] A Program Review
Secretariat was created in the Privy Council
Office, which was tasked with analyzing
departmental strategic plans. It was assisted
in this task by the Department of Finance and
Treasury
Board
Secretariat.
Public
expectations were managed by a
communications strategy that underscored
the dangers of doing nothing while informing
the public of the advantages of decisive
action. Public servants were kept involved
and motivated by creating a sense of
urgency. Bargaining
with
sub-national
governments featured concessions to ease
the offloading and contracting of federal
responsibilities.

France
Building on the successful Canadian
experience referred to above, the French
government launched a general review of
public policies from 2007-2012. This review
looked aimed to improve the quality of
government services, modernize and
simplify public bodies, move to a more digital
and
sustainable
model
of
public
administration and increase efficiency and
effectiveness of public spending. In order to
further this particular aim, the authorities
set up a high-level administrative committee
with Cabinet backing. This was supported by
the General Finance Inspectorate, the elite
internal audit and advisory body of the
Ministry of Finance, as well as line ministry
internal audit bodies. An overall audit of
public spending was undertaken, with
support from outside consultants. This
resulted in significant savings, in particular
on discretionary expenditure (procurement,
real
estate
management,
utilities,
etc.). During the same period, deficit
pressures resulted in the non-replacement
of a proportion of civil servants who had
retired, which was not a popular
measure. Following a change of government
in 2012, this review was replaced by the
Public Administration Modernization effort,
which focused more on the performance of
public services than on cost-cutting.
However,
the
Finance
Inspectorate
continues to identify opportunities for
greater
cost-effectiveness
and
has
developed a strong expertise in that area.
The Budget Directorate routinely uses their
findings in budget negotiations.
Hong Kong [5]
Hong Kong created an Efficiency Unit (EU) in
1992 to secure continuous improvement in
public services through an ongoing program
of public sector reform and promotion of
best practice in management. The EU
provides
an
in-house
management
consultancy to assist public service agencies
on a flexible basis through a range of
services, with the goal of improving the
quality and value of public services. It also
helps to develop new service models and
with the application of design thinking for
more engaging and effective public
services. The unit also runs 1823a one
stop call service for the public to obtain
information about government services and
to report problemsand the GovHK
websites youth portal. These initiatives
have allowed the agency to better
understand evolving trends and dynamics in
the use of public services. An example of
consultancy services provided by the EU
would
include
business
process
reengineering (which has been a major area
of focus), along with organizational

restructuring, enhancing the use of IT

(including both improved information
management within government as well as
major systems, such as HR management),
performance management, and private
sector engagement in helping to meet
broader social needs, as well as general
management and consultancy support. The
EU reports up through the Chief Secretary
for Administration, who heads the
Government Secretariat and is the most
senior
official
within
the
special
administrative region government, reporting
up to the Chief Executive and the Legislative
Council. It is organized into six bureaus and
ten departments. As of 2015, it has an
establishment size of around 88 and an
annual operating budget of US$28.5 million.
The United Kingdom [6]
Within the United Kingdom, the Efficiency
and Reform Group (ERG) is a part of the
Cabinet Office, where it reports up through
the Permanent Secretary to the Minister for
Cabinet Office. It was established in 2010
with an emphasis upon driving cost savings
and enhancing economic growth. It works in
partnership with the Treasury through the
Chief Secretary to pursue a number of
objectives, including:
Delivering savings by ensuring that
government acts as one customer
through combining governments buying
power, increasing its pool of suppliers
(including small and medium-sized
enterprises) and expediting procurement;
Assuring the delivery of governments
most significant projects, on time, within
budget and to a high quality;
Transforming public services by being
digital by default, focusing on the needs of
users and making sustainable savings for
government; and
Reforming governments management
information and driving a clear, evidence
based approach to efficiency programs
across government.
The ERG has an annual budget of 72 million
and a staff of around 1,125, with offices in
London,
Newport,
Norwich
and
Liverpool. Its current priorities involve
working collaboratively with departments to
achieve significant cost savings (they
targeted at least 12 billion in 2013 and
2014); supporting the adoption of new
digital technologies and commercial models
to improve the delivery of public services;
minimizing losses due to fraud and error in
the distribution of benefits; and improving
the collection of debts owed to the
government, among others. It has a strong
emphasis upon procurement related
reforms, including renegotiating contracts
with major suppliers; the implementation of
a centralized procurement process; a review
of major government projects; and the

24
creation of a new Property Unit. National
Audit Office reports from 2011 and 2013
noted that in 2011-12, the unit estimates
that it has influenced around 5.5 billion in
government expenditure, including 1.5
billion in staff costs; 1.8 billion in reported
savings on consultants and other temporary
staff; 1.5 billion in other areas; and .8
billion in spending on capital projects. It also
noted that the agency has struggled with a
number of staffing issues, including a
relatively high turnover (around 18 percent),
as well as difficulty in attracting staff with the
required expertise in corporate finance and
IT systems.

contracts; eliminating improper payments;

leveraging the federal governments
purchasing at scale; and improving the
management
of
federal
real
estate. Subsequent priorities have included
reducing travel expenditures through
expanded use of teleconferencing and
videoconferencing technologies, as well as
the increased use of government properties
for conferences; reviewing inventories of IT
devices and establishing controls on their
use; reducing the publication of documents
and relying more heavily upon electronic
dissemination; and improving the fuel
efficiency of vehicle fleets and optimizing
their size.

United States [7]

Conclusions
While the United State has no single unit or
agency dedicated to promoting efficiency in
government, the Presidents Office of
Management and Budget (OMB) has long
made efficiency in public expenditure a
major priority. Most recently, President
Obama announced a campaign to cut waste,
fraud and abuse in government expenditure
in 2011. He signed two executive orders: (1)
Executive Order 13576 on Delivering an
Efficient, Effective and Accountable
Government in June 2011; and (2) Executive
Order No. 13589 in November 2001, which
urged all government agencies to develop a
dedicated plan for efficiency gains along
multiple dimensions (see below). A number
of
institutional
arrangements
were
developed to take forward these
initiatives. The Vice President was charged
with convening periodic meetings with
Cabinet members and the Director of OMB
to monitor progress in implementation. The
Federal Chief Performance Officer, a senior
official within OMB, was tasked with working
with agencies to ensure that robust
performance metrics were in place and
frequently updated. Each agencys Chief
Operating Officer and Chief Financial Officers
were also tasked with delivering
performance gains and cost savings. In
addition, a new Government Accountability
and Transparency Board was established to
provide strategic guidance and direction for
this effort. It is comprised of 11 members,
including agency Chief Financial Officers,
Deputy Secretaries, a senior official from
OMB, and several agency Inspectors
General. A number of areas have been
flagged for review, consolidation and
cancellation, including the proliferation of
government websites (where there are
currently almost 2,000 across the federal
government); eliminating poorly performing
technology projects; curbing spending on

In conclusion, several observations are in

order:
The mandate of these units can vary
significantly. Some, such as the Office of
Management and Budget in the United
States, act with the full authority of the
President and canat least in principle if
not in factcompel agencies to adhere to
various directives through Executive
Orders and the like. Others, such as Hong
Kongs Efficiency Unit, operate as what is
in essence an in-house consulting
group. The French Finance Inspectorate,
which sits within the Ministry of Finance,
cannot normally compel line ministries to
comply with its recommendations, but its
findings are used extensively in annual
budget negotiations.
A closely related question is how relations
with line ministries and departments will
be structured. Efficiency Units operate in
a range of modalities between
cooperation and compliance, and any
MENA government will need to think
carefully about how its unit will be
positioned
and
supported
politically. Backing from the highest levels
of government will be critical to the
success of the effort, and careful
consideration will need to be given to its
oversight. Line ministries that cooperate
and achieve efficiency gains would need
to be rewarded in some fashion (maybe
with more flexible funding), whereas
others could be penalized (through a
productivity tax associated with budget
allocations).
In Canada, France and the United States,
efficiency drives were accompanied by
significant attention to the institutional
mechanisms for coordination between
ministries and agencies in pushing
through efficiency gains, including inter-

agency working groups below the cabinet

level.
The size of these units can be
significant. The UK office has a staff of
over 1,100 and an annual budget of 72
million. The Hong Kong unit, while much
smaller, has over 80 staff and a budget of
$28 million. A small and under-resourced
unit
may
not
be
particularly
effective. Staffing can also be problematic,
and even countries such as the UK have
struggled to attract staff with the requisite
skills, particularly in areas such as financial
analysis or IT systems.
Finally, several of these units are playing a
major role with regard to procurement,
whether
gaining
savings
through
purchasing in bulk; getting greater
diversity in the government supplier base;
or carefully tracking the implementation
of large capital projects.
As the discussion above indicates, there is no
one size fits all solution to this
challenge. The approach ultimately taken
will need to be carefully adopted to local
circumstances, politics and administrative
traditions. However, it is also doubtful that
MENA countries will achieve the savings
necessary through a series of ad-hoc costcutting measures. To truly succeed in their
quest for greater efficiency in expenditure,
careful consideration must be given as to
how such efforts can be institutionalized
throughout government on a sustained
basis, starting at the top. Towards this end,
the experience of otherssuch as the five
brief examples cited in this notecan
provide a valuable guide.
________________________________
[1] The author wishes to thank Renaud Seligmann for his
extensive contributions to an earlier version of this
article.
[2] The Kuwait and Qatar citations are from Al Arabiya
News on October 27 and November 3, 2015. The Saudi,
Omani and Bahrain examples are cited from Bloomberg
Business,
October
21,
2015.
[3] For more information, see Institutionalizing
Monitoring & Evaluation systems: Five Experiences from
Latin
America,
World
Bank,
2005.
[4] The position is analogous to the Secretary of Cabinet
and is the most senior civil servant position within the
Canadian
government.
[5] More information can be found on the following
website:
http://www.eu.gov.hk/en/index.html
[6] More information can be found on the following
website:
https://www.gov.uk/government/organisations/efficien
cy-and-reform-group/about
[7] More information can be found on the following
websites:
https://www.whitehouse.gov/goodgovernment/actions/
campaign-cut-waste
https://www.whitehouse.gov/the-pressoffice/2011/11/09/executive-order-13589-promotingefficient-spending

Corruption

25

How corruption affects businesses around the world, in 5 charts

Ravi Kumar
Online Communications Officer
We know corruption in developing countries affects poor people the most. It also impacts firms in many ways. Here are five charts showing how
corruption is affecting businesses from South Asia to Sub-Saharan Africa. These charts are based on surveys of more than 13,000 firms in 135
countries, by World Bank Enterprise Surveys. It collects data directly from firms to study an economys private sector.

27% of companies in Sub-Saharan Africa are expected to give "gifts"

to public officials "to get things done"

Over 50% of companies in Middle East and North Africa identify

corruption as a major constraint

1 in 4 companies in South Asia are expected to give "gifts" to get an

operating license

Almost half of firms in South Asia are expected to give "gifts" to

secure a government contract

1 in 3 firms are expected to give "gifts" to get a construction permit

in East Asia and Pacific

26

PIM
Selecting and prioritizing development projects:
How to be more effective in delivering public services
Michael Schaeffer
Emmanuel Cuvillier
Authors both World Bank PFM/PIM
Senior Public Sector Specialists
Public Investment Management Selection
Criteria Guidelines have been prepared by
the PIM Technical Practice to assist public
administration officials in drafting and
prioritizing their development (investment)
project requests. Transparent project
selection and evaluation selection criteria
should be agreed and established prior to
the preparation, and funding, of
development project requests.
By
articulating the project selection criteria
upfront, project funding should more tightly
align to the needs of citizens, and service
delivery should significantly improve.
However, no project selection and
evaluation criteria process is perfect. Not all
criteria will apply to every project. Good
judgment, common sense, and political
considerations will continue to play
important roles in the project selection
process. Nevertheless, carefully prepared
criteria will sharpen distinctions among
projects, narrow the range of disagreement,
provide a basis for discussion and, hopefully,
make the entire process more transparent.
It is critical that project selection be
supported by accurate and relevant
information in order for the public sector to
be more effective in delivering services to
citizens. Practical experience shows that it is
desirable that the development (investment)
project priority setting process have the
following
characteristics:
i)
Is
understandable to all users and stakeholders
of the process; ii) Is practical in terms of cost,
time and personnel available to carry it out;
iii) Considers all major consequences of a
project; iv) Is supported by reliable, relevant
information; v) Indicates clearly whether the
key value judgments (i.e., assigning
weights to each criterion) are to be made
by technical experts, public officials, and civil
society; vi) Provides information not only on
the relative ranking of projects but on their
individual merits or value; and vii) Identifies
critical and non-critical projects according to
the national and sectoral development. The
MENA regions project selection criteria
guidelines should assist government officials
involved in capital budget preparation to
understand clearly and manage efficiently
the use of project selection and prioritization
criteria in the project cycle through the

following approach:

Project lifecycle: The project lifecycle is

a process by which an idea is
transformed into a concrete solution
through the analysis of alternatives and
the choice of the most profitable
alternative from the economical point
of view. As the project moves through
its lifecycle, the focus of managerial
activities shifts from planning to
operating and controlling activities. In a
strategic planning exercise, the
emphasis is on investment efficacy or
on spending on the right public assets.
Spending
should
promote
the
achievement of strategic priorities, and
resources should be allocated only to
those areas that are best aligned with
the governments objectives at both
central and local levels.

Must-have features in project

identification and screening: It is
necessary to have a clearly articulated
strategy and formal process in place to
ensure adequate project screening. The
most important documents on which
public investment decisions are based
are the sector level strategies which
identify the economic growth path with
clearly defined objectives and form the
foundation of public investment since
all projects need to be linked back to
how they will contribute to the delivery
of the strategy.
Using project appraisal to strengthen
the selection criteria:
The desirability of a project can and
should be interpreted from the point of
view of the investor (financial analysis)

Projects should be compatible with

national priorities: All projects that are
submitted for government funding
must be compatible with the majority
of national and sectoral priorities in
order to be considered for further
evaluation and appraisal.
Link between development projects,
sector
strategies,
and
budget
decisions: The link between sector
strategies and budget decisions may
not be consistently maintained and
political pressures may weigh in on the
final selection of projects. Under the
top down approach (Medium Term
Budget Framework) the aim is to
calculate available funds in the next and
following two years, select most
important priorities of the national
strategy that can be financed from the
available funds and, establish budget
ceilings for recurrent and development
spending. With the bottom-up
preparation, line ministries are
requested to prepare detailed budget
calculations for selected priorities and
within given ceilings. Upon receipt of
detailed budget submissions, the
budget department analyses these
submissions and discuss them during
the budget hearings. Based on the
outcomes of budget hearings, a draft
national budget is compiled for
Cabinets review and consequent
Parliament approval.

27
or from a wider national perspective
(economic analysis). After choosing the
best among project alternatives and
verifying the financial viability of a
selected option, the next step is to test
the economic viability of that option.
The initial step in testing the economic
viability of a project is to identify,
quantify and value the economic costs
and benefits. A fundamental aspect of
project appraisal is the comparative
analysis of the costs and benefits of
alternative ways of achieving the
objectives. The development of options
should include the creation of
alternative ways to achieve the
objectives, and of a do the minimum
option.
It is also necessary to define a project
weighting scheme for ex-ante evaluation.
Relevance,
short
term
assumption
performance, efficiency, effectiveness and
sustainability are assigned variable weights
depending on their importance in relation to
the stage in the project cycle and to types of
evaluation. After the project-level evaluation

results aggregation, projects should be

ranked in their specific level (for example,
sector at governorate level) according to
their respective score. Then proposed
projects for state funding should be ranked
by their evaluation score and result band,
and the decision taken for their selection in
accordance with the availability of budgetary
resources. The higher the evaluation score,
the better the anticipated or actual project
performance.
Project selection needs to be integrated into
the budget. Not just the initial financing but
maintenance and operational costs also
need to be integrated into the budget. All
appraised projects should be recorded in a
data base ranked by priority for budget
consideration. Rejected projects should also
be recorded so that they may be revisited
when circumstances have changed and they
are likely to generate net positive benefits.
For project implementation, it is also
necessary to develop the institutional
arrangements associated with maintenance
of the capital infrastructure, after its

completion and during the operation phase

(all recurrent expenditures relating to the
operation and maintenance of the assets
must also be included in the budget).
Conclusion
There is a very strong argument that the
availability of public funds should be more
strongly linked to good investment practices.
Although many projects may demonstrate
positive cost-benefit ratios, the relative cost
effectiveness of project designs, policy
options, and alignment with national and
sectoral policy directives should be given
more attention. The selection of individual
projects within the overall strategic plan
should be driven by high-quality analytical
assessments of competing projects, which in
turn could more effectively inform political
administrative decisions. The World Banks
Project Selection guidelines should serve as
a basic forerunner to discussions and tools
for developing good project selection and
evaluation criteria in order to be more
effective in delivering public services.

Improving Service Delivery by Strengthening the Investment Project Selection Process

28

Cover Story

Overview 29
Interview 30
Insights 35
Institutions & Incentives 38
Government in Action 39
Books 41

Governance
&
Water

Water is a global issue. It is a source of life and prosperity. It has a wide impact in everything
ranging from agriculture, industry, energy and transport to climate change, and public health.
Water is also a cause of hardship and conflict. Water scarcity is reaching alarming levels with
reports focusing on the fear of increased conflict around water leading to water wars, and
Goldman Sachs described it as the petroleum of the next century. Water is also a global
development challenge. OECD estimates tell us that by 2050 water demand will rise by 55%
and that 240 million people will remain without access to clean water and 1.4 billion with
access to basic sanitation services. With the global community having set the Sustainable
Development Goal on Water and Sanitation (SDG 6) to achieve universal and equitable access
to safe and affordable drinking water for all and adequate and equitable sanitation and
hygiene for all by 2030, the challenge of managing water resources is none too soon.

COVER STORY
Overview
The Role of Governance in the Water Sector
How societies choose to govern their water
resources has profound impacts on peoples
lives and their ability to prosper, as well as on
environmental sustainability. On the ground,
this means that some groups or individuals
will benefit while others will lose out when
water allocation changes are made. Having a
fair water provision can, for many people, be
a matter of daily survival. How and for whom
water is being governed has impacts on river
flows, groundwater tables and pollution
levels, affecting both upstream and tail-end
water users. The capacity of countries to
pursue poverty reduction strategies and
Integrated Water Resources Management
plans, meet new demands, manage conflicts
and risks depends to a large extent on their
ability to promote and put into place sound
and effective governance systems
It is increasingly recognized that the socalled water crisis is essentially a crisis of
governance (UNDP 2004; United Nations
(UN) 2005, 2006). In water services this
manifests itself in the fragmented
institutional structures, the lack of clarity of
roles and responsibilities, questionable
resource allocation, patchy financial
management, low capacity of implementing
organizations; and in the pervasive leakage
of sector resources, weak accountability of
politicians, policy-makers and implementing
agencies, unclear or non-existent regulatory
environments, and unpredictability in the
investment climate for private sector actors
(UN 2006). In many developing countries the
governance of the water sector as a whole is
in a state of confusion and dysfunction with
little responsiveness or accountability to
citizens (Tropp, 2005). The lack of
institutional clarity is a well-known aspect of
government failure. Over the past few
decades the water sector has been
successful in developing the technical
solutions it needs but it has only recently
begun to come to terms with issues of
governance. There is a now a growing
recognition that increasing the focus and
depth of future efforts on the governance of
the sector in all its dimensions is critical if
poor people are going to gain access to
better, more sustainable services. The
notion of governance for water includes the
ability to design public policies and
institutional frameworks that are socially
accepted and mobilize social resources in
support of them. Water policy and the
process for its formulation must have as its
goal the sustainable development of water
resources, and to make its implementation

effective, the key actors/stakeholders must

be involved in the process. Governance
aspects overlap with technical and economic
aspects of water, but governance points us
to the institutional elements of solving a
problem or exploiting an opportunity.
Governance of water is a subset of the more
general issue of the creation of a nations
physical and institutional infrastructure and
of the still more general issue of social
cooperation.
The reform of the institutional aspects of
service delivery can be the game changer in
the quest for improving service delivery in
the water and sanitation sector. According to
Junaid Ahmad, Senior Director of the World
Banks Global Water Practice, funding
infrastructure has to be done in a way that
the organization can use the funding to
improve service delivery by setting up
systems
of
capacity,
systems
of
accountability and systems of management,
in other words the overall systems of
governance, instead of mere asset creation.
This underscores the need to understand
and strengthen the institutional aspects of
service delivery both for Governments
themselves as well as for financing agencies
such as the World Bank.
Three key issues come to the front in reform
of the institutional setting for water service
delivery. They are:
The formal and informal institutional
relationships in water service delivery:
Water service delivery involves the interplay
of several institutions such as Central and
Subnational/Local Governments, water
utilities,
regulatory
agencies
and
citizens/civil society organizations. While the
formal institutional relationships between
some of these institutions may be clearly
defined (such as the Ministry of Water
resources and water utilities), other
relationships (such as between a local
government and water utility) may not be
that well defined. Understanding these
formal
institutional
relationships
is
becoming increasingly important in
countries (such as Kenya and India) where
decentralization reforms are redefining the
relationships between local governments
and service delivery entities such as water
utilities. Equally important is the
understanding of the informal relationships
between the various stakeholders within a
system. Understanding of the political
economy underlying these relationships is

29

central to the understanding of the forces

that drive or hinder reforms and enable
efficient and accountable service delivery.
Financing aspects of water and sanitation
service delivery: the traditional model of
financing water and sanitation services
through budgetary resources being
providing in the form of capital and recurrent
budgets to utilities is found inadequate to
meet the burgeoning needs for water and
sanitation services. Therefore options for
attracting private capital as debt financing
(in some rare cases equity financing through
Public Private Partnerships) is increasingly
being considered. Access to market based
financing sources requires strengthening the
financial management and operational
efficiencies of utilities. Also moving away
from input based project financing, countries
(such as Egypt) are in the process of linking
financing with service delivery performance.
Transparency and Accountability in service
delivery: Inefficient and ineffective service
delivery performance by water sector
institutions in many developing countries
have resulted in citizens demanding
increased
accountability
from
such
institutions. Though there are good models
(such as Water User Associations) that
incentivize robust participation by citizens
and stakeholders, much more needs to be
done to strengthen the social contract
through enhanced citizen engagement. In
addition to strengthening downward
accountability of water service providers
through
social
accountability
tools,
reforming the formal systems of upward
accountability is also being reformed
through the use of innovative reporting
techniques such as Sustainability/Integrated
Reporting.
List of References:
Rethinking Governance in Water Services (2007), Janelle Plummer
and John Slaymaker. Working Paper #284, Overseas Development
Institute, London
Gupta, J., A. Akhmouch, W. Cosgrove, Z. Hurwitz, J. Maestu, and
O. nver. 2013. Policymakers reflections on water governance
issues. Ecology and Society 18(1): 35. http://dx.doi.org/10.5751/
Iza, A. and Stein, R. (Eds) (2009). RULE Reforming water
governance. Gland, Switzerland: IUCN.
OECD (2011), Water Governance in OECD Countries: A Multi-level
Approach, OECD Studies on Water, OECD Publishing.
http://dx.doi.org/10.1787/9789264119284-en
Rogers, Peter and Hall, Alan W (2003) Effective Water
Governance. Global Water Partnership Technical
Committee.World Bank MENA Development Report 2007
Making the Most of Scarcity Accountability for Better Water
Management in the Middle East and North Africa
Jagannathan, Vijay, Mohamed, Ahmed, and Kremer, Alexander
Water in the Arab World Management Perspectives and
Innovations World Bank MNA Region, 2009
Manghee, Seema and Poole, Alice Approaches to Conducting
Political Economy Analysis in the Urban Water Sector World
Bank Water Papers, September 2012

30

Interview

COVER STORY

Junaid Ahmad
Senior Director - Water Global Practice
Rama Krishnan
Lead Financial Management Specialist
[Shortly after this interview was
completed, Junaid was selected as the
Chief of Staff, Office of the
President. We wish him the very best
in his new position.]
Rama Krishnan: What are your priorities for
the World Banks Water Global Practice
(GP)?
Junaid Ahmad: Across countries it is evident
that economic development is thirsty
business. In this context, our overarching
priority is to support our clients create
systems of water and sanitation that
underpin their national growth and
development strategies. The specific focus
will vary country by country, covering areas
such as water resource management,
financing of hydraulic infrastructure,
delivering on the promise of universal access
to services, or promoting institutional
change in the way water is delivered. But, at
all times our focus is on the relationship
between water and the welfare of nations
what we call water-writ-large and the
role of water in boosting prosperity and
eradicating poverty. It is about building a
water-secure world for all.
Rama Krishnan: As the world transitions
from the Millennium Development Goals
(MDGs) to the Sustainable Development
Goals (SDGs), and with water and sanitation
continuing to be a global priority, what is
the role that the Bank and the Water GP can
play in influencing this global agenda?
Junaid Ahmad: I think it's very interesting
that President Kim has introduced Global
Practices in time to coincide with the arrival
of the SDGs. Today, for the first time in the
history of the Bank, all components of the
water family make up the Water Global
Practice -- covering areas as diverse as access
to water and sanitation services, water and
sanitation for health, water for agriculture,
water
resource
management,
and
transboundary issues. The GP structure can
potentially allow us to be one of the
implementing arms of the Water SDGs. But,
this will only be possible if we are able to look
at water in an integrated way.
Water is not about a sector; it's about an
agenda underpinning food and energy

security, sustainable urbanization, universal

access to services, and importantly, in a
world replete with risks and uncertainties,
building the resilience of nations against
climate change, conflict, and pandemics. We
have moved away from looking at water
primarily as an input into particular sectors
to assessing how overall water influences
development of nations.
On the issue of climate change, we have just
completed some important analytical work
which shows that how water is managed,
priced, and governed can not only dampen
but reverse the negative impacts of climate
change on economic growth. The Bank is in a
position to be one of the foremost global
institutions that can help nations build
resilience against climate change and the
water agenda has a major role to play in this
effort.
In terms of investment, the Water Global
Practice has an asset base of US$ 22 billion
growing at a gross rate of about US$ 4-5
billion a year with the potential to grow at
US$ 7-8 billion per year. This core resource
base if appropriately structured can be

leveraged several fold to help fund

partnerships, knowledge, and service
delivery across our client countries and
crowd in public and private finance. This
would be our contribution to the SDG
challenge in water. But, the key will be to
move away from the narrow definition of
operations and use the Global Practice
structure to leverage public and private
funds.
Rama Krishnan: Although historically the
water sector in the Bank focused primarily
on infrastructure investments, of late there
has been a great deal of discussion
regarding governance issues in the water
sector. What do you think is the reason for
this shift in attention to the governance
aspects of water?
Junaid Ahmad: Experience has shown us
that economic growth depends not only on
the stock of infrastructure and how this stock
grows the Solow growth model -- but
importantly how it is managed, operated,
and maintained. These are, however, not
just technical issues. They are also about the
governance and politics of how you manage

31
a water utility, a dam, or a river embankment
program. Putting it differently, converting a
stock of infrastructure into service delivery is
an intensely political affair, and if you do not
recognize that fact, you will not be able to
ensure
the
sustainability
of
the
infrastructure stock or its conversion into
services for farmers, businesses, and
households.
In the context of water, governance plays a
very important role in the allocation of water
across sectors and for ensuring equity in
service delivery. With growing demands on
water from industry, energy, municipalities,
environmental concerns, the health sector,
and households, countries have to create

mechanisms for the efficient and equitable

allocation of water. Creating property rights,
regulation, and markets to manage this
allocation problem is the role of the state and
its system of governance. It is imperative that
the Water GP support countries tackle this
challenge of water allocation.
Finally, governance will be critical for
ensuring that capital markets can be
leveraged to fund infrastructure. In the
coming years, I expect that the Banks
political risk insurance instruments and
guarantee instruments can help leverage and
scale up private capital into the
infrastructure sector. But, a pre-condition
will be a basic level of governance around
service delivery for private capital to be
triggered. In water, I would predict that the
Sabsp model -- the water utility of Sao Paulo
of a public, corporatized provider accessing
capital markets may well be the norm in
developing countries.
Rama Krishnan: Picking up on a point that
you mentioned regarding the governance of
water service delivery, we have heard you
speak eloquently about the importance of
fixing the institutions that fix the pipes

rather than merely fixing the pipes. Can you

elaborate on that concept?
Junaid Ahmad: Yes, I think the water team is
very used to hearing me say time and again
"Don't fix the pipes, fix the institutions that
fix the pipes." But, I did not come up with
that phrase. I adapted it from a statement
made by President Mandela when he met
with the team tasked with bringing
Johannesburg out of bankruptcy. He was
reported to have said "Don't fix the lights. Fix
the institutions that fix the lights" suggesting
that the focus should be on fixing how the
city is managed, financed, and linked to its
citizens. In other words, how it is governed.

management and accountability. This is why,

when we work with countries to invest in the
infrastructure, we must make sure that what
we are doing is not just fixing the pipes, but
helping countries create better institutions
to serve their citizens.
Rama Krishnan: You mentioned a very
important point about accountability as a
key issue that affects service delivery in the
water sector. We know that there are
different
types
of
accountability
relationships in service provision. What can
be done to strengthen these different
accountability relationships?
Junaid Ahmad: You are absolutely right that
there are different types of accountability
relationship in
service delivery. Shanta
Devarajan and Ritva Reinneka invited a team
of us to work on the WDR 2004, Making
Services Work for Poor People. We pulled
together an understanding of service
delivery using the lens of accountability. At
the center of this framework is the citizen,
and the story we share is one where the
success of service delivery depends on
whether states and service providers are
accountable to citizens and what strengthens
these relationships. I would invite our Global
Practices to re-discover the 2004 WDR as
they respond to the challenge of delivering
the SDG goals. In response to your question
I would like to share three takeaways.

I discovered the same in the water sector.

When I first started working in India, for
example, I was surprised to learn that the
capital of India which had one of the biggest
water agencies was only delivering five hours
of water a day. My first reaction was, "Is it
because they face water scarcity?" Well, it
turns out that Delhi receives more water, per
capita, per day, than a city like Paris or
London, or Dakar. Yet each of these cities
can provide water 24 hours/7 days a week,
but Delhi cannot. The problem was not
technical. India has some of the best
engineering minds and, in particular,
infrastructure engineers. Rather, the
challenge is around the politics of how water
delivery is managed.
This includes important issues such as
separation of powers whether the
functions of policy makers, regulators, and
providers are undertaken by different parts
of government so that judge and jury are not
one and the same; the accountability of
providers to citizens; and the issue of who
pays and how subsidies are provided. When
you take such a perspective you realize that
utility turnaround and investment has to be
considered in the context of the rules of

First, accountability can be strengthened by

learning across sectors. A sole focus on
technical features of service delivery
emphasizes the uniqueness of different
sectors such as water, education, and
transport.
Adopting an accountability
framework, on the other hand, offers a lens
based on incentives and governance and
allows for a common understanding from
different sectors about what determines the
scale up and sustainability of service delivery.
Within water, for example, there was a sense
that irrigation and water supply have little in
common; a framework based on
accountability is allowing staff to compare
and contrast service delivery to farmers with
service delivery to businesses and
households. Similarly, the design and
management of water basins can draw on
lessons we have learned from the design and
management of corporatization of utility
systems.
Second, in the framework of accountability,
it is important to recognize that there is a
difference between a citizen's and a
beneficiary or a client's role in service
delivery. When I am a recipient of a water
service, and I pay for it through a bill, I'm a
client or beneficiary and my relationship is
with a service provider. But, when I am a
citizen, my relationship is with the state and
its regulatory agencies. The latter is what we

32
traditionally call voice and the former is what
the WDR 2004 team called client power. In
designing service delivery we often confuse
the two. Instruments that strengthen voice
e.g. the mechanisms for citizens
participation in local councils, the
assignment of roles and responsibilities
between different tiers of government, and
the design of fiscal transfers and the
availability of this information to citizens
are different from the instruments that
reinforce client power e.g. reform of
service provider, e-billing and payment, and
enabling
competition
in
service
delivery. Take for example, community
driven development: under which conditions
is CDD an instrument of voice or an
instrument of client power? What we are
increasingly recognizing is that for achieving
scale up and sustainability in service delivery,
voice needs to reinforce client power. For
example, understanding the relations
between water and federalism may well be
essential in designing well managed and
operated irrigation systems.

governance reforms in the water sector?

Third, it is important to look at the links

between
different
channels
of
accountability. For example, we often

In fact, we now recognize that the most

expensive water, especially for the poor, is
free water. Time and again studies have

develop citizen report cards in a context

where citizens do not have access to
government at any level. A citizen's report
card on water delivery, for example, has
greater impact in a context of utility reform,
strengthening of the regulatory regime, and
the improvement of the state's oversight.
Accountability is best approached in a
comprehensive and not in a piecemeal way
or at the very least we need to ensure that
interventions are tactically sequenced.
Rama Krishnan: Water sector reform is
often impacted by strong political interests
within a country. What are the critical risks
that you see in the progression of

Junaid Ahmad: The one critical political

economy issue that has the potential of
putting the brakes on governance reform in
the water sector is pricing!
Interestingly, today, in the context of climate
change, the world is seeking to put a price on
carbon but there is uncertainty on how to
value water. Yet, more than ever, pricing and
valuation of water has become essential.
Pricing will need to play the role of
supporting water efficiency and reducing
waste; facilitating the allocation of water
between competing needs such as energy,
agriculture, and municipal sectors; creating
accountability in service delivery; meeting
environmental needs; and importantly,
securing universal access and affordability. A
single price cannot meet these differing
objectives, but not pricing water or
underpricing water leads contrary to popular
belief to inefficiency, inequity, and misgovernance.

shown that subsidies in water are often

captured by better off in society and poor
revenue streams for provider undermine
their accountability and ability to
universalize service delivery, leaving poor
households outside the ambit of formal
service delivery. The Gordian knot of pricing
water can only be cut in the context of
institutional reform and sector governance,
while distributional and equity goals can be
addressed through effective safety nets
financed separately and securely by the
State. This is at the heart of the politics of
water.
It will be important that a global dialogue is

started on the issue of valuing water and

showing how pricing can ensure that water
resources are protected and access is
universalized. All stakeholders need to be
invited to participate in this important
discussion it will take time and effort, but it
is
a
dialogue
that
needs
to
happen. President Kim and Secretary
General Ban ki-Moon have just recently
announced the formation of a Heads of
States Panel on Water. A select group of
state leaders is being asked to pull together
actions
and
programs
for
the
implementation of SDG6 the water
SDGs. This Panel is well placed to lead the
global dialogue on the valuation and pricing
of water.
Rama Krishnan: Let me just turn slightly to
one other issue for more of a global
perspective on water. Water is sometimes
seen as a source of conflict. When you look
at some of the recent conflicts, in one way
or another, there have been connections to
water. What can the Bank do to address
these issues that have an impact on
governance and development?
Junaid Ahmad: The connection between
conflict and water is not a simple one.
Historically there are few indeed any -examples of war between countries over
water
while
trans-national
water
agreements are quite common. History
therefore does not support the dire
prediction that water will be the next source
of a major war. Take for example the Indus
Treaty between Pakistan and India. In the
middle of conflict technical teams from both
countries have crossed their borders to
ensure that the Treaty remained
functional. In the context Middle Eastern
politics today, we see a growing dialogue
between Israel, Jordan, and Palestine about
water transfers. So, contrary to popular
expectations, I believe that water can be a
bridge and not a cause of war between
nations.
The story of water and conflict, I would
propose to you, is perhaps a more of a local
story where conflict over water and natural
resources between communities has
emerged inside nation states. Left
unresolved, these localized conflicts can
potentially destabilize the nation state with
forced migration and refugee flows across
national boundaries. Examples abound in
regions like sub-Saharan Africa, South Asia,
and
the
Middle-East
and
North
Africa. Indeed Darfur, the Chad and Syria
conflict, and part of the refugee movement
into Europe has water origins that started as
local problems inside nation states. Which is
why today the Water GP is assessing how
tensions over local water can lead to conflict
and what can be done about it.

33
We are also investing in teams that work on
trans-boundary river basins -- covering water
basins of the Nile, the Ganges, the
Brahmaputra, the Mekong, and in Central
Asia. Climate change and growing energy
demands the energy-water nexus, is
putting a greater focus on the sharing of
water across national boundaries. But I am
optimistic that this increased demand on
shared waters will further prove that water
can be a bridge and not a separator of
nations.
Rama Krishnan: The Banks regional
strategy for MENA emphasizes four critical
themes: Renewing the Social Contract,
Regional Cooperation, Resilience to
internally displaced persons (IDPs)/refugee
shocks, and Recovery and Reconstruction.
These are what we call the Four Rs. Can
you elaborate on how you see the water
practice in MENA, addressing these Four Rs
in particular?
Junaid Ahmad: I am very proud that the
water teams work has contributed to the
development of the MNA strategy and its
focus on the four Rs. For example, the Egypt
sanitation program long a black spot on our
portfolio -- is now a utility reform program,
which is empowering and improving the
governance of water utilities to deliver
sanitation in complete collaboration with
citizens. The devolution of power to water
utilities, changing the governance of water
utilities, and the involvement of citizens in
the service delivery process means
completely re-writing the compact between
the state, service providers and citizens.
Another example is our focus on water
scarcity. MNA is a region with the highest
stress in terms of water. We are beginning to
look at integrated water management which
includes more efficient provision of water,
desalinization, water transfers and water re-

use. By focusing on integrated water

management at both a country and city level,
we are supporting governments in MNA
reduce the potential of conflict over water
scarcity. We are therefore focusing on
regional peace and nation building by
addressing one of the potential drivers of
national and regional instability water
scarcity.
A couple of years back, as part of the
Sustainable Development team, we
extended the framework of resilience from
the climate change talks to addressing the
impacts of political shocks. We recognized
early on that unlike the refugee crises of the
past and despite the emergence and
visibility of large camps the majority of the
displaced communities are not moving into
special refugee camps but instead
embedding themselves in host communities.
This crisis has created a large shock on the
management and financing of municipal
services as existing capacity can no longer

cater to the needs of both local residents and

the influx of displaced communities. Not only
are residents seeing a deterioration of
service standards, there is now the risk of
tension and violence between residents and
the newcomers over access to services and
space. Mayors and heads of municipalities
have become the first responders in this
growing pressure on cities and towns. In this
context, the assistance paradigm is
changing. It is no longer one of exclusively
providing relief to refugees in camps. It is
now increasingly about building the
resilience of cities and towns to deliver basic
municipal services to residents and the
displaced population. It is also about
strengthening the governance capacity of
city and municipal leaders. The Syrian crisis is
gradually triggering a discussion about the
role of cities in bottom up governance in
traditionally centralized setting.
Overall, service delivery will be key to
keeping the fabric of a nation-state
sustainable especially if we use service
delivery to trigger both voice and client
power. In this context, and particularly in a
region characterized by water scarcity, water
will play a very, very big role in delivering on
the promise of the four Rs.
Rama Krishnan: It is interesting that you
mention the Egypt sanitation Program for
Results (PforR) program since the design of
the program introduced an institutionsfocused approach that is different from the
traditional investment-focused approach to
water sector operations in the Bank. What
are the key lessons of the Egypt PforR
operation that can be replicated in water GP
operations in the Bank? How can the
Governance GP partner with the Water GP
in such operations?
Junaid Ahmad: We could have addressed the
Egypt sanitation challenge by solely funding
more infrastructure through existing systems

34
of delivery. Instead, we are funding the
needed infrastructure in a way that ensures
that the provider of that infrastructure can
actually deliver the service in a sustainable
way. In this context, the P4R instrument is
supporting Government of Egypt to set up
systems and institutions in the water sector
and through this process trigger the much
needed investments in sanitation.
Across the Bank, we are just beginning to
understand the real value of the PforR
instrument. It is an instrument that enables
us to partner with a country to build the
country's institutions and systems. In the
case of Egypt, we are helping Egypt reform its
water utility and service provision and
strengthen the oversight by citizens. From
the perspective of improving the quality of
our portfolio management, a P4R offers a
better way to strengthen portfolio
management and disbursement compared
to traditional investment loans. The P4R in
Egypt was used as a catalyst to restructure
existing investment loans in the sanitation
sector that have not been performing for
several years.
This project could easily have been an
operation run by the governance team. It is
governance applied to water. I think more
and more we need to examine how services
such as solid waste, water, electricity,
transport and others can be delivered in this
mode using the P4R instrument to help build
local institutions of service delivery while
accelerating infrastructure investments.
I think that the future of the Governance
Practice lies less on advising on governance
issues at the macro level of a nation. I think
the future will be about governance and
service delivery. I believe this is the big
agenda waiting to unfold, and Egypt's
sanitation program and the collaboration
between the governance team and the water

team, is a perfect example.

Rama Krishnan: We are very happy to take
note of your positive view about how the
Governance GP can partner with the Water
GP. Can you advise the Governance team on
how we can engage more with the Water
GP?
Junaid Ahmad: I think it will be important to
engage at several levels. First, a partnership
at the operational level can ensure that
successes through operations can grow our

collaboration. The water and the governance

teams need to look at water portfolio and
see whether we can adopt and adapt the
approach we used in Egypt in other places.
For example, we are doing utility reform in
Botswana. Here too we can focus on the
governance of utilities. Similarly, we are
discussing
integrated
urban
water
management in Morocco and Kenya. Can we
approach this program through the

governance of how cities manage integrated

water management? In sum, we need to very
concretely identify a cluster of projects
where we can engage the governance and
the water teams.
Second, I would like to see joint learning
events between the two practices. I think
that it is important for the water team to
understand better the tools of governance,
and the governance team to better
understand the water sector. In this context,
the Global Leads who are expected to form

the backbone of the knowledge architecture

of the GPs, can create the linkages between
the two Practices. The next Water Week
could offer an excellent platform to design
programs that link the Water and
Governance GPs.
Third, we should be bold enough to hire
managers who go beyond the boundaries of
our practices. I would like to see governance
specialists apply for practice manager
positions in the Water GP. I would hope that
the Governance Practice could also begin to
look at the service provision practices for
future managers to lead the governance
teams.
In summary, operations, learning events,
exchanges between the global leads, and
crossover in terms of management from
each sector, are some of the mechanisms to
embed a greater collaboration between the
two Practices.
Rama Krishnan: Thank you for giving us an
opportunity to talk to you. Wishing you all
the best.
Junaid Ahmad: My pleasure.

35

Insights

COVER STORY

Steven Schonberger & Hisham Waly

The Governance-Water Nexus

Steven Schonberger, is the

Practice Manager of the Water Global
Practice at the World Bank.

Hisham Waly, is the Practice

Manager of the Governance Global
Practice at the World Bank
The new MENA regional strategy is
centered on the four Rs Renewing the
Social Contract, Regional Cooperation,
Resilience to deal with refugee and
migration shocks, and Recovery and
Reconstruction. How can the Governance
and Water Global Practices (GPs) work
together to realize these strategic
objectives for the region?
Steven: Both the Water and Governance GPs
are directly aligned with the 4Rs of the World
Bank MENA Strategy, with governance being
a critical enabler and water services and
resources being key outcomes. Specifically,
we have seen globally that access to water
services drinking water, sanitation,
irrigation are among the most visible
public services to citizens, and the reliability
of their provision is often taken as a proxy for
state effectiveness and responsiveness.
However, competition for water from transboundary rivers and aquifers is often
perceived as a potential source of regional
conflict particularly in a water-scarce
region such as MENA. At the same time,
global experience has shown that the mutual
recognition by countries of the critical
importance of water has led to regional

technical cooperation and agreements,

which have been extraordinarily resilient.
For example, India and Pakistan have
maintained their cooperation over the Indus
River for three wars. Vietnam and Thailand
continued to discuss management of the
Mekong throughout the Vietnam War, and
closer to home, Jordan and Israel have
maintained a continuous dialogue regarding
management of the Jordan River since 1956.
Hisham: I fully agree with Steven. Both of our
GPs interventions are directly aligned with
the new MENA strategy, providing us with a
clear platform to engage in the important
agenda of water governance. What I like
about the new MENA strategy is the
recognition that our focus needs to be on
using development to promote peace and
social stability instead of waiting for peace to
start engaging in development. Here, I would
also like to stress the evolving regional
context that is making us look at innovative
and pragmatic ways to support the people of
MENA. Indeed, fragility and conflict are a
global challenge. However, when you look
back to 2012 there were 700,000 Syrian
refugees and around 2 million internallydisplaced persons (IDPs), whereas today we
have 4 million Syrian refugees and 8 million
IDPs. In addition to the tragic impact on the
refugees, this has serious implications on the
host communities in countries such as
Lebanon and Jordan impacting their
ability to deliver services in water,
education, health, and transportation. There
are numerous examples from across the
world that drive home the close connections
between governance and water. The policy,

institutional and financing aspects of water

service delivery are a critical part of the
effort of countries to manage their water
resources in a sustainable way. At the World
Bank, the Governance GP is working
together with the Water GP to look at these
issues in a coherent and coordinated way.
The recently approved Egypt Rural
Sanitation Program-for-Results (PforR)
operation introduced an institutionsfocused approach that is different from the
traditional investment-focused approach to
water sector operations in the Bank. How
can this model of designing water sector
operations while also focusing on
governance and service delivery issues
be replicated in other countries in the
MENA region?
Hisham: The key driving force that is
impacting the governance of water
resources is the demand for accountable and
efficient service delivery. There is increasing
pressure on central governments to
decentralize service delivery responsibilities
to the tiers of the state that are closest to
citizens. In Egypt, the historical model of
water and sanitation service provision
through centralized agencies was found to
be ineffective, and the government was keen
to strengthen the performance and
accountability of sanitation services. The
Egypt Sanitation PforR operation was a
game changer as it redefined the
institutional and financial relationships
between the central government and water
service companies by creating incentives for
improving utility performance, reforms and

36
accountability. This was achieved by linking
the financing of sanitation services to
institutional performance. These linkages
between institutions, incentives and
accountability form the core of the
governance engagement in the water sector.
Applying the World Development Report
2004 framework on service delivery to the
water sector that is, strengthening the
long route of accountability that connects
citizens, service providers and policy makers
requires that appropriate institutional and
financing mechanisms need to be in place.
Such mechanisms will strengthen the
performance and accountability linkages of
service delivery.

irrigation services. This then needs to be

integrated into the practical nuts and bolts of
financial
flows,
procurement
and
performance reporting.
Hisham: Let me start by pointing out
something interesting, some would say even
controversial, that is, the Oxford Handbook
of Governance opens with the following
characterization: Governance is said to be
many things, including a buzzword, a fad, a
framing device, a bridging concept, an
umbrella concept, a descriptive concept, a
slippery concept, an empty signifier, a weasel
word, a fetish, a field, an approach, a theory
and a perspective. In other words,
governance is a broad theme that can mean

For instance, when we looked at the various

entry points to promote governance in the
region, we found that the water sector can
act as a catalyst of change for the prevailing
governance systems in many countries. To a
large extent, this shaped our governance
program at the country, sector and project
levels. So, we are working with the water GP
to reinforce the key elements of good water
governance
including
transparency,
participation, accountability, equity and
responsiveness.
At the operational level, how can the
Governance and Water Task Teams
collaborate more effectively to design
innovative solutions to client problems and,

Steven: The Egypt dialogue is a perfect

example of how governance enables
institutional change in water. In this context,
institutional changes in water can be the
leading edge of broader governance reforms
in terms of accountability to citizens. The
operation has embedded, in a significant
way, the empowerment of local service
providers, transparency with regard to
performance assessments and incentives,
and citizen engagement in ways that many
saw as unattainable as recently as six months
ago. What we have learned from this
operation and what we want to replicate in
other countries in MENA and globally is the
need to approach water sector reform from
a governance perspective. The unofficial
motto of the Water GP is Dont focus on
fixing the pipes, but rather focus on fixing the
institutions which fix the pipes. So, instead,
we approach the overall sector and assess
how good governance is incentivized in the
overall water service delivery system in
terms of downward accountability to
customers/citizens
and
upward
accountability
to
shareholders
and
regulators. Based on this assessment, we
provide governments with global examples
of countries which have worked through the
implementation of needed policy and
institutional reforms in terms of the
technical and political economy aspects. We
are pursuing similar work with the
Governance team in Tunisia, where this is
part of a broader state-owned enterprise
(SOE) reform. We are also opening up
dialogue space for this ambitious approach
with other countries in the MENA region.
What are the areas in which the
Governance and Water GPs could
collaborate in addressing the governance
challenges in the water sector in the MENA
region?
Steven: The two GPs can collaborate in
analyzing the accountability framework for
the sector, as well as in designing the
institutional structures and incentives to
promote transparency and performance in
the provision of water supply, sanitation and

many things to different people, which is not

a bad thing as it allows us tailor our
responses to specific country circumstances.

at the same time, ensure robust operational

quality?

37
Hisham: Let me go back to the Egypt PforR,
as we are now reflecting on the experience
to draw lessons and to think through
questions such as: What are the appropriate
institutional arrangements that will enable
efficient and accountable service delivery
where service delivery responsibilities are
devolved to sub-national governments (for
example in Iraq)? How can the existing
instruments for public financing for water
and sanitation services be reformed to
provide the right incentives for performance
and accountability? How can service
provision be made more accountable to
citizens and other stakeholders? How can
institutional performance be strengthened
through a mix of incentives and
accountability? How can sustainable
financing arrangements be put in place in a
multi-level governance framework where
service
delivery
responsibilities
are
decentralized to sub-national governments?
As you can see, there are a number of
important and difficult questions. Both the
Governance and Water teams have been
discussing these issues together. We are
looking at comparable country examples
where these issues have been addressed,
either as part of Bank operations or other
means.
Steven: We have been really happy with the
collaboration across the Governance and
Water teams. There really is a shared
agenda and recognition of how our work
together generates much greater results
than our work separately. Of course, the
management of both GPs also ensures that

the staff involved in this good collaboration

are encouraged and recognized.
A critical issue that impacts service delivery
in the water sector is the weak
accountability of service providers to
citizens. How can the Governance and
Water GPs work together to create robust
models of accountability in water and
sanitation service delivery in the MENA
region?
Steven: We need to take advantage of the
opportunities to incorporate performance
transparency of service providers. How
continuous is service? Are utilities reducing
leakages which, left untreated, raise the cost
for everyone? We also need to support
citizen
engagement,
but
through
mechanisms which provide space for citizens
and utilities to work together toward a
common service objective. We are seeing in
MENA what we saw in countries in Asia and
Latin America, where central governments
are more comfortable decentralizing
responsibilities and accountabilities to
service providers than to locally-elected
governments. Therefore, we have to ensure
that these utilities demonstrate that such a
devolution results in greater citizen
satisfaction which, in turn, encourages
further steps in local empowerment. Our
experience to date demonstrates that to
make this work, we must provide
continuous,
on-the-ground
technical
support to both the customers and the
service providers to learn how to engage
constructively. In this regard, we are very
fortunate in the Water GP to have our

CASE STUDY
Water
Against The Current: How to Shape an Enabling Environment for
Sustainable Water Service Delivery in Nigeria
The case study is part of a series on Doing Development Differently in
Nigeria. This series seeks to support the World Banks Nigeria country team
in strengthening its effectiveness by tailoring interventions to the local
context using World Bank support to leverage systemwide change and
systematically learn by doing. This case study is also part of the Science of
Delivery case study program that is contributing to the Global Delivery
Initiatives Library of Delivery Case Studies. The Global Delivery Initiative is
a collaboration across the international development community to forge a
new frontier in development efforts worldwide.

colleagues from the Water and Sanitation

Program who are based in the countries and
who bring tremendous experience to this
work.
Hisham: People in the region rightly expect
quality services, whether in education,
health or water. Yet we find badly managed
public schools, ill-equipped health clinics,
and many people with undependable access
to clean water. Part of the problem is that in
the region, water supply and sanitation
services are mostly delivered through central
government agencies and their subsidiaries
with little consultation and engagement with
citizens. As a result, critical investment
decisions often do not reflect local
preferences. This, in turn, results in poor
quality of services delivered. Local Water
Supply Companies that are in a position to
gauge local citizen preferences and that are
responsible for delivering services could not
be held accountable because they did not
have much of a say in operational and
financial decisions. This weakened the
accountabilities of service providers to
consumers/citizens, thereby contributing to
the poor quality of services. The old social
contract in many MENA countries violated
the rights of citizens to a clean and safe
environment. It often excluded the poorest
from deriving a livelihood from natural
resources. This contributed to poor quality of
service delivery, environmental pollution
and unfair distribution of natural assets. This
is why our work with the Water GP is
extremely important and I personally
consider it a priority in our program.

38

COVER STORY
Institutions & Incentives
Improving Water Supply and Sanitation Institutions
and Incentives to Strengthen Sector Performance
By Norhan Sadik and Gustavo Saltiel
from the Global Water Practice
Since 1990, an additional 2.1 billion people worldwide have gained
access to improved sanitation and 91 percent of the global population
is now using an improved drinking water source. Yet, those who have
access still often cope with poor service quality, including intermittent
supplies, and many of the poorest are still without access. Continued
environmental degradation and financially weak service providers
also put into question the sustainability of the services that are being
provided.
Misaligned incentives have led Governments to opt for investments
in highly visible infrastructure projects and to allocate less resources
for improvements in quality of service delivery. Policy and
institutional arrangements for WSS services are oftentimes ineffective
at empowering service providers to deliver sustainable, quality WSS
services. In this context, achieving the Sustainable Development Goal
on Water and Sanitation (SDG 6) that sets out to ensure availability
and sustainable management of water and sanitation for all is a
major challenge. This global challenge demands a new integrated
approach that addresses the institutional, policy and incentive
aspects of service delivery to achieve sustainable WSS services for all.
In addition, the world-wide trend for decentralization of service
delivery responsibilities and increasing demands for accountability in
service delivery is also impacting the water sector. The traditional
centralized model that places emphasis on capital investments, asset
creation and regulation has not been found to be very effective in
addressing these demands as it does not create the necessary

incentives for accountable service provision and cost recovery.

Therefore countries are looking for alternative institutional, financial
and accountability structures and relationships that would strengthen
service delivery and reinforce accountability by the state as well as
the service providers to citizens, consumers and other stakeholders.
Addressing institutional and incentive constraints to WSS service
delivery is not an uncommon challenge to the majority of the World
Banks client countries. To better serve our clients, and to unlock
institutional and incentive bottlenecks in WSS service delivery, the
Water Supply and Sanitation Global Solutions Group (WSS GSG) of the
Water Global Practice, working closely with the Governance Global
Practice, is currently exploring the institutional and incentive
constraints to sustainable WSS service delivery and will work towards
developing a number of tools that would allow client countries to
analyze, identify and address institutional and incentive problems
through comprehensive solutions that would address institutional,
incentive, policy and regulatory aspects of service delivery in parallel.
Analytical work is underway that includes the development of a global
study on policies, institutions and incentives to provide an in-depth
analysis of the policies, institutional structures and financing
mechanisms that, if addressed in an integrated manner, could provide
an adequate set of incentives to achieve sustainable universal access
to water and sanitation services. The work will look at international
experiences in relation to regulation, financial instruments,
decentralization, fiscal transfers and incentives, and the role of civil
society. Learning from the findings of the global study, the intention
is to work with one client country to design a detailed plan of how to
implement a model based around improving policies, institutions and
incentives to raise performance within the WSS sector nationwide.

COVER STORY
From Across the World Bank
Modernizing Uzbekistans Water Sector
with Citizen Engagement

39

Uzbekistan
has
made
substantial
investments in upgrading its water supply
and sanitation (WSS) services over the past
decade, amassing the largest public
borrowing portfolio for WSS projects of any
country in Central Asia. Despite such
progress, the countrys citizens continue to
face challenges in accessing clean and
reliable water services. For instance, the
households of more than half the population
(roughly 31 million people) remain
unconnected to a piped water system.
A recent World Bank study, Social Impact
Analysis of Water Supply and Sanitation
Services in Central Asia: the Case of
Uzbekistan, aims to assist the Uzbekistan
government and WSS service providers in
designing policies to improve the water
sector by providing information on
consumer experiences and readiness for
reform in Uzbekistan. Statistics about access
to WSS services tell us little about the quality
of those services, and reliable evidence on
the continuity of service, water quality and
accountability of service providers is scarce
in Uzbekistan. The study, therefore, builds
upon this evidence base with much-needed
citizen feedback and stakeholder views on
WSS modernization needs.
In 2014, a team of Uzbekistan-based World
Bank researchers conducted 17 focus group
discussions with consumers, 19 in-depth
interviews with government and WSS utility
firm officials, and 10 household case studies
across Uzbekistan. Comments and feedback
by Uzbek citizens who participated in the
focus group discussions are included in the
study.
A formal survey of 300 randomly selected
households was also conducted. Data was
gathered
in
Tashkent
and
three
geographically
contrasting
regions:
Karakalpakstan in the west, Jizzak in the
south, and Fergana in the east. Within these
regions, 30 households were selected in
each of three different location types: the
center of theoblast (province); the center of
the raion (district); and rural areas.
On 26 January, 2016, the findings of the
study and its policy recommendations were
discussed at an event in Tashkent by
stakeholders including representatives from
the Uzbekistan Ministry of Finance, the
Ministry of Economy, the Tashkent
Vodokanal(water utility firm), and the Center
for Economic Research and the Institute for

Social Studies. The Swiss Agency for

Development Cooperation (SDC) a donor
to the Central Asia Energy-Water
Development Program (CAEWDP), which
funded the study was also represented at
the event, along with other World Bank
development partners such as the Asian
Development Bank and the European Union.

"I believe this is a very useful report. It is

always interesting to listen to consumers,
and the problems are there. Lack of data is a
real issue for us; our customer databases are
incomplete. But lets not forget that the
government
is
making
substantial
investments in the WSS sector. Cost recovery
is key. But that requires reducing system
losses and increasing the accountability of
water utility providers for the amount of
water that is supplied. I believe that raising
the drinking water tariffs will not be a good
idea unless we substantially improve service
delivery and the transparency of service
providers, so that we can justify those higher
tariffs. Resolution 306, which decentralizes
WSS management decisions to the regions, is
an important step towards institutional
reform needed for better performance of the
sector."
Ms. Sadjida Rustemova
Uzbekistan Ministry of Finance

Photo: World Bank

Surveyed households in Tashkent mostly experience good
quality drinking water and sanitation services, but nearly
all households outside Tashkent experience an
intermittent supply of water.

Key findings from the study:

Surveyed households in Tashkent

mostly experience good quality drinking
water and sanitation services, but
nearly all households outside Tashkent
experience an intermittent supply of

water (if connected to a centralized

piped water network).
Many households outside Tashkent
who participated in the study used
multiple sources of water, including
outside taps and water pumps in the
yard, and public standpipes.
Surveyed low-income households often
have no choice but to use unhygienic
open sources of water, such as
irrigation canals and rivers or ponds,
which can take more than half a day to
collect in some areas.

More than half of surveyed households

with taps inside their property that are
connected to a water network reported
water quality problems, specifically
turbidity and high salinity levels.
Only one quarter of all surveyed
households had access to a centralized
sewerage system, and no surveyed
households in the raion centers and
rural areas were connected to such a
system.
Water utility officials indicated that the
Vodokanals (water utility firms) often
have severe debts and cannot even
afford basic operating expenses for

delivering their services, partly due to

low tariffs and system inefficiencies.
When all costs to meet a households
drinking water and sanitation needs are
added up, households not connected to
a piped water supply network system
often spend more than twice as much
as those that are connected to such a
network. This does not include nonmonetary costs.
Surveyed households that have a water
meter pay less than those that pay a
fixed amount per month, based on
family size. Focus group discussions
suggest that many households believe
that meters will provide incentives for
Vodokanals to deliver water to
households, as they will only be able to
bill households for the actual amount of
water delivered.

40
Many households in the sample, not
connected to a piped network, reported
that they were willing to pay double the
current tariff provided they received
good quality piped water in sufficient
amounts 24 hours a day.

The studys quantitative findings are

intended to be approximate, as the survey
sample size was relatively small. The authors
suggest, therefore, to conduct a more
comprehensive
and
representative
household survey in order to confirm the
findings. It is also recommended that the
Government of Uzbekistan regularly conduct
a nationally representative household
expenditure survey that includes detailed
questions on the quality of current utility
service conditions and on the costs that

households incur for meeting their WSS

needs.

"Studies like this can really add value in

countries like Uzbekistan and other Central
Asian countries, where collecting feedback
and other data from citizens on utility service
performance is not common practice. It
builds trust, injects a sense of reality in WSS
reform plans and broadens the debate.
Understanding consumer experiences and
perceptions is essential for coming up with
sensible plans and policy reform measures. "
Rob Swinkels
World Bank Senior Social Development
Specialist and lead author of the study.

New Report
More Money and Better Service Delivery:
A Winning Combination for Achieving Drinking Water
and Sanitation Targets
In addition to money, strong institutions,
accountability and mechanisms that turn
investment into effective services for people
who need it, are critical to achieving
universal water access and safe human
waste management, according to a report by
the World Banks Water and Sanitation
Program (WSP) in partnership with the
WHO/UNICEF Joint Monitoring Programme
for Water Supply and Sanitation.
Today, 2.4 billion people still live without
access to improved sanitation, about one
billion people defecate in the open, and
more than 640,000 people lack improved
drinking water sources. With the adoption of
the Sustainable Development Goals on
water and sanitation (SDG 6), countries of
the world committed themselves to change
this situation over the next 15 years not only
by reducing to zero the number of unserved
population but also upgrading the current
levels of water, sanitation and hygiene
WASH (6.1 and 6.2) services [1].
The study, The Costs of Meeting the 2030
Sustainable Development Goal Targets on
Drinking Water, Sanitation, and Hygiene,
reveals that current levels of investment are
likely to be sufficient to provide basic water
and sanitation services [2] for all by 2030. If
the current global expenditure, estimated at
around $28.4 billion per year, were to be
targeted properly, every household in the
world would have access to drinking water,

an adequate toilet and a suitable place to

wash their hands by 2030 [3].

investments translate into effective service

delivery over time.

But the SDG water and sanitation targets 6.1

and 6.2 go beyond basic services. They set
the goal for a world where all people always
have access to drinking water nearby and
their fecal wastes are safely managed. The
total cost of providing WASH services at
these levels is estimated at around $114
billion per year, three times the current
investment levels.

In order to encourage deeper analysis, the

report includes results and analysis by world
regions. The underlying country data are
available via the World Bank website; the
main purpose is not to replace national
figures and plans but to provide key inputs
for governments to define the most suitable
WASH services for all.

Considering the amount of estimated

investment needed, efforts to meet the SDG
targets on drinking-water and sanitation will
require not only additional public funding,
but also greater service efficiency and
increased engagement from civil society and
the private sector, according to WSP Senior
Economist Guy Hutton, the lead author of
the study.
There is no doubt higher levels of financing
are needed; however, universal and
sustainable WASH services also require
strengthened institutions and better
policies, according to Jyoti Shukla, WSPs
Senior Manager. Countries need to assess
the best way to spend their resources, which
infrastructure to build, how to operate the
services, what funds are available, and what
tariff structure to adopt while also remaining
sensitive to affordability. Institutional
strengthening is fundamental to ensure that

The publications and data sets are available

for download at:
http://www.worldbank.org/en/topic/water/publication/
the-costs-of-meeting-the-2030-sustainabledevelopment-goal-targets-on-drinking-water-sanitationand-hygiene

The Water and Sanitation Program is a multidonor partnership, part of the World Bank
Group's Water Global Practice, supporting
poor people in obtaining affordable, safe,
and sustainable access to water and
sanitation services.
[1] The Sustainable Development Goal on water and
sanitation (SDG 6) is comprised of 8 sub targets that cover
a wide range of issues such as environment,
management, and transboundary cooperation. This study
focuses on the sub targets related to water, sanitation,
and hygiene (6.1 and 6.2).
[2] Basic water supply includes an improved community
water source within a 30-minute round-trip; basic
sanitation includes an improved toilet; and basic hygiene
includes a hand-washing station with soap and water for
every household.
[3] Note that the study covers 140 middle- and lowincome countries and off-track developed countries.
OECD countries are largely excluded.

COVER STORY
Governance in Action
Egypt Sustainable Rural Sanitation Services (SSRS)
Program for Results (PforR)

41

Innovative Governance Solutions to Enhance Sustainability of Service Delivery

By Norhan Sadik, Osama Hamad, Yogita
Mumssen, Fadel Ndaw and Rama Krishnan
Venkateswaran
Photo Credit: ESRISS Project
The Government of Egypt (GoE) launched
the National Rural Sanitation Program
(NRSP) in 2014 as a Presidential priority
program to address the challenge of critically
low sanitation coverage levels in particular in
the Nile Delta area with huge health impacts
on the poorest population: only 12 percent
of rural Egypt currently has access to the
sewage network. As one of the key partners
of the GoE in the rural sanitation sector, the
Bank is working to support the GoE to
achieve its development priority to increase
access to improved sanitation services - yet
now with a different approach. Given the
marked weak sector performance to date,
including
for
example
severe
implementation delays of infrastructure
construction lasting up to thirty years in
some cases, the announcement of the NRSP
was seen by the Bank as a real opportunity
for the sector to move from an inefficient
centralized approach to more decentralized
service delivery.
While the traditional focus in the sector was
on investments through Investment Project
Financing, the Program for Results (PforR)
instrument was considered the most
appropriate instrument that would allow the
Bank to support the GoE improve the design
and implementation of the NRSP using
country systems and, by directly linking the
achievement of results to the disbursement
of Bank funds, incentivize implementation of
long-stalled institutional improvements
essential for improved sanitation service
delivery. The SSRS PforR was designed by
drawing on the wealth of experience
obtained from previous operations in the
rural sanitation sector which suffered from
slow project initiation and implementation
as well as high costs. The PforR adopts an
approach that seeks to build more
sustainable and accountable service providers through the implementation of
innovative governance measures that will
lead to the achievement of the three
Program results areas: (i) improved
sanitation access, (ii) improved operational
systems and practices of WSCs, and (iii)
strengthened national sector framework.

The separation of institutional roles and

responsibilities for investment planning and
construction
from
operation
and
maintenance has been a major contributor
to the sectors poor performance. The
Program,
therefore,
follows
the
Governments strategic choice to shift from
a centralized model of service delivery to a
decentralized model that empowers the
local Water and Sanitation Companies
(WSCs) to improve service provision by
placing responsibility for investment
planning and operation and maintenance
with the WSCs. Whereas previously, the
WSCs were institutionally beholden to
central level organizations, under the
Program, three Delta WSCs (Beheira,
Dakahlia and Sharkeya) will assume full
implementation
responsibility
from
investment planning to implementation and
operation and maintenance. Accordingly,
the Program is centered on empowering the
WSCs since they are the service delivery
entities closest to the beneficiaries and as
such are best suited to respond to citizens
demands. The Program provides significant
capacity building support to the WSCs in
addition to training of the technical staff
engaged in operation and maintenance. In
this regard, the Water and Sanitation
Program (WSP) administered by the World
Bank will complement the PforR with an
initial USD 3.5 million programmatic
technical support program to strengthen the
capacity of the Program implementing

entities particularly the WSCs as they work to

deliver improved sanitation services.
As part of these institutional reforms, the
Government is for the first time
implementing a system of Performance
Based Capital Grants (PBCGs) through the
Program. These will provide transparent and
predictable financing to WSCs, enabling
them to address their service delivery
responsibilities effectively. Disbursement of
the PBCGs are linked to an incentive-based
regime of Annual Performance Assessments
(APAs) that will be designed and
implemented in a transparent manner. The
APAs will assess the institutional
performance of WSCs specifically in the
Operational, Financial, Institutional, and
Citizen Engagement dimensions of water and
sanitation service delivery. Achieving the
mandated threshold scores will enable the
WSCs to be eligible and to receive the PBCG.
A base grant entitlement will be provided to
the WSCs based on their ability to meet a
predetermined threshold and additional
grant entitlements will be provided to the
WSCs if they exceed a set threshold, thus
rewarding better performance. To allow the
WSCs to deliver on their annual performance
targets stipulated in the APAs, they will
receive technical support embodied in
Performance Improvement Action Plans,
similar to business plans, and would include
measures to improve each WSC across the
four areas of service delivery.

42
incentives and accountability mechanisms
embodied in the SSRS PforR are designed to
address
the
previous
project
implementation challenges that have
impeded the achievement of increased
access to sustainable sanitation services for
Egypts rural communities. Although many of
the abovementioned aspects are to be
implemented for the first time in Egypt, the
Government is strongly committed to
implementing the necessary institutional
improvements, with the capacity building
and institutional strengthening support from
the Bank.
The Program is also unique in the way it was
prepared. Unlike previous sector operations
where task teams were comprised almost
entirely of sector specialists, the SSRS was
prepared through a collaborative effort
between the Water and Governance
practices. This approach of addressing a
development challenge by bringing together
skills and experience from two practice areas
within the Bank. The task team brought
together the technical and operational
experience of the Water practice and the
institutional development and public sector
reform experience of the Governance
practice to create a solution that was
innovative and integrative.

Key Lessons Learned:

Accountability to citizens for greater voice

and inclusion form a critical pillar of the
Program. Citizen engagement through
citizen report cards/ beneficiary feedback
surveys, Grievance Redress Mechanisms,
awareness campaigns, community outreach
guidelines,
and
strengthened
communications systems of WSCs, as well as
the development of a strategy for serving the
poor, are all incorporated in to the Program
either through results-based incentives,
required measures (e.g. covenants), or
through capacity building programs. Overall,
an important framework has been
embedded in the operation to leverage
client feedback, make WSCs performance
and responsiveness information publically
available to clients, the strengthen role of
the regulator and independent verification
underpinning these processes.
The Program also supports a number of
policy and regulatory initiatives to provide a
strong enabling framework for empowering
the WSCs to become efficient and
accountable service delivery institutions,

including the strengthening of the capacity

and role of the Egyptian Water and
Wastewater Regulatory Agency (EWRA).
Further, a new water and wastewater tariff
is to be developed by the Ministry of
Housing, Utilities and Urban Communities
(MHUUC) in order to enhance financial
sustainability of the sector. The MHUUC is
also developing an updated national rural
sanitation strategy that is consistent with the
NRSP and the SSRS PforR, which will clarify
the existing overlap of institutional roles and
responsibilities that are currently deterring
clear intuitional accountabilities.
Thus the SSRS Program contrasts with
previous sector operations and reform
efforts in several critical ways. It seeks to
implement a unified approach that
comprises decentralized services, utility
reform, financial sustainability, and
performance enhancement through the
creation of incentives for investment and
through
strengthened
accountability
mechanisms including enhanced citizen
engagement, and strengthened regulation,
policy and institutions. This combination of

1. The Program adopted an

innovative
design
that
incentivized
institutional
performance and accountability
and linked financing to service
delivery results while piloting a
more decentralized approach.
2. The task team for the
preparation of the operation
brought together Water and
Governance specialists that
resulted in the institutional
development focus of the
Program. The ability of the team
to take a broad based approach
instead of a siloed approach was
instrumental in creating a
seamless operational design for
the operation.
3. The use of the PforR instrument
enabled the Government and
the Bank team to focus
attention on results instead of
getting bogged down on rules
and procedures.

COVER STORY
World Bank Financed Operations
Strengthening Institutional Capacity
in the Palestinian Water Sector
The World Banks US$2 million grant to the Palestinian water sector
will help strengthen the capacity of the water authority and
contribute to the implementation of reform initiatives as outlined in
the water law. The grant will supplement ongoing capacity building
work in the water sector.
With the new water law, the Palestinian authority has a good
framework to deal with the severe challenges the sector faces such as
limited resources, insufficient wastewater treatment and reuse, and
an alarming situation in Gaza where 96 percent of water resources are
unfit for human use, said Steen Lau Jorgensen, World Bank Country
Director We are proud to be supporting the continued strengthening
of state institutions in this essential sector for the future of all
Palestinians.
The project will help establish streamlined water institutions with
clear roles and responsibilities in line with the new water law that
stipulates the establishment of the Water Sector Regulatory Council,
independent from the Palestinian Water Authority. The World Bank
will provide capacity building support to both institutions through the
existing Water Sector Capacity Building Project and this additional
grant.

43

The World Bank supports building institutions at the national level and
financing infrastructure and capacity building through projects, such
as the Northern Gaza Emergency Sewage Treatment Project, the Gaza
Water Supply and Sanitation Improvement Project, the Hebron
Regional Wastewater Management Project, and the West Bethlehem
Village Improvement Project.
The investment in the Palestinian water institutions is a strategic
priority in the context of acute water problems and future needs as a
result of a growing population. The improvement and expansion of
infrastructure must be accompanied by the capacity-building required
for Palestinians to run the water sector independently and efficiently,
said Iyad Rammal, Senior World Bank Infrastructure Specialist.
The additional financing comes from the Partnership for Water and
Urban Development, the Multi-Donor Trust Fund that received
contributions from the Swedish International Development Agency
(SIDA), Frances Agence Franaise de Dveloppement (AFD), and the
governments of Croatia, Denmark, Finland, the Netherlands, Norway,
and Portugal.

BOOKS
Water

Arab Water Security:

Threats and Opportunities
in the Gulf States
(International Hydrology),
by Hussein A. Amery. Cambridge
University Press.

Confronting Climate
Uncertainty in Water Resources
Planning and Project Design:
The Decision Tree Framework
by Patrick A. Ray and Casey M.
Brown. World Bank.

The Last Drop:

The Politics of Water
by Mike Gonzalez and
Marianella Yanes. Pluto Press.

Connecting the Drops:

A Citizens Guide to Protecting
Water Resources
by Karen Schneller-McDonald.
Cornell University Press.

44
Interview 44
Morocco 46
Tunisia 50
Libya 52

Maghreb

Interview
World Bank Country Director for the Maghreb,
Marie Francoise Marie-Nelly
World Bank Priorities, Strategy and Activities for the Maghreb
Laila Mouden
Financial Management Analyst
Laila MOUDEN: Marie-Francoise MarieNelly, congratulations on your new post as
the World Bank Country Director of the
Maghreb Country Department. How does it
feel to join the Middle East and North Africa
(MENA) region?
Marie Francoise Marie-Nelly: This is an
important moment to be in the MENA region
and I am very excited. As you are aware,
there are many issues deeply relevant to the
world today which this region is at the core
of, such as the crisis of refugees fleeing their
homes to other fragile countries in the
region and Europe, the post-Arab Spring
recovery, and the renewal of the social
contract in countries such as Tunisia which is
still facing challenges to complete its political
and economic transition. In addition, there
are the increasing number of radicalized
groups which bring violence and fragility,
and finally the wide-spread youth
unemployment issue, as well as exclusion,
which could become a social implosion if
unattended. At the same time, with the
recent political agreement in Libya, there is
hope that this country can regain some
stability and that the World Bank Group
(WBG), in partnership with others, can play a
role in helping to rebuild key state
institutions
and
restore
physical
infrastructure.
Due
to
such
an
unprecedented complexity of issues, the
WBG is being challenged to think of new
ways in shaping its response. The new MENA
strategy offers a unique opportunity to
change the way we are doing business and to

design innovative solutions, including in the

way we interact with various stakeholders.
For example, in our Maghreb countries
starting with Tunisia, we are now
establishing an interactive youth forum to
seek young peoples inputs and shape
solutions for them. So, although the region is
facing a diversity of challenges, it also offers
unique potential for development. Indeed,
there are many opportunities for the WBG to
continue to make a difference. This makes
my job very rewarding.
LM: In your new post, how would you
develop and advance the strategic
partnerships with the Maghreb countries,
while keeping in line with the World Bank
Groups MENA regional strategy?
Overall, the new MENA strategy is well
aligned with the priorities of the Maghreb
countries in that all countries are working to
define a new relationship with their citizens.
Obviously, the process varies from country
to country, but helping to forge a new social
contract between the government and the
citizens is central to what we are doing in
these countries. In Libya, where a political

accord was recently reached, we are

launching an initiative on economic recovery
as well as prioritizing and sequencing actions
toward fostering social stability. The idea is
to help Libyan opinion leaders and
influencers to prepare for the post-conflict
period by helping to shape a consensus on a
common diagnosis, priorities, and options
for fast-tracking economic recovery and
social stability in the aftermath of the
conflict. The challenge will be to focus on the
immediate post-conflict needs, while
starting to develop a vision for the long term.
In Tunisia, the challenge is to support the
countrys effort to get back on an economic
recovery path while ensuring that
opportunities are created for those left
behind, notably youth, women and the most
vulnerable in lagging socio-economic
regions. We are also deepening our
partnership with Algeria, focusing on both
short- to medium-term issues such as
improving the business environment,
revitalizing the agriculture sector and
assessing social protection mechanisms. In
addition, we are undertaking a long-term
visioning exercise with a view to define ways
to move the country away from large public

45
funding to a more efficient market economy.
In designing our programs, we ensure that
our activities do not perpetuate the old
social contract model,2 but rather promote a
new dynamic where the citizens and local
actors play an active role in shaping the
solutions and holding their governments
accountable. For example, in Tunisia, we are
supporting a local government program,
which is designed to empower communities
and elected local authorities.
LM: What do you think are the key
governance challenges and opportunities
for the Maghreb countries given the
diversity of the countries?
MFMN: Again, while there are some aspects
specific to countries, there are some
common challenges as well, such as: (i) how
to ensure that institutions are strong and
accountable; (ii) how to ensure that public
resources are allocated and managed
transparently with a focus on results, (iii)
how to ensure that there is a level-playing
field and that people can openly access
economic opportunities; and (iv) how to
ensure that the citizens are engaged and
provide checks and balances so that services
are delivered in a fair, efficient and timely
manner. I am pleased that our governance
team has helped us develop a
comprehensive approach, which will allow
our operational teams to look at both the big
picture and at specific sectoral issues.
Moreover, defining a clear road map will
enable us to seize opportunities when they
occur, while working on strengthening the
institutions that underpin a strong
governance system. This effort usually
requires a lot of time and is therefore a longterm agenda. While the context is often
perceived as challenging, there are also a
number of opportunities. First of all,
governments increasingly realize that they
need to allow citizens to access information,
and efforts are being made to review the
legal framework for this to happen. For
example, in Tunisia, budget information is
now made available on line through the
platform Mizaniyatouna (Our budget) with
a great level of detail. The question is how
can we support this development to make
sure that this new transparency model is
used to result in greater public
accountability? Both Morocco and Tunisia
have adopted access to information laws3.
This new environment provides greater
opportunities for citizens to challenge the
decisions made by their governments.
Secondly, all countries are complex and
understanding the quickly evolving contexts
of our countries in the Maghreb is key to our
effectiveness as an institution. It is
imperative that we broaden the scope of our
2

The old social contract refers to the post-independence

model by which the State provided jobs, free health and
education, and subsidized food and fuel and expected the

Mrs. Marie-Franoise Marie-Nelly, the new Country Director for the Maghreb countries
and Malta, was invited to join the Moroccan Professional Accounting Organization (PAO)
annual event as a panelist for the session on Growth and Competitiveness Developing
Synergies in Africa. Key issues for discussion included doing business in Africa,
opportunities for micro, small and medium enterprises (MSMEs), and the changing role
of the accountant in this process, as well as using Morocco as a good sample and platform
for greater cooperation and synergy between African economies. Mrs. Marie-Nelly
focused on the potential and the opportunities for south-south cooperation in sectors
such as agriculture industrialization, technology, and air connectivity. The outcomes of
the event were broadly to enlarge the accountant role from certification of financial
information to strategic information, which is of interest to investors. It will consolidate
its role as the expert with essential professional reference in the service of investment
and decision-making.
due diligence work and understand the
political economy of our activities. This will
help us understand who is likely to benefit,
who is likely to resist reform efforts, as well
as how we can support locally-owned
solutions which may build on international
best practice principles while tailoring them
to diverse local realities. Our role in the
Maghreb can help support a new social
contract. An in-depth contextual knowledge
is key to ensuring that we play a positive role
in building local solutions aimed at achieving
the WBGs twin goals of ending poverty and
promoting shared prosperity. Thirdly, and
related to this, the new openness in many of
our client countries means that we are now
able to engage a broader array of
stakeholders which will provide us with a
broader basis of information and knowledge
on which to build our support. We can use
this opportunity to liaise candidly about the
root causes of persistent problems and
realistic solutions which will require the
engagement of multiple actors and
coalitions. So, while it is true that the
challenges
are
considerable,
new
opportunities are also being presented and it
is our responsibility to seize these and
challenge ourselves to be problem solvers

that support locally-facilitated solutions

among a wide array of actors.

citizens to keep their voices low, the so called

authoritarian bargain.

LM: You joined the Maghreb department

after spending years in the Africa region. Do
you see opportunities for cross-fertilization
between the two regions, and in the
Maghreb countries in particular?
MFMN: It is interesting to note that the
World Bank has divided the continent into
two parts; yet I see that the Maghreb and the
Sub-Saharan
countries
have
really
understood the potential and the
opportunities
for
cross-fertilization.
Obviously there are countries more active
than others in this regard. Morocco, for
instance, has made this partnership with
Sub-Saharan Africa a government priority
For Morocco, the adoption of the access to information
law has not yet received Parliamentary approval.

46
which is already percolating at all levels. For
example, the recent National Conference of
Chartered Accountants in Marrakech was
opened to the entire continent. This has
generated very rich discussions and
opportunities for greater collaboration. A
number of companies from the Maghreb
have also successfully invested in subSaharan African countries. There are win-win
opportunities which can build on the
respective comparative advantages of the
countries. Agriculture forms the basis for any
industrialization and the continent has a lot
of potential. So, this is an area where the two
regions can develop greater synergy and
complementarity in the use of technology,
such as the use of appropriate fertilizers,
climate resistant seeds, and so on. At the
same time, there is a need to improve the
enabling environment to facilitate such
cooperation. For example, connectivity
needs to be improved significantly: shipping
lines do not operate efficiently along the

coast and air transportation connections

need to be developed further.
LM: The World Bank Group deals with a
wide range of issues. Is there one issue in
particular that you feel strongly about?

successful pilots. In this sense, there must be

a deeper acceptance by educational
institutions of the changing nature of the
working world, and their curricula and
structures should reflect this. The youth
have a voice in this and should be listened to
in shaping solutions for them.

MFMN: I feel strongly about a lot of issues as

I have been fortunate enough to work in
many countries which are faced with a
variety of unique challenges. However, one
of the issues which I have found to be
common and which keeps me up at night is
the youth challenge. How can we find a new
approach to mobilize all actors to create
opportunities, training, entrepreneurship,
and participation in community work and in
key public decisions? There are many
organizations
which
are
providing
interesting solutions to the issue of youth
unemployment. Another fundamental lever
to pull would be the cross fertilization
between institutions of education and
institutions of work and then to scale up

Morocco
Social Contract and Civil Liberties
Paul Prettitore
Senior Public Sector Specialist
The Arab Spring and its aftermath have
inspired much discussion of the social
contracts that have defined the relationship
between citizens and the state in the Arab
world. In the past, the typical social contract
of a state in the Middle East or North Africa
broadly afforded that citizens would be
provided jobs and public services, and
presumably political stability, in return for
limiting civil liberties that could be used to
challenge governing regimes. The political
transition in Morocco has provided space for
addressing civil liberties in the debate on
new social contracts. Moroccans, like many
in the MENA region, have long resented that
attempts to fully exercise civil liberties could
result in heavy-handed responses by security
services and courts. Activists, journalists, and
even music rappers have been singled out for
violations of rights by government
authorities. However, many other citizens
were systematically denied civil liberties as
the result of weak safeguards within the
justice sector. Discussions on the inclusion of
civil liberties in new social contracts has
centered mostly on citizen engagement,
largely looking at access to information,
transparency, and public consultations.
There has been less discussion on other key
aspects of civil liberties, namely protection
from
ill-treatment
by
government
authorities and the right to a fair trial. Prior

to the Arab Spring, such liberties were often

violated through the use of arbitrary arrest
and detention; torture and other forms of illtreatment of detainees; lengthy pre-trial
detention; and restricted access to legal
assistance. Political interference in the courts
by the executive branch was not uncommon.
Further, civilians could be sent for trial
before military courts, which lacked the most
basic fair trial safeguards. Later, Moroccos
Charter for the Reform of the Judicial System,
adopted in 2013, highlighted a number of
gaps in the exercise of civil liberties,
particularly in relation to fair trials and

treatment of detainees. Moroccos National

Human Rights Council has noted the
persistence of abuses by prison staff against
inmates and poor treatment of juveniles in
detention in the past. Morocco scored poorly
on the Economist Intelligence Units
Democracy Index (2014) measure of civil
liberties. Its lowest score on the 2013 World
Governance Indicators (WGI) is for Voice and
Accountability, which covers civil liberties.
However, on a host of other WGI indicators,
including the rule of law and government
effectiveness, it scores well above the
average for lower-middle-income countries,

47
suggesting the government can be effective
when it wants to be. The government of
Morocco has taken steps to enhance civil
liberties. The Constitution adopted in 2011
outlawed the practices of arbitrary arrest
and detention, torture and ill-treatment. It
also enhanced fair trial safeguards and set
the basis for criminalization of torture and
arbitrary arrest and detention. The mandate
of the National Human Rights Council was
expanded to allow more pro-active
monitoring, investigation, and intervention
involving cases of violation of civil liberties.
The Charter for the Reform of the Judicial
System set policy objectives for improving
fair trial safeguards and the treatment of
detainees, and for limiting the use of pre-trial
detention. The trial of civilians by military
courts was outlawed in January 2015.
These reforms are relatively recent, and the
extent of implementation remains unclear.
Yet violations in Morocco have been
highlighted in the last several years by the
United States (U.S.) State Departments
Morocco Human Rights Report 2014, the
United Nations (U.N.) Working Group on
Arbitrary Detention, the U.N. Special
Rapporteur on Torture, Human Rights
Watch, and Amnesty International. For
example, the U.S. State Department has

pointed to the continued practice of

arbitrary arrest and detention, and the
excessive use of pre-trial detention, often for
periods longer than allowed by law, taking
place throughout 2014. Ensuring the social
contract covers the full range of civil liberties
is important for several reasons. Civil
liberties should be respected as a matter of
legal principle. These rights are wellestablished under international law, and
guaranteed in Moroccos constitution and
international human rights treaties that it
has signed. The exercise of civil liberties by
citizens,
and
their
protection
by
governments, is integral to promoting good
governance. Violation of civil liberties with
impunity by government authorities is a
powerful deterrent to citizens fully
exercising their rights. The exercise of civil
liberties is also linked with citizen well-being
and agency. Ill-treatment by police, prison,
and security officials undermines well-being,
including physical and mental health.
Families of the detained are also affected.
Unnecessary detention also undermines
agencythose in detention are severely
restricted in the exercise of choices in, and
control over, their lives. This may last beyond
the period of detention, for example in terms
of access to employment and education. The
violation of civil liberties also imposes

economic costs. Wrongful detention

separates individuals from employment and
reduces financial assets at the family level.
This presents a particularly precarious
situation in Morocco, where most detainees
are men and the labor force participation of
women, especially married women, remains
low. Furthermore, much of these costs are
likely avoidable. For example, Moroccos rate
of pre-trial detention (per 100,000 of
population) is comparable with countries
such as Bolivia, Brazil, Colombia, El Salvador,
and Mexico all of which have considerably
higher rates of homicides and other violent
crimes. This raises the question as to
whether Morocco needs such high levels of
pre-trial detention. Finally, the poor are likely
to suffer disproportionately from violations
of civil liberties. The poor are more likely to
be involved in crimes and come into contact
with the police, prisons and courts. They are
more frequently held in pre-trial detention
because they cannot afford legal assistance
from a lawyer, bribes or bail, and lack the
personal connections to navigate the court
system. In addition, they cannot rely on
functioning legal aid systems to ensure
access to lawyers. The economic costs
incurred may push the vulnerable into
poverty, or exacerbate the conditions of
those already in it.

Morocco
Making Government more Accountable to Citizens
Fabian Seiderer
Senior Public Sector Specialist
The World Bank recently announced a
US$200 million operation to support ongoing
reforms in Morocco to make government
more efficient and more accountable to its
citizens.
The
Transparency
and
Accountability Development Policy Loan
(DPL) is the second operation of a
comprehensive program designed to assist
the government in laying the foundations for
meeting the governance goals outlined in the
new Constitution. The new Constitution
responded to public discontent over poor
service delivery and government institutions
that were out of reach to ordinary citizens.
The Transparency and Accountability DPL
program was designed to support the
government in taking the critical first step
toward putting the Constitution into practice
by developing the relevant policies and legal
framework. The first DPL supported a broad
package of reforms to improve performance
and transparency of key public institutions
and allow for greater citizen participation by
making the chain of accountability clearer.
This second DPL provides further momentum

through deepened support to policies for

fiscal transparency and citizens access to
information and the right to petition. The
new operation also promotes increased
efficiency in the overall handling of public
funds, with a focus on better financial
management at the central and local
government levels, as well as by state-owned
enterprises.

Morocco is undertaking an ambitious

overhaul of its governance framework and
the World Bank is pleased to support these
reforms with this comprehensive program,
said Marie Franoise Marie-Nelly, World
Bank Country Director for the Maghreb. This
program not only supports reforms but also
aims to provide the capacity building needed
to ensure they can be implemented. What

48
matters now, however, is that Moroccans see
the results of change, and that reforms lead
to greater participation of citizens in public
life.
The program, also titled Hakama, or
Governance in Arabic, is a joint effort with
the European Union and the African
Development Bank who have both
contributed a further US$250 million in
support of the budget, procurement and
open governance reforms. In parallel with
the financial support, Hakama provides
technical assistance to the central and local
governments as well as to the Parliament for
the implementation of the governance
reforms, including training on performance
budgeting, monitoring and evaluation, fiscal
decentralization and citizen engagement.
The translation of these new constitutional
governance rights and principles into specific
laws and policies is a key milestone of the
program said Fabian Seiderer, World Bank
Public Sector Specialist and task team leader
of the program. The next phase will focus on
the implementation of these policies with a
view to improving the quality of public
services to Moroccans and allowing citizens
to make effective use of these new rights.
Programme dappui aux rformes de
gouvernance au Maroc (Hakama)
Quest-ce que le programme Hakama ?
Le programme de gouvernance (Hakama) de
la Banque mondiale, est ancr dans la
nouvelle Constitution marocaine. Il soutient
les rformes du Maroc visant renforcer les
mcanismes de transparence et de
redevabilit dans la gestion des ressources
publiques et la concrtisation des nouveaux
droits et principes constitutionnels pour une
gouvernance plus ouverte, pour
un
dveloppement conomique et social plus
inclusif et une amlioration de lefficience et
de la qualit des services et des programmes
publics. Il sagit dun programme holistique
et intgr lanc en 2012, qui vise maximiser
les synergies des rformes de Gouvernance
travers le secteur public, tant au niveau de
ladministration centrale, des collectivits
territoriales et des Entreprises et des
Etablissements Publics (EEP), afin de
renforcer les rsultats tangibles pour tous les
citoyens.
Quelles sont les rformes constitutionnelles
appuyes par le programme Hakama ?
Le programme Hakama comprend deux
piliers : Pilier I - Amlioration de la
transparence et de la redevabilit dans la
gestion des ressources publiques et Pilier II
Promotion dune gouvernance ouverte

Pilier I

La rforme pour une budgtisation

programmatique
axe
sur
la
performance,
La rforme de la passation des marchs
publics,
Le cadre juridique et institutionnel pour
les partenariats public-priv,
La gouvernance des agences et des
entreprises et tablissements publics
(EEP),
La rgionalisation et la gouvernance
locale.
Pilier II
Les rformes qui visent renforcer la
transparence budgtaire,
L'accs l'information,
La consultation du public et les ptitions
des citoyens pour favoriser un
engagement croissant et direct des
citoyens dans la conception et la mise
en uvre des politiques publiques et
programmes qui les concernent.
La fourniture en ligne de services
publics aux citoyens, comme les
certificats de naissances

Le programme Hakama cest aussi :

une srie dappuis budgtaires de 400

millions de dollars sur la priode 20132016, dont la seconde opration vient
dtre approuve par le Conseil
dadministration de
la
Banque
mondiale;

un projet dassistance technique

dappui au nouveau cadre de

gouvernance, de 4 millions de dollars,

financ par le Fonds de transition, qui
soutient la mise en uvre des politiques
sur la consultation et la ptition
publiques, la rforme budgtaire, les
rformes de la passation des marchs et
de la dcentralisation budgtaire ;
le projet de jumelage institutionnel
dappui la mise en uvre de la Loi
organique des finances (LOF) financ
par le projet ci-dessus ;
un projet de renforcement des
capacits et de formation du
Parlement ;
de lassistance technique la refonte de
la passation de marchs ;
des diagnostics des finances publiques
(PEFA) et des tudes sur la gouvernance
des services publics
des
sminaires,
formations
et
communauts de praticiens (finances
publiques, passation de marchs,)

Les partenaires : Le Parlement, le Secrtariat

Gnral du Gouvernement, les ministres
des Affaires Gnrales et de la Gouvernance,
le ministre de lEconomie et des Finances,
de lIntrieur, des relations avec le Parlement
et avec la Socit Civile, de la Fonction
Publique
et
de
la
rforme
de
lAdministration, les ministres sectoriels
mettant en uvre la LOF, les EEP mettant en
uvre le code de bonne gouvernance, les
collectivits territoriales, les associations,
LUnion europenne et la Banque Africaine
de Dveloppement.

Morocco
Overhauling a Fragmented Identification System

49

Diego Angel-Urdinola
Senior Economist
For years, Morocco has relied on multiple
identity systems, each highly developed in its
own way. In the late 1970s, the government
introduced a national identity system. This
was replaced in 2008 with an electronic
identification system, Carte Nationale
dIdentit
Electronique
(CNIE)
with
approximately 20 million electronic ID cards
issued to date. Besides CNIE, Moroccos
identification systems include the civil
registry which records births and deaths, the
National Register of Children (MASSAR), a
completely electronic system that manages
aspects of the scholastic life of children, the
RAMED database (introduced in 2011), a free
medical insurance program for the poor, and
the Social Security register (CNSS) by which
employers register their employees in the
social security scheme.
A Missing Link
And yet, for many reasons, Morocco found
that its complex identity ecosystem was no
longer serving all its identification needs. A
key issue was lack of interoperability. Each
system had created its own identification
number; none of these systems or numbers
was interoperable or even followed the same
logic or standards. Many of the functional ID
programs required prospective beneficiaries
to possess a CNIE but could only use this to
do on-the-spot manual verification. Without
electronic access to the CNIE database, there
was no way to truly verify that beneficiaries
were, in fact, who they said they were. This
lack of electronic verification made systems
susceptible to fraud. Further, it resulted in
individuals appearing differently across
databases with slight variations in names,
spellings and addresses. In the long run, this
lack of electronic integration resulted in a
waste of time and money for the
administration and burdened individuals
with the need to repeatedly prove their
identity in order to access services and rights.
An Incomplete System
The introduction of the RAMED and Tayssir
social safety net programs only underlined
the countrys need for a new identification
system. Both programs were introduced to
help the poor cope with the inevitable rise in
cost of food and fuel as the Moroccan
government began to phase out its energy

subsidy. Through RAMED, the government

planned to provide free health insurance to
the poor while Tayssir was a conditional cash
transfer to encourage poor families to send
their children to school.
At first, the CNIE seemed the logical choice of
database by which to identify and
authenticate beneficiaries for these new
programs. Both RAMED and Tayssir required
potential beneficiaries to possess CNIEs as a
prerequisite for enrolment. However, it soon
became evident that the CNIE could not be
used to verify RAMED and Tayssir
beneficiaries for the simple reason that it had
enrolled neither the poorest of the poor nor
children. Deterred by the high cost (roughly
USD $8.5) of enrolling in CNIE, the poor
turned out to be an excluded segment of the
population in the database; children below
the age of 18 were anyway not covered by
the CNIE. It seemed the government would
have to find another way to target and
identify poor families and their children.
Besides not meeting the needs of RAMED
and Tayssir, CNIE had other issues. It could
not be considered a true digital identity as it
lacked certain digital assets including a
unique identifying number (UIN).
A New Approach
To implement a true digital identification
system capable of supporting access to
services and rights for all, the Government of
Morocco called on the World Bank for
financial and technical assistance. After a
thorough assessment of the countrys
present systems, the World Bank
recommended the development of both a

National Population Register (NPR) with a

Unique Identifying Number, and a Social
Register (SR).
The NPR will be a comprehensive
foundational database of all individuals who
have the right to reside in the country. By
drawing on the existing databasesthe CNIE
for adults above 18, the MASSAR for children
between the ages of 6-18, and the civil
register (once it is put online) for those under
the age of 6the NPR will be able to create
a unified register. Each individual in the
register will be assigned a unique identifying
number (UIN) which will be the key to linking
the disparate databases. Once the multiple
databases are able to use the UIN to
crosscheck and link identities, there will be
no room for identity fraud. The NPR will also
be available for use by Moroccos registries
and social programs, existing and in the
pipeline, to make secure and transparent
transactions such as payment of social
benefits.
The SR will be used to create a unified
register of applicants of different social
programs. By collecting and crosschecking
their socioeconomic information as well as
that of their households, the SR will ensure
that the right groups are receiving the right
kind of help from the government. The SR
will be periodically updated, verified, and
integrated with other information systems
(such as taxes, utilities, and social security)
for data controls and cross verification.
This approach will give Morocco the digital
identification system it needs for the 21st
century.

Tunisie

50

Le Budget Participatif: Un pas vers la dmocratie locale en Tunisie

(exprience de la commune de Sfax)
Guidara Ahmed
Conseiller des services publics,
Directeur Financier de la commune de
Sfax
Le Budget Participatif est dfini souvent
comme un processus de dmocratie
directe travers lequel les citoyens dcident
de manire souveraine et indpendante,
avec laccord de la commune, sur une partie
du budget et des dpenses de leur commune
. Il amliore la relation entre citoyens et
commune et contribue construire un
rapport de confiance entre eux. Les travaux
excuts travers le Budget Participatif
rpondent directement aux besoins
prioritaires des citoyens et amliorent
linfrastructure et les quipements dune
commune. En effet, les communes
tunisiennes sont habitues dcider sur le
budget communal derrire des portes
fermes. Les citoyens, quant eux, ne
sintressaient gure aux affaires de la
commune et ny participaient plus,
ngligeant par la mme occasion de payer
leurs impts
locaux
en
motivant
gnralement leur incivisme fiscal par le
manque de transparence dans la gestion
financire de la commune et par la
mdiocrit des prestations fournies
localement. La dmocratie reprsentative
atteint ses limites et les citoyens ont les
sentiments que les conseillers lus sont
dconnects de la ralit vcue et que
lintrt gnral est rarement respect. Le
Budget Participatif aide surmonter ces
difficults par un apprentissage de lintrt
gnral au profit de la commune et des
citoyens. Cet article va exposer lexprience
de budgtisation participative de la
commune de Sfax [1] qui a commenc en
2015.
I. LES PHASES PRLIMINAIRES DES FORA DES
ZONES DHABITATION
Dans le cadre des nouvelles orientations en
matire de dcentralisation et en cohrence
avec les dispositions du chapitre 7 de la
constitution tunisienne de 2014 et plus
prcisment avec larticle 139[2], la
commune de Sfax sest engage pour lanne
2015 dans une exprience de budgtisation
participative pour inclure les projets choisis
par les citoyens dans le projet du budget de
2016, vot lors de la 3me session ordinaire
du conseil municipal qui a eu lieu le 28 juillet
2015 en sance plnire. Le conseil
municipal a exprim son fort engagement
politique pour entamer cette exprience

considre comme une prparation

lapplication de lapproche participative
instaure par le chapitre 7 de la nouvelle
constitution
tunisienne
[3].
Prparation et cadre rglementaire
Lors de sa premire session ordinaire de
2015 tenue le 25 fvrier 2015, le conseil
municipal a approuv la dcision
daffectation dune enveloppe budgtaire de
3 millions de dinars du budget
dinvestissement dans les rubriques de la
voirie, lclairage public et la construction de
trottoirs et leur pavage. Par la suite, la
commune a lanc Travers un communiqu
de presse un appel manifestation dintrt
aux associations actives dans le territoire
communal pour ladhsion au processus.
Plus de 40 associations ont rpondu. Les fora
des zones dhabitation sont anims par des
facilitateurs locaux proposs par les
associations signataires des conventions
titre de bnvolat. Aussi, et pour respecter la
mthodologie du budget participatif, la
commune a procd au dcoupage du
territoire communal en zones dhabitation
qui fera chacune lobjet dun forum citoyen
pendant 2 jours conscutifs. Le choix de
lenveloppe budgtaire a t arrt suivant
les bonnes pratiques internationales : entre
5 et 15% du budget communal.
La campagne de sensibilisation et de
communication
La communication et la sensibilisation est la
phase la plus importante qui conditionne la
russite mme de lexprience du BP. Ainsi,
une forte corrlation positive existe entre
lefficacit
de
la
campagne
de
communication et de sensibilisation et le
taux de participation aux fora citoyens.

Photo n 1 : Tract distribu dans le cadre du

Budget Participatif

II. LE DROULEMENT DES FORA DANS LES

ZONES DHABITATION
La Description des fora des zones
dhabitation
Le forum citoyen dure 2 jours, le premier jour
qui se tient le samedi est consacr la
prsentation des finances locales et des
ralisations dinvestissement dans les
domaines relatifs la voirie, trottoirs et
clairage public. Le but de cette runion est
dinstaurer une culture de transparence et
de redevabilit chez les responsables des
autorits locales et de restituer la confiance
perdue entre le citoyen et son administration
locale [4]. Durant cette journe, des affiches
en couleur illustrant un budget citoyen [5]
labores par des experts ont t exposes.
Ces affiches prsentent des agrgats relatifs
la gestion financire de la commune,
essentiellement la structure des recettes et
des dpenses, lvolution de ces agrgats
depuis 2012, lvolution des principales
ressources et dpenses ainsi que des ratios
de structures relatifs lendettement,
leffort dinvestissement et la marge de
manuvre de la commune en matire de
dpenses. Le langage utilis dans les fora est
trs simple et les prsentations en power
point taient animes essentiellement par
des histogrammes et des camemberts.
Lobjectif tait de simplifier les concepts
relatifs la finance locale et
linvestissement. Durant la deuxime
journe du forum citoyen, la contribution du
citoyen devient plus manifeste. Afin que la

51
parole ne soit pas monopolise par les
orateurs les plus habiles ou les personnes les
mieux dotes en capital culturel, la
commune a fait appel un professionnel
neutre pour animer les dbats et distribuer
la parole durant cette journe. Assembls en
groupes de 10 15 personnes, les citoyens
discutent ensemble pour proposer des
projets (en prcisant leurs emplacements et
leurs compositions techniques sommaires).
Aprs le recueil de toutes les propositions de
projets des diffrents groupes, les
propositions seront numrotes et affiches
devant le public qui fait la queue pour
commencer le vote. Durant chaque forum, il
est demand aux participants de postuler
pour tre dlgu de quartier et par
consquent mandat par les citoyens pour
dfendre leurs intrts. Aprs consultation
des participants, et dans lobjectif de
prserver la neutralit du processus de toute
interfrence politique, les candidats dsirant
devenir dlgu de quartier et qui seront
connus par les participants comme membres
actifs dun parti politique (les simples
adhrents ntant pas concerns par cette
interdiction) ne sont pas accepts. Aussi, les
dlgus de zones dhabitation doivent tre
obligatoirement un homme, une femme et
un jeune (dont lge varie entre 18 et 35
ans)[6] et ce pour permettre davoir une
reprsentation de toutes les catgories de la
socit parmi les dlgus de chaque zone
dhabitation. Les dlgus lus doivent
assister aux runions relatives un forum de
dlgus pour contribuer la priorisation
des projets et retenir les ides qui seront
prises dans le cadre du budget participatif.
Les dlgus de zones dhabitation doivent
aussi assister aux runions de prparation
des procdures de passation de la
commande publique et dexcution des
projets choisis. Il est mme envisag de
permettre aux dlgus dassister aux
runions de la commission des marchs[7] et
davoir des badges pour accder mme aux
chantiers dexcution des travaux. A la fin de
chaque fora, les participants votent 3 projets
et 3 dlgus (voir photo n4).
Interprtation des rsultats
Au total presque 2000 citoyens ont assist
aux fora citoyens, ce qui prsente un taux de
participation trs satisfaisant pour une ville
durant son premier exercice de budget
participatif. La deuxime journe a
enregistr la participation de presque 70 %
des citoyens prsents dans les fora
lencontre de 30 % durant la premire
journe. La progression enregistre du
nombre de participants entre les 2 journes
est explique par lintensification de leffort
de communication durant la matine du
dimanche et aussi grce leffet positif de la
communication de bouche oreille et mme
de mobilisation des citoyens prsents lors de
la premire journe dans leurs quartiers.

Rpartition des participants au fora des

zones dhabitation par sexe
24.53% des participants taient des jeunes
(entre 18 et 35 ans). 26.77 % des participants
taient des femmes et 73.23 % des hommes.
A la fin du forum de dlgus anim par une
quipe de facilitateurs professionnels, 25
projets ont t choisis parmi les 30 proposs
aprs avoir fix des critres de priorit (Voir
Photo n 7). Aprs un dbat trs riche et un
change davis dans le respect total des
principes du dialogue et de la tolrance
envers lautre, les dlgus, eux seuls, se
sont concerts sur la liste des projets dans la
limite de lenveloppe budgtaire alloue au
budget participatif en utilisant les
valuations financires prpars par les
services techniques de la commune
mentionnes sur tiquette coll sur chaque
carte de projet. Il est remarquer que la
visite programme avant la tenue du forum
de dlgus aux diffrents sites de projets
dcoulant des 10 foras de zones dhabitation
a amen un consensus sur les priorits
adopter au lieu du vote, concrtisant ainsi la
primaut de lintrt collectif sur lintrt
particulier exigu.
Photo n 7 : Priorisation des projets durant le
forum des dlgus
Le cot de tous les projets choisis lors du
forum de dlgus dune manire
consensuelle (25 projets) est de lordre de
3.010.000 dinars rpartis comme suit :
2.706.000 dinars pour des projets de voirie et
304.000 dinars pour lclairage public. La
commune, quant elle, a intgr les cots
des 25 projets choisis dans le projet du
budget de lanne 2016 qui t vot lors de
la troisime session ordinaire du
conseil municipal du mois de juillet 2015
avec la prsence des dlgus des zones

dhabitation. Il s'agit pour les dlgus des

zones dhabitation, non seulement d'tre
associs des runions administratives
traitant des questions budgtaires, mais
aussi de prendre effectivement part la
dcision, aux diffrents niveaux de
conception et de mise en uvre des projets.
Lexprience internationale a montr que de
nombreux dlgus, condition quils aient
t suffisamment investis dans le processus,
sont devenus plus informs la suite de leur
exprience de participation, acqurant des
savoirs techniques, politiques et pratiques
quils ne possdaient pas auparavant. La
dynamique cre par cette exprience incite
la commune continuer dans ce projet et de
la reproduire lanne prochaine pour une
enveloppe plus importante et pour dautres
champs dintervention. Les citoyens appuys
par la socit civile active peuvent ds
maintenant commencer un plaidoyer dans ce
sens.
________________________________
[1] La Banque met en oeuvre un programme dassistance
technique auprs des municipalits tunisiennes incluant
sept valuations des systmes de finances publiques
municipales (PEFA), dont Sfax en partenariat avec lAFD
ainsi que des actions dAT cibles. Lexperience de budget
participatif Sfax a t appuye par lAction Associative,
ONG tunisienne et bnficie dun financement de GIZ.
[2] larticle 139 stipule que : Les collectivits locales
adoptent les mcanismes de la dmocratie participative
et les principes de la dmocratie ouverte afin de garantir
la plus large participation des citoyens et de la socit
civile la prparation des projets de dveloppement et
damnagement du territoire et le suivi de leur excution,
conformment la loi ,
[3] Suspendu pour le moment jusqu' la promulgation des
textes
dapplication
y
affrents.
[4] Le faible taux de prsence des citoyens dans les
diffrentes runions de la commune ainsi que lincivisme
fiscal remarquable prouvent ce constat.
[5] Un projet de conception dun Budget citoyen est
encours de finalization
[6] Cest la mme dfinition du jeune utilise par les
autorits centrales pour les politiques publiques
sectorielles
[7] La rglementation actuelle des marchs publics
autorise la prsence des dlgus et de la socit civile
dans la commission des marchs.

Libya
A debate show keeps discussion alive

52

Christine Petre
Consultant MNAEC
You never know what you might hear on the
Libyan debate showHiwar Mushtarak, or
Shared Debate. The show aims to foster an
open dialogue about the countrys current
challenges and its potential future by
bringing together Libyans of all stripes. There
are panel discussions featuring a diverse
range of Libyan politicians and civil society
activists, and the audience is encouraged to
engage, giving a voice to ordinary Libyan
citizens. For a recent show to commemorate
Libyas February 17 revolution, which five
years ago led to the ousting and death of
former leader Muammar Gaddafi, a panel
debated the question: What is the way
forward?
On a stage at the Science City Auditorium in
Tunisias capital Tunis, where the show was
recorded, panelist Amal Labeidi, Professor of
Politics at University of Benghazi, began by
highlighting the need for disarmament. She
insisted that securing the large amount of
weapons circulating within the countrys
borders was a primary concern that needed
to be addressed first. No democratic
progress can be achieved without security,
said Labeidi. The discussion remained
focused on how to build a secure and stable
state.
Panelist
Hisham
al-Wendi,
independent participant in the UN Libya
talks, insisted that priority needed to be
given to creating a culture of tolerance and
forgiveness. To which Giuma Atiqa, former
Vice President of the Tripoli-based General
National Congress (GNC), added the
importance of reconciliation. There is a link
between national reconciliation and
security, he said. Efforts to heal wounds are
an integral part of re-building society,
observed Atiqa. For Mustafa El Sagezli,
Director of General Libyan Program of
Integration and Development, who works on
re-integrating former fighters, it was
essential that all willing parties are included
in the dialogue about the countrys future.
With exclusion you feed hate, he said.
Najwa al-Fitouri, Member of Voice of Libyan
Women for Peace, emphasized that the time
for dialogue was ripe.
Along with listening to panelists, one of the
principal aims of Hiwar Mushtarak is to give
the audience a rare opportunity to voice
their opinions freely. The aim is to support
a culture of dialogue, explained the shows
producer, 23-year-old Libya Idris from the

development charity BBC Media Action,

which has trained and supported the shows
Libyan staff.
The around 200 audience members for this
episode followed the debate closely. In
addition to security, the show addressed
topics such as the Government of National
Accord (GNA), terrorism and whether or not
to support a Western intervention to target
the Islamic State. On the latter, most of the
Libyans present seemed to reject the idea.
One of them, a young man in the audience,
opposed any foreign interference. We
refuse to become another Iraq, he said to
the panelists.
This is a collective effort to overcome
divisions and hopefully circulate ideas
through, for example, social media, said
panelist Labeidi after the show. The more
we discuss our problems, the better.
There are no debate shows like this in
Libya, said Nemat Ghanimi from Tripoli,
who was temporarily in Tunisia and took
advantage of the opportunity to join the
audience. According to the 19-year-old, the
show empowers young people by giving
them a way to communicate with
politicians. For another of the young women
in the audience, 19-year-old Janan
Abdulkader, this was the second time joining
the program. When she came to the last
show she was immediately captivated. She
had never heard of a show where anyone in
the audience could openly ask questions.
Politics had held little interest for her before,
but she is now keen to get involved in the

show. But most of her Libyan friends in

Tunisia are reluctant to come. She has tried
convincing them but they are afraid it could
cause them problems.
The program shows that you can have a
heated debate without using violence, said
the shows host, 30-year-old Raafat Belkhair,
Libyans can find a common ground. To
him, it is especially important at this period
of time in Libyas transition to emphasize
that expressing ones opinions is a right.
While Belkhair likes an interactive and
heated debate he admits that sometimes the
discussions can get overly heated, and then
it is important to remain neutral and wellorganized.
This episode was recorded in Tunisia but
Belkhair, who is from Tripoli, is hoping that
the show will return to Libya in the very near
future. Ghanimi agrees. It sends the wrong
message having the show in Tunisia and not
in Libya, she said. Despite supporting the
initiative she is skeptical it will lead to any
concrete solutions. The next episode will be
recorded in April, this time in London, a city
with a large Libyan diaspora. And perhaps
the one after will be in Libya, inshallah (God
willing), said a hopeful Abdulkader.
Towards the end of the show, Belkhair asked
the audience: Are you optimistic about the
GNA? About half of the audience raised their
hands, which may reflect the divided and
cautious political opinion among many
Libyans five years after the revolution.

Libya
Governance and Public Administration

53

Vito Intini
Michael Schaeffer
After more than a year of civil war, almost
four years of fraught transition, and months
of intensive U.N.-led negotiations, Libyans
are poised to form a Government of National
Accord (GNA) and begin the process of
reunifying the country. However, without
swift and bold action by the GNA the
situation in Libya will remain prone to reform
reversal and instability due to fragmented
state institutions, disrupted oil exports,
shrinking government revenues, local
political monopolies, and violence from
radical groups. Indeed, the GNA and the
Libyan institutions will be put to a difficult
test as they will have to quickly deliver in a
time when demand from Libyans has never
been so pressing, against a backdrop of
weakened public services, under a global
scenario of persistently low oil prices (and
hence their revenues) and a regional context
of increasing political instability and
polarization. The overthrow of the regime in
2011 did not lead to a peaceful transitional
process in Libya but to ongoing localized
conflict that varied in intensity. As this article
is being formulated, Libya is currently still
split between two rival governments and
their allied coalitions, with significant parts
of the country under the control of extremist
groups that will continue acting as spoilers to
the transition. Yet there is a glimmer of hope
that a government of National Accord may
emerge.
A Recent History: All Libyan governments
since 2011 have been transitional in nature.
Their primary mandate has been
stabilization and the immediate response to
the needs of the Libyan people. The election
of the General National Congress (GNC) took
place in July 2012 with a political controversy
over when its mandate should end.
Opponents of GNC believed it had a mandate
until February 2014. The elections of the
House of Representatives (HoR) were held in
June 2014, following the protests against
GNC for having renewed its mandate beyond
February. Only 630,000 Libyans turned out
to vote in 2014, a significant reduction of the
1.7 million votes posted during the GNC
elections in 2012. Each post-Qaddafi
government has failed to build consensus
among the Libyan public and its many
stakeholders on a common national agenda.
The divisions within Libya are not new, but
follow the divide and rule politics that was
encouraged by the regime.
Several

interrelated layers of conflict coexist in Libya

today, with the localized groups and militias
fighting each othersome due to
alignments with the two competing
governments, some in support of or against
extremist groups, and others over access to
resources in specific locations. The different
militias in Libya hold considerable weight
that they use to influence political systems or
processes, and have a history of getting their
demands met through the use ofor threat
to useviolence. By the 2011 uprising,
Libyan society lacked even weak or partially
independent social institutions that could
help manage a peaceful transition: Libya had
no political parties, regional or local
governments, trade unions, independent
legislators or judges, independent or robust
civil society groups, or even prominent
religious or traditional organizations. To
their credit, the civil society groups that did
exist (or have since emerged) have been
quite active, as have the newly independent
media. Libyas 2013 Human Development
Index stood at 0.784, against 0.641 in 1980,
positioning the country in the 55th out of 187
countries. This is explained by the good
performance in terms of education and
health (at least from a merely quantitative
perspective) and the high GDP per capita
income generated from oil. Between 1980
and 2013, the mean years of schooling
increased by 5.3 years. Over the same
period, life expectancy increased by 11.1
years. Libya has one of the highest literacy
rates in the Arab region (90 percent of
people aged 15 and over in 2012, 96 percent
for males and 83.7 percent for women). In
2008, the net enrollment ratio in primary
education was 98.2 percent, while the infant

mortality rate was 17.6 deaths per 1000 live

births. The poverty rate was estimated at
11.8 percent in 2003 (the latest year for
which official data are available) and,
according to the 2009 MDG report, Libya was
well on track to achieve the MDGs by 2015
before the conflict erupted. The economy,
traditionally dependent on oil, has suffered
greatly from ongoing conflict and state
fragmentation.
The sabotage of port
terminals and production facilities has
caused significant fluctuations in oil exports,
and
hence
government
revenues,
throughout
the
transitional
period.
Smuggling economies have developed.
Economic growth is negative, as the fighting
has damaged infrastructure, and foreign
investing has stopped. Strong economic,
social, and security ties between Libya and
its neighbors Tunisia and Egypt mean that
instability in Benghazi and Tripoli are felt in
Tunis and Cairo as well. The violence and
economic instability in Libya has been
increasingly correlated. Indeed, one of the
key drivers of the fragmentation of the
Libyan transition was the issue of control
over oil revenues (See Figure 1). Political
groups in Libya are understandably hesitant
to allow their rivals to control these large
revenue streams. Even if all the factions
committed to the fair distribution and nonmilitary use of oil revenues, there are few
mechanisms to enforce such a deal. As a
result, macroeconomic health has worsened
as the fighting damaged infrastructure, and
business and consumer confidence declined.
The collapse in international oil prices since
June 2014 has cut the countrys foreign
exchange revenues and the outlook based

54
on protracted low prices is not encouraging
for the countrys economy.
Measures of Governance Have Declined:
The initial upheaval that swept Libya and
gave civil society a stronger voice which has
been
demanding
transparency
and
accountability from the government.
However, the post-Gaddafi governments
were unable to end armed conflict, stop the
deterioration of the security situation and
impose authority which resulted in the
worsening of the governance situation.
Indicators in the figure below show
governance performance between 2009 and
2013. All indicators recorded significant
drops except for voice and accountability
which showed improvement. Libyas
government performance is deficient (See
Figures 3-8, below). Compared to other
countries with an average GNI per capita
higher than $10,000, Libya scored lowest for
all governance categories by at least two
points for each of them. Transparency
Internationals Corruption Perception Index
(CPI), which ranks how corrupt a countrys
public sector is, also confirmed that Libya is
relatively more corrupt. In 2014, it ranked
Libya 166/175 with a score of just 18 (on a

scale 0-100, where 0 is very corrupt, 100 is

very clean). The two primary elements of
states i.e. 1) the monopoly on the use of
force; and 2) the collection of taxes; are
currently absent in the Libyan context. The
over-reliance
on
budget
revenues
proceeding from oil reserves was induced
due to the absence of wide taxation base. As
a result, the paramount task of any future
transition government is to build rather than
rebuild public administration, starting
perhaps from a clearly articulated vision and
policy that defines nature, mandates and
roles of the countrys governance system at
central and local levels.
Public Administration Lacks Transparency
and Accountability: In the Libyan public
administration apparatus, there is absence
of
transparency
and
accountability
mechanisms. Policy processes remain
confusing and arbitrary. In recent times
there has been an intense discussion
involving
government
agencies,
international organizations, and others
about the alternatives for improving the
current system. Summarizing some of the
primary issues that have been identified in
the debate as slowing down the

Figure 3: Oil Production and Violence in Libya (2010-2015)

consolidation of subnational local autonomy

and the decentralization process as follows:
1) the lack of an integrated vision on
decentralization in policy formulation; 2) the
influence of the central public authorities
representatives on the activity of local public
authorities; 3) the lack of clarity with respect
to the administration of services; 4) the lack
of transfer of some competences to a local
administrative authority; and, 5) the absence
of an equitable transfer system. Lack of
vertical and horizontal coordination is
paramount. As a result, the level of
interaction
between
deconcentrated
government offices and municipalities is
characterized by lack of clarity on roles and
responsibilities.
1

The World Bank and UN (ESCWA) finalized LIBYAS

SOCIO-ECONOMIC AND PFM CHALLENGES AN
OPPORTUNITIES by Vito Intini UN (ESCWA) and Michael
Schaeffer (WB); December 2015. The Joint World Bank
and UN (ESCWA) paper is intended to stimulate
discussion and debate as to the future prospects of Libya.
The paper aims to show how developmental and
humanitarian aspects can be closely related to the
institutional and governance ones, including public
finance issues.
1 Libya HDR data, HDR 2014
1 CIA World Fact book
1 The Millennium Development Goals In the Great
Socialist Peoples Libyan Arab Jamahiriya: Towards 2015:
Achievements and Potentials (2009)

Figure 4: Governance Indicators for Libya (Percentile Rank)

2000

200

1800

180

1600

160

1400

140

1200

120

1000

100

800

80

600

60

400

40

200

20

80

70

60

50

40

30

20

0
10

Sources: US Energy Information System; ACLED; WB and ESCWA staff

calculations.

2009
2010
2011
2012
2013

2009
2010
2011
2012
2013

2009
2010
2011
2012
2013

2009
2010
2011
2012
2013

2009
2010
2011
2012
2013

violent conflict incidents

2009
2010
2011
2012
2013

oil production: 1000 bpd

Control of Corruption
Government
Political Stability
Effectiveness
and Absence of Regulatory
Violence/Terrorism
Quality Rule of Law
Voice and Accountability

Source: WGI, World Bank. Note: WGI capture Governance

performance of Libya before, during and after the 2011 civil war.

55
1,000,000

1,000,000

GNI per Capita (PPP current $), 2014 (log scale)

Figure 8: GNI per Capita and Regulatory Quality Indicator

GNI per Capita (PPP current $), 2014 (log scale)

Figure 5: Relationship between GNI per Capital and Political Stability

Qat
UA

100,000

Lib

Leba Alg

10,000

Jo Mor

Eg

Mau

1,000

100
-3.00

-2.50

-2.00

-1.50

-1.00

-0.50

0.00

0.50

Qa
tar UA
E

100,000

1.00

10,000

Li
by
a

1,000

100
-3.00

1.50

Al
E
ge
g
ria
y
pt
Ma
urit
ania
-2.00

Leb
J
ano
o
n
r Mor
d occo
a
n

-1.00

0.00

1.00

2.00

3.00

Source: WGI, World Bank. Note: Estimate of governance (ranges from

approximately -2.5 (weak) to 2.5 (strong) governance performance)

Source: World Bank. Note: Estimate of governance (ranges from

approximately -2.5 (weak) to 2.5 (strong) governance performance).

Figure 6: GNI Per Capital and Government Effectiveness

Figure 9: GNI per Capita and Rule of Law Indicator

1,000,000

100,000

Qat
ar

Li
by
a

Al Leb
E ge an
g on
Mau ria
y
rita
p
nia
t

10,000

1,000

100
-3.00

-2.00

-1.00

GNI per Capita (PPP current $), 2014 (log scale)

GNI per Capita (PPP current $), 2014 (log scale

1,000,000

J
o
r
Mor
d
occ
a
o
n
0.00

1.00

2.00

Qat
UAar
E

100,000

UA
E

3.00

Li Le
Al
by Eba
g
a gno

10,000

yne
Mau
pri
ritat a
nia

1,000

100
-3.00

J
o
Mor
r
occ
d
o
a
n

-2.00

-1.00

0.00

1.00

2.00

3.00

Source: WGI, World Bank. Note: Estimate of governance (ranges from

approximately -2.5 (weak) to 2.5 (strong) governance performance)

Source: WGI, World Bank. Note: Estimate of governance (ranges from

approximately -2.5 (weak) to 2.5 (strong) governance performance)

Figure 7: GNI per Capita and Voice and Accountability Indicator

Figure 10: GNI per Capita and Control of Corruption Indicator

1,000,000

100,000

10,000

1,000

100
-2.00

GNI per Capita (PPP current $), 2014 (log scale)

GNI per Capita (PPP current $), 2014 (log scale

1,000,000

Qat
ar
UA
E
Al Le
Lib
g Jba
ya
Eg
erMono
yp
ia rn
Mau or
t
d
ritan oc
a
co
ia
n
-1.50

-1.00

-0.50

Qat
ar
UA
E

100,000

0.00

0.50

1.00

1.50

2.00

Source: WGI, World Bank. Note: Estimate of governance (ranges from

approximately -2.5 (weak) to 2.5 (strong) governance performance)

10,000

Li Le
by ba
a no

1,000

Maun
ritan
ia

100
-2.00

-1.50

-1.00

Al
E
g
g
er
y
ia
p
t

Jo
rd
Moa
rocn
co

-0.50

0.00

0.50

1.00

1.50

2.00

2.50

Source: WGI, World Bank. Note: Estimate of governance (ranges from

approximately -2.5 (weak) to 2.5 (strong) governance performance).

56

Mashreq

Jordan 56
Lebanon 64

Jordan
Poverty and Legal Problems:
Defining the Relationship
Paul Prettitore
Senior Public Sector Specialist
Introduction: Many persons will experience
some type of legal problem during their lives
stemming from civil, criminal or family
matters. Jordanian citizens are no exception
a household survey conducted in Jordan in
2011 found that roughly 20% of families had
a member experience a legal problem in the
previous five years. Legal problems will
range in severity from the minor to the
incredibly complicated. They may affect an
individual only, but are also likely to
somehow impact the family unit. There is a
relationship between legal problems and
poverty. Legal problems, left unaddressed,
can cause an economic or social shock that
pushes vulnerable persons into poverty. For
example,
pre-trial
detention
and
imprisonment, wrongful termination of
employment, financial debt or denial of
social safety net benefits can cause persons
vulnerable
persons
to
fall
into
poverty. Unresolved legal problems can also
prevent an individual in poverty from
escaping it. Data at least suggests that in
some contexts legal problems are likely to
multiply once an individual falls into poverty,
complicating any attempts at poverty
alleviation. Understanding this relationship is
important for targeting public sector services
to address legal problems. These services
are important on a number of levels. From
an equity standpoint, the poor and near-poor
need equal access to services that
subsequently enhance opportunities to
exercise their rights. Taking the equity
argument a step beyond equal access to
existing services, governments should

develop special services that target the

specific needs of the poor in resolving legal
problems. These services also have value as
social protection and poverty alleviation
measures. They can protect the vulnerable
from falling into poverty because of
economic shocks caused by legal
problems. For example, an employee could
be reinstated in a job from which they were
wrongfully terminated before loss of salary
has detrimental effect. They can also resolve
legal problems that are perpetuating poverty
for those already in it. Ensuring financial
transfers related to wrongfully denied social
safety net benefits or nonpayment of
alimony and child support payments to poor
female-headed households. Defining the
Relationship: Defining the relationship
between legal problems and poverty is not a

simple task. The first step is identifying the

types of legal problems that are most likely
to affect the poor and the near poor, and
comparing
this
with
wealthier
citizens. There are two dimensions. The first
is assessing the general frequency that
specific problems affect the poor. The other
dimension is identifying legal problems with
considerable gaps in the extent to which they
effect the poor versus the non-poor, even if
the overall frequency of such problems is
relatively smaller. This first step is relatively
more straightforward. Household surveys
are increasingly being used to identify such
legal problems. The downside of household
surveys are that they are expensive and rely
to an extent on individual respondents
understanding of what constitutes a legal
problem. Another source of data is case

57
information from legal aid service providers,
but this source does not allow for
comparisons with the non-poor. Useful data
can also be found from courts and
administrative complaints mechanisms if
there is information on income levels, or a
way to identify it, of the complainants. The
second step is to identify within this group
the types of cases that are most likely to have
some kind of poverty impact on the poor and
near-poor. This is considerably more
complicated. And data sources are much
more limited. Identifying relevant legal
problems: Defining the relationship between
legal problems and poverty in Jordan is
complicated by the lack of comprehensive
data. There is more evidence available for
taking the first step identifying the types of
legal problems most likely to affect the
poor. A 2011 household survey in Jordan
(Statistical Survey on the Volume of Demand
of Legal Aid Services - Legal Aid Survey) is the
most comprehensive attempt to collect
relevant data. Among its general findings
were the following:

The near poor were most likely to face

legal problems, followed by the
poor. Together these two expenditure
quartiles accounted for 68% of reported
legal problems.
The poor and near poor were less likely
to have access to courts or lawyers to
help address legal problems.
Awareness of special services, namely
legal aid services, targeted to assist the
poor resolve legal problems is almost
non-existent
(roughly
2%
of
respondents).
The types of legal problems reported by
respondents varied by expenditure
quartiles.

The last point above can be elaborated as

follows. Families in the lower two
expenditure quartiles, which cover roughly
the poor and near poor, were more likely to
experience legal problems related to all
types of general legal problems family law,
civil law and criminal law. But the gap is
widest in relation to family law problems,
where they account for nearly 80% of
reported legal problems, versus 68% for civil
law and 65% for criminal law. There is
additional variation within these broad
categories of legal problems, furthering
identification of the most relevant legal
problems. (Figure 1) Regular household
surveys can also be useful sources of
information. For example, the Population
and Family Health Survey administered by
the Department of Statistics on a regular
basis includes questions on domestic
violence. It has shown that women in the
lowest wealth quintile were the most likely
to report having been a victim of physical,
sexual and emotional violence. Data from
civil society organizations (CSOs) providing

services to poor persons is also useful. In

interpreting such data it needs to be
considered that CSOs often serve particular
constituencies. For example, in some
context women may be more likely to access
CSOs for assistance. The Justice Center for
Legal Aid provides legal aid services
(awareness, information, counseling and
legal representation) to the poor and nearpoor. Roughly 70% of their counseling and
legal representation services are related to
family law problems, 20% for civil law
problems and around 10 for criminal
problems. The most common type of
problem for which services are provided is
alimony, encompassing spousal alimony and
child support, which accounts for nearly 25%
of cases, followed by separation/divorce
(15%), theft (15%), child custody (4%) and
landlord-tenant (4%). Of beneficiaries of
Tkiyet Um Ali (TUA), a civil society
organization providing food assistance to the
most poor, nearly 18% have reported some
type of legal problem. The most common
type of problems, in order of decreasing
frequency, are: divorce; alimony and child
support; criminal matters; domestic
violence; and family estrangement. Linking
legal problems and poverty: The data already
available helps us identify good staring
points for assessing links between legal

upper middle income countries. Progress on

reducing welfare inequality, measured by the
Gini coefficient, was more erratic during the
same period. One of the more unique
aspects of Jordans poverty profile is the
relatively high levels of transient and
seasonal poverty. Nearly 19% of Jordanians,
though not officially considered poor,
experience poverty in at least one quarter of
the year, making them transient poor. This
transient poverty is also experienced by
some lower-middle income families, which
we know from the Legal Aid Survey are some
of the most likely to experience legal
problems. Combining the poor and transient
poor means that 33% of Jordanians
experience poverty during the course of a
year. It is also important to consider the
extent to which social and economic
characteristics affect legal problems. For
instance, the low labor force participation of
women makes them more vulnerable to
poverty in relation to legal problems around
alimony,
child
support
and
inheritance. Access to public services is
highly dependent on location, with areas of
higher poverty usually underserved. So
there are likely to be considerable problems
linked with access to basic services. The
majority of poor in Jordan are working poor,
and likely susceptible to legal problems

problems and poverty. We know what types

of problems the poor and near-poor are most
likely to experience, and we know what types
of problems are likely to impact the poor and
near poor versus others. It is then important
to consider the poverty characteristics of
Jordan. The most recent poverty estimates,
from 2010, put poverty at 14% of the
population, which is relatively low by
regional and international standards. Shared
prosperity, measured by consumption
growth of the bottom 40% of the population,
showed positive trends between 2006 and
2010, though Jordans performance on this
measure is modest in comparison to other

related to labor abuses, such as unpaid

wages, non-payment of benefits and illegal
termination. There are areas where
additional data would be helpful. The Legal
Aid Survey suggests that the poor and nearpoor are more likely to experience multiple
legal problems, which is likely to exacerbate
vulnerability and poverty. What is less
understood is how certain legal problems
trigger additional problems, for example
wrongful termination from employment
triggering debt and housing problems. This is
particularly important in the context of
assessing whether legal problems are in any
way linked with transient poverty. Also in

58
need of further understanding is the way in
which legal problems cluster for the
poor. Better understanding of both
triggering and clustering of legal problems
will come from more in-depth surveys in the
near future of the beneficiaries of JCLA and
TUA.

Conclusion: Understanding the relationship

between legal problems and poverty is
important for a number of reasons. Legal
problems
cause
and
exacerbate
poverty. They can also undermine some
poverty alleviation mechanisms. Legal
problem cause not only direct economic
costs, but undermine other aspects of

Figure 1 - Legal problems, by expenditure quartiles

120
100
80
60
40
20
0

development such as exercise of civil and

political
rights,
well-being
and
agency. Greater knowledge of this
relationship will help policy-makers develop
the appropriate tools to address these
problems.

Figure 2 - Violence against women

(since age of 15), by wealth quintile
50

Percentage

40
30
20
10
0
Lowest
Upper two expenditure quartiles

Second
2007

Lower two expenditure quartiles

Source: Statistical Survey on the Volume of Demand of Legal Aid

Services

Middle

Fourth

Highest

2012

Source: Jordan Population and Family Health Survey

Jordan
Developing an Efficient
Public Investment Management System
Emmanuel Cuvillier
Salam Almaroof 4
Introduction
The primary objectives of Jordan 2025: A
National Vision and Strategy are to address
the challenges of increasing living costs,
poverty, and unemployment and ensure
enhanced prosperity over the next 10 years.
Vision 2025 envisions Jordan as an economic
gateway to regional markets that takes
advantage of free trade agreements signed
with several countries. The most significant
challenge that Jordan is confronting is
achieving a qualitative improvement in its
public investments. In order to achieve
accelerated, export-led growth, Jordan
needs to improve its primary infrastructure
and the efficiency and effectiveness of
public investments.
There is evidence of inefficiency in public
investment management (PIM) in terms of:
(i) a poor selection of projects that do not
transform into productive assets; (ii)
4 This project was supervised by Emmanuel Cuvillier,
Senior Public Sector and Governance Specialist (Task
Team Leader) ecuvillier@worldbank.org, and by Salam

unrealistic schedules in ex-ante appraisal

and consequent delays in completion; (iii)
chronic under-execution of capital projects;
(iv) cost over-runs; and (v) neglect in
operating and maintaining newly-created
assets.
Based on the governments interest in PIM
analytical work and related technical
assistance from the World Bank (see Figure
1), the Ministry of Planning and
International
Cooperation
(MoPIC)
developed a three-step roadmap in line with
the content of the International Monetary
Fund
(IMF)
Stand-By
Agreement.
Specifically, it focuses on: (i) designing a PIM
framework that includes public-private
partnership (PPP) procedures; (ii) a detailed
assessment of the current PIM system; and
(iii) preparation of a three-year PIM action
plan.
The PIM Framework
Since April 8, 2015, a formal system of public
investment/PPP project appraisal had
provided the basis and conditions for the
Almaroof, Public Sector Analyst salmaroof@worldbank.org,
World Bank Governance Global Practice (GGODR). This

Government of Jordan (GoJ) to move

forward only those initiatives that are
demonstrably the most economically
attractive. Such a system allows for the
transformation of investment ideas into
public investment/PPP projects, and, then
into public investment/PPP decisions.
This system is designed to put projects
through the Project Life Cycle (Figure 2),
starting with identification of a project
idea/concept and ending with the final
handover of operations, and finally to the
ex-post evaluation stage:
As seen in the figure below, the first phase
of the project cycle is the generation of
project ideas. These should be informed by
priorities set out in the Vision 2025 to ensure
that they contribute to national objectives.

Project profiles require a rigorous

identification process, that is, the
identification of economic needs and
investment priorities for the public sector.

The Pre-Feasibility Study should

be done in nine required modules/studies.
MENA Knowledge and Learning Quick Note was cleared by
Hisham Waly, Practice Manager (GGODR).

59
The first five modules are the project
building blocks (that is, demand,
technical/engineering
inputs,
human
resources and administrative support,
environmental, and institutional/legal
studies). The last four are the analytic
modules, that is, financial appraisal,
economic/social
appraisal,
distributional/basic needs appraisal, the
finally the risk analysis modules.
The Feasibility Study is normally the most
expensive and it is also the last opportunity
to
stop
a
bad
project
before
implementation, that is, it is the last chance
for the relevant PIM government agency to
appraise project quality.
The final investment decision may be to
provide funding, either through the
traditional fiscal budget, PPPs, or through
international cooperation (grants and/or
loans), and to proceed to the execution of
the project. In the final investment decision,
new actors5 may become involved with the
project during this stage.
The Project Operation Phase refers to when
the project is able to produce its final and
fully operational deliverable (for example, a
new plant, product, system, and so on). The

Figure 1: PIM Support to Jordan (WBG)

5 Project managers, hedge funds, unit trusts,

pension funds, and so on.

management processes now shift toward

the effective and efficient delivery of the
products and outputs from the new services.
The Project Execution Phase is when the
project execution plan designed in the prior
phases of the project is put into action.
The purpose of project execution is to
deliver the expected project results, that is,
deliverables and outputs.
Ex-post project appraisal involves
assessing the actual operational results of a
project and comparing them to planned
forecasts. The focus is on establishing
whether the project represents value for
money, as well as on learning lessons for
future similar projects.
The Treatment of Public-Private
Partnerships: In the lower part of Figure 2,
there is a special procedure for projects that
could potentially become PPPs. Figure 3 is
much more specific in terms of the special
process for PPPs. The Integrated Bank of
Projects (IBP-Data Base) is the common
backbone for all kinds of project files,
including those that later become PPPs.
PIM Assessment (2015)

The Government of Jordan, as all other

governments, faces the challenge of
allocating scarce resources (natural, human
and capital) toward obtaining maximum
social and economic benefits. The
development of an integrated budget
execution system will provide the
government with a solid base for
improvements that should complement
budget planning and the subsequent
investment process. Improvements should
contribute to the integration of all line
ministries and independent budget agencies
in sectoral strategic plans as well as
procurement processes, budget approvals
and execution of public infrastructure
projects, thereby establishing a solid
foundation for inter-sectoral coordination
and budget integration in line with Jordans
priorities.
The PFM legal framework is based on a
combination of constitutional, legislative
and regulatory provisions that often differ in
purpose and are not well linked. Moreover,
recent budget preparation reforms are not
adequately specified in the legislation which
does not appropriately describe the unique
features of the preparation cycle of
investment projects.

60
Figure 2: PIM Framework (PIP)

61
The main recommendations of the 2015
Jordan PIM Assessment were as follows:
Legal framework: A new public financial
management (PFM) law is needed in Jordan.
Setting up of a PIM central unit: The
establishment of a PIM central unit will help
ensure that all investment projects follow
the pre-investment project cycle (that is,
profile, pre-feasibility, feasibility study) and
establish the three filters or stage gates6.
The unit will be a part of all three stage-gate
committees and provide the seal of
approval only if projects successfully pass
Stage Gate 3. To manage the Integrated
Bank of Projects (the project database), it
will provide full access to, as well as
restricted access to line ministries and
independent budget units.
Strategic Planning: Strategic planning will be
necessary to: i) to complete all the
deliverables of the strategic planning
exercise; (ii) put in place a system of
incentives with rewards and penalties, tying
the key performance indicators (KPIs) with a
performance budgeting exercise; (iii)
gradually replace all project ideas/proposals
in the Executive Development Plan (20162018) with ready-to-go projects (that is, with
the seal of approval); and (iv) include a
mandatory log-frame matrix in all
investment initiatives.
Project appraisal guidance: Project appraisal
guidance will: (i) gradually prepare the
following set of project documentation:
general project evaluation manual;
guidelines on policies and procedures;
guidelines
per
life-cycle
phase;
methodologies per project type; check lists
for the end of the phase or stage gate
reviews; (ii) impose the obligatory use of a
single, consistent database of unitary
market prices for the valuation of project
inputs and outputs; (iii) commission the
calculation of a set of key national
parameters and shadow prices and impose
their mandatory use; and (iv) include project
templates and case studies in order to
facilitate the matching training process.
Information
integration:
Information
integration will: (i) establish a proprietary
Integrated Bank of Projects (IBP) for Jordan,
or buy an existing IBP and adapt it to the
governments organizational structures and
PIM processes and conditions; (ii) focus on
the first subsystem (that is, the Technical
Economical Analysis Sub-system) because it
deals with the pre-investment phase of
projects; and (iii) a new, complex and
comprehensive information technology (IT)
tool, such as the proposed IBP, must be
adapted to the governments conditions.
Likewise, the current organizational
structure and PIM processes of the Ministry

Stage Gate 1 for Project Profiles; Stage Gate for PreFeasibility Studies; and Stage Gate 3 for Feasibility
Studies.

of Finance, MoPIC and line ministries must

be adapted to the new IBP.
Capacity building: Capacity building will
involve: (i) the rolling out of the PIM capacity
building strategy to create a critical mass of
public officials who can be experts in project
design/formulation, appraisal, and selection
in order for this system to function at the
national, governorate, and municipal levels;
(ii) priority should be given to public officials
training on the Log Frame Approach and
project key performance indicators (KPIs) in
general, and to preparation of pre-feasibility
and feasibility studies by line ministries in
particular; and (iii) the training institute of
the Central Bank of Jordan should prepare
annual courses to train public officials in
different topics of interest in public
investment, including the use of the new
IBP.
Establishing management functions inside
the PIMS: Specifically, this will involve: (i) the
integration of
all line ministries,
independent
budget
agencies
and
governorates in sector strategic planning, as
well as procurement processes (ii) ensuring
that all public investments progress through
a strengthened PIMS that ensures
established quality controls both in terms
of technical effectiveness and economic
efficiency; (iii) ensuring that projects remain
within their budgets and have confirmed
sources of financing; and (iv) keeping
strategic projects on track, while making
room for immediate priorities (security, and
refugees in particular).
Defining project selection criteria for the
medium and long term: This involves
defining and formalizing project selection
criteria for public investment prioritization
for the period 20162018. In the medium
term, the government should improve the
process of project prioritization, and define
and formalize a project selection criteria for
public investment prioritization for 2019
and subsequent periods. In the long term,
the government should improve the process
of project prioritization.
Improving public investment in terms of
project management: Specifically, this will
involve: (i) creating PIMS units for project
management (execution, monitoring and
follow-up) in line ministries. These units will
be a group within a government agency that
defines and maintains project management
standards for several related project (ii)
developing guidelines, methodologies,
templates
and
tools
for
project
management (execution, monitoring and
follow-up).
Any
project
execution
methodology should be based on a global
project management standard; (iii)
implementing training programs in project

management (execution, monitoring and

follow up). A professional project
management training program should
provide a qualification that reflects the role
of individuals who possess a sound
theoretical knowledge base and who can
use a range of specialized, technical or
managerial competencies to plan, carry out
and evaluate their own work and/or the
work of a project team; (iv) improving the
ex-post evaluation process in order to build
a framework for ex-post evaluation; (v)
strengthening and modernizing the public
procurement system. This action will
support
the
high-priority
public
procurement reform activities in Jordan that
are aimed at modernizing the public
procurement system and strengthening its
management through modernizing the legal
framework, the issuance of standard bidding
documents, templates, and procurement
plans, as well as the promotion of the
professionalism of the procurement
workforce.
PIM Action Plan (2016-2018)
This PIMS for Jordan was developed as a
comprehensive set of concepts, techniques,
standards, and methodological procedures,
and as a uniform information and document
depository and management system for the
formulation, preparation and evaluation of
projects. In accordance with international
best practices, it is proposed that the
following activities be developed in Jordan
in order to improve the current public
investment procedures and to install a
complete PIMS in the country (Figure 4).
These actions and correlated activities are
proposed in a calendar for short- and
medium-term implementation (2016
2018).
These actions are intended to strengthen
the Jordan PIMS to ensure an efficient
investment process, to maximize the
expected return on investment projects, and
to ensure their contribution to increasing
national welfare.
[1] This project was supervised by Emmanuel
Cuvillier, Senior Public Sector and Governance
Specialist
(Task
Team
Leader)
ecuvillier@worldbank.org, and by Salam
Almaroof,
Public
Sector
Analyst
salmaroof@worldbank.org,
World
Bank
Governance Global Practice (GGODR). This MENA
Knowledge and Learning Quick Note was cleared
by Hisham Waly, Practice Manager (GGODR).
[2] Project managers, Hedge Funds, Unit Trusts,
Pension Funds, etc.
[3] Stage Gate No1 for Project Profiles; Stage Gate
No2 for Pre-Feasability Studies; Stage Gate No3
for Feasibility Studies.

62
Figure 3: PIM Framework (PPP)

Figure 4: 2016-2018 PIM Action Plan

Jordan
Report from the Field:
Working To End Violence against Women

63

Paul Prettitore
Senior Public Sector Specialist
Grasping the full extent of violence against
women is difficult everywhere. In the Middle
East, it can be both difficult and dangerous
for women to report abuse given social
attitudes toward the roles of women and
men within the family. In Jordan, the
violence against girls and women embodies
the problem.
The Jordanian governments Population and
Family Health Survey captures only a portion
of the scale of violence against women.
Social norms are at play; roughly 70 percent
of Jordanian women think there are
circumstances that justify a husband beating
his wife.
Over one-third (34 percent) of Jordanian
women report that they have experienced
some form of physical violence since the age
of 15. One in three Jordanian women
experienced some form of emotional,
physical, and/or sexual violence from their
spouse, and almost 1 in 10 experience sexual
violence at least once in their lifetime.
One of the major concerns resulting from the
survey is that almost half (47 percent) of the
women reporting violence did not seek any
type of help, with less than 5 percent taking
steps to address sexual violence. Very few
women seek help from medical providers,
police,
lawyers
or
social
service
organizations.
Over the past four years, the World Bank
Group has been collaborating with the
Justice Center for Legal Aid (JCLA), a
Jordanian civil society organization, to pilot
legal aid services for poor Jordanians as well
as Iraqi, Palestinian and Syrian refugees.
As is often the case, poverty status is a strong
indicator of the likelihood of violence in
Jordan. Poorer women were more likely to
report all types of violence, and higher
frequency of such violence. They are also
more likely to believe such violence is
justified. The legal aid program provides
awareness /information, counseling and
legal representation by a lawyer to aid the
poor in addressing legal problems. The
majority of JCLA beneficiaries just over 70
percent are women. One of the justice

gaps identified by JCLA is in providing

effective legal services to female victims of
violence.
Jordan adopted legislation to protect victims
of domestic violence in 2008, for the first
time giving victims the access to protection
orders one of the most effective tools in
addressing violence. Victims can also receive
direct compensation.
It also provided
confidential proceedings and procedures to
detain alleged abusers.
A specialized institution, the Family
Protection Department of the Ministry of
Interior, was established to implement the
reform, providing access to multiple
services, including complaints/investigation,
medical care and social counseling.

around awareness and information for

victims.
This focus is now about to expand. With the
assistance of the World Bank Group, JCLA is
launching an initiative to provide more
comprehensive services to female victims of
violence. The plans include establishing a
referral system in the Family Protection
Department and placing a legal aid lawyer at
each of the Departments in-take centers.
What do we hope to achieve? There are
several opportunities.

Yet the law left a number of gaps in place. It

applies only to perpetrators living with the
victims. As such, ex-husbands, boyfriends
and brothers may not be covered, and the
survey shows they are often responsible
committing the abuse.

The overarching goal is to ensure that poor

women can access services and achieve
some level of justice to address the violence
they suffer. More specifically, the referral
system should aid in providing victims the
legal services they need to initiate and
navigate criminal proceedings, including
obtaining and enforcing protection orders.
Victims will also have assistance in
addressing legal problems commonly linked
to domestic violence, such as divorce, child
custody, child support and alimony.

It also leaves in place a heavy focus on

reconciliation, to the possible detriment of
protecting the victims. A lack of shelters for
victims, along with the inability to link
requests for child custody and child support
with protection orders, may prevent many
women from seeking help. To date, JCLAs
assistance has been focused primarily

As a lawyer, I volunteer my time

representing poor persons, including women
seeking protection orders, at the Superior
Court in Washington, D.C. I understand the
importance of providing legal assistance to
female victims of domestic violence, and am
encouraged to see such an initiative
launched in Jordan.

Lebanon
The Lebanese Association of Certified Public
Accountants - LACPA

64

An Active Association with a Clear Vision

The LACPA is the sole professional body

governing the public accounting profession
in Lebanon. It was formed in 1994 under the
decree number 364/94 issued on August 1st
1994. Qualified persons who wish to practice
the audit profession in Lebanon should be
licensed from the LACPA and meeting its
professional requirements. Although it is a
relatively young association with limited
resources, it has paved its way into becoming
globally recognized by the professional and
financial community as well as an active
member in the International Federation of
Accountants (IFAC). In May 2014, a new
council, having a professional and ambitious
program with a well-defined roadmap and
vision for the advancement of the
association was elected. This councils
president, Elie Abboud, is an MBA and an
American CPA holder with an institutional
vision, leadership skills and an active
personality. The program of the council
varied from (i) monitoring the professional
development of its members and keeping
pace with the international professional
requirements to (ii) creating partnership
with regulatory authorities and (iii) building
an effective presence within the regional
and international professional accountancy
organizations (PAO).
(i)
Monitoring
the
professional
development of its members and keeping
pace with the international professional
requirements: In 2010, the LACPA adopted
the Quality Control and Peer Review
Manuals: two manuals issued by the
association to help monitor the CPA firms
practice (practice monitoring). The goal of
practice monitoring, and the program itself,
is to promote quality in the accounting and
auditing services provided by the LACPA
members and firms, thus serving the public

interest and enhancing the significance of

the LACPA membership. This program
resulted in several subsequent related
events and programs. Therefore, during
2015, the LACPA developed the Audit File
Manual and the related working papers to
be used as guidance for small, medium and
large practice firms as well as sole
practitioners and before the application of
the quality control program. Once works on
the manual were finalized, the LACPA
worked on securing a training program for
around 700 of its members all over the
Lebanese territory. In parallel, the Quality
Control Supervisory Commission, an
independent commission in charge of the
supervision and implementation of the
Quality Control and Peer Review Program,
was formed. In November 2015, the LACPA
organized a training workshop for 70 peer
reviewers from Lebanon, Jordan and Egypt
conducted by trainers from the American
Association of Certified Public Accountants
AICPA. Hence, the association took the
initiative to widen the peer review vision in
the region. Moreover, the LACPA started
opening several communication channels

Financial Reporting, Audit and Assurance,

and Managerial Accounting certificates.
Additionally, in this context, and in order to
maintain excellence and broaden service
offerings of accounting professionals, the
LACPA signed a cooperation protocol with
the American Association of Certified Public
Accountants (AICPA) to share information,
training materials and expertise with the
AICPA. This cooperation intended to offer
the LACPA members a wide variety of
continuing
professional
education
publications, programs and certificates
developed by the AICPA as well as to share
different perspectives from articles of the
AICPA Journal of Accountancy to be
published in LACPAs publications.

with leading international PAOs whereby it

signed cooperation protocols with the
Association
of
Chartered
Certified
Accountants (ACCA) in England and the
Association of Accountants and the Financial
Professionals in Business (IMA). As per those
protocols, the LACPA members and trainees
can now benefit from preferential rates on
the certificates offered
by these
associations: Diploma in International

took the initiative in organizing, with the

cooperation of the Special Investigation
Commission and the Central Bank in
Lebanon, the Anti-Money Laundering
Forum which was addressed to the
regulatory authorities, the business
community and the external auditors. The
forum closed with recommendations
regarding (i) the pursuit of good governance
and the application of global governance and

ii) Creating partnership with regulatory

authorities: Since the audit profession is
closely related to various professional bodies
in Lebanon, in the public and private sectors,
the LACPA worked on strengthening the
relationship with the local government and
various regulatory bodies. This relationship
was evidenced by their active participation in
all LACPA activities. Furthermore, the LACPA

65
regulations associated to fight money
laundering and terrorism financing and (ii) to
speed up the passage of laws relating to
amendment of the anti-money laundering
and terrorism financing and (iii) the moneytransfer law and (iv) the cross-border
exchange of tax information. Moreover, the
LACPA organized jointly with the Ministry of
Finance the Specialized Technical Congress
on
The Application of the International Public
Sector Accounting Standards (IPSAS) in
collaboration with the World Bank regarding
the application of the International Public
Sector Accounting Standards (IPSAS). The
three-day congress included several
workshops which addressed the definitions
and practical applications
of the
International Public Sector Accounting
Standards (IPSAS) and was attended by
about 150 participants including Certified
Accountants, employees from the Ministry
of Finance and the Public Sector. These
professional activities confirmed the
credibility of the LACPA and its close
cooperation with the governmental and
official supervisory bodies where the
association used its international network to
serve Lebanon. Furthermore, the LACPA had

an active participation in the discussion of

the draft amendment to the Lebanese Code
of Commerce. During these discussions, it
was realized that some articles lack a clear
vision. Therefore, in order to create a new
dynamism in the legislation and a real
partnership between the regulators and
private sectors.
The LACPA signed a Memorandum of
Understanding with the Beirut Bar
Association where both associations
contribute to the proposal and the study of
laws, decrees, decisions and instructions of
ministerial projects in the fields of public
finance, taxation, trade and economy and
financial markets, each within its
competencies.
(iii) LACPA effective presence on the
regional and international level: As
mentioned earlier, the LACPA took the
initiative to spread the peer review vision
regionally and discussed issues related to the
regional
challenges
through
active
participation with all regional events. On the
other hand, the presence of the LACPA
activated and strengthened the cooperation
with all international regulatory as well as
professional bodies: from active presence in

the International Federation of Accountants

(IFAC) meetings, to the professional practice
and the commitment to the statements of
membership obligations (SMO) in IFAC.
Moreover, and in the same context, it is
worth to mention that the LACPA was
ranked first in the MENA region and fifth in
the top ten countries worldwide in
responding to the IFAC Global SMP Survey in
2014, a survey that the IFAC conducts on
annual basis with an objective to understand
the business environment facing small and
medium practitioners (SMPs) and their SME
clients.
Moreover, the LACPA was an active
participant with other international
professional organizations as for example by
providing work papers in the Public Interest
Oversight Board (PIOB) forum in 2015 and in
the ISAR-UNCTAD group of experts meetings
in Geneva in 2014. In an obvious turnaround
and boost in its internal strategy and vision,
the LACPA was able to prosper and stand out
as a pioneer in an otherwise challenging time
and economic environment. Meeting the
professional and developmental goals of its
members has always been its major
motivational factor. The LACPA was able to
become the beam of light projecting into a
brighter future for the profession.

In The News
World Bank Group Launches New Strategy for the
Middle East and North Africa (MENA) Region
Given the ongoing fragility and conflict in the region, the World Bank
Group has prepared a new regional strategy for the Middle East and
North Africa. Instead of taking conflict and violence as given and
working around it, this new strategy, entitled "Economic and Social
Inclusion for Peace and Stability in the Middle East and North Africa:
A New Strategy for the World Bank Group" puts the goal of
promoting peace and social stability in the MENA region at its center.
The strategy is built around four pillars (the 4 Rs) that respond to
both the underlying causes of conflict and violence, as well as the
urgent development interventions that will help foster inclusion and
shared prosperity. The four pillars of the strategy are as follows:
Renewing the social contract to generate a new development
model that is built on greater citizen trust; more effective protection
of the poor and vulnerable; inclusive and accountable service
delivery; and a stronger private sector that can create jobs and
opportunities for MENAs youth;
Regional cooperation particularly around regional public goods and
sectors such as education, water, and energy so as to foster greater
trust and collaboration across MENA countries;
Resilience - to refugee and migration shocks by promoting the
welfare of refugees, internally-displaced persons (IDPs), and host

communities by focusing on building trust and building their assets;

and
Reconstruction and recovery through a dynamic approach that
brings in external partners, leverages large-scale financing, and moves
beyond the humanitarian response to longer-term development
wherever and whenever conflict subsides.
In implementing this strategy, the World Bank Group will rely heavily
on both deepening and expanding partnerships with national,
regional, and global actors, especially the Islamic Development Bank.
With respect to financing, the World Bank Group will continue to
expand its investment in the region. In addition to our own funds, the
core focus will be on leveraging and mobilizing global resources to
meet the extraordinary financing needs of the region through
innovative mechanisms. Finally, our knowledge work (including our
growing Reimbursable Advisory Services [RAS] program) will be of
prime importance in informing and mobilizing the support for the
strategy and will lead (rather than follow) our lending.
International Bank for Reconstruction and Development (IBRD)/
International Development Association (IDA) lending for the MENA
region increased from US$2.8 billion in fiscal year (FY) 2014, to US$3.5
billion in FY15 and is expected to reach US$3.7 billion in FY 2016.

World Bank Financed Operations in MENA

66

World Bank Provides a US$1.2 billion Loan to Support

Iraq amid Challenging Economic Situation
A US$1.2 billion World Bank loan will support Iraq in strengthening
fiscal stabilization and improving efficiency in the energy sector to
help counter the effects of the drop in oil prices, as well as rising
security costs. The World Bank Groups Board of Directors
acknowledged the government of Iraqs engagement in a rigorous
reform program and approved the Emergency Fiscal Stabilization,
Energy Sustainability and State-Owned Enterprise Transparency
Development Policy Financing. The operation is aligned with the
governments recovery blueprint for 2015-2018, that commits to
reforms to achieve inclusive growth, efficient service delivery and
improved social protection.
The World Banks support for the current reform momentum in Iraq
is very important at this critical time as the country grapples with longstanding challenges in the financial sector, public financial
management and energy efficiency and security, said Ferid Belhaj,
World Bank Director for the Mashreq Region.
The proposed operation will focus on reforms in three areas.
Reforming the public wage system by reducing the highest salaries
and increasing the lowest ones will improve expenditure allocation.
There will also be reforms in public investment and debt
management, and the pension scheme. Reducing gas flaring,
expanding gas-to-power generation and reducing electricity subsidies

will help support more sustainable energy supply. A third area of

reform focuses on addressing the lack of transparency among
financial and non-financial, state-owned enterprises.
The support to Iraq is very much in line with the World Banks strategy
for the Middle East and North Africa, which was launched in October
2015. This strategy builds on four pillars: (i) renewing the social
contract in fragile states in the region; (ii) regional cooperation; (iii)
resilience to refugee shocks; and (iv) reconstruction and recovery
where needed. In order to achieve these goals, calculated risk taking
in countries such as Iraq is required.
The Development Policy Framework is a critical part of the Banks
efforts to help address fragility and increase stability in Iraq and the
broader Middle East and North Africa region, said Eric Le Borgne, the
World Banks Lead Economist for Iraq.
With the US$1.2 billion Development Policy Financing, the World
Banks present engagement in Iraq rises to nearly US$2 billion,
including US$355 million for the Transport Corridors Projects to
improve transport connectivity and road safety, and US$350 million
for the Emergency Operation for Development, which supports the
reconstruction and rehabilitation of municipalities that have suffered
recent damages from the ongoing conflict.

World Bank Signs US$1 Billion in Development

Finance to Support Economic Reforms in Egypt
Egypt and the World Bank signed a US$1 billion development policy
finance operation to support the governments economic reforms
program across key economic areas. Recently, the World Bank
Groups Board of Executive Directors also approved the First Fiscal
Consolidation,
Sustainable
Energy,
and
Competitiveness
Programmatic Development Policy Financing (DPF). This is the first in
a programmatic series of three annual development finance loans to
Egypt.

program focuses on three pillars: (i) fiscal consolidation through

rationalization of tax regimes, moderation of wages, and stronger
debt management; (ii) ensuring sustainable energy supply through
reforming energy subsidies, promoting clean energy, and liberalizing
the energy market to allow for greater private sector engagement;
and (iii) enhancing the business environment through a package of
reforms designed to cut red tape, reduce barriers to entry, and
promote better competition policies.

This operation supports key economic policies essential for building

capacity of domestic institutions, promoting investments and creating
jobs in Egypt said Asad Alam, World Bank Country Director for Egypt,
Yemen and Djibouti. This program is central to our new Country
Partnership Framework that scales up World Bank Group support to
Egypt to about US$ 8 billion over 2015-19 he added.

The policies supported by program would help unlock the private

sector investment in key sectors, that are integral for job creation,
said Ashish Khanna and Ahmed Kouchouk, co-Task Leaders of the
program from the World Bank. Among other things, the DPF program
seeks to unlock Egypts energy supply potential by reforms to attract
investments into the gas and electricity sectors, support for the
regular publishing of public debt management strategy, and
enhancement of the competition and enabling environment for
businesses, they added.

The programmatic approach would support reform implementation,

over three years in order to achieve sustainable reform outcomes.
The second and third DPFs would be prepared sequentially, subject to
implementation of the multi-year reform program, particularly with
respect to an adequate macroeconomic framework. The DPF
program is based on collaboration with development partners,
especially the African Development Bank which is providing parallel
financing. The program was coordinated by an inter-ministerial
working group comprising 6 ministries of the government led by the
Ministry of International Cooperation, reflecting close collaboration
and team work within different governmental departments. The

The current portfolio of the World Bank in Egypt includes 28 projects

for a total commitment of US$6.47 billion. The World Bank finances
projects for faster delivery of benefits to the people of Egypt in key
sectors, including social safety nets, energy, transport, water and
sanitation, agriculture and irrigation, housing, health, as well as
supporting employment-intensive projects and financing for micro
and small enterprises.

67

Offering the World a Public Good:

A Meeting of Parliamentarians and Donor Agencies regarding
Neighboring Country Support for Syrian Refugees
Fueled by intractable and violent conflicts in
Iraq, Libya, and Syria, the refugee crisis has
made headlines for surging to an
unprecedented scale in neighboring Middle
East and North African (MENA) countries
and, more recently, for reaching the
European shores of the Mediterranean Sea.
More than 4 million Syrian refugees are
registered with the United Nations, making it
the largest refugee crisis the world has
witnessed since World War II. It is against
this backdrop that the External and
Corporate Relations' Global Engagement
team and the Parliamentary Network (PN)
on the World Bank and International
Monetary Fund co-hosted a briefing via
videoconference to facilitate discussion
between parliamentarians from both sides
of the Mediterranean committed to
addressing this most pressing development
issue. The PN is an independent, nongovernmental organization that provides a
global platform whereby Members of
Parliament (MPs) advocate for increased
accountability and transparency in good
governance practice and development
initiatives.
The Challenge of Meeting Both the
Development and Humanitarian Needs of
Refugees
Country Director Farid Belhaj noted the wide
discrepancy between what Lebanon requires
in the way of financial support and what the
international community has put on the
table. Relying on funds channeled through
humanitarian agencies such as the United
Nations High Commission for Refugees
(UNHCR) is not sufficient, he noted that
current levels of support are "still a far cry
from what the country needs." Indeed, with
a fourth of its population now made up of
Syrian refugees, Lebanon is struggling to
meet the basic needs of its local constituency
in health, education services, electricity,
water and sanitation, said MP Mohammad
Kabbani. While refugees have attempted to
integrate in the social and economic fabric of
host countries, the magnitude of the influx
has exerted significant pressure on the job
market, thus putting the most fragile fringe
of the local population under considerable
risk of reverting back to extreme poverty. In
light of these alarming trends, the World
Bank has scaled up its support to help

mitigate the impact of the crisis in MENA

host countries, primarily in Jordan and
Lebanon. Between 2012 and 2014, the Bank
committed US$700 million in loans and
grants to help Jordan maintain access to
essential healthcare services and basic
household needs for the population affected
by the impact of the Syrian crisis. The World
Bank has also recently announced a joint
initiative with the United Nations and the
Islamic Development Bank to rally the
international community around a global
effort to raise the scale of funds needed for
recovery and reconstruction in MENA. An
immediate priority is to provide Jordan and
Lebanon with sources of concessional
finance, which as middle-income countries
they do not currently have, for the long-term
support required to build up their resilience
to shocks and allow them to focus on the
development needs of refugees.
A Call for Global and Concerted Action
But with an ever-increasing number of
refugees trying to cross the Mediterranean
to seek protection in Europe, the crisis is no
longer confined within the borders of the
Middle East. As European Union (EU)
countries have recently been called upon to
address stronger flows of migration, the
briefing was also an occasion to channel the
convening power of MPs to explore ways to
strengthen international collaboration.
Greek MP, Niki K. Kerameus, and Turkish MP,

Yusuf Ziya Irbec, both urged Europe to take

in more refugees to help ease the
demographic pressure on MENA countries.
The issue of immigration remains a
contentious and politically sensitive one in
Europe, but EU countries might be more
open to stepping up their financial support in
MENA host countries, advised Jeremy Lefroy,
MP for the United Kingdom and Chair of the
PN. However, they will do this only with the
assurance that aid will not be diverted from
the most in need, cautioned Austrian MP
Gerald Zelina. He noted that "We need to
ensure that international financial support is
not diverted from the refugees and the most
in need. The conference showcased
countries' diverging views on the best course
of action, and parliamentarians came out of
the session with a keener sense of the
challenge at hand, as well as a renewed
commitment to bringing this issue to the
attention of their respective decisionmakers.
Beyond
raising
awareness,
parliamentarians are set to play a critical role
in crafting the legislation and monitoring the
governmental actions necessary to address
the humanitarian crisis without overlooking
the developmental needs of local
populations. MPs are on the front line, as
"they are the ones who authorize the
disbursement of aid," concluded Ferid
Belhaj. After all, it is the legislative branch
that holds the financial strings.

68

GCC

Kuwait 68
Bahrain 69
World Government Summit 71

Kuwait
Embedding a tax culture in an oil-rich economy
Joey Ghaleb
Senior Public Sector Specialist
The tax department at MoF is led by a middle
manager who assumes the dual role of tax
and financial affairs section head a
mandate that reflects the low importance of
taxes in Kuwaits public administration. The
tax team has been implementing a couple
instruments (e.g., religious zakat, corporate
tax on select foreign firms), utilizing basic
excel-based systems and processes with a
base of ~2,000 taxpayers. In other words, the
tax department, and its operations
generating less than 1% of state revenues,
were not on the radar screen of most
government official and international
agency.
Fast forward to 2011, a political decision was
made at the Gulf Cooperation Council (GCC)
level to introduce a value added tax (VAT) to
diversify revenues across this six-nation
custom union. The Government of Kuwait, a
signatory, asked the Ministry of Finance
(MoF) and the Tax and Financial Affairs
Department to execute. The task was
immense for the staff who lacked specialized
skills and were immersed in daily
bureaucratic and transaction-type work.
After some iteration between the options of
seeking a consulting firm to carry out the
preparations, having the Bank take on the
preparations, or MOF doing the preparations
with the support of the Bank, the latter
option was chosen. The primary reason from
MoF's perspective was their need to build
their own capacity in tax administration and
a corresponding concern that using a
consulting firm would not have built any
organic capacity in the ministry.

legislative and institutional infrastructure.

The work also entailed heavy on-the-job
capacity building coupled with awareness
raising to secure the buy-in of senior
management on the required reform
agenda. This was aided by the long term of
presence of Arab-speaking Bank tax advisor.
The World Bank engagement was making
inroads but with the Arab Spring creeping
into neighboring Oman and public unrest
observed on the streets of Kuwait, another
political decision froze the introduction of
new taxes for at least three years and with it
the VAT project faced its toughest test. In
similar circumstances, the parties reluctant
to undertake change would have
overpowered the core group of reformers
and succeeded in killing the fragile project;
turning it into yet another one of the
numerous failed experiments that Kuwait
observed in recent decades.

The World Bank engagement focused

initially on reviewing and proposing a new

This was not the case. The reform agenda

and progress to date had garnered enough
momentum, and senior management at the

Ministry requested in early 2013 from the

Bank to realign its assistance towards
modernizing the administration. The
objective was more strategic. The
administration wanted to be ready to
implement any tax instruments. The Bank
team went back to the drawing board, and a
comprehensive long term engagement was
born.
The restructured project included six main
components and they were: 1) legislative
and regulatory, 2) institutional, 3) processes
and IT infrastructure, 4) compliance, 5)
capacity
building
and
6)
change
management. To deliver on this ambitious
task, the Bank adopted the incubator
model by deploying a strong team of 4
resident advisors, all of whom spoke Arabic.
Language proved to be a major factor and
thus a large share of short term consultants
were recruited from the Middle East. The
Ministry, on the other hand, created a
dedicated reform team and empowered it by

69
putting the head of the Tax Department as
its chief.
The work modality, was by and large, a joint
effort driven by the three-partite team
composed of the Bank resident team,
regional and international experts, and the
local MoF team. Together a long list of
important deliverables were produced
within two years. This approach allowed for
on-the-job capacity building, transfer of
international know-how, and exposure to
regional experiences. To date, the list of
outputs include draft laws (e.g., VAT law, tax
procedure code), a new organization
structure for headquarters, regional offices
and a Large Taxpayer Office, over 60
processes reengineered and detailed, a
customized IT interim solution, a strategic
plan, a change management plan, draft audit
selection strategy, a risk management plans,
in addition to numerous workshops, study
tours and the like.
The engagement is judged by the client, and
by peers, to be a success and there are
underlying features behind this outcome. A
tax culture is indeed being created in this oilrich economy and an administration is now
adapting to good international practices and
defending internally and externally - the
reform agenda. The secret to this hard
fought success is attributed to more than
one factor, but the key element is the
presence of an embedded Arab-speaking
team of tested tax experts with management
experience. It is not sufficient to have any

resident advisor. This expert must also be

seasoned, a solid manager, and above all an
Arab speaker. The approach of spaced-out
missions with aide memoires at their tail end
would have turned this engagement into an
expensive academic exercise with no
champions within MoF and no real impact
achieved.
Despite all the progress registered, there are
limitations to any Bank engagement and this
is summarized by the challenge of
implementing the reforms and rendering
them operational. Implementation is now
the main issue when it comes to achieving
the objective of putting in place an effective
and efficient tax administration. Moving
towards this objective is not only a technical
matter but important and key political
decisions have to be taken. First of all, the
government has to make a decision about
the model of tax administration they want to
establish. The options include a Directorate
under the purview of MoF, a semiautonomous revenue body, or another
hybrid model. Vesting autonomy in tax
administration has been a predominant
feature of tax reforms in many regions across
the globe in the past two decades.
Autonomy in the areas of human resource
management and procurement is expected
to improve performance by reducing
political interference and increasing the
mandate of technical managers.
Looking ahead, and with a profit tax and a
VAT looming in the horizon, the readiness of
MoF is put to a real test. There are key

consideration the Ministry and the reform

team has to consider. First, the
administration has to be assume full
ownership and responsibility of key
functions such as IT operations. Additionally,
a special attention has to be given to HR
management policies since the lack of skilled
staff is one of the main concerns of the Bank
team. Moreover, MoF has to promptly
initiate the implementation of basic and
across-the-board on-line registration and
collections processes which aim at
facilitating taxpayer compliance. The
establishment of a full-fledged Large
Taxpayer Office should be another milestone
without overlooking the need to strengthen
the tax audit function.
The final stages of this tax engagement
remain critical and may define the lasting
impact of this World Bank technical
assistance. First and foremost, the phasingout of Bank support has to be timely and well
planned to avoid sudden ruptures or aborted
reforms. But there are other considerations
to account for. For instance, will the
departure of resident advisors in the future
create a void or weaken the mandate of the
reformers at MoF? In other words, has the
Bank struck the right balance and properly
mitigated the potential risk of capture and
dependency, or is the MoF staff well trained
and empowered to take over and drive home
the reform agenda? Time will only tell.

Bahrain
Training Vocational Accountants in the Middle East
and membership body for vocational
accountants, working across the globe with
around 135,000 members in more than 90
countries.
The Association of Accounting Technicians
(AAT) has been operating in the Middle East
for over twenty years, training students in
the region in practical financial skills that can
be used in real-world work. AAT builds
relationships with local organizations,
combining knowledge and expertise to
develop local financial intelligence.

Justin Kyriakou
Global Development Manager,
Association of Accounting Technicians
Justin Kyriakou is Global Development
Manager at AAT (Association of Accounting
Technicians), the UKs leading qualification

AATs Accounting Qualification combines

the latest industry insight with practical work
skills to help prepare students for careers in
accounting or other finance-based roles. It is
comprised of three different levels, making it
accessible even for individuals with no
previous
financial
background.
The
qualifications can also be studied flexibly,
meaning individuals can study when it suits
them, in the evenings or on weekends.

Currently, AAT works with six organizations,

known as training providers, in Bahrain and
one in Abu Dhabi, United Arab Emirates to
provide the Accounting Qualification. AAT
also has plans to expand its operations
further by moving into Dubai, UAE, Oman,
Qatar, and Saudi Arabia. One of AATs
strongest connections at the moment is with
Bahrain, where the organization has been
active for a number of years. Although it was
one of the first states to discover oil, Bahrain
is less dependent on it than other the Gulf
countries, balancing it with a thriving banking
and financial services sector. Bahrain is a
global hub for Islamic finance, with the
Central Bank of Bahrain supporting this
sector. In 2001, Bahrain became the first
country in the world to develop and
implement regulations specific to the Islamic
banking industry. Tourism is another industry
that has grown in Bahrain, with large
amounts of visitors from the Gulf region, but
also increasing visitors from outside of the
region as well. These different sectors have

combined to help strengthen the Bahraini

economy. Mr. Abdulla Marzooq, Managing
Director of the training company, Score
Training, one of the training companies AAT
works with says:
Bahrains economy is improving year by year,
with real gross domestic product (GDP)
moving from 3.4 percent in 2013 to 5.4
percent in 2014. Draft reports for this year
indicate that it is still stable at that level.
There has also been a rise in tourist numbers,
which will lead to improvements of hotels
and other leisure facilities further fuelling
Bahrains economy and performance.
As part of its diversification from being an
economy reliant solely on income from oil
production, the government of Bahrain has
made it a priority to provide support to train
the local population and equip them with
practical skills required in the workplace. The
government is particularly keen to offer
qualifications that are United Kingdom
regulated, but also recognized globally, and
which also provide progression opportunities
toward chartered accountancy qualifications
and university. In addition, these finance
skills are extremely valuable for growing
businesses. In this context, the government
funds students in the country who want to
study for an AAT qualification, paying the
costs for their course. AAT is also widely used
in the Bahraini public sector. The Bahrain
Central Bank owns the Bahrain Institute of
Banking and Finance, which is a training
organization AAT works closely with to offer
Accounting Qualification. Bahrain also
established an organization called Tamkeen
in August 2006 to assist with the
governments economic vision. Its two
primary objectives are to:

70
Foster
the
creation
and
development of enterprises; and
Provide support to enhance the
productivity and growth of
enterprises and individuals.

Tamkeen is roughly equivalent to the United

Kingdoms Skills Funding Agency, and is an
avenue through which individuals can obtain
financial support to study professional
qualifications to advance in their careers.
AATs Accounting Qualification is among
those Tamkeen make available. Indeed, it is
the most popular certificate they offer.
As Mr. Abdulla Marzooq noted:
As Bahrain has a dynamic economy and an
open, competitive market, there are many
opportunities for AAT-qualified students. In
the past 3 years, many qualified personnel
have gone into a range of sectors, from
information technology (IT) and distribution
to education and auditing, thanks largely to
the governments Tamkeen human-capital
scheme to sponsor training for Bahrainis and
help prepare them for the labor market.
I think Bahrains economic and financial
landscape will be stable over the next
decade, provided that government spending
on capital projects and private sector
subsidies is maintained at the current level.
As the investment hits home, I foresee that
certain business types will take off, such as
training institutes, private universities and
software houses.
Given our dynamic, globalized economy,
accountants planning to work here should

definitely have world recognized professional

qualifications, such as the AAT, the
Association
of
Chartered
Certified
Accountants (ACCA) and the Certified Public
Accountant (CPA), as there is such a high
demand for qualified staff.
Batool Mohammed was 21 years old when
she began studying AAT. She was
encouraged to study for the qualification, as
she was working in a job doing the accounts
at a company which rented out party
equipment. She studied for the qualification
part-time in the afternoons after work. Since
completing it, she has received a pay rise and
now has an additional job as an AAT
Assessor, assessing the work of other
students who study for the qualification. She
is also planning to use the knowledge she
gained from studying the AAT qualification to
progress to a Chartered Institute of
Management
Accountants
(CIMA)
qualification.
She noted that: Obtaining the AAT
qualification helped change my career in
many ways. Its helped me change my
position, increase my salary, build my selfconfidence, and has given me my new role as
an assessor.
AAT is pleased to support the development
of financial skills and knowledge in the
Middle East, working with employers to
ensure they get the highly qualified staff they
need and with individuals looking for a
qualification to help them succeed in their
careers. With its plans to expand into Dubai,
UAE, Oman, Qatar, and Saudi Arabia, AAT
looks forward to helping the region continue
its financial growth.

The World Government Summit

71

Shaping Future Governments

Dubai, United Arab Emirates

Leonard Hessling
World Bank Consultant,
Public Sector Expert

Since 2013 government officials, thought

leaders, policy-makers and private sector
entrepreneurs have met at the World
Government Summit in Dubai, United Arab
Emirates (UAE) to discuss the best ways to
develop the future of governance based on
the latest developments and
future trends in technology,
innovation and society. The
summit, a global networking
platform
on
contemporary
questions of government and
public policy, has produced a
series of reports on such issues as
well as hosting roundtables and
other meetings of thought
leaders to create and share ideas
and solutions that map to the
needs of governments globally.
The Summit is accompanied by
awards for innovation in
government and a number of
showcases and exhibitions, such
as the Innovation Pavilion and the
Museum of Future Government Services. In
2015, the Summit embarked on a new
exploration of not only policy, but the future
of policy and governance.
The 2015 Summit Future Focus
Hosting over 4,000 government leaders from
over 90 countries, the third annual event of
the
Summit
on
Shaping
Future
Governments took place on February 9-11,
2015. With a firm focus on emerging trends
and technologies, the Summits futuristic
theme led to an unparalleled sharing of best
practices and innovations that had the
potential to impact government policies and
services. The 2015 event covered a wide
range of topics; including education, health,
empowering women, smart cities, and
government services. In the field of health
for instance, discussions focused on the
future of healthcare and the opportunities

for data collection and improvement of

services linked to the so-called quantified
self and the internet of things. Further
highlights of the 2015 event included the
keynote address by UN Secretary-General
Ban Ki-moon and speeches by practitioners
and scholars such as Boo Keun Yoon of
Samsung and Professor Klaus Schwab of the
WEF. The UN Secretary-General highlighted
the importance of using technology to
engage citizens with government and said
that information technology (IT) solutions
can help involve citizens more in developing
government services, and in linking
government and business for economic
growth: This communication can actually
create an environment wherein citizens are
involved with their governments in codesigning solutions. On the back of
innovative information technology networks
and solutions, a society where the
government and its businesses come
together can be a showcase for sustainable
growth, collaborative governance, and

economic success, he noted. The nexus

between governments and the private
sector was another core theme of the
summit. "The future can only be solved by
governments, working in close cooperation
with businesses" said Klaus Schwab, founder
and Chairman of the World Economic Forum,
who also noted that "it is human imagination
and innovation that drives economic change.
Governments have an essential role to play
though innovation has tended to come
from private business, governments have to
be catalysts, driving the innovation in this
ecosystem". Highlighting the importance of
the digital revolution and government, Dr
Erik Brynjolfsson, Director of the
Massachusetts Institute for Technology
(MIT) Centre for Digital Business, warned of
the risks for nations of being left behind and
considered uncompetitive if they do not
show appetite to embrace the potential of

the digital revolution to benefit national

economies:
There is no doubt that we are living in an era
of rapid change. The evolution of digital
technologies has never been quicker and is
only continuing to accelerate. Meanwhile,
globally, our skills, organizations and
institutions are often lagging behind and
failing to adjust to the rapid progress. This
will not be solved by adopting a business as
usual approach and nations should follow
the lead of Dubai in considering projects
which benefit the economy and people
across the full spectrum of society.
The 2016 Summit
The upcoming fourth annual event of the
World Government Summit will take place
on February 8-10, 2016 in Dubai. It is
expected to build on the success of previous
years by attracting world leaders and further
sparking debate on the future of government
in the 21st century. It is conceptualized as a
gateway to the future, aiming to
highlight
developmental
and
societal issues in the near term,
medium term and long term future.
The 2016 World Government
Summit is focused on looking ahead,
to evaluating the impact of
innovation and the changes wrought
by the speeding growth and ubiquity
of technology, particularly in the
growing series of massive inflection
points created by the wave of digital
technologies rolling out today and in
the foreseeable future. As each
technological shift creates benefit, it
also drives change, sometimes
creating benefits for some and
economic threat for others. Evaluating that
inter-connected series of events triggered by
innovation and human development is a
core theme for the 2016 Summit. A series of
ten changes to the 2016 World Government
Summit cement the themes of futurism and
connected policy. The Summits global focus
has been formalized and the event has been
transformed from being an annual
conference and meeting to a year-round
initiative which aims to tie together best
practices in global government with a
particular focus on planning for innovation
and technologically-led disruption and
meeting future challenges. The Summit will
be tasked with creating a resource of
research and intelligence on a year-round
basis. Increased focus on smarter, more
focused delivery means shorter sessions and
more interaction between speakers and
audience. Aiming to create shareable and

72
accessible content, the Summit aims to build
knowledge platforms to give access to
sessions, findings and resources on a local,
regional and global basis, opening the
conversation to a global audience. Tying into
the UAEs strong movement to embrace
smart city concepts, the Summit builds on
mobile applications to enhance its
communications and sharing goals. The
Edge of Governments, together with a
series of UN SDG focused round tables and a
new annual World Government Summit
award to honour excellence in governance
by singling out government leaders who
have led transformational projects and
initiatives complete the changes to the
event.
Content and concepts
The three key pillars of the upcoming World
Government summit are: (i) future
governments, (ii) government innovation,
and (iii) the development of government
services. Specifically, it will explore
innovative concepts for reinventing
governments and enhancing quality and
efficiency through the presentation of
innovative global practices in government
service delivery. As such, it will help shape
the future of governments and provide a
unique
opportunity
for
governments,
national
authorities, academic institutions
and
leading
international
organizations from around the
world to share experiences and
practices. In addition, it will
promote and enable publicprivate
partnerships
and
collaboration with the private
sector. The Summits partners
reflect that mix, including telco
Du, Dubai Municipality, global
logistics management company
DP World and DEWA, the Dubai
Water and Electricity Authority as
well as the United Nations, Arab
League, Gulf Cooperation Council,
World Bank, Organisation for Economic
Cooperation and Development, and World
Economic Forum. Kicking off with the $1mn
Drones for Good and its sister award, the
$1mn AI and Robotics for Good taking just
prior the Summit, the event will once again
play host to government leaders from
around the world. The participation of
government officials from 100 countries is to
be headed up by a special delegation from
the US, while a number of round table events
targeting the UN-defined Sustainable
Development Goals will take place on the
Summits sidelines. With a wide-ranging cast
of speakers assessing and sharing
innovations and key elements of change in
education, technology, transport, commerce
and social behaviours. Adding to established
events such as the popular Museum of the
Future, a World Government Summit event

which has led to the establishment of a fullyfledged Museum of the Future in Dubai, the
new Edge of Government exhibition aims to
enable some 15 governments to share their
experiences and knowledge on applied
disruptive innovations.
Results and Successes of the 2015 Summit
Event
Hosting over 4,000 government leaders from
over 90 countries, the third annual event of
the World Government Summit on Shaping
Future Governments took place on February
9-11, 2015. Its objective was to explore how
technology and innovation will shape future
governments and best meet citizens' needs.
It focused on shaping governments of the
future and enhancing their performance of
delivering services through innovation in
government. The summit also strengthened
cooperation and coordination between
governments, and promoted the exchange
of knowledge and experience about the best
innovative global practices in the public
sector. The success of previous summit
events is largely due to its nature as a highlevel event with the ability to convene senior
government officials, decision- and policymakers, thought leaders and researchers, as
well as private sector leaders. In addition,

the events location in Dubai showcases a

leading country that has successfully
harnessed the digital revolution by investing
in high-tech infrastructure. Among the over
100 speakers of the previous events were
leaders such as: Sheikh Mohamed bin Zayed
Al Nahyan (UAE Vice President, Prime
Minister and Ruler of Dubai), Queen Rania Al
Abdullah (Queen of Jordan), Ban Ki-moon
(United Nations Secretary-General), Ibrahim
Mahlab (Prime Minister of Egypt), Gordon
Brown (former United Kingdom Prime
Minister), William C. Danvers (Deputy
Secretary-General of the Organisation for
Economic Co-operation and Development),
Chris Vein (World Bank Chief Innovation
Officer for Global Information and
Communications Technology Development),
Boo Keun Yoon (President and CEO of
Samsung), Steve Wozniak (Co-Founder of
Apple), Sir Richard Branson (Founder of

Virgin Group), Professor Jeffrey Sachs

(Director of the Earth Institute at Columbia
University), and Professor Klaus Schwab
(Founder and Executive Chairman of the
World Economic Forum [WEF]). The summit
also included the presentation of three
international awards: First, the Best MGovernment Service Award, which is
designed to encourage government entities
to develop creative and innovative solutions
and applications for smart phones in order to
provide high quality services to citizens in a
simple, efficient and transparent way.
Second, the UAE Drones for Good Award
emphasizes the key role of the government
in promoting innovation. It encourages the
creation of partnerships between the
government and leading technology
universities and research and development
(R&D) centers in order to develop new
products and services that enhance peoples
lives in various fields including medicine,
public service, social activities, and others.
Third, the UAE Artificial Intelligence (AI) &
Robotics Award for Good honors the best
application of robotics and artificial
intelligence for the service of humanity,
mainly in the fields of education, health and
social services. The summit also included two
special exhibitions: The Museum of Future
Government Services focused
on exploring future trends and
innovations in government
services. It exposed real
prototypes
of
innovative
services which can be adopted
by governments of the future in
the fields of travel, healthcare,
education and smart services. It
also shed the light on ideas for
developing these services in the
coming years through the
collaboration of the best
designers, technicians and
thinkers from around the world.
The Innovation Pavilion took
its visitors on a futuristic journey
to a world of innovation and
experiences through the Innovation
Exhibition, Ibtikar Talks and Rapid
Government
Innovation
Labs.
The
Innovation Exhibition offered visitors the
opportunity to discover the latest
innovations in six different categories:
Services, Governance, Public Policy, Science,
Systems and Community. The Ibtikar Talks
served as a platform through which visitors
interacted and communicated with
innovation experts who presented examples
of innovation and different applications
around the world. The Rapid Government
Innovation Labs provided an opportunity
for participants to develop innovative and
tangible solutions to key challenges faced in
different sectors.
For more information visit:
www.worldgovernmentsummit.org..

Remarks by World Bank Group President Jim Yong

Kim at the World Government Summit
Inclusive Governance: The Foundation for
Building Human Opportunity and Prosperity

Hello everyone. Im very happy to be here

today with you. Im grateful to the people of
the United Arab Emirates and His Highness
Sheikh Mohammed bin Rashid Al Maktoum
for inviting me to participate in this years
World Government Summit. For more than
60 years, the World Bank Group has been
working with governments in developing
counties to reduce poverty and promote
human dignity. Were a proud supporter of
this event because good governance is the
foundation for all development. Delivering
quality public services and creating
conditions that encourage businesses to
create jobs are fundamental to building
opportunity and prosperity for all. The focus
of this years conference shaping
future governments comes at a
pivotal moment in modern history.
Last year, for the first time, the rate of
extreme poverty was projected to fall
below 10 percent. This is stunning
progress. It means that today there
are 1 billion fewer people living in
extreme poverty than 15 years ago.
But more than 700 million people still
live on less than about $2 dollars a
day. Our research and experience tells
us that three things have been critical
to reducing poverty and boosting
prosperity:
inclusive
economic
growth, investments in peoples
health and education, and insuring
against risks that can plunge the
vulnerable into poverty, risks like
unemployment, illness, climate change and
pandemics. Shaping future governments so
they deliver on these responsibilities is our
shared responsibility and essential to
achieving our twin goals of ending extreme
poverty by 2030 and boosting shared
prosperity. The global landscape suggests
that reaching these objectives wont be easy.
Economic growth the most powerful
poverty reduction force the world has ever
known is slowing globally. Many emerging
markets are suffering sharp reductions in
growth because of declining demand from
China and lower commodity prices. Warmer
temperatures potentially linked to climate
change made 2015 the hottest year in
history; and the most powerful El Nio on
record is affecting the lives and livelihoods of
billions across the globe. Many parts of the
world are becoming more fragile, making
quality leadership and good governance ever
more important. The Middle East and North
Africa, in particular, have been deeply
affected by these changes. Lower oil prices

73

are forcing governments across the region to

reevaluate policies that have been in place
for decades. Economies dominated by large
firms are not producing enough jobs, and
this is true for countries that both export and
import oil.
Furthermore, economies
dominated by fossil fuels are currently not
earning enough oil revenues to support large
public sector expenditures and fuel
subsidies. Throughout the region, highly
centralized bureaucracies have not delivered
the quality health and education services
needed to enable young people to compete
in the globalized marketplace. The net result
is a long period that discouraged innovation
and entrepreneurship. This decline in
economic prospects are causing increasing
fragility in a region that has already
experienced too much instability. Conflicts
have now forcibly displaced 15 million

breadwinner for his family of eight, lit

himself on fire to protest treatment he had
received
at
the
hands
of
his
government. Bouazizis act was essentially
triggered by the absence of good governance
in his country. Ten days after his death,
public protests brought down Tunisias
government. This anger exploded at a time
when the national economy was growing.
But opinion polls prior to the protests
showed that, despite Tunisians awareness
of their countrys increasing prosperity, over
80 percent considered themselves to be
struggling or suffering. Many indicated that
their unhappiness was rooted in low quality
public services and infrastructure, and a
government that made their livelihoods
difficult. Poor governance had stretched the
countrys social fabric beyond repair.
Governments that operate in opaque,

people in the Middle East and North Africa,

contributing to the worst humanitarian crisis
since World War II. Fresh water and fertile
farmland are becoming scarcer, creating
more potential flashpoints. The human
development consequences are worrying.
Violent extremists are using these
challenging circumstances to rally recruits to
their cause with global implications. Deadly
attacks in West and East Africa, North
America, South and East Asia, and Europe,
show that all of us have a stake in shaping
future governments that are capable of
tackling these challenges. For people who
feel excluded from or aggrieved by society,
the feelings of anger and frustration can be
overwhelming. When you have studied hard
and cant find a job, or discover that your
education did not help you develop the skills
to get a job, the personal disappointment
can be profound. These circumstances give
people powerful motivations to challenge
what they see as the source of their troubles.
Five years ago, in 2011, Mohamed Bouazizi,
a 26-year-old Tunisian vegetable seller and

exclusive and unaccountable ways, or fail to

empower local authorities, often plant the
seeds of discontent. When governments
dont allow the public to participate in
decisions, they breed suspicion; when
governments make decisions on the basis of
favoritism, social or ethnic divisions,
discrimination or corruption, citizens
become deeply aggrieved. The demands for
good governance, in fact, are not a recent
phenomenon. The demands are rooted in
the traditions and history of many cultures,
including the Arab and Islamic world. The
scholar Imam Muslim recounted words said
by the prophet, quote, One whom I appoint
to a public office must render account on
everything, big and small. The Arab
philosopher Ibn Khaldun wrote in his opus,
the Muqqaddimah, that the social compact
between the individual and tribes was a
sacred bond based on mutual accountability,
protection, and proper and reliable delivery
of such basic services as security and
justice. Ibn Khaldun said the worst kind of
state is a tyranny wherein government

74
usurps property rights and rules with
injustice against the rights of men. So whats
the best way forward today? We believe that
the answer is what we call inclusive
governance. At the core of inclusive
governance is a social compact between
government officials and their citizens that is
based
on
three
principles.
First,
governments must be transparent in their
actions and fully engage with citizens.
Second, governments must invest in their
people to give them opportunity to reach
their full potential. And third, governments
must create business environments that
encourage innovation, competition and
private sector investment, which will, in turn,
create jobs and increase economic growth. A
story from Brazil illustrates the benefits of
governments being held accountable for
their actions. The World Bank Group helped
the government build a program calledBolsa
Familia, which is a targeted conditional cash
transfer program. It promotes opportunity
for the poorest by providing money to needy
families who keep their children in school

years. Sheikh Mohammed bin Rashid, your

invitation last week to the UAEs universities
which you tweeted! to identify a minister
under age 25 to represent youth and give
them a voice and role in governing the
nation, is among the most inspiring
gestures in governance of this still-new
year. Community engagement in Brazil and
the UAE has helped their governments
promote investment in people a second
important element of inclusive governance.
We know that investing in people, especially
in their health and education, is critical to
promoting opportunity and prosperity.
Research has shown that education helps
people escape poverty at very high rates
starting at the earliest ages. Globally,
earnings increase an average of 10 percent
for every year of education for employed
workers. Educated women and girls can be
particularly effective agents of social and
economic progress, both for society and
their children. Educated mothers earn higher
wages and invest more in their childrens
health and education. In Pakistan, children

and ensure they receive vaccinations and

regular health check-ups. The program has
helped one of the most unequal countries in
the world reduce income inequality, which is
a powerful driver of social instability. Bolsa
Familias success is due in part to
accountability through its structures a
single register, eliminating the layers of
bureaucracy, and making the system
transparent. The outcomes from this
program have been remarkable: Studies
show that the program funds help parents
buy food, clothing and school supplies for
their children. Since 2003, Bolsa Familia has
been responsible for up to 21 percent of the
countrys decline in inequality. And the total
cost of the program is only 0.6 percent of
GDP. Here in Dubai, input from communities
and parents has helped the Knowledge and
Human Development Authority improve
education quality. Today, more than half of
the emirates students are in good or
outstanding schools, compared to 30
percent in 2010, and student achievement
has steadily improved over the last five

whose mothers have even a single year of

education spend an extra hour studying at
home and achieve higher test scores.
Governments that invest in peoples health
and education also create a powerful
counter-narrative to violent extremism.
Instead of sowing seeds of discontent, these
governments promote opportunity, and that
opportunity, if coupled with improving the
business environment, can lead to more job
creation. Governments must ensure that the
business
environment
helps
spark
innovation,
entrepreneurship,
and
competitiveness. One example is China.
China has produced a remarkable record of
economic growth and job creation over the
last 15 years with the vast majority of those
jobs created by the private sector. In the last
five years up to the end of 2015 China
created 64 million jobs. When governments
do not promote a fair and competitive
business environment, when they limit
opportunities by favoring allies, they foster a
form of crony capitalism that can lead to
instability and chaos. Experience shows that

governments can safeguard the fairness and

integrity of their business climates by using
special initiatives that reduce regulatory
costs for the private sector. Under
Denmarks Burden Hunters Project,
officials work with companies to simplify
rules that the business community perceives
as most burdensome. This cooperative
approach helped Denmark rank first in
Europe and fifth in the world on the ease of
doing business in the World Banks Doing
Business report this past year. These are just
a few examples. No doubt you will hear
about many more innovations in governance
over the course of this conference. For the
Middle East and North Africa, for all regions
in the world, the path to stability and
prosperity is through inclusive governance
actions that foster individual opportunity
through quality public services and an open
and competitive business climate. Tunisia
today shows this is possible. After the
countrys revolution, the government
adopted laws and policies that made its
budget decision-making more transparent.
The public now has the right to
official government information.
Simplified and yet detailed data on
state revenue and expenditure,
treasury
funds
and
public
administrative entities can be
accessed by anyone online. In 2013,
when assassinations and social
unrest threatened to undo these
and other advances, the Tunisian
National Dialogue Quartet, a
coalition of trade unions and legal
and human rights organizations,
used its moral authority to bring
together citizens, political parties
and authorities in peaceful dialogue.
While this process still has a ways to
go, this dialogue has started to bring
accountability and government
engagement with citizens to the
constitution-building
process,
helping
develop consensus on a range of issues
across political and religious divides. It also
reduced violence and earned the Quartet the
2015 Nobel Peace Prize. Now is the time for
even greater ambition for the Middle East
and North Africa. Last week, in London, we
committed to using innovative financial tools
to provide new support to Jordan and
Lebanon, Syrias neighbors who have been
shouldering so much of the burden in
hosting Syrian refugees. First, our Board of
Directors is working with World Bank Group
management on an extraordinary measure
to provide $200 million dollars in direct
concessional financing to create jobs and
increase access to education in Lebanon and
Jordan Second, with assistance from the UN
and the Islamic Development Bank, were
seeking donors who will provide $1 billion
dollars in grants that will then be leveraged
to supply $3 to $4 billion dollars in
concessional financing to help fund public

75
service delivery and other needs. These new
financing initiatives, combined with our
existing programs, are expected to total
about $20 billion dollars in the next five years
which is roughly triple our investment in
the region from the previous five years. We
must act much more quickly in response to
such humanitarian crises because we know
that a refugee can remain a refugee for
years, even decades. We must find ways to
bring knowledge from development
organizations such as the World Bank Group
to improve the lives of refugees soon after
they arrive in a host country not years later.
Indeed, I believe we must all respond to
what Martin Luther King Jr. called the fierce
urgency of the now. He wrote, and I quote:
There is such a thing as being too late. This
is no time for apathy or complacency. This is
a time for vigorous and positive action. I
also believe that we must move urgently not
just in response to humanitarian crises but
also to prevent these crises from happening
in the first place. In this region, in Latin
America, in Africa, and in Asia, that means
building good governance. Another inspiring

figure to me is the Palestinian intellectual

and writer Edward Said. His book
Orientalism, which is largely about how
Westerns perceive the East, had a profound
impact on my thinking. He also focused on
the power of good governance. He once
wrote, and I quote: Power, after all, is not
just military strength. It is the social power
that comes from democracy, the cultural
power that comes from freedom of
expression and research, the personal power
that entitles every Arab citizen to feel that he
or she is in fact a citizen, and not just a sheep
in some great shepherds flock. This is the
moment for all enlightened leaders in the
region and around the world to act and to
build inclusive governance. It means that
leaders must be transparent in their actions
and engage with people so that -- as Edward
Said says they feel they are in fact citizens;
it means leaders must invest in their people;
and it means they must create business
environments that encourage private sector
investment. The greatest strength of the
Middle East and North Africa is its people
especially its youth. If leaders invest in young

peoples education and health, if they give

youth opportunities by diversifying their
economies and sparking the dynamism of
the private sector, the future of this region
will become far brighter. With good
governance, there will be greater
opportunity and prosperity for all. One last
note that Id like to make directly to Sheikh
Mohammad bin Rashid. During this visit to
the UAE my first -- Ive been very impressed
by what you, Sheikh Mohammed bin Zayed,
and
other
leaders
here
have
accomplished. If the rest of the region can
commit to the kind of good governance that
has built the modern and dynamic UAE, the
prospects for peace and prosperity would
greatly improve. I pledge that we will
continue to learn from you and share the
successes here with other countries around
the world. I also pledge that we will stand by
your side and offer our assistance as you
accomplish things that we cant imagine
today, but that all of us will experience in the
years ahead. Thank you very much.

Pictures from
The 2016 World Government Summit
(Source: World Government Summit Twitter)

76

77

CV MENA

Events

Exchange 78
Events 84
Bootcamps 90

The Exchange
From Vulnerability to Resilience

78

Hammamet,
Tunisia

Leonard Hessling
World Bank Consultant,
Public Sector Expert
The Exchange conference series is an
annual forum which provides a channel for
dialogue. Enabling countries to share
experiences, lessons learned, and best
practices, the Exchange begins where
governance
diagnostics
leave
off,
supporting the creation of an enabling
environment for reforms to move from
concept to reality. The Exchange feeds into
the design of the other three components in
the regional Connecting Voices of MENA (CV
MENA) initiative and partnership (Boot
Camps, Solutions Labs, and the Maarefah
community of practice).
From Vulnerability to Resilience. The tile of
the fifth Exchange conference suggests a
transition away from a state of vulnerability
towards increased resilience. Vulnerability
and resilience represent two related yet
different approaches to understanding the
response of systems and actors to change
(Miller et al. 2010). In order to frame the
debate on governance in MENA, the two
complex concepts of vulnerability and
resilience first need to be understood,
differentiated from related concepts, and
narrowed down to a working definition,
before they can be contextualized and
adapted to the complexities of a dynamic
region like MENA.
The MENA region is in a state of
vulnerability. The region is experiencing
significant instability, with several violent
conflicts and political transitions, which are
fundamentally altering the political, social

and economic landscape. Underlying causes

and dynamics are complex and multifaceted, spanning sub-national, country and
regional forces. The impacts and
consequences of violence and conflict are
not limited to individual countries, with
significant spillovers on neighboring
countries and even globally (World Bank,
2015b).
Drivers deepening vulnerability. Despite
positive economic growth and declining
levels of poverty in the MENA region
between 1990 and 2010 (Figure 1), several
structural challenges contributed to
deepening vulnerability, in particular due to
the trajectories of political transition,
instability and conflict after the 2011 Arab
Uprisings. In summary, these structural
challenges include: (i) Deep horizontal and
vertical inequalities exacerbated by
worsening global and regional economic
conditions that led to strengthened
perceptions of marginalization; (ii) Poor
governance, characterized by inadequate
service delivery, lack of transparency and
accountability, lack of rule of law, and
corruption; and (iii) Increased social
fragmentation and polarization leading to
the fragmentation of the national and social
fabric in some countries, and the rise to
prominence of identity-based agendas at
the expense of a collective national vision
(World Bank, 2015b).
MENA
countries
are
experiencing
transition, large-scale conflict, and acute
vulnerability. Although overall warfare in
MENA has been decreasing since 1990
according to some measures, the region is
experiencing a renewed increase in state

fragility and warfare since the early 2000s

with the number of major episodes of
political violence and armed conflict
increasing steadily (Figure 2). While the
dynamics of conflict and violence differ
significantly between countries, they can be
roughly regrouped as follows: (i) Countries
undergoing complex transitions that have
addressed some grievances and initiated
important reforms and institutional
transformation,
including
through
constitutional processes (e.g. Egypt,
Tunisia); (ii) Countries experiencing largescale conflict characterized by the
breakdown of institutions, major loss of life,
significant
population
displacement,
destruction of infrastructure, and economic
crises (e.g. Syria, Libya, Iraq and Yemen);
and (iii) Countries in situations of acute
vulnerability that have been significantly
affected by conflicts occurring in
neighboring countries, and that have been
directly impacted by the Syrian conflict
through the influx of refugees, as well as the
spill-over of conflict and violence across
borders increasing their vulnerability to
destabilization and conflict (e.g. Lebanon,
Jordan). While vulnerability is registered not
by exposure to hazards alone; it also resides
in the resilience of the system experiencing
hazard (Berkes, 2007).
The concept of resilience a holistic
methodology. Resilience refers to the
capacity to recover quickly from difficulties
and other notions include the ability to
bounce back, return to equilibrium and
to reorganize after a disturbance.
Resilience can be approached from multiple
angles and historically it has been used in
engineering, psychology and ecology.

The Exchange
The approach of psychological resilience is
useful insofar as it defines the individuals
ability to properly adapt to stress and
adversity, which can be extrapolated to
entire societies (Cyrulnik, 2009). The
resilience perspective in ecology uses a
wider approach in order to understand the
dynamics of socialecological systems, and
to the study of governance, the emerging
notion of resilience serves as a perspective
for understanding how societies cope with,
and develop from, disturbances and change
(Folke, 2006). Although resilience thinking
contains substantial normative and
conceptual difficulties for the analysis of
social systems, the resilience approach to
governance issues also shows a great deal of
promise as it enables a more refined
understanding of the dynamics of rapid,
interlinked and multi-scale change (Duit et.
al., 2010). By bringing together the
humanitarian
and
development
communities, resilience provides the
missing link between relief and
development, between disaster risk
reduction, climate change adaption and
conflict prevention, thus offering a holistic
methodology to these and other
interconnected issues (Mitchell, 2013).
Including this missing link plays an
important role in the strategic approach to
governance in MENA.
The Exchange is built around the four pillars
of job creation in the private sector, state
institutions, service delivery, and rule of
law. The conference will also cover
associated themes of citizen engagement
and social accountability; and the concept of
resilience, its relevance and usefulness
when applied to public sector governance in
MENA.
Understanding
resilience.
Although
everyone is talking about resilience, some
people find it difficult to understand what
resilience actually means. The following
table aims to facilitate the discussion about
resilience and its linkages to governance by
providing an overview of resilience-related
terminology that shall serve as working
definitions for the Exchange.
Resilience and Governance in MENA
Since the 1990s the concept of good
governance has been an explicit part of the
World Banks development agenda
acknowledging that inefficiencies and
weaknesses in the institutional environment
have a direct impact on the achievement
and the quality of development results. The

increasingly complex, interconnected and

evolving risk landscape of MENA in 2015
requires a new approach linking the concept
of good governance with resilience. In an
attempt to grasp the emerging thinking on
resilience and by looking at tools such as
resilience systems analysis, this session will
explore how resilience can be applied as a
framework to good governance practices.
Resilience as an opportunity for
development. For the present purpose of
analysis of vulnerability in MENA after the
Arab Uprisings of 2011, resilience appears
rather as a process leading the region and its
governments back to a state of peace and
normality where perhaps the most
important element is the development of
adapting
abilities
of
governments
themselves. Resilience appears as the
capacity to overcome difficulties despite, or
maybe because of the factors of risk and
stress. In this sense resilient people and
communities have the tendency to see
problematic
situations
rather
as
opportunities than as barriers for
development.
Resilience involves understanding the
complex risk landscapes in each context
holistically. This means determining where
in which layer of society those risks are
best owned and managed, and working to
strengthening these components of
resilience, and thereby empowering
different layers of society with the ability to
cope with those risks that they face in their
everyday lives. However, due to the
interconnectedness of risks, a certain layer
of society can no longer be selectively
resilient, instead issues need to be
addressed holistically (Mitchell, 2013).
The added value of resilience thinking.
Besides highlighting the interconnectedness
of
risks,
building
resilience
and

79

strengthening the resilience of people and

states to shocks and stresses can help
protect lives before a crisis hits, reduce
potential economic losses, and empower
people to take better decisions about the
risks they, and those they are responsible
for, face (Mitchell, 2013).
Different resilience approaches in different
countries. Although MENA countries are
facing similar threats and governance issues,
the disturbances to societies in the Levant
are different from those in the Maghreb and
the Gulf. While a countrys resilience and
long-term perspective appears to be
associated with factors such as income
inequality, the size of the middle class,
ethnic
fractionalization,
female
participation in the labor force, education
levels, public sector size, and public private
sector relations, states have different
capacities to absorb disturbances and to
reorganize. The challenge for the Exchange
will be to assess countries absorptive,
adaptive, and transformative capacities to
address the impacts of negative events in
MENA.
The resilience systems analysis tool.
Developed by the OECD-led Experts Group
on Risk and Resilience, this tool is based on
a conceptual framework consisting of five
steps (Figure 1). The analysis process starts
with (i) an understanding of the risk
landscape in a particular context, then (ii) it
looks at how those risks will affect a
societys systems, and (iii) it gathers
information about how systems are set up
to cope with risks, and whether this makes
them resilient. The analysis (iv) determines
what needs to be done to boost resilience;
to help the different parts of the system to
either absorb shocks, adapt or transform.
The result (v) is a resilient system, which will
then change the overall context and risk
landscape (OECD, 2014).

The Exchange

80

Figure 1: Conceptual Framework for the Resilience Systems Analysis

Source: OECD, 2014

Day 1 May 27, 2015

Day 2 May 28, 2015

Table 1: Running Order

Exchange Conference 2015 From Vulnerability to Resilience
Opening Remarks, Welcome Address
Session #1: Citizen Engagement and Social Accountability
Session #2: Resilience and Governance in MENA
Session #3: Job Creation and the Private Sector
Session #4: State Institutions
Session #5: Service Delivery
Session #6: Rule of Law
Closing Session, Concluding Remarks

Table 2: Glossary of Resilience-related Terminology

Resilience-related Terminology
Resilience
Resilience boosting
Resilient system
Absorptive capacity
Adaptive capacity
Transformative capacity
Risk
Shock
Stress
System
Vulnerability

The ability of households, communities and nations to absorb and recover from shocks, whilst positively adapting and transforming their
structures and means for living in the face of long-term stresses, change and uncertainty.
To manage the impact of shocks and future issues of risk, change and uncertainty, by strengthening the capacity to absorb shocks, or adapting
to reduce exposure to shocks, or transforming so that the shock no longer has an impact on the system.
The end result of building the resilience of a system, comprising components (or characteristics) that vary between different layers of society
(household, community, nations). These components result from applying resilience-building capacities that better structure risk management
actions to development / vulnerability reduction / poverty reduction programs and other long-term programming.
The ability of a system to prepare for, mitigate or prevent the impacts of negative events using predetermined coping responses in order to
preserve and restore essential basic structures and functions.
The ability of a system to adjust, modify or change its characteristics and actions to moderate potential, future damage and to take advantage
of opportunities, all in order to continue functioning without major qualitative changes in function or structural identity.
The ability to create a fundamentally new system when ecological, economic or social structures make the existing system untenable.
The combination of the probability of an event and its negative consequences.
A sudden event with an important and often negative impact on the vulnerability of a system and its parts. Shocks represent significant negative
(or positive) impacts on peoples means of living and on the functioning of a state.
A long term trend, weakening the potential of a given system and deepening the vulnerability of its actors.
A unit of society (e.g. individual, household, a group of people with common characteristics, community, nation), of ecology (e.g. a forest) or a
physical entity (e.g. an urban infrastructure network).
An expression of susceptibility to harm, and exposure to hazard.

Source: Berkes, 2007, Mitchell, 2013; OECD, 2014.

The Exchange

81

The Exchange

82

The Exchange

83

EVENT
Advancing Public Participation in the Audit Process:

84

A Capacity Building Workshop for the Middle East and North Africa (MENA)
Countries
Hammamet, Tunisia

Mona El-Chami
Senior Financial Management Specialist
Also Mehdi El Batti, Rama Krishnan, Carolina
Vaira, Franck Bessette, Wael Elshabrawi, and
Keith McLean[1]
Introduction: In recent years, many Supreme
Audit Institutions (SAIs) around the world
have begun pioneering different citizen
engagement
models
to
increase
transparency and accountability, enhance
the effectiveness of the audit process, and
ensure value for money in the use of public
resources. Despite increasing trends toward
public participation, engaging citizens
throughout the audit process is fraught with
potential complications. Indeed, the formal
mandate of all SAIs and the general limited
experience and capacity of both SAIs and
citizens has made it difficult to collaborate in
a meaningful and results-oriented way. The
challenges preventing effective engagement
between SAIs and citizens are many. For
instance, how can space be created for
citizens to interact with the audit process and
enhance external oversight? How can a set of
guiding principles be created for SAIs and
citizens to interact and jointly work toward
improving the audit process? A recent
capacity building workshop held in
Hammamet, Tunisia on Advancing Public
Participation in the Audit Process organized
by the Public Resource Mobilization and the
Management and the Governance and
Inclusive Institutions units at the World
Banks Governance Global Practice (GGP)
brought together representatives from the
SAIs of Egypt, Iraq, Jordan, Lebanon and
Tunisia to explore the value of citizen
participation in the audit process and identify
entry points for engagement. Tunisia case
was selected to be demonstrated as an
example form the MENA region supported
by its launched process of citizen
engagement. International experts from
Korea and the Philippines also participated to
share their experiences.
The MENA Region: External scrutiny and
audit in MENA is generally characterized by
weaknesses as noted in a World Bank review
[2] that summarized the Public Expenditure
and Financial Accountability (PEFA) exercises

in 6 countries. It also compared them to

other countries with similar levels of
development. The weakness depicted
concern both the capacity of the SAIs and the
legislative body charged with following up on
the audit reports. (See Figure 1). External
scrutiny and audit capacity in MENA is
comparable to these countries. Results from
a regional survey [4] of MENA countries
explored the perception of a sample of these
countries civil society organizations (CSOs)
(47) and media (27) concerning the quality of
public finance transparency and value of
SAIs. The survey provided information about
current interactions of different stakeholders
with SAIs. Sixty-six percent of those surveyed
indicated that they have not interacted with
their national SAIs in the last year. Those who
interacted, had done so mostly in the last
year. When asked about their interest in
collaborating with SAIs, 85 percent of
respondents indicated that they would like
to engage on a range of initiatives including
training and/or the creation of joint
committees and other related activities to
bridge the relationship between the public
and the SAIs. (See Figures 2 and 3). The
results of the survey will help to guide
regional collaboration between SAIs, CSOs,
and the media in the region, as well as World
Bank support for these processes.
The Case of Tunisia: Tunisias SAI, the Cour
des Comptes (the Court), is one of the first
movers of the MENA region in advancing a
citizen engagement strategy that is expected

to gradually address means for SAI-citizen

participation in the public audit process. The
Court is increasingly looking for more
innovative ways to make information
available to citizens, and to engage with
them in a more systematic manner. National
and Court efforts have been reinforced by
global engagements, such as the Open
Government Partnership.[5]

The National Action Plan also helps to

strengthen
the
overall
authorizing
environment for the Court to advance public
participation in the audit process, for
example, by publishing an annual report on
public sector audit activities in a simplified,
easily accessible and understandable form
for citizens. The vision of the Court is led by
the principles of independence, integrity and
professionalism. In this regard, the Court is
seeking to respond to the legitimate
concerns of citizens by identifying the audit
topics that matter to them. As the Honorable
Abdellatif Kharrat, President of Tunisias
Court of Accounts, noted: It is the SAIs
responsibility to make its work known to and

85
understood by the people and the work of
the SAI is led by the need to respond to the
legitimate concerns of the people. The
Courts new Communication Strategy (2015
2019) provides guidance to foster a
collaborative environment from which to
advance internal and external efforts on
three fronts: (i) Internal Communication:
Promoting transparency and the sharing of
information to create a sense of ownership
among different staff of the Court; (ii)
External Communication: Promoting the
image of the Court and strengthening its
relationships with other stakeholders. The
work of the Court needs to be known and
recognized by the people that benefit from
its work; (iii) Leveraging the use of
Transparency International and engaging
with social networks to facilitate broader
outreach and the timely dissemination of
information to communicate with external
stakeholders (with the support of bilateral
and multilateral donors, such as the
Netherlands Court of Audit, the World Bank,
and the African Development Bank).
International Comparative Cases
South Korea: Koreas engagement with its
citizens goes back to the 15th century during
the Chosun Dynasty. By hitting a sinmungo
(big drum), citizen concerns were elevated to
the Emperor. This tradition evolved when the
Board of Audit and Inspection (BAI) was
established in 1963. From 1971 to 2004, new
innovations such as the Civil Petition and
Complaints Reception Center, the Fraud
Hotline, the Open Audit System and the
Business Complaints Reception Center were
introduced as enhancements to the BAIs
existing system. The benefits resulting from
participatory audits in Korea are enormous.
Among the most important ones, citizen
participation contributes to reducing blind
spots for auditors. Citizens can help to pinpoint problems that would otherwise be
overlooked. Most importantly, citizen
participation has been instrumental in
enhancing transparency and accountability,
as well as in improving the performance of
public sector administration. The underlying
success factors include the following: (i) a
legal foundation should be in place to ensure
continued operation and resource inflows;
(ii) top managements support is necessary
to provide motivation to auditors; (iii)
offering various but related activities
increases citizen satisfaction; and (iv)
enhanced access through various online and
offline media encourages more active
participation (Board of Audit and Inspection
of Korea).
The Philippines: The relationship between
the Philippines Commission on Audit (COA)
and its engagement with citizens was
highlighted through the lens of the Citizen

Participatory Audit (CPA) project. The CPA is

an innovative initiative that focuses on
citizens and state auditors working together
in the conduct of joint audits. Under the CPA,
citizen representatives are included in the
COA audit team. They are trained in the audit
process and encouraged to participate in the
interests
of
enhanced
government
accountability. The projects desired
outcome was to pilot citizen-government
partnerships
to
support
the
institutionalization of participatory audits in

organizations to articulate the citizens

agenda. Within 24 months, the methodology
of the CPA was used to monitor the
performance of several key projects. The
underlying success factors included the
following: (i) the importance of leadership;
(ii) the use of pilot project(s) to ease the
transition of state auditors in working with
civil society; (iii) developing an appreciation
of the differences of each others institutions
and systems; (iv) clarifying roles and
expectations through a formal document to

COA. Since it was first launched in 2012,

several milestones have been achieved in
line with intermediate outcomes, including
the establishment of an enabling framework
for citizen engagement (policies, systems,
and processes), and the ability of civil society

manage expectations; and (v) state auditors

now see citizens as force multipliers,
especially given the limited number of
auditors in the country.

86
Lessons for the MENA region: There has
been a strong power shift from the
government institutions to the people in a
number of MENA countries that experienced
the Arab Spring. The people had voiced their
demand to basic services, for transparency,
and right to hold governments accountable.
SAIs need to respond to the popular
demands for more accountability and
information. Under participatory democracy,
the importance of CSOs as stakeholders in
SAIs has grown. New Constitutions may
stipulate specific new responsibilities
assigned to the government, the SAI and/or
the citizenry. Like in the case of Columbia and
Indonesia, the legislations for SAIs were
amended to include in their mandate, the
obligation to disseminate audit reports to all
relevant actors and implement participatory
practices during the audit process. The major
challenges faced by SAIs in the MENA region
include independence, availability of
financial and human resources, and technical
capacity. In addition, a key challenge is how
to open spaces where they can interact with
citizens to enhance external oversight. A
general consensus emerged that SAIs from
the MENA region could start taking ideas
from the experiences of other SAIs around
the world. They could begin taking small
steps toward designing
tailor-made

interventions that can include citizens in the

public audit process in the near future. SAIs
can begin work with citizens in the areas of
least resistance, for instance, in the audit
design/planning stages. Like in South Korea
and Argentina, SAIs receive proposals on
entities and programs to be audited for their
potential inclusion in the annual plan. In this
context, parallel efforts need to be made to
enhance CSO capacity so that they can
constructively engage with SAIs. Another
entry point would be raising public
awareness through the dissemination of
audit reports. These entry points could be
challenged by limited mutual understanding
between the CSOs and the SAIs. They could
also be made more difficult because of
existing mandates, systems and processes, as
well as the complex nature of audit reports.
Furthermore, integrating citizens without
undermining objectivity and professionalism
remains a challenge. Better and closer
cooperation would bring more opportunities
for joint workshops, training CSOs on the
audit process, and developing effective
communication plans.
Possible next steps could include a virtual
learning series incorporating additional good
practices, as well as peer-assisted processes
and technical assistance to promote better

SAI-CSO dialogue, the creation of working

groups, the building of frameworks for
engagement, and the development of
guiding principles for interaction during the
audit process
---------------------[1]. The authors all work in the Governance Global
Practice (GGODR) of the World Bank.
[2] Public Financial Management in MENA A Regional
Overview, World Bank, 2012.
[3] Public Financial Management in MENA A Regional
Overview, World Bank, 2012.
[4] Public Finance- Multi-Country Survey, World Bank,
December 2013.
[5] Open Government Partnership is an international
organization promoting multilateral initiative and
seeking strong commitments from participating
government institutions to promote transparency,
increase civic participation, fight corruption, and harness
new technologies to make government more open,
effective, and
accountable. https://en.wikipedia.org/wiki/Open_Gove
rnment_Partnership

Figure 1. MENA PFM in Global Comparison [3]

Source: Public Financial Management in MENA A Regional Overview, World Bank, 2012.

87
Figure 2. Interaction with SAI

Figure 3. Cooperation with SAI

Source: Public Finance- Multi-Country Survey, World Bank, December 2013.

Source: Public Finance- Multi-Country Survey, World Bank, December 2013.

EVENT
Building a strong, effective and accountable state:
Selected experiences
Istanbul, Turkey
August 16-18, 2015
Summary
The World Bank organized a capacity
building activity for Libyan civil servants in
Istanbul, between August 16 and 18, 2015,
funded through the State and Peace Building
Fund. This event was the third in a series of
capacity building activities for civil servants
in Libya including VCs (July 8) and the
training delivered face-to-face in Istanbul
(April 2015). Its objective was to build on the
knowledge shared during the previous
workshop (April 2015) and show how other
countries have built their state institutions
and public administrations after years of
severe civil war, while concentrating on
specific challenges. Building on the feedback
received at the end of the previous
workshop, this capacity building activity
covered four essential areas that are
inherent to an effective transition process in
a
post-conflict
environment:
local
governance, communication, transitional
justice, and institution building. Regional and
international experts with experience in
conflict states as well as career public
servants from countries that have
experienced similar democratic transition
processes shared a diverse set of
experiences. The list of lecturers is included
in the Agenda in Annex 1. The participants
had also the opportunity to discuss how
experiences from other countries might be
relevant and applicable to the Libya context
and also contribute to the discussion
through a group exercise finalized with

presentations
on
local
governance,
communication, and transitional justice.
26 senior civil servants and technical staff
(the list of participants is included in Annex
2) from the following selected agencies and
ministries attended the workshop: the
Bureau of Statistics & Census, MO(Planning),
MO(Local
Governance),
MO(Labour),
MO(Communication), MO(Oil & Gas),
National Audit Bureau, MO(Economy),
MO(Finance), MO(Industry), MO(Electricity),
MO(Health), MO(Education), MO(Housing),
Passport
Authority,
State
Property
Authority, National Policy Decision Centre,
Economic Sciences Research Center,
National Oil Cooperation, Tripoli University.
The complete list of participants is included
in Annex 2.

The summaries of the topics covered in each

session are included below.
Session 1: Setting the stage for institutional
building in a post-conflict environment:
selected country experiences and initial
lessons learnt
The first presentation exemplified the
vulnerabilities (such as politicization of the
public service, poorly trained staff, highly
centralized and poorly informed decisionmaking) that are common in post-conflict
public
administrations
and
the
consequences that derived from these
vulnerabilities in countries such as Sierra
Leone, Mozambique, Burundi, Sudan,
Somalia. It has also addressed the dilemma
of how to achieve the balance between
immediate existential needs and conflicting

88
longer term development and capacity
building needs. The second presentation was
based on the findings of the World
Development Report 2011 and the helix that
post-conflict/autocratic states have to
transition through to move from violence
and fragility towards resilience to risk. The
panelists also addressed the internal and
external stresses that countries face
throughout this process and underlined the
importance of inclusion and coalitions well
as on building on quick wins (e.g. electricity
reform in Liberia) to restore the confidence
needed in institutional transformation. The
speaker emphasized two key messages: the
need for priority setting in the post-conflict
phase and the difficult trade-offs that are
inherent
in
the
transformation
/reconstruction process. During the Q&A the
participants raised the following issues: the
need to draft a manual for decision making;
the importance of political balance,
prioritization, and conflict diagnosis; what is
the role of the international community in
re-building institutions? What support can
the WB provide (the disconnection between
the WB mandate focused on economic
issues and the current political needs which
are now priority in Libya)? The session was
particularly appreciated because it included
mechanisms for effective institutional
building and it stressed the importance of
collaboration between institutions and of
building trust between government and
citizens.
Session 2: Setting the stage for institutional
building The example of Croatia, 19952015
This session focused on presenting the
transition experience of Croatia from postconflict country in 1995 to EU and NATO
state member. The presentation discussed
the challenges encountered during this
process, the solutions implemented, and
how policy actions and steps were
prioritized. The four main components/steps
that characterized the transition process in
Croatia were creating the legislative
architecture,
building
institutions,
strengthening the institutional capacity
(particularly
human
capacity),
and
implementation
and
monitoring
of
performance. The lecturer underscored the
importance of having a vision, leadership,
and inclusion as well as building a road map
based on the vision and using champions of
change. Examples such as the procurement
compliance and debt enforcement reform in
Croatia were provided. The main message of
this session was that ownership of the
solution has to reside within the country:
whatever the solution to the current political
and security crisis, it needs to be owned by
the Libyans. The workshop participants were
interested to find out what the biggest
challenge was that Croatia had to face during

transition and how the new government

dealt with the supporters of the old regime.
They considered this discussion helpful
because it reflected similarities with the
current situation in Libya and included an
example of framework to use during
transition.
Session 3: Transitional Justice (TJ) An
overview
This session introduced the participants to
the transitional justice concept and the four
approaches that can be taken, alternatively
or complementary to achieve reconciliation:
criminal justice, truth-seeking, reparations
and institutional reforms with focus on the

security sector, judiciary. The discussion

addressed the current situation in Libya and
the progress made between 2011 and 2013
on deciding how the country should deal
with the past. The main take-aways from this
discussion were: the importance of
balancing the need for accountability
(including juridical) and moving the society
towards reconciliation, tailoring the
transitional justice model by combining and
sequencing the four approaches, the
importance to have a comprehensive TJ
strategy and social dialogue. Examples from
the former Yugoslavia, Peru, Guatemala,
Chile, Argentina and Morocco were shared
during the workshop. The Libyan
participants engaged actively during this
session and concentrated especially on the
usefulness of the 2013 Libyan TJ Law and the
best time to apply it. Participants also
wondered which of the four approaches had
Libya made progress on. The session was
appreciated because it centered on an
analysis of the Libyan TJ law and the progress
achieved until now in this area.

Session 4: Transitional Justice (TJ) The

case of Serbia
The good practices from countries of the
former Yugoslavia (particularly Serbia), were
outlined in this session: challenges and
lessons learned from different criminal
justice systems - e.g. the achievements of
the International Criminal Tribunal for the
former Yugoslavia; the War Crimes
Prosecution Office, the War Crimes
Departments in Serbia - in the High Court in
Belgrade (for trial) and in the Appellate
Court in Belgrade (for appeals); specialized
units for criminal justice prosecution in four
biggest courts in Croatia, the hybrid
character (national and international) of

criminal justice in Bosnia and Herzegovina.

Additionally,
the
session
included
recommendations
for
truth-telling
initiatives; types of material reparations
awarded by courts or by governments; as
well as institutional reform initiatives
undertaken by former Yugoslavia countries,
and lessons learned from the former
Yugoslavia case. The participants were
interested to know how long it will take to
achieve results in the TJ process. Most of
them agreed that the lessons learned from
this case could be applied to Libya despite
country differences.
Session 5: Local governance and
decentralization general overview. The
case of Yemen
The general presentation introduced the
main functions of local governments in
transitioning countries with focus on public
financial management and the following
questions: what should the local
government structure look like? which level
of local administration should spend and on
what (expenditure assignment)? what

89
sources of revenue should be assigned to
sub-national governments? how might fiscal
imbalances be resolved? how is the timing of
revenues to be managed and monitored?
what Exists in Libya today? The presentation
also included international best practice for
local government requirements and reform
proposals for: expenditure assignments,
revenue mobilization, capacity building, or
developing a transparent equalization
transfer mechanism. It was complemented
by a study case of the decentralization
reform in Yemen before the 2011 revolution
and afterwards, a case study that displayed
resemblances with the current situation in
Libya. The Libyans were interested to learn
more about the technical assistance
necessary in this area and raised the need for
training on how to implement a budget
reform.
Session 6: Local governance and
decentralization in Bangladesh
This session presented the constraints and
challenges of the decentralization process in
Bangladesh, the current local governance
structure, and the WB Municipal
Governance and Services Project, which aims
to improve municipal governance and basic
urban services in municipalities and city
corporations, as well as other local
governance support projects that were
implemented in Bangladesh. The Q&A
following session 5 and 6 focused on the
pitfalls of the current local governance law in
Libya, how local governments have the
capacity and resources to operate and
deliver services, and how the tribal element
plays into the decentralization process. The
Libyan examples and the tips in approaching
the local governance reform in Libya were
particularly appreciated.
Session 7 and 8: The role of information and
communication within the government and
between the government and citizens
country examples
A WB senior communications expert chaired
the two sessions on the role of
communication in a post-conflict country.
The first part was dedicated to policy
options, country examples (such as Iraq) and
what communication can achieve (i.e. public
opinion as the basis of power and legitimacy;
communication as a market in which the
sellers governments, interest groups,
business can achieve the buyers citizens
loyalty and the organization of the media
system). This part also stressed the role of
communication in building a sense of
country identity and the importance of
knowing well the audience. The media
situation in Libya was also discussed. The
second session addressed the topics of
internal government communication and
outreach to external parties, particularly

citizens (resources, capacity, etc.), pointing

out to the interdependence between policy
and
communication.
Specific
recommendations and a short exercise
asking participants to identify the main
challenges in the communication realm were
also included. The participants expressed

interest in learning how to neutralize the

influence of old media, how to build
communication departments in ministries,
and whether a local law to control media is
more appropriate vs. a nation-wide one
while also expressing frustration regarding
the non-transparency of the Libyan media.
They considered this topic timely because it
is one of the biggest challenges faced
currently. The workshop included also a
group discussion exercise at the end of the
two day in which participants created three
groups and were asked to discuss the three
main topics of the workshop local
governance,
transitional
justice,
communication, diagnose the current
status of the issue in Libya and identify the
main challenges and root causes of problems
that they face in each of the three areas.
Each group presented its findings to the rest
of the participants and speakers offering
compelling in-depth analysis of the issues
that they currently confront as well as
approaches that the government could take
in moving forward on each of the three
subjects.
Workshop evaluation. The participants were
asked to evaluate the relevance and
usefulness in understanding the topics
discussed in each of the workshop session
and to provide additional examples of
subjects that they would be interested to
learn more about. Regarding the sessions in
the first day institutional building and
transitional justice - 77% of the participants
rated their usefulness with 6 or above on a
progressive scale of 1 to 10, 47% using scores
of 8 or above. As for the sessions on local
governance and communications in Day 2,
80% of participants considered them helpful
rating the sessions with 6 or above, while
50% used scores of 8 or higher. Additionally,
the participants appreciated the fact that
this workshop was more focused than the
one in April, narrowing down on a few topics

of interest, and that it included more country

examples on each topic. The participants
also pointed out as additional topics of
interest for future VCs and Workshop
events: mechanisms to build up a
comprehensive country strategy and design
effective policies for different sectors;
modalities to create a
road map and prioritize,
ways to put in place the
mechanisms of decision
making and perform a
diagnosis
of
the
challenges that need to
be addressed; fighting
corruption; reforming
the education system;
creating profitable and
legal
contracts;
procurement; financial
management; achieving
and maintaining security; the psychological
element during transition. The organizers
and presenters noted the Libyan civil
servants interest and commitment to
analyze all the topics presented through the
Libyan perspective and reality, and their
interest for the presentations and
discussions that were tailored to the current
situation in the country and were close to
their experiences and jobs. Moreover the
participants expressed interest in learning
more from successful country examples and
focused a lot on the implementation stage of
the issues discussed.
Conclusion. The training was a successful
event and achieved its stated objectives. The
Libyan participants expressed great
satisfaction about the topics covered during
the workshop and excitement about the
group exercise. They showed interest in
learning more from international best
practices and from the experience of
countries which have gone through similar
transition processes. Finally some of the
participants created a core group that plans
to build on the workshop discussions on
communication and explore how their
analysis on this topic could be translated in
practice in their institutions. Beyond
reaching its objective, the workshop
represented the basis for identifying areas of
further engagement with the Libyan civil
servants and a rare opportunity to
consolidate relations with technical experts
in Libyan line ministries and academia.
GGODR will plan further capacity building
activities for the Libyan civil servants,
including through partnerships with other
international organization such as European
Union. The objective of these trainings is to
provide the Libyan civil servants knowledge
and skills that will enable them to translate
international transition best practices in the
Libyan system.

90

Bootcamp

BTOR: Lebanon (CFR)

Quality Control and
Peer Review on Audit
Firms - Regional
Workshop
Beirut, November 3-5, 2015
Cleared
by
Hisham
Waly, Practice
Manager, PRMM and PSP, GGP

Background & Objective:

Under the patronage of his Excellency
Minister of Finance Mr. Ali Hassan Khalil, the
World Bank (co-TTLs, Gabriella Kusz, Sr. FMS,
and Rima Koteiche, Sr. FMS) has
collaborated with the Lebanese Association
of Certified Public Accountants (LACPA) and
the American Institute of Certified Public
Accountants (AICPA) to organize theQuality
control and Peer review on audit firms
training on November 3-5, 2015. An opening
ceremony took place on Nov. 3, 2015
preceded the two- days technical training
where keynote words were provided by: Mr.
Ferid Belhaj, Country Director- World Bank,
Mr. James Brackens, Vice President Ethics
and Practice Quality- AICPA, Mr. Elie
Abboud, President- LACPA, Mr. Alain Bifani,
DG, MOF- Lebanon representing the
Minister of Finance. The ceremony gathered
delegates from local, regional supervisory
and regulatory bodies, and government

officials, to launch the Peer review and

quality assurance training reflecting
international practices and its importance in
the financial business environment. A
System of Peer Review includes determining
whether the firms system of quality control
for its accounting and auditing practice is
designed and complied with to provide the
firm with reasonable assurance of
performing and reporting in conformity with
applicable professional standards, in all
material respects. The two-day technical
training aimed to provide technical learning
to practicing auditors on the peer review and
quality assurance requirements and process,
an important element in the membership
with the International Federation of
Accountants (IFAC). This event is part of a
larger program that the World Bank has been
supporting LACPA to lead the advancement
of the profession of accounting and auditing
in Lebanon both in the private and the public
sector.
Participants:
More
than
60
participants attended
the
technical
workshop.
The
participants
were
professional practicing auditors from LACPA
(Lebanon), the Jordanian Association for
CPAs (Jordan) and the Egyptian Society for
Accountants and Auditors (ESAA).
Content and Delivery: The two-day technical
training included several sessions which
addressed the whole cycle of the peer
review: planning, performance, reporting
and administering the review in addition to
several practical case studies. The sessions
were delivered at the Institute of FinanceBasel Fleihan Institute by James W. Brackens,
Jr, Vice President of Ethics and Practice
Quality at AICPA, and Michael L. Brand, chair
of the Accounting and Review Services
Committee at the AICPA.
Outcomes: After the delivery of this
workshop on Peer review and Quality
assurance, the participants are able now to:

Recognize the requirements for enrolment in

the peer review program.
Differentiate between the types of peer
reviews and the objectives if each type
Recognize administrative requirements for
performing a peer review
Determine the correct organization of the
review team
Identify technical qualifications required to
serve as a peer reviewer.

Next steps: Now that a large regional team

of trained peer reviewers are ready, the
voluntary peer review process will be kicked

off in Lebanon in the couple few months in

alignment with the LACPA strategy and IFAC
membership requirements. The pilot peer
reviews will shape the process in Lebanon
and give confidence in the existence of an
independent oversight of the professional
conduct of practicing accountants and
auditors from the point of view of protecting
the public interest.

Bootcamp
BTOR: Lebanon (PFM)
Application of the
International Public
Sector Accounting
Standards (IPSAS)
Congress
Beirut, June 10-12, 2015
Cleared
by
Hisham
Waly, Practice
Manager, PRMM and PSP, GGP

Background & Objective: Under the

patronage of his Excellency Minister of
Finance Mr. Ali Hassan Khalil, the World Bank
(TTL, Rima Koteiche, Sr. Financial
Management Specialist) and the Lebanese
Association of Certified Public Accountants
(LACPA) have organized the International
Public Sector Accounting Standards Congress
on June 10-12, 2015. An opening ceremony
took place on June 9, 2015 preceded the
three- days technical training where keynote
words were provided by (i) Mariano
Damore, IPSAS board public member, (ii)
Pierre Messali, World Bank Senior Public
Sector Specialist, (ii) Mr. Elie Abboud, LACPA
President, and (iv) His Excellency Mr. Ali
Hassan Khalil, Minister of Finance. The
ceremony gathered delegates from local,
regional, and international supervisory and
regulatory bodies, government officials and
corporate leaders, to reflect the IPSAS
application and its importance in a public
financial management system. The threeday technical training aimed to provide
technical learning to staff directly implicated

91
by IPSAS application. This event is part of a
larger program that the World Bank has been
supporting LACPA to lead the advancement
of the profession of accounting and auditing
in Lebanon both in the private and the public
sector. This event was supported by World
Bank team: Amal Chaoul, program assistant
for the logistical arrangements, while Joey
Ghaleb (Sr. Public Sector Specialist), and
Gretchen Biery (Sr. Governance Specialist)
assumed the technical coordination with the
FMR2 project.
Participants:
More
than 150
participants attended the technical training.
The participants were mainly from MOF, and
LACPA that are directly and indirectly
involved with IPSAS application and
implication.
Content and Delivery: (Attached above
agenda, WB keynote and press releases). The
three-day technical training included several
workshops which addressed the definitions
and practical applications
of the
International Public Sector Accounting
Standards (IPSAS), specifically regarding:
- Fixed Assets (properties, plant and
equipment, service concessions).
- Presentation of the Financial Statements
(discussing the cash basis accounting)
- Liabilities (Employee benefits)
- Consolidated Financial Statements
(includes comparing the budget prepared on
the cash basis to the one prepared on the
accrual basis)
- Revenues (particularly Taxes and Grants in
IPSAS 23).
- Opening Balance Sheet & Transition to
Accrual Accounting (including other
countries adoption experiences)
- Financial instruments
The sessions were delivered at the Institute
of Finance- Basel Fleihan Institute by Paul
Mason, technical manager at IPSAS Board
(IPSASB), and Ross Smith, technical manager
at IPSAS Board (IPSASB).
Conclusions and key recommendations:
Upon explaining IPSAS and its application
mechanisms, especially by adopting clear
bases and rules for preparing financial
statements, in such a way that reinforce the
principle
of
transparency
in
the
administration and expenditure of the public
finance, the following suggestions were
formed at the conclusion of the Congress:
6. Supporting the guidelines of the
Minister of Finance regarding the readiness
of the public administrations in order to
benefit from the opportunity to develop
their systems in a way that is compatible
with the International standards, within his
vision to develop the work of the public
sector institutions.
7. Establishing a global vision along with a
work program that includes all the required

procedures, steps, time schedule and

transitional period to implement such
standards.
8. Forming an ad hoc body or committee
comprising representatives from the
Ministry of Justice, the Ministry of Finance,
LACPA, and the World Bank, in addition to
international specialists in the domain in
order to establish an executional work plan
aiming at preparing the adequate ground for
implementing the IPSAS, including but not
limited to: preparing such standards to start
implementing them while establishing time
deadlines for all procedures and suggestions
included within the said work plan.
9. Endeavouring to provide necessary
professional human resources, equipment
and software in order to start the
implementation of the standards subject to
the congress.
10. The initial commitment by the legislative
and executive powers to implement such
standards.

Bootcamp

Training Libya, Lebanon

and Palestine SAIs on the
Supreme Audit Institution
Performance Measurement
Framework (SAI PMF)
Bootcamp
April 2015
Istanbul, Turkey
Mona El-Chami, Rima Koteiche, Nadi
Mashni

A bootcamp on INTOSAIs Supreme Audit

Institutions Performance Measurement
Framework (SAI PMF) was organized by the
World Bank Governance Global Practice,
Public
Resources
Mobilization
&
Management team in Istanbul, Turkey
during in April 2015. The Arabic-delivered
bootcamp brought together staff and
managers of the Libyan National Audit
Bureau (NAB), Lebanese Court of Accounts
(CoA), and Palestinian SAACB in. The
objective of the bootcamp was to: (i)
understand the purpose of undertaking a SAI
PMF assessment and how the reports can be
used by the SAI and external stakeholders to

establish a baseline for measuring any future

progress and stimulating strategic planning
and further capacity development; (ii)
understand the strengths and limitations of
the SAI PMF; (iii) be able to apply the
principles and methodology in planning,
implementing and reporting on a SAI PMF
assessment; (iv) be able to identify a suitable
process for conducting a SAI PMF according
to the purpose of the assessment and the
country context; and (v) to learn about the
experience of the Palestinian Supreme Audit
and Administrative Control Bureau (SAACB)
in conducting a SAI PMF. The bootcamp was
delivered with support from ARABOSAI and
SAACB. The participants were provided with
certifications of having attended the SAI
PMF Assessors training course by INTOSAI,
which qualifies them to perform SAI PMF
assessments.

Bootcamp
BTOR: Lebanon
Internal Audit and
Internal Control in the
public sector workshop
Lebanon Fiscal
Management Reform 2
project (FMR2)
Beirut, December 7-8, 2015
The World Bank organized in collaboration
with European Union and the Ministry of
Finance of Lebanon a workshop entitled
Internal Audit and Internal Control in the
public sector on December 7-8, 2015, as
part of the World Bank- financed project
Lebanon Fiscal Management Reform 2
project.
The objectives of the workshop which
gathered senior technical Lebanese staff
from the Ministry of Finance, Inspection
General, and Court of Accounts were to:
(i) underscore relevance and importance of
modern internal audit function in a public
financial management system,
(ii) present on the internal controls progress
implementation achieved within the
Lebanese controls framework
(iii) share knowledge and provide a forum for
discussion of good practices regarding
internal audit, internal controls, and external
audit at the public level while drawing on
international experiences and available
standards and guidelines, and
(iv) share actual successful implementation
of public sector internal audit in other
countries (France and Turkey).

92
The two-day workshop was a cornerstone
towards raising awareness on the
importance of the internal audit function in
the public sector and its distinction with
other control functions such as the
inspection general, and its complementarity
to external audit function carried out by the
country Supreme Audit Institution (SAI).
Participants: More than 20 participants from
Lebanon attended the workshop. The
Lebanese participants were senior technical
officials from Ministry of Finance, the
Inspection General, and the Court of
Accounts.

World Bank: Rima Koteiche, Sr. FMS

(workshop facilitator and coordinator) ;
Pierre Messali, Sr. FMS; Anna Staszewicz, Sr.
Risk Management Officer; and Walid ElNajjar, FMS

European
Union: Herve
Allais, Resident
consultant
twinning
arrangement

France : M.
Viault, Directeur
des
Risques MOF-France; M. Caze, Court of
Accounts France

Turkey: Halis Kiral, Head of Central

Harmonization Unit- Turkey; Ahmet
Koray, Public financial Expert- MOF- Turkey

Institute of Internal Auditors: Naji

Fayyad, Governor, IIA Lebanon Chapter
This event was coordinated with Joey
Ghaleb, Sr. Public Sector Specialist, and TTL
of FMR2 project, and supported by Amal
Chaoul, Program Assistant for the logistical
arrangements.

Content and Delivery:

The two-day workshop included several
sessions which addressed the definition of
Internal Audit as per International Standards
on Professional Practices of Internal Auditing
(Institute of Internal Auditors) sand other
guidance and Internal control in a public
financial management system, as well as an
overview of the financial control framework
in Lebanon and in MENA. The event was
marked by presentations of the French
experience
in
the
Internal
audit
implementation in France, its organization,
and its relationship with Inspection General
and the Court of Accounts. The French model
highlights the presence of a central
harmonization Unit (CHU) that is a playing a
crucial role in coordinating the interventions
of the several control bodies in France. This
has helped tremendously the Lebanese
participants to get a better understanding on
what can be achieved in Lebanon at that
level and how the different control bodies
work together efficiently towards a better
governance scheme in the country.
Another successful implementation of
Internal Audit in the public sector was
brought to this event by Turkey, that has
been successfully implementing internal
auditing since more than ten years now, and
have reached a very advanced stage of
maturity making it one of the top leaders in
that area and is currently providing technical
support to other neighbouring countries in
IA implementation at the public sector level.
The event took place at the World Bank
premises- Beirut and delivered by:

Outcomes
After this workshop, the Lebanese
stakeholders are now able to:
1. Recognize the importance of Internal
audit in a public financial management
system.
2. Differentiate among the different types
of control functions and the role and
objectives of each:
a.
Internal Audit vs. External Audit (CoA),
b. Internal Audit vs. Inspection (Inspection
General), and
c.
Internal Audit vs. Internal controls.
3. Recognize the impact of Internal Audit
function and learn from successful
implementation both in France and Turkey,
and have the necessary technical awareness
to embark in the implementation of the pilot
internal audit.
Next steps:
Kick off the Internal Audit implementation
at the MOF-Lebanon on a pilot basis; ToRs
are already cleared and hiring of consultants
in charge of assessment, design,
development of IA manuals and training are
being currently processed (as part of the
FMR2 project)
Additional focused round tables will be
arranged as needed to reinforce the
importance of IA for improved synergies
with other control functions within the
Lebanese public financial management
framework.

Bootcamp
Libya PFM/PIM
The World Banks (WB) Governance
Practice (PFM/PIM) have been engaging
with Libyas public administration over the

past several years. Most recently, the WB,

in conjunction with the International
Monetary Fund (IMF), engaged in Libyan
national budget discussions with 28
members of Libyas technical budget
administration during theDecember 8-11,
2015 period.
The
Libyan
Public
administration
counterparts
included
members of the Central Bank of Libya,
Ministries of Finance and Planning, Audit,
and the National Oil Company. These
December budget discussions serve as a
follow-up to earlier discussions in March
2015 which provided the impetus for some
budget consolidation and the gradual
reduction of government subsidies.
During December 15-18, 2015, the World
Banks Governance, Social Development
Practices, and Private Sector Development
Global practices will engage in a joint
UNDP/UNSMIL meeting with the technical
experts from Libya to assist in planning a way
forward for the near-and-medium terms.

Bootcamp

MENA: Advancing Public

Participation in the Audit
Process in MENA Bootcamp
May 2015
Hammamet, Tunisia
Mona El-Chami, Mehdi El Batti, Rama
Krishnan, Carolina Vaira, Franck Bessette,
Wael Elshabrawi, and Keith McLean

A bootcamp on Advancing Public

Participation in the Audit Process was
organized by the Public Resource
Mobilization & Management and the
Governance and Inclusive Institutions units
at the WorldBanks Governance Global
Practice (GGP) in June 2015. The bootcamp
brought together representatives from the
Supreme Audit Institutions (SAIs) of Egypt,
Iraq, Jordan, Lebanon and Tunisia. The
objective of the bootcamp was to explore
the value of citizen participation in the audit
process and identify entry points for
engagement between the citizens and
SAIs. Tunisia SAI case was demonstrated as
an example form the MENA region based on
its launched process of citizen engagement.
Both the Korean and the Philippines relevant
experiences were drawn upon to enrich the
discussion and provide good examples of
citizens-SAIs cooperation.

93
Bootcamp

Bootcamp

MENA: Strengthening the

Role of Parliament in
Financial Scrutiny MENA
Regional Annual Seminar

Iraq: Banking Regulation

and the Role of the
Parliament Round Table

April 2015
Beirut, Lebanon
Mona El-Chami, Lida Bteddini, Miriam
Bensky

The MNA Regional Annual Seminar on

Strengthening the Role of Parliament in
Financial Scrutiny was organized by the
Public
Resources
Mobilization
&
Management team and the Parliament
Strengthening Program at the World Bank
Governance Global Practice in Beirut,
Lebanon in April 2015. Hosted by the Arab
Institute for Parliamentary Training and
Legislative Studies and supported by the
Westminster Foundation for Democracy
(WFD), the seminar brought together
Members of Parliament from Finance and
Budget Committees, Public Accounts
Committees, Committee Staff, and SAIs from
Morocco, Tunisia, Iraq and Lebanon. The
objective of the seminar was to provide a
forum for parliaments in the region to
exchange experience and knowledge on how
they scrutinize the budget and exercise their
external audit function, in particular: (i)
gaining a better understanding of global
research and international good practice on
the role of parliament in oversight of the
national budget; (ii) Enhancing their
awareness as to the different tools and
processes parliamentarians can use in
budget scrutiny, including access to data,
relationship with the SAI, and citizen
engagement tools; (iii) Strengthening the
capacity of parliamentary staff to undertake
their
administrative
and
technical
responsibilities; and (iv) Developing countrylevel action plans aimed at translating
regional and global knowledge into countrylevel action points. The seminar benefited
from presentations and interventions from
different regions and countries including
Europe, South Africa, Canada, UK, and
Nigerian.

April 2015
Beirut, Lebanon
Mona El-Chami

A round table on the Banking regulation and

the role of Parliaments was organized by
the World Bank Governance Global Practice,
Public
Resources
Mobilization
&
Management team in Beirut in cooperation
with the Finance and Markets Global
Practice in Lebanon in April 2015. The
roundtable was hosted by the Training and
Legal departments of the Central Bank of
Lebanon and the cole suprieure des
affaires. The general objective of the round
table was to equip Iraqi legislators, in
particular the banking sub-committee of the
Finance Committee, with the technical
knowledge to design policies and
frameworks that will enhance the regulatory
framework of the banking sector. The
banking sub-committee was in the process of
revising the banking law and needed specific
questions answered. The choice of the
Lebanese experience was based on the
resilient financial system that Lebanon
managed to establish and maintain despite
all the odds.

Bootcamp
LACPA Conference
Quality Financial
Reporting Serving
the Economy

On November 25 and 26, 2015, I participated

in the 20th International Congress of the
Lebanese Association of Certified Public
Accountants (LACPA). This years congress
was titled Quality Financial Reporting
Serving the Economy. I represented the
World Bank in a panel discussion of the
International Public Sector Accounting
Standards (IPSAS).

The panel discussion took place over a 90

minutes session titled Importance of
Applying IPSAS on Economic Growth and
Transparency of Government Accounting.
Other members in the panel included the
Chairman of the Budget and Finance
Parliamentary Committee of the Lebanese
Parliament, and the Director General of
Finance in Lebanons Ministry of Finance. My
presentation focused on the IPSAS
contribution to better governance and
transparency, special considerations in
transition to IPSAS, as well as examples of
successful implementation of IPSAS.

94

Cross-Cutting

Syria 94
Photography 95
Social Contract 97
Year in Review 100
Books 103

The Multiple Tragedies of Syrias Displaced Women

Why the G20 Needs to Pay Attention
Omer Karasapan
Knowledge Coordinator
Roughly half of the worlds 60+ million
displaced people are female. This figure
includes 19 million refugees and 41 million
internally displaced people (IDPs). This the
highest number ever recorded and the
numbers continue to rise. According to the
United Nations High Commissioner for
Refugees (UNHCR), Antonio Gutierrez, We
are witnessingan unchecked slide into an
era in which the scale of global forced
displacement as well as the response
required is now clearly dwarfing anything
seen before.
Already facing multiple inequalities, women
face significantly
greater
risks in
displacement especially discrimination,
grinding harassment, and often sexual- and
gender-based violence. Host and transit
countries need to be aware of the specific
dangers faced by women and try to provide
for the safety and special services they
require, especially for the most vulnerable,
that is, unaccompanied women and children,
female-headed families, and pregnant,
disabled, and older women. However, many
countries are overwhelmed with the sheer
numbers and are unable to adequately
respond, despite the efforts of local and
international humanitarian agencies. The
single largest source of forced displacements
in the world remains Syria, with over 4
million refugees and about 8 million IDPs. In
October 2015, a further 124,000 Syrians
were displaced from their homes in Aleppo
and Idlib as the Syrian army, with Russian
and Iranian support, went on the offensive.
Currently, Turkey is estimated to host some
2.2 million registered Syrian refugees, with
over one million registered in Lebanon and

630,000 in Jordan. The actual numbers are

higher. Roughly a quarter of this population
are women and half are children under the
age of 17. The trauma of being a refugee cuts
across gender, ethnic and sectarian lines, but
women tend to fare worse when it comes to
many outcomes. In Egypt, Iraq, Jordan and
Lebanon, one in four families, or 145,000
families, are female headed with tens of
thousands or more such families in Turkey. A
2014 UNHCR report stresses the
vulnerability of these families: Life in exile
for these women has meant becoming the
main breadwinner and caregiver, fending for
themselves and their families, away from
their communities and traditional sources of
support. For most, the burden is
overwhelming, and many are entirely
dependent on outside assistance. These
households tend to have greater debt, less
food, more children at work and are subject

to greater degrees of violence, sexual and

otherwise. This is happening as winter
approaches and the situation for Syrian
refuges in neighboring countries is
deteriorating as funding for humanitarian
support runs low. Hundreds of thousands
have had aid sharply curtailed in Jordan and
Lebanon. The World Food Programme (WFP)
states that 80 percent of Syrian refugees in
Jordan are living below the poverty line, and
well over half of those in Lebanon. Food
insecurity afflicts 85 and 79 percent of these
refugees respectively and echoing the
UNHCR underlines the much higher
vulnerability for families headed by women.
The vulnerability of young displaced women
and girls has also led to massive increases in
involuntary child marriages. With fears of
sexual violence, many families quickly marry
off their daughters for protection or for fear
of the girls honor. Many also need the

95
dowry payments. According to Isadora Quay,
a Gender in Emergencies Specialist from
CARE, Weve seen a massive increase in
child marriages in Syria and Iraq andas far
afield as Egypt. Marriages of children under
18 had trebled among refugees in Jordan in
2014. Women refugees in Turkey also cite
the pressure to enter into marriages as one
of their most serious challenges. According
to the UN, among rural Syrian families where
marriage before the age of 18 was common,
now girls as young as 13 and 14 are being
married, often to much older men. While in
Syria the minimum age for marriage is 16 for
girls, it is 18 in Turkey and Jordan, though in
the latter a waiver is rare but possible.
Therefore in both countries, marriages of
girls under 18 are illegal. Also, many girls end
up as second or third wives. In Turkey,
where the practice of polygamy is illegal and
had practically disappeared, it is now
resurfacing. This means that many of these
marriages are illegal, as can be the urfi or
traditional marriages in Jordan and Lebanon

that are often not documented properly,

leaving the women with little legal
protection. The impact on these girls can be
devastating with an increased risk of health
problems, especially related to births, health
issues for the newborn, greater risk of
violence within families, and the impact of
leaving ones family, school and community
at an early age and its attendant
psychological impact. Leaving school early is
also strongly linked to being trapped in a life
of poverty. The current large movement of
refugees into Europe poses risks for all
refugees, but especially for young girls and
women who need additional protection and
appropriate services and shelter. Sheltering
or incarceration with large numbers of men,
and the sharing of facilities, is a challenge for
women and children. Most at risk are
unaccompanied women and children who
are falling prey to organized crime groups
intent not only on trafficking for sexual
purposes, but also to recruiting slave labor.
The growing number of separated children

and women during the trek through Europe

exacerbates this tragedy with the UNHCR
receiving reports of children engaging in
survival sex. With winter coming and
neighboring and European nations struggling
to cope, it is vital that the G20 pay special
attention to the plight of women refugees
especially
when
under
Turkeys
Chairmanship and with strong EU support,
they have decided to step beyond their usual
narrower economic mandate. It is not easy
to focus host and transit countries on this
issue. Yet providing women with livelihood
support, safe shelters for them and their
children, health care, family reunification,
protection from harassment, and making
available police and other professionals to
deal with criminal activities and their victims
is imperative. The UNHCR sees Syrian
women as the glue that holds a broken
society together. Any support to them will
greatly facilitate the emergence of stable,
adaptive communities whether back home
or abroad.

CV MENA Recommends
Capturing the Refugee Crisis Through a Camera Lens

The Work of Emily Pinna

Interview by:

Franscesca Recanatini
Senior Economist
CV MENA: Why is it important to use pictures to document this crisis
and capture this story? How did this idea come about?
Emily Pinna: I had heard so much about the refugee crisis and it was
getting worse by the day. As many of us, I felt I had to do something
to help and decided to narrate the crisis by using my skills and training
as a visual storyteller. The format that I chose is that of a visual
chronicle consisting of a few powerful selected pictures with extended
captions. In my experience, this is a powerful format that combines
the instant power of images with concise and to-the-point narratives.
It is very useful in creating an instant connection between the
audience and an event, while being informative at the same time. In
addition, I really wanted to learn more about the refugees, who they
are, what reality they left behind, what their dreams are, and why they
decide to subject themselves and their children and elders to such
perilous journeys. It breaks my heart to see, after the most recent
terrorist attacks in Paris, that people confuse refugees with terrorists.
In many cases the refugees are the direct victims of those exact
terrorists. If only we were all more compassionate!
CV MENA: How can these photos and information complement what
we already know? How is this relevant for a development
organization like the World Bank?
Emily Pinna: In my opinion, with exceptions, development
organizations approach communication with an angle that is
exceedingly analytical. This approach is justified in the case of
comprehensive development reports. However, the analytical angle
does not work as well in emergency/crisis situations. In such cases,
too much focus on analysis and dry figures make reports hard to read

and disconnected from the actual issue which in the end is the
stories of human beings and their families as they face adversity,
suffering, sometimes death, and hopefully redemption or success. I
believe bringing the human dimension into the narrative is very
important. It is the personal human stories that touch us the most.

CV MENA: What does this new way of conveying information offer to

development practitioners that is different and useful for their work?
Emily Pinna: Visual storytelling and the visual chronicle format in
particular is very useful because it combines photography with
narrative. The former is essential to create an emotional link between
the reader and the subject of the photograph. This is critical to elicit
in the reader an emotional response and a desire to learn more about
the subject of the photography. The extended caption provides the
information that the reader is seeking about the events and people

96
that are being photographed. I believe that this format which
combines empathy with information has a role to play in the reporting
and advocacy works of development organizations such as the World
Bank. With this specific work, I also wanted to communicate the
personal dimension of the tragedy as I lived it. As it happened, events
took on a life of their own because just a few hours after landing in
Lesvos, I found myself helping out of a plastic dinghy 50 refugees from
Afghanistan, some of them literally collapsing in my arms. What
struck me was that, except for a handful of other helpers who like me
happened to pass by that stretch of coast at that time, there was no
network, no organization, no doctors, nothing. It was just one human
being helping another human being. It was overwhelming, and I was
certainly not prepared for that. One thing is clear, you do not board a
shabby, overcrowded plastic dinghy, while wearing grass filled life
vests, putting your own and your childrens life at risk, if you have any
other thinkable option. These people are running for their lives, they
simply have no option.
CV MENA: Can visual storytelling more broadly help development
practitioners to better understand some of the challenges we face?
Are there any other areas in which this approach could be applied to
help Bank staff in their work?
Emily Pinna: As I said, I believe visual storytelling and visual
chronicling can and should be used more, especially whenever
awareness needs to be raised about an emergency or crisis situation,
or when the human angle needs to be emphasized (which is often).
As we know, images can convey information and emotions very
rapidly, and the extended captions provide a set of concise initial
elements of information. Than the deeper, more analytical, figures,
numbers, and extended narrative can follow. But the first impact
should always be visual in my opinion. This is an area in which
development organizations can improve. Non-governmental
organizations (NGOs) are often better at this.
CV MENA: What did you learn from this particular project and
experience?
Emily Pinna: I learned many things both as a professional and a human
being. As I think back about the refugees I met, especially those
Afghans who I helped out of the boat, I am confronted with an urge
to learn more about where they are now and how fate is treating
them. I would love to visually chronicle the journey of two or three
refugee families as they cross Europe to reach their destinations and
attempt to settle. In the end, we are interested in specific human
experiences that we can relate to. Getting to know our fellow human
beings and learn about their stories as they develop. A sort of reality
storytelling. Between 50 to 100 of these 'plastic boats' are arriving
each and every day to the shores of the Greek island of Lesvos,
separated by the Aegean Sea from Turkey by only 10 kilometers.

Emily Pinna graduated from the Maryland

Institute College of Art with an innovative
Masters Degree in Social Design. She is a
certified
professional
photographer
(Washington School of Photography), and also
holds a Masters Degree in Communications
from the University in Bonn/Germany. She is a
visual storyteller, photographer and social
impact designer. She has worked for several
international organizations, including the
community outreach program at the World Bank. She currently
divides her time between Luxembourg and Washington, DC and
travels often on assignments. www.emilypinnaphotography.com
To see the full Blog//Visual Storytelling Chronicle, please visit:
WWW.EMILYPINNAPHOTOGRAPHY.COM/BLOG

It is a desperate decision to board such an overcrowded, unfit boat, as

the likelihood that they will never reach the Greek shore is pretty high.
It is also a business. The refugees pay between 800-2000 to
smugglers per person. The one who agrees to be the driver of the
boat, gets a free ride and a 5-minute introduction on how to 'drive'
the boat. If the refugees are lucky, they are greeted by some very
dedicated volunteers who provide some dry clothes, water and food
as there is no structure in place, no big humanitarian organization
dealing with this human exodus in a professional way. In this case, the
boat did not arrive at Skala Skaminias the shore where most boats
arrive but just outside the capital of Mitilini. I happen to spot them,
pull over and help the exhausted refugees out of the boat. There were
around 60 people fitted tightly into each boat. Luckily there were
another three, more experienced, volunteers driving by who knew
what to do, and together the four of us did what we could to help. We
had people collapse in our arms, with no help or doctor nearby. We
drove them to the nearest camp.

Children are the most vulnerable of travelers. There are no statistics

about child mortality among refugees as they travel to Europe. The
boy above is among the lucky ones who made it safely to Europe.
Others are not so lucky. When boats capsize, they are the first to die.
The coast of eastern Lesvos is littered with thousands and thousands
of discarded life vests. If those of adults are fake and stuffed with
sponge-like material or grass, those worn by children are pathetic
pieces of cheap plastic, originally intended as toys. In fact, many of
these vests carry warnings in English, such as "does not prevent
drowning" and "not for boating".

What is the Social Contract?

Why does the Arab World Need a New One?
Shanta Devarajan,
Chief Economist, MENA Region
The social contract is an idea that dates
back to the ancient Greeks, and refers to the
implicit agreement among members of a
society that defines their relationship with
each other and the state. That relationship
holds the key to unravelling the puzzle of the
Arab Spring. To development economists
like myself, the uprisings that started in
Tunisia and spread to several countries in
the Arab world in 2010-11 came as
somewhat of a surprise. For the previous
decade, almost all of the indicators of
economic well-being were strong and
improving. The growth in gross domestic
product (GDP) was substantial, at about 5
percent a year. Extreme poverty (defined as
people living on US$1.25 a day) was low and
declining. The conventional measures of
inequality, such as the Gini coefficient, were

lower than in other middle-income

countries, and in some cases declining. In
Egypt and Tunisia, the per-capita income of
the bottom 40 percent was growing faster
than the average. In terms of human
development, the Middle East and North
Africa region recorded the fastest decline in
child mortality rates and the steepest
increase in school attainment. Yet, as
various Gallup and World Values Surveys
indicate, there was growing dissatisfaction
in these societies, which erupted in
revolutions in four countries and popular
protests in several others. While much of
the protests were about voice and political
accountability, there is still a puzzle about

how there could have been so much

discontent in the face of seemingly strong
and improving economic conditions. The
solution lies in the nature of the social
contract in these countries that, on the one
hand, delivered the favorable indicators, but
on the other hand, failed to meet the
aspirations of the growing middle class, and
especially its youth. In almost all countries,
governments provided free education and
health, subsidies for food and, later, fuel, as
well as jobs in the public sector with
guaranteed benefits for life. The result was
that human development progressed at a
rapid pace. The economy grew thanks to oilrelated rents and public investments, and
the poor were protected with food
subsidies. The outcomes included low and
declining inequality, low poverty and, at
least by the World Banks definition, shared
prosperity.

On the other side of this social contract,

however, were governments that were
authoritarian, brooked very little dissent,
and in some cases denied human rights to
certain groups. At the turn of the century,
several aspects of this social contract were
beginning to fray.
First, because of
significant fiscal deficits, the public sector
could no longer be the employer of first and
last resort. In fact, the public sector started
retrenching. A generation of young people,
who had diligently gone to school thinking
they would get a public-sector job, found
themselves unemployed. Worse, their skills
were not suited to the private sector, which
nevertheless was not growing rapidly

97

enough to absorb them. The Middle East

and North Africa found itself with the
highest unemployment rate in the world,
with the unemployment rates for young
people and women in particular nearly
double the overall rate. Moreover, about 80
percent of the population believed that
most jobs were based on connections rather
than merit adding to the frustration of the
newly-educated young population. Second,
it was becoming clear that lagging private
sector growth was related to the autocratic
nature of the regimes. In particular, friends
and families of the autocrats benefited
through monopoly rents in domestic
industries,
undermining
export
competitiveness and employment creation.
For instance, the Ben Ali firms in Tunisia,
although only 0.8 percent of industrial
output, accounted for 21 percent of profits.
These firms benefited from regulations that
restricted foreign investment in sectors in
which they were involvedtransport,
banking and telecommunicationswhich in
turn raised prices for inputs to the exporting
sectors and made them less competitive
globally. As a consequence, growth was
insufficient to absorb the large number of
young people entering the labor market
each year. Third, the web of subsidies that
were part of the social compact had become
more of a burden than a benefit. Fuel
subsidies in particular accrued mainly to the
rich and resulted in an economic structure
that favored capital- rather than laborintensive industries. There is also evidence
that, in Egypt, politically connected firms
benefited disproportionately from fuel
subsidies. The previously free education and
health, while it delivered on basic education
and health, was becoming increasingly
ineffective at delivering quality. Teacher
and doctor absenteeism in schools and
clinics were common. A private sector
emerged that made people pay for the same
services to which they were entitled. As a
woman in Egypt said, You can go to the
private clinic and lose all your money, or go
to the public clinic and lose your life. As a
reflection of these difficulties with the social
compact, citizen satisfaction with their
governments was deteriorating, even when
other economic indicators looked promising.
Resentment grew to the point where it
erupted into widespread protests and in
four countries, the autocratic leader was
removed from office. Understanding the
Arab Spring paradox points us to the
solution. It is clear that a new social contract
is needed. Competition policy (a level-

98
playing field) should be enforced. Subsidies
should be replaced with targeted cash
transfers, which give poor citizens a choice

of what goods to consume. Further, the

public sector should be rationalized to
perform those functions that government

should perform, rather than simply being an

employer of first or even last resort.

Exchange between Author & Readers

COMMENTS SUBMITTED BY MOHGA

SUBMITTED BY SHANTA ON THU, 11/12/2015 - 21:39

Sure youth unemployment was a factor but actually this piece totally ignores
other critical factors:
- The start of Tunisia up-rise was the poor seller who was struggling to make
end meet and eventually was kicked out of the street which was the straw
that broke the camels back
- The popular call of the Egyptian revolution: Bread, Freedom, Social Justice.
Bread came first
- Despite the nice figures quoted by WB and IMF there was rising income gap
between those who scrap to feed their families and the top few who were
shopping in London and Paris. It was not the macro- economic figures that
mattered but the rising inequality. I remember a provocative TV ad saying
break your old bathroom and buy a new one showing picture of a dream
bathroom where middle class neighbours were struggling with bad sanitation
systems!
- The combination of unemployment, high prices despite food subsidy
(subsidy did not cover all basic food) and having to pay for health and
education
led
to
real
suffering
for
the
bottom
40%
On several occasions I heard you speak about absenteeism of public sector
workers as if it is their fault ! This vision totally ignores decades of chronic
under-funding of health and education that result in meagre salaries for
workers. It is strange that WB people who have decent salaries seem to expect
public sector workers to continue working 9-5 on a salary not enough to rent
a flat let alone to feed the family or pay for half decent education or
healthcare!

Dear Mohga,
Thanks for your comment. Of course there was inequality in the MENA region.
The point though is that this inequality was not higher than in other middleincome countries, such as those in Latin America, East Asia and Eastern
Europe. And we don't find systematic evidence that inequality was rising in
MENA during the 2000s.
The shopping trips in London you refer to is a sign of wealth inequality. We
find that wealth inequality is higher than income inequality. However, here
too, we don't find evidence that wealth inequality in MENA was higher than
in other parts of the developing world. Yet, only MENA had revolutions, which
is why we are suggesting that it was other factors, such as unemployment,
that triggered the Arab Spring. Incidentally, the fruit seller who set himself on
fire in Tunisia was frustrated because he couldn't get a formal sector job, and
because he worked in the informal sector, he was harassed by the police.
Finally, teacher absenteeism is not just a function of teacher salaries, but how
the salaries are paid. For instance, we find that teachers in NGO-run schools
get paid much less, and still show up for work.
If teachers salaries were more closely tied to performance, absenteeism is
likely to go down (as has been observed in India and elsewhere). I should add
that public sector teachers come from the 90th percentile of the income
distribution or higher.
Shanta

New World Bank Study

99

Middle-Class Frustration Fueled the Arab Spring;

Economic Indicators Failed to Predict Arab Uprisings
Judging by economic data alone, the revolutions of the 2011 Arab
Spring should have never happened. A long-time reliance on
economic indicators as a barometer of progress in Middle Eastern and
North African countries masked the level of frustration and
dissatisfaction in the region ahead of the Arab Spring. Indeed, the
numbers from the decades before had told a glowing story: the region
had been making steady progress toward eliminating extreme
poverty, boosting shared prosperity, increasing school enrollment,
and reducing hunger, child and maternal mortality. Reforms were
underway and economic growth was moderate.
And then, in late 2010 and early 2011, millions of people poured onto
the streets of major cities in the Middle East and North Africa (MENA),
calling for change, and the Arab street began to tell a story that
standard quantitative indicators had not
foreseen.
Now, a new study focusing on economic
inequality, subjective wellbeing, and social
turmoil in MENA helps provide a possible
answer to this Arab inequality puzzle and,
specifically, to two questions: what drove
people to the streets and why did the
numbers miss this?
The report attempts to resolve the apparent
paradox presented by mass demonstrations
in the face of improving economic conditions.
In examining the causes of the Arab Spring,
the report identifies sources of frustration
that persist today, and run the risk of being
aggravated by the current economic
slowdown.
The report finds that the Arab Spring
revolutions were triggered by growing and
broadly shared dissatisfaction with the quality
of life. Ordinary people were frustrated by
their deteriorating standards of living,
reflected in a shortage of quality jobs in the
formal sector, poor quality public services,
and the lack of government accountability. The old social contract of
redistribution without voice had stopped working. In the Arab world,
the middle class wanted a say and more opportunities. The system of
general subsidies could not compensate for these problems. Indeed,
subsidies mattered less for the well-being of the middle 40 percent of
society than they did for the bottom 40 percent.
On the eve of the Arab Spring, the Arab world was an unhappy place
for a variety of reasons, said Shanta Devarajan, World Bank Chief
Economist of the Middle East and North Africa Region. The old
social contract of redistribution with limited voice had stopped
working, especially for the middle class, prior to 2011. People wanted
a say and real opportunities for economic advancement.
According to the report, many countries in the region seemed primed
to fall into disarray following the Arab Spring uprisings. Unless there
are global efforts to end regional conflicts and help countries renew

the social contract, a vicious circle of instability exacerbated by

economic weakness could be the long term future for the MENA
region.
The situation has continued to deteriorate in the region as many of
the factors that made people unhappy before the Arab Spring are still
present today, said Elena Ianchovichina, World Bank MENA Lead
Economist and principal author of the report. Though grievances
alone do not lead to civil wars, grievance-motivated uprisings can
grow into civil wars in societies polarized along ethnic or sectarian
lines. High male youth unemployment rates and the abundance of
natural resources increase the risk of conflict.
Rather than inequality, the study finds that ethnic or sectarian intergroup inequality may have played a role in the
increased incidence of conflict in the MENA
region. The researchers of this study conclude
that although grievances alone do not cause
civil wars, they can motivate people to start
fighting, especially if ethnic and sectarian
grievances are used to garner public support.
Where societies are polarized along ethnic or
sectarian lines, the combination of
unemployed young men and natural
resources also increases the risk of conflict. It
was in this context that after the Arab Spring,
many countries in the region seemed primed
to fall into disarray.
The report also provides an economic outlook
for the Middle East and North Africa,
predicting that regional gross domestic
product (GDP) growth will average 2.8 percent
for 2015. Continued low oil prices, civil wars
and conflicts, and a likely global economic
slowdown mean that prospects for faster
growth are slim. Civil wars have severely
harmed the economies of Iraq, Libya, Syria,
and Yemen, and have had adverse spillover
effects on the economies of Lebanon and Jordan. MENAs oilimporting countries have not grown rapidly in the wake of low oil
prices because they have been hurt, to varying extents, by terrorist
attacks, spillovers from neighboring wars, slow growth in the Euro
zone, and political uncertainty.
The full report can be found at:
http://documents.worldbank.org/curated/en/2015/10/25119063/in
equality-uprisings-conflict-arab-world
The World Bank Group recently launched a new Middle East and
North Africa strategy focused on addressing the causes of conflict to
promote peace and stability. One of the primary goals of the new
strategy is to rebuild the relationship between citizens and
governments through improved service delivery and increased
transparency and accountability. Information about the World Bank
Groups MENA Strategy can be found at:
http://www.worldbank.org/en/region/mena/overview#2

100

Donna Barne
Tariq Khokhar
Now that we've reached the end of 2015, it's clear this was a year of
major milestones, emerging trends, and new beginnings. Among
other things, 2015 marked a historic drop in poverty, a major climate
change agreement, and record low child and maternal mortality rates.
Take a look at what the data show.

have a significant impact on poverty levels. The World Bank Group is

working with 130 countries to help implement "climate-smart"
development and will increase investments in climate finance to as
much as $29 billion a year by 2020 -- a one-third increase over current
levels.

1. The Global Poverty Rate Fell below 10%

The share of the worlds population living in extreme poverty is
projected to hit a historic low of 9.6% of in 2015 falling from 37.1%
in 1990. New estimates show 702 million people living below the
updated global poverty line of$1.90 per day, with the majority of
them in Sub-Saharan Africa and South Asia. The milestone was hailed
as the best news in the world today by World Bank Group President
Jim Yong Kim, and marks real progress on the road to ending extreme
poverty by 2030.
3. A Record Number of People Were Forcibly Displaced
The number of forcibly displaced people now stands at more than 60
million -- the highest number since the Second World War. More than
half of the some 20 million refugees worldwide come from Syria,
Afghanistan, and Somalia, and the majority find refuge in countries
close to their own. The World Bank Group, United Nations, and Islamic
Development Bank announced in October they would tackle the
worsening refugee crisis in the Middle East and North Africa by issuing
new bonds to raise billions of dollars to help displaced people and
support reconstruction of the war-torn region. This month, the Global
Program on Forced Displacement launched a call for ideas to improve
development response for refugees and internally displaced persons.
2. The World Reached an Accord on Climate Change
Representatives of 195 nations signed on to the landmark Paris
climate agreement on Dec. 12, 2015. Each country pledged to lower
greenhouse gas emissions in what could mark a turning point in the
global effort to slow climate change. The deal recognized the role of
incentives in reducing emissions, including carbon pricing. Currently,
about 40 countries and 23 cities, states, and regions are using a
carbon price -- their outputs represent only 12% of annual
greenhouse-gas emissions. As part of the Paris deal, more than 90
developed and developing countries have included carbon-pricing
schemes among the actions they intend to take. Climate change could

101
4. The SDGs Set Ambitious Targets for 2030
In September, the worlds countries came together to affirm the
Sustainable Development Goals (SDGs) -- a set of 17 goals for the
world. Their broad aims are to end extreme poverty, fight inequality
and injustice, and to address climate change. The goals are associated
with a number of new targets and indicators. A World Bank study
earlier this year found that many countries in the world lack the data
to reliably estimate trends in poverty, and the institution has recently
committed to filling these data gaps in the worlds poorest countries.
This year also saw the launch of the Global Partnership for Sustainable
Development Data, which aims to bring together a diverse group of
individuals and institutions to make better use of data and technology
to both monitor and achieve the SDGs.
7. Ebola Left a Lingering Legacy
A World Bank report estimated that the loss of health workers to
Ebola will likely affect non-Ebola mortality even after the countries
are declared Ebola-free. For example, maternal mortality could
increase by 38% in Guinea, 74% in Sierra Leone, and 111% in Liberia - rates last seen in these countries 15 to 20 years ago. The report
found that Ebola has weakened already very fragile health systems in
these countries, and as of May 2015, Liberia, Sierra Leone, and Guinea
had lost 8.07%, 6.85% and 1.45% of their entire countrys health
workers -- rates far higher than deaths among their general
populations.
5. Finance for Development Needs to Move from Billions to Trillions
The levels of Official Development Assistance (ODA) or foreign aid
to developing countries are already dwarfed by private resource flows
(such as remittances) and commercial foreign investment. The
ambitious new Sustainable Development Goals (SDGs) require equal
ambition in using the billions in ODA and in available development
resources to attract, leverage, and mobilize trillions in investments
of all kinds. Additional funds are expected to come from two main
sources: public domestic resources (such as tax revenues), where the
most substantial development spending happens, and commercial
finance and investment, the largest potential source of additional
funding.

6. Commodity Prices Plummeted

The decline in commodity prices that began with metals and
agriculture four years ago -- joined by crude oil in mid-2014 -continued in 2015. According to the Commodity Markets Outlook,
energy, metals, and agricultural prices were down this year, in part
due to increasing supplies, bumper harvests, weak demand and a
stronger U.S. dollar. This end of the commodity super-cycle will see
exporters in the Middle East, Africa, Latin America, and Europe
adjusting to a new normal, while importers like India benefit from
reduced costs.

8. More than 60% of the Worlds Economies Improved Business

Rules
The 2016 Edition of Doing Business identified 231 reforms that
enhanced business activity in 122 countries around the world. For
example, data for the past 12 years show that in 2003, it took an
average of 51 days worldwide to start a new business. This has now
been more than halved to 20 days. In addition, the data shows
encouraging signs of convergence toward best practices, as lowerincome economies have shown more improvement than high-income
economies over time. The case of Mozambique illustrates this trend.
In 2003, it took an entrepreneur 168 days to start a business, but now
it only takes 19 days. You can explore the data further in this
interactive visualization.

102
11. The Bottom 40% Are Doing Better
Rising incomes over the past decade have helped the bottom 40% of
the population in many countries. Considering five-year periods
starting about 2007 and ending around 2012, incomes of the bottom
40% grew in 65 of the 94 countries with adequate and comparable
data. Among them, 47 countries registered a shared prosperity
premium, with the incomes of the bottom 40% growing faster than
the incomes of the average population, thus reducing income
inequality between these groups.

9. Changing Demographics Are Shaping Our Future

While the global working age population peaked at 66% in 2012, parts
of Africa and Asia are seeing a surge in their working age populations,
and countries in these regions have an opportunity for greater
prosperity and higher living standards. According to the 2015 Global
Monitoring Report, Sub-Saharan Africa will account for more than half
of the worlds working-age population growth through 2050. The
worlds population is set to reach 9.7 billion in 2050, and almost half
the population growth will occur in just nine countries.

12. Legal Restrictions Affect Working Women

The 2016 Women, Business and the Law report finds 155 out of 173
economies have at least one law impeding womens economic
opportunities. In 100 economies, women face gender-based job
restrictions. In these economies, women are restricted from pursuing
the same economic activities as men and in some cases are prohibited
from holding particular jobs, particularly in highly paid industries. The
report finds that restrictions on womens work lower their earning
potential relative to men.

10. Maternal and Child Mortality Rates Hit Record Lows

Between 1990 and 2015, the under-5 and maternal mortality rates fell
53% and 44% respectively. This means the number of children dying
before age 5 has fallen dramatically - from 12.7 million in 1990 to 5.9
million in 2015. Millions have survived because of the use of such
evidence-based interventions against the leading infectious diseases
as insecticide-treated mosquito nets, rehydration treatment for
diarrhea, nutritional supplements, and therapeutic foods. However,
in spite of this progress, an estimated 16,000 children under 5 still die
each day and, nearly half of these deaths are attributable to
undernutrition.

103

BOOKS
Tour

MENA Books
The Arab Spring Five Years Later, by Hafez Ghanem
Hafez Ghanem gives a thorough assessment of the Arab Spring, beginning with political developments since the
revolutions and changes in the legal and institutional frameworks that affect economies. Arab economies grew at
healthy rates before the revolts, but the benefits of economic growth were unfairly distributed. The politically
connected reaped great benefits, while educated youth could not find decent jobs, and the poor and middle class
struggled to make ends meet. Ghanem advises that Arab countries need to adopt new economic policies and programs
that enhance inclusiveness, expand the middle class, and foster growth in undeveloped regions. Key elements include
strengthening economic institutions, developing small businesses, reforming the education system to better prepare
Arab youth for the modern labor market, promoting gender equality with the objective of raising female labor market
participation rates, and setting up programs for rural and regional development to reduce inequality and eliminate
extreme poverty.
Arab Dawn: Arab Youth and the Demographic Dividend They Will Bring
by Bessma Momani. University of Toronto Press.
Change is on its way in the Middle East, argues Bessma Momani, and its cause is demographic. Today, 1 in 5 Arabs is
between the ages of 15 and 24. Young, optimistic, and increasingly cosmopolitan, their generation will shape the
regions future. Drawing on interviews, surveys, and other research conducted with young people in fifteen countries
across the Arab world, Momani describes the passion for entrepreneurship, reform, and equality among Arab youth.
With insightful political analysis based on the latest statistics and first-hand accounts, Arab Dawn is an invigorating
study of the Arab world and the transformative power of youth.

Trust, Voice, and Incentives: Learning from Local Success Stories in Service Delivery in the Middle East and North
Africa by Hana Brixi, Ellen Lust, and Michael Woolcock. World Bank.
This report examines the role of incentives, trust, and engagement as critical determinants of service delivery
performance in MENA countries. Focusing on education and health, the report illustrates how the weak external and
internal accountability undermines policy implementation and service delivery performance and how such a cycle of
poor performance can be counteracted. Case studies of local success reveal the importance of both formal and informal
accountability relationships and the role of local leadership in inspiring and institutionalizing incentives toward better
service delivery performance. Enhancing services for MENA citizens requires forging a stronger social contract among
public servants, citizens, and service providers while empowering communities and local leaders to find 'best fit'
solutions. Learning from the variations within countries, especially the outstanding local successes, can serve as a solid
basis for new ideas and inspiration for improving service delivery. Such learning may help the World Bank Group and
other donors as well as national and local leaders and civil society, in developing ways to enhance the trust, voice, and
incentives for service delivery to meet citizens' needs and expectations.
A Political Economy of the Middle East by Melani Cammett, Ishac Diwan, Alan Richards, and John Waterbury. Fourth
Edition. Westview Press.
This book provides a comprehensive analysis of developments in the political economy of the region over the past
several decades, examining the interaction of economic development processes, state systems and policies, and social
actors in the Middle East. This new/fourth edition, with new authors Melani Cammett and Ishac Diwan, has been
thoroughly revised, with two new introductory chapters that provide an updated framework with which to understand
and study the many changes in demography, education, labor markets, urbanization, water and agriculture, and
international labor migration in the recent years. The new edition also includes: a new chapter that charts the political
economy of the Gulf states and, in particular, the phenomenal growth of oil economies; a new chapter on the rise of
"crony capitalism;" and increased coverage of the changes in civil society and social movements in the region, including
an exploration of the causes, dynamics, consequences, and aftermath of the Arab uprisings.

104

Politics and
Governance in the
Middle East by
Vincent Durac and
Francesco
Cavatorta. Palgrave
Macmillan.

The New Middle

East: The World
after the Arab
Spring by Daniel
Danahar.
Bloomsbury.

Expanding
Opportunities for
the Next
Generation: Early
Childhood
Development in the
MENA by S El-Kogali
and Caroline Krafft.
World Bank.

Political and
Constitutional
Transitions in North
Africa: Actors and
Factors by J Frosini
and F Biagi.
Routledge Studies in
MENA
Democratization
and Government.

Economic
Implications of
Lifting Sanctions on
Iran by Shanta
Devarajan and Lilli
Mottaghi. World
Bank.

Improving the
Quality of Financial
Intermediation in
the Gulf
Cooperation Council
Countries. World
Bank. Engagement
Note.

Champions Wanted:
Promoting Exports
in the Middle East
and North Africa by
Mlise Jaud and
Caroline Freund.
World Bank.

Contentious Politics
in the Middle East:
Popular Resistance
and Marginalized
Activism Beyond
the Arab Uprisings
edited by F A.
Gerges. Palgrave
Macmillan.

Irans Political
Economy since the
Revolution by
Suzanne Maloney.
Cambridge
University Press.

Learning in the Face

of Adversity: The
UNRWA Education
Program for
Palestinian
Refugees by H
Abdul-Hamid, H A
Patrinos, J Reyes, J
Kelcey, and A Diaz
Varela. World Bank.

The Penguin State

of the Middle East
Atlas by Dan Smith

Saudi Arabia in
Transition: Insights
on Social, Political,
Economic and
Religious Change by
Bernard Haykel and
Thomas
Hegghammer.
Cambridge
University Press.

The Negotiator: A
Memoir by George
Mitchell. Simon and
Schuster.

Oman Reborn:
Balancing Tradition
and Modernization
by Linda Pappas
Funsch. Palgrave
Macmillan.

From the First

World War to the
Arab Spring: Whats
Really Going on in
the Middle East?
by M. E. McMillan.
Palgrave Macmillan.

105
Business, Banking, Finance and Accounting
Exploring Assurance on Integrated Reporting and Other Emerging Developments in External Reporting. IFAC.
The purpose of this publication, prepared by the Integrated Reporting Working Group, is to inform stakeholders about
the IAASBs ongoing work to explore assurance on integrated reporting and other emerging developments in external
reporting. It explains that the IAASB established the Integrated Reporting Working Group to inform the IAASB as to how
and when to respond to these developments most effectively in the public interest, and outlines the groups activities.

Interpretation and Application of IPSAS by Caroline Aggestam-Pontoppidan. Wiley Regulatory Reporting.

Interpretation and Application of IPSAS provides practical guidance on the implementation and application of the
International Public Sector Accounting Standards. This book brings readers up to date on the standards, and describes
their proper interpretation and real-world application. Examples and mini-case studies clarify the standards' roles
throughout, giving readers a better understanding of complex processes, especially where the IPSAS deviate from IFRS.
Readers also gain insight into smoothly navigating the transition for a public sector entity, which is moving to either
IPSAS under accrual basis of accounting or to cash accounting IPSAS, plus an overview of IPSAS adoption status and
methods around the world. Global public sector accounting is highly diversified, resulting in ongoing moves to
harmonize standards worldwide. The IPSAS are international standards that largely follow the IFRS model, but differ in
some key areas and include standards in places where IFRS has none. This book provides complete guidance to IPSAS,
with clear explanation and expert insight.
Understand the meaning and role of each standard
Apply the standards to real-world scenarios ,
Manage the process of transition to IPSAS
These standards are meant to be followed by all public sector entities, including national and regional governments
and local authorities. They've been adopted by the UN, NATO, the European Commission, and others, and either have
been or soon will be adopted in Malaysia, Switzerland, Spain, and more.

Benchmarking
Public
Procurement 2016:
Assessing Public
Procurement
Systems in 77
Economies. World
Bank.

Public Sector
Accounting, by Tjerk
Budding, Giuseppe
Grossi and Torbjorn
Tagesson.
Routledge.

Doing Business
2015: Going
Beyond Efficiency,
by International
Finance
Corporation (IFC).

Islamic Finance
and the New
Financial System:
An Ethical
Approach to
Preventing Future
Financial Crises by
Tariq Alrifai. Wiley
Finance.

Principles of Islamic
Accounting by Nabil
Baydoun and Maliah
Sulaiman. Wiley
Finance.

A Directors Guide
to Integrated
Reporting,
Deloitte.

Business
Sustainability:
Performance,
Compliance,
Accountability and
Integrated
Reporting by Z
Rezaee. Greenleaf
Publishing.

Risk Management
for Islamic Banks:
Recent
developments from
Asia and the Middle
East, by I Wahyudi, F
Rosmanita, M Budi
Prasetyo and N
Iwani, S Putri. Wiley.

Women, Business
and the Law 2016:
Getting to Equal.
World Bank.

106
General Economics, Development Economics and the Global Economy
Economics Rules: The Rights and Wrongs of the Dismal Science
by Dani Rodrik. W.W. Norton & Company, Inc.
In the wake of the financial crisis and the Great Recession, economics seems anything but a science. In this sharp,
masterfully argued book, Dani Rodrik, a leading critic from within, takes a close look at economics to examine when it
falls short and when it works, to give a surprisingly upbeat account of the discipline. Drawing on the history of the field
and his deep experience as a practitioner, Rodrik argues that economics can be a powerful tool that improves the
worldbut only when economists abandon universal theories and focus on getting the context right. Economics Rules
argues that the discipline's much-derided mathematical models are its true strength. Models are the tools that make
economics a science. Too often, however, economists mistake a model for the model that applies everywhere and at
all times. In six chapters that trace his discipline from Adam Smith to present-day work on globalization, Rodrik shows
how diverse situations call for different models. Each model tells a partial story about how the world works. These
stories offer wide-ranging, and sometimes contradictory, lessonsjust as childrens fables offer diverse morals.
Whether the question concerns the rise of global inequality, the consequences of free trade, or the value of deficit
spending, Rodrik explains how using the right models can deliver valuable new insights about social reality and public
policy. Beyond the science, economics requires the craft to apply suitable models to the context. The 2008 collapse of
Lehman Brothers challenged many economists' deepest assumptions about free markets. Rodrik reveals that
economists' model toolkit is much richer than these free-market models. With pragmatic model selection, economists
can develop successful antipoverty programs in Mexico, growth strategies in Africa, and intelligent remedies for
domestic inequality. At once a forceful critique and defense of the discipline, Economics Rules charts a path toward a
more humble but more effective science.
The Economics of Inequality
by Thomas Piketty and Arthur Goldhammer. Harvard University Press.
Thomas Pikettywhose Capital in the Twenty-First Century pushed inequality to the forefront of public debatewrote
The Economics of Inequality as an introduction to the conceptual and factual background necessary for interpreting
changes in economic inequality over time. This concise text has established itself as an indispensable guide for students
and general readers in France, where it has been regularly updated and revised. Translated by Arthur Goldhammer,
The Economics of Inequality now appears in English for the first time. Piketty begins by explaining how inequality
evolves and how economists measure it. In subsequent chapters, he explores variances in income and ownership of
capital and the variety of policies used to reduce these gaps. Along the way, with characteristic clarity and precision,
he introduces key ideas about the relationship between labor and capital, the effects of different systems of taxation,
the distinction between historical and political time, the impact of education and technological change, the nature
of capital markets, the role of unions, and apparent tensions between the pursuit of efficiency and the pursuit of
fairness. Succinct, accessible, and authoritative, this is the ideal place to start for those who want to understand the
fundamental issues at the heart of one of the most pressing concerns in contemporary economics and politics.

The Great Surge:

The Ascent of
the Developing
World by Steven
Radelet. Simon &
Schuster.

Development Goals in
an Era of Demographic
Change, Global
Monitoring Report:
2015/2016. World
Bank.

Global Financial
Development Report:
Long-Term Finance,
2015/2016. World
Bank.

Global Financial
Stability Report.
International
Monetary Fund
(IMF).

World Economic
Outlook. International
Monetary Fund (IMF).

International Debt
Statistics 2016, World
Bank Group

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