BURKINA FASO Growth And Competitiveness Credits (1-4)

PrefaceThis Project Performance Assessment Report (PPAR) evaluates the Growth andCompetitiveness Credit Development Policy Financing series (I–IV) implemented inBurkina Faso between 2012 and 2015. The total cost of the four operations was 359 million equivalent. The first operation was approved by the Board of theInternational Development Association (IDA) on June 26, 2012, and the last on April 2,2015. The series closed on December 31, 2015.The development objectives of the four operations were to catalyze private sectorgrowth and generate employment; improve transparency and accountability in publicresource mobilization and management; and increase resilience and reduce vulnerabilityto shocks.The Independent Evaluation Group (IEG) prepared the report based on interviews, areview of World Bank files, and documents and data collected during a field visit toBurkina Faso in November 2017. The mission met with World Bank staff, governmentofficials, beneficiaries of the reforms, donors, academia, and civil society groups. Theevaluation also draws from interviews with the task team leaders and country managerof Burkina Faso. The series followed 11 budget support operations of the PovertyReduction Support Credits and Grants 1–11 in Burkina Faso and was the only type ofdevelopment policy operation financed by IDA resources during the period.The cooperation and assistance of all stakeholders as well as the support of the WorldBank Country Office in Burkina Faso are gratefully acknowledged.Following standard IEG procedures, a copy of the draft PPAR was sent to the borrowerfor comments. No comments were received.vii

SummaryThis Project Performance Assessment Report (PPAR) assesses the extent to which theGrowth and Competitiveness series of four operations between 2012 and 2015 achievedits development policy objectives. The series involved a total disbursement ofSDR239.8 million (about 359 million) in the form of grants and credits. The firstoperation was approved by the Board of the International Development Association(IDA) on June 26, 2012, and the last on April 2, 2015. The series closed on December 31,2015.The development objectives of the series were to catalyze private sector growth andgenerate employment; improve transparency and accountability in public resourcemobilization and management; and increase resilience and reduce vulnerability toshocks.The outcome of the series is rated unsatisfactory.The development objectives were substantially relevant. The series broadly supportedthe strategy presented in the government’s Poverty Reduction Strategy Paper (Stratégiepour la Croissance Accélérée et le Développement Durable [Durable (Strategy forAccelerated Growth and Sustainable Development; SCADD]). The SCADD programwas realigned by the transitional government following an economic and political crisis,but the nature of the realignment and its impact on the program are not fully explainedin the project documents. The sector strategies within the SCADD were not fully fleshedout and action plans had not always been developed. Some policy priorities emergedonly in the Letters of Development Policy. In other cases, such as cotton, the programseems to have relied much more on the World Bank’s 2010 Country EconomicMemorandum than the subsequent government’s program, calling into questiongovernment ownership.The development objectives were broadly relevant to World Bank strategy for BurkinaFaso. The 2010–12 country assistance strategy underpinned the first two operations andthe 2012–16 country partnership strategy the two subsequent ones.Relevance of design is rated modest. The choice of a programmatic DPF instrument wasinappropriate in a challenging environment characterized by significant politicalturbulence. The design was insufficiently flexible to react to shocks and attempted tocover too many areas. The series supported the completion of reforms from previousendeavors at a time when the country context had begun to deteriorate and earlier gainshad been eroded. Objectives were formulated differently under each operation. This,together with the breadth of the objectives, made it difficult to establish a clear chain ofviii

causality. Many of the prior actions supported were too weak to achieve the broadobjectives. Some prior actions were reversed and repeated.Efficacy is assessed as negligible for the first objective and modest for the second andthird. There is no evidence that the series catalyzed private sector growth or generatedemployment. Enhancement of public transparency and accountability was limited anduneven. There is little evidence of reduced vulnerability to shocks. Many outcometargets were not met. Some of those that were met were inadequate to ensure theattainment of the objectives. Some previous achievements were reversed.The risk to development outcome is rated moderate. The limited achievements areunlikely to be reversed.Bank performance is rated unsatisfactory. Quality at entry was undermined byattempting to support too many unrelated policy areas, in direct opposition to therecommendation of the country assistance strategy. Risks were identified butinadequately mitigated. Supervision did not address pertinent issues in a timelymanner. The technical assistance provided was not sufficient to address capacityweaknesses.Borrower performance is rated moderately unsatisfactory. The government maintainedmacroeconomic and fiscal stability despite severe shocks. However, resources madeavailable for reform implementation were inadequate, as was reporting of results.Institutional and political turmoil undermined the implementation of reforms. Internalcoordination was weak.Lessons When political risks are high and capacity is strained, design is better focusedon a few key priorities. This series covered too many areas, and some keybinding constraints were not addressed. The series might have been moresuccessful with a sharper focus on more realistic objectives accompanied by asimpler design. The success of budgetary support depends on the suitability of theinstrument to the country environment. In a context of political turbulenceand uncertainties about the government’s ability to undertake long termreforms, the World Bank could have ended the programmatic series after thethird operation and made the fourth operation a stand-alone. Alternatively,the World Bank could have implemented a series of stand-alone operationsafter the second programmatic series when it became apparent that thepolitical and policy environment was rapidly changing.ix

Lack of clarity on the respective roles and responsibilities of central and localgovernments and of the private sector undermines policy actions. It isimportant to ensure that there is a shared vision and that the need for reformis recognized and accepted by all parties. In this case, there was a lack ofclarity among different stakeholders during implementation of the reformson decentralization and fertilizer distribution. When monitoring and evaluation is not adequately resourced orimplemented, there can be delays in the identification of problems and theapplication of remedies. Monitoring and evaluation weaknesses can becompensated by leveraging information available elsewhere, or throughspecific impact assessments and perceptions surveys. There may be a trade-off between the promise of continuous and predictablefinancing, urgently needed in times of crisis, and the strength of the reformprogram. In Burkina Faso the emphasis was on continuous financing evenwhen reform performance was waning. The lack of broad consultations with stakeholders when the World Bank isdesigning a complex reform program could lead to unsatisfactory results. Inthis case, the lack of consultations with an important stakeholder association(the Confederation Paysanne du Faso) on fertilizer distribution affected theachievement of results of one of the first objectives. Also, some developmentpartners and civil society organizations had limited knowledge of thereforms pursued in the Growth and Competitiveness series. Inadequately resourced implementing agencies will likely be unable to carryout agreed reforms. Under-resourcing may indicate low governmentcommitment, which needs to be addressed through policy dialogue. It is alsoimportant to ensure that agencies have appropriate technical capacity andsystems in place, and that potential political obstacles at the local level arebeing addressed.Auguste Tano KouameDirectorHuman Development and Economic ManagementIndependent Evaluation Groupx

1. Background and Context1.Burkina Faso is a low-income, landlocked country with about 16.7 millioninhabitants. It is prone to large external shocks, resulting in part from the primary natureof its major exports (gold and raw cotton). Growth is hampered by natural anddemographic factors, as well as its governance framework. In addition, poor policychoices and institutional weaknesses constrain economic performance. Almost40 percent of the population lives in poverty and lacks productive jobs. The World Bankhas provided development support to the Government of Burkina Faso for severaldecades. In total, the International Development Association (IDA) lent about 4.1billion between 1980 and 2017, of which 1.45 billion was provided as developmentpolicy financing (DPF). In addition, the country benefited from 1.15 billion of IDA debtrelief under the Highly Indebted Poor Countries Initiative and the Multilateral DebtRelief Initiative. Overall, the World Bank’s investment lending has constituted a largershare of the portfolio than DPF, although the latter has become increasingly importantover the past decade (see appendix B, table B.6).2.The country was politically stable for over two decades until 2011. The periodbefore 2011 was characterized by political and economic stability, during which BurkinaFaso moved away from a centralized model toward market-oriented reforms and reengagement with the international community. The government pursued reforms toaddress low agriculture productivity, limited expansion of productive nonfarm jobs,poor educational outcomes, lack of basic infrastructure, and insufficient human capitalto escape the traps of poverty. After 2011, a series of domestic protests and politicalunrest complicated implementation of policy reforms (World Bank 2012a). The countrysuffered a political crisis that led to the removal of the president in October 2014 andinstallation of a transition government, which faced an attempted military coup inSeptember 2015. Following popular protests against the transition government, a newpresident was democratically elected in November 2015. The new governmentcontinued to face agitation by labor unions demanding higher salaries through 2016 and2017.3.Domestic and external shocks periodically affected the economy and the fiscalbalance. The location of the country made it prone to “Sahelian attacks,” especially after2011. The government increased its security budget to address this menace (estimatedincrease of 40 percent). In addition, the 2012 Sahelian food crisis led to an inflow ofabout 100,000 Malian refugees to Burkina Faso. These shocks, alongside the politicalinstability, contributed to a decline in real gross domestic product (GDP) growth from9 percent in 2012 to 6.6 percent in 2013 and 5 percent in 2014. The trend in GDP growthis volatile and averages about 5.5 percent between 2007 and 2016. Development partners1

supported the government with 100 million of additional budget support (2012–14),but the impact of the crises lingered on throughout the series.Figure 1. Evolution of Country Context in Burkina FasoSource: Publicly available information.4.Corruption was a significant contextual issue in Burkina Faso during thepreparation of the series (World Bank 2012a). The program documents (programdocuments) indicated government acknowledgment of deep challenges concerninggovernance and openness, especially the perception of corruption. The judiciary had notbeen independent and had been perceived as being prone to political interference,though Burkina Faso had signed or ratified various regional and internationalinstruments on the prevention of corruption, including the United Nations ConventionAgainst Corruption. The government had created entities to help implementanticorruption policies and laws, but their implementation had been ineffective. Theperception of corruption had persisted. In the Letter of Development Policy of theGrowth and Competitiveness (G&C) first program document, the governmentcommitted to fight corruption.5.The World Bank had no country manager for six months during the preparationof the series. The absence of the country manager adversely affected policy dialogue andthe responsiveness of the World Bank to the crisis. Many donors indicated that theircohesion was weakened given the World Bank’s convening power as the head ofdevelopment partners in Burkina Faso.2

Evolution of World Bank Development Policy Financing, 2001–156.The G&C series represents a continuation of IDA support in an increasinglydifficult and complex national context. The World Bank provided continuous multiyearbudget support through development policy financing operations (DPFs) totaling 1,174 million from 2001 to 2015. This includes Poverty Reduction Support Credits andGrants (PRSCGs) 1–6 of 310 million, PRSCG 7–11 of 505 million and to G&C 1–4( 359 million). In addition, the country benefited from 100 percent multilateral debt writeoff from the Highly Indebted Poor Countries Initiative and the Multilateral Debt ReliefInitiative, amounting to 1,154 million as debt relief after July 2006.7.The PRSCG 1–6 of 2001–06 had moderately satisfactory results. The ProjectPerformance Assessment Report (PPAR) by the Independent Evaluation Group (IEG) ofthe series reports modest achievements of the objective of accelerating broad-basedgrowth and employment and disappointing progress on private sector development.Also, achievements under the objective of ensuring access to b

Burkina Faso: First Growth and Competitiveness Credit (P126207) Project Task Manager/Leader Sector Manager Country Director Appraisal Samba Ba Miria A. Pigato Madani M. Tall Completion Ali Zafar Lars Christian Moller Pierre Frank Laporte Burkina Faso: Second Growth and Competitiveness Credit (P132210)