Document of The World Bank FOR OFFICIAL USE ONLY Report No: ICR00006299 IMPLEMENTATION COMPLETION AND RESULTS REPORT ON AN IDA GRANT (IDA-D1030) IN THE AMOUNT OF SDR7.5 MILLION (US$10.3 MILLION EQUIVALENT) AND ON AN ADDITIONAL IDA GRANT (IDA-D3450) IN THE AMOUNT OF SDR10.1 MILLION (US$14.5 MILLION EQUIVALENT) TO THE ISLAMIC REPUBLIC OF MAURITANIA FOR THE PUBLIC SECTOR GOVERNANCE PROJECT June 27, 2023 Governance Global Practice Western And Central Africa Region CURRENCY EQUIVALENTS (Exchange Rate Effective {December 31, 2022}) Mauritanian Currency Unit = Ouguiyas (MRU) 34.2 = US$1 US$1.33 = SDR 1 FISCAL YEAR July 1 - June 30 Regional Vice President: Ousmane Diagana Country Director: Keiko Miwa Regional Director: Abebe Adugna Dadi Practice Manager: Gael J. R. F. Raballand Task Team Leader(s): Marie J. Bolou, Angelo Donou ICR Main Contributor: Marc-Anton Pruefer ABBREVIATIONS AND ACRONYMS AF Additional Financing AGA Autonomous Government Agency ANSADE National Agency of Statistics and Demographic and Economic Analysis (Agence nationale de la Statistique, de l’Analyse démographique et économique) ARMP Procurement Regulatory Authority (Autorité de Régulation des Marchés Publics) BEPS Base Erosion and Profit Shifting COTREF Land Reform Technical Commission (Commission Technique chargée de la Réforme Foncière) CPF Country Partnership Framework CPIA Country Policy and Institutional Assessment CPS Country Partnership Strategy CSEPS Presidential Delivery Unit (Cellule de suivi de l'exécution des priorités stratégiques) DGB General Budget Directorate (Direction Générale du Budget) DGDPE General Directorate for Land Management (Direction General Des Domaines et du Patrimoine de l’Etat) DGI General Tax Directorate (Direction Générale des Impôts) DGMG General Directorate of Mining and Geology (Direction Générale des Mines et de la Géologie) DGT General Customs Directorate (Direction Générale des Douanes) DTF General Directorate for Financial Oversight (Direction de la Tutelle Financiere) EFA Economic and Financial Analysis EITI Extractive Industries Transparency Initiative EPA Public Administrative Body (Etablissements Publiques Administratives) FA Financing Agreement GDP Gross Domestic Product GFMIS Government Financial Management Information System GoM Government of Mauritania ICR Implementation Completion and Results Report IGF General Financial Inspectorate (Inspection Générale des Finances) LOLF Organic Law related to the Finance Laws (Loi Organique relative aux lois de finances) MoF Ministry of Finance (Ministère des Finances) M&E Monitoring and Evaluation MTEF Medium-Term Expenditure Framework NSS National Statistical System ONS National Office of Statistics (Office Nationale de Statistiques) PAD Project Appraisal Document PDO Project Development Objective PIU Project Implementation Unit PP Project Paper RACHAD Electronic Expenditure Chain System (Réseau Automatisé de Chaine de la Dépense) RGHP General Census of Population and Housing SCAPP Strategy for Accelerated Growth and Shared Prosperity SNIM National Industrial and Mining Society (Société Nationale Industrielle et Minière) SOE State-Owned Enterprise TAHDIR Budget Preparation System TEHLIL Land Title Management System ToC Theory of Change TABLE OF CONTENTS DATA SHEET ........................................................................................................................... I EXECUTIVE SUMMARY ................................................................................................................ v I. PROJECT CONTEXT AND DEVELOPMENT OBJECTIVES ....................................................... 1 A. CONTEXT AT APPRAISAL ......................................................................................................1 B. SIGNIFICANT CHANGES DURING IMPLEMENTATION (IF APPLICABLE) ....................................4 II. OUTCOME ...................................................................................................................... 7 A. RELEVANCE OF PDOs ...........................................................................................................7 B. ACHIEVEMENT OF PDOs (EFFICACY) .....................................................................................8 C. EFFICIENCY ........................................................................................................................ 13 D. JUSTIFICATION OF OVERALL OUTCOME RATING ................................................................. 14 E. OTHER OUTCOMES AND IMPACTS ..................................................................................... 15 III. KEY FACTORS THAT AFFECTED IMPLEMENTATION AND OUTCOME ................................ 16 A. KEY FACTORS DURING PREPARATION ................................................................................ 16 B. KEY FACTORS DURING IMPLEMENTATION.......................................................................... 16 IV. BANK PERFORMANCE, COMPLIANCE ISSUES, AND RISK TO DEVELOPMENT OUTCOME .. 16 A. QUALITY OF MONITORING AND EVALUATION (M&E) ......................................................... 16 B. ENVIRONMENTAL, SOCIAL, AND FIDUCIARY COMPLIANCE.................................................. 19 C. BANK PERFORMANCE ........................................................................................................ 19 D. RISK TO DEVELOPMENT OUTCOME .................................................................................... 21 V. LESSONS AND RECOMMENDATIONS ............................................................................. 21 ANNEX 1. RESULTS FRAMEWORK AND KEY OUTPUTS ........................................................... 23 ANNEX 2. BANK LENDING AND IMPLEMENTATION SUPPORT/SUPERVISION ......................... 32 ANNEX 3. PROJECT COST BY COMPONENT ........................................................................... 35 ANNEX 4. EFFICIENCY ANALYSIS ........................................................................................... 37 ANNEX 5. BORROWER, CO-FINANCIER AND OTHER PARTNER/STAKEHOLDER COMMENTS ... 45 ANNEX 6. THEORY OF CHANGE ............................................................................................ 46 ANNEX 7. SIGNIFICANT CHANGES DURING IMPLEMENTATION ............................................. 48 ANNEX 8. SUPPORTING DOCUMENTS .................................................................................. 54 The World Bank Mauritania Public Sector Governance Project (P146804) DATA SHEET BASIC INFORMATION Product Information Project ID Project Name P146804 Mauritania Public Sector Governance Project Country Financing Instrument Mauritania Investment Project Financing Original EA Category Revised EA Category Not Required (C) Not Required (C) Organizations Borrower Implementing Agency Ministry of Economic Affairs and the Promotion of Ministry of Economic Affairs and the Promotion of Productive Sectors Productive Sectors Project Development Objective (PDO) Original PDO

The Project Development Objective (PDO) is to improve monitoring and transparency of selected government entities and the administration of property and mining taxation.

Revised PDO The revised Project Development Objective (PDO) is to enhance transparency and improve the mobilization, allocation and management of public resources i The World Bank Mauritania Public Sector Governance Project (P146804) FINANCING Original Amount (US$) Revised Amount (US$) Actual Disbursed (US$) World Bank Financing 10,300,000 10,300,000 10,445,167 IDA-D1030 14,500,000 14,500,000 13,683,557 IDA-D3450 Total 24,800,000 24,800,000 24,128,724 Non-World Bank Financing 0 0 0 Borrower/Recipient 1,300,000 2,200,000 2,200,000 Total 1,300,000 2,200,000 2,200,000 Total Project Cost 26,100,000 27,000,000 26,328,724 KEY DATES Approval Effectiveness MTR Review Original Closing Actual Closing 28-Mar-2016 24-Jun-2016 03-Nov-2017 15-Feb-2020 31-Dec-2022 RESTRUCTURING AND/OR ADDITIONAL FINANCING Date(s) Amount Disbursed (US$M) Key Revisions 25-May-2021 12.67 Change in Results Framework Change in Components and Cost KEY RATINGS Outcome Bank Performance M&E Quality Moderately Satisfactory Moderately Satisfactory Modest RATINGS OF PROJECT PERFORMANCE IN ISRs Actual No. Date ISR Archived DO Rating IP Rating Disbursements (US$M) 01 24-Jun-2016 Satisfactory Satisfactory .88 ii The World Bank Mauritania Public Sector Governance Project (P146804) 02 27-Jan-2017 Satisfactory Moderately Satisfactory 1.86 03 08-Jul-2017 Satisfactory Satisfactory 2.60 04 27-Feb-2018 Satisfactory Moderately Satisfactory 3.79 05 07-Sep-2018 Satisfactory Moderately Satisfactory 4.86 06 02-Apr-2019 Satisfactory Moderately Satisfactory 6.66 07 18-Dec-2019 Satisfactory Moderately Satisfactory 8.63 08 30-Jun-2020 Satisfactory Moderately Satisfactory 10.94 09 26-Jan-2021 Satisfactory Moderately Satisfactory 12.20 10 19-Aug-2021 Satisfactory Moderately Satisfactory 14.18 11 17-Mar-2022 Moderately Satisfactory Moderately Satisfactory 15.65 12 08-Oct-2022 Moderately Satisfactory Moderately Satisfactory 20.48 13 26-Dec-2022 Moderately Satisfactory Moderately Satisfactory 23.36 SECTORS AND THEMES Sectors Major Sector/Sector (%) Public Administration 70 Central Government (Central Agencies) 70 Energy and Extractives 30 Public Administration - Energy and Extractives 30 Themes Major Theme/ Theme (Level 2)/ Theme (Level 3) (%) Economic Policy 10 Fiscal Policy 10 Tax policy 10 iii The World Bank Mauritania Public Sector Governance Project (P146804) Public Sector Management 76 Public Finance Management 32 Public Expenditure Management 22 Domestic Revenue Administration 10 Public Administration 44 Transparency, Accountability and Good 44 Governance Urban and Rural Development 15 Rural Development 15 Land Administration and Management 15 ADM STAFF Role At Approval At ICR Regional Vice President: Makhtar Diop Ousmane Diagana Country Director: Louise J. Cord Keiko Miwa Director: James A. Brumby Abebe Adugna Dadi Practice Manager: Renaud Seligmann Gael J. R. F. Raballand Task Team Leader(s): Kjetil Hansen, Eric Brintet Marie J. Bolou ICR Contributing Author: Marc-Anton Wilhelm Pruefer iv The World Bank Mauritania Public Sector Governance Project (P146804) EXECUTIVE SUMMARY i. The Mauritania Public Sector Governance Project (P146804) was originally approved on March 28, 2016, in the amount of US$11.60 million. At the time of appraisal, Mauritania had just become a lower middle-income country displaying improving economic growth, however, the country was facing several Governance-related challenges. Medium-term planning and programming were at a nascent stage, the quality of public spending was affected by variations in the composition of expenditures and poor monitoring and control over public spending; and budget information systems did not provide a clear, real-time overview of budget execution. There was a need to expand the tax base and improve tax collection to limit vulnerability to mining tax volatility, and major challenges remained in regularizing land tenure and modernizing the systems for land administration. Meanwhile, oversight institutions were unequipped to effectively audit public accounts, inadequate control of the parastatal sector was heightening fiscal risks, and the procurement system was inefficient. ii. The Project was conceived in response to this context, supporting public sector reform with a view to Improve Allocation and Management of Public Finances, Improve Mobilization of Public Resources, and Enhance Transparency of Public Resources. The original Project Development Objective (PDO) was: “to improve monitoring and transparency of selected government entities and the administration of property and mining taxation”. An Additional Financing (AF) and First Restructuring was approved in July 2018, in the amount of US$16.40 million to consolidate and scale-up activities and expand scope, and extending the closing date from February 15, 2020, to December 31, 2022. The PDO was accordingly revised to “to enhance transparency and improve the mobilization, allocation and management of public resources”. A Second Restructuring in May 2021, which occurred in the context of the Corona Virus Disease 2019 (COVID- 19) pandemic, responded to an emerging need to further strengthen strategic planning and monitoring of Government of Mauritania (GoM) priorities, and entailed support for the operationalization of the Presidential Delivery Unit (CSEPS) the GoM had recently created. iii. The Project achieved substantial results in priority areas. Relevance of the PDO is rated as Substantial. Over its lifetime the Project directly aligned with the GoM’s “Strategy for Accelerated Growth and Shared Prosperity 2016‐2030” aim to strengthen governance in all its dimensions, and to inform policy reforms in the areas of economic governance, institutional accountability, and investment climate. It also directly aligned with the World Bank’s FY14‐FY16 Country Partnership Strategy (CPS) which prioritized the efficient management of public financial resources and the FY18–FY23 Country Partnership Framework (CPF) focus on strengthened fiscal management. The Project realized its expected outcomes with Substantial Efficacy. The Project supported the GoM in completing the upgrade and expansion of critical budget (TAHDIR, RACHAD) and tax (JIBAYA) information systems, strengthened the alignment between Medium-Term Expenditure Frameworks (MTEFs) and Annual Budget estimates, and timely transmission of budget execution bills. The computer systems of the General Directorate of Mines and Geology were also modernized, mining sector tax audits are now being conducted according to a risk-based approach, and land administration and electronic management of land tenure were improved. Finally, it significantly improved transparency and monitoring of State-Owned Enterprises (SOEs), public access to fiscal information, and strengthened national statistical capacity. Overall, the ICR estimates the economic and financial benefits for Project results vis-à-vis costs to be Substantial. iv. The Overall Outcome is rated as Moderately Satisfactory and the Risk to Development Outcome as Moderate. Despite the strong outlined results, the Overall Outcome is assessed as Moderately Satisfactory, as the Project recorded only Modest Efficacy of its outcome on improved allocation and management of public finances. This outcome was only partially achieved, because the (ambitious) PDO-level target for the alignment between MTEFs and Annual Budget estimates was slightly missed, and given repeated challenges with large Government Financial Management Information v The World Bank Mauritania Public Sector Governance Project (P146804) Systems (GFMIS)-related procurements also led to a crucial intermediate indicator to be missed (failed procurement of the Treasury accounting system). There were also some connected issues regarding the sustainability of the IT systems that were successfully procured. As a result, the Project’s Risk to Development Outcome is assessed as Moderate. v. Several important lessons and recommendations emerged from the Project. The transparency-focused support to SOE reform under the Project proved highly impactful, replicable, and scalable, specifically as it relates to the preparation of aggregate portfolio reports, their publication on the oversight institution’s website and their inclusion in the country’s budget proposals. Another emerging lesson pertains to the Presidential Delivery Unit. Limited strategic support to the CSEPS under the Project served as a catalyst for its operationalization and helped generate encouraging initial results that warrant its consideration for further Bank support. The CSEPS has developed a digital monitoring tool that allows it to systematically assess progress and implementation challenges, assisting strategic decision making on Priority Programs. Other lessons point to a need for more careful planning of complex IT procurements that often constitute core elements of PFM reform, among others. vi The World Bank Mauritania Public Sector Governance Project (P146804) I. PROJECT CONTEXT AND DEVELOPMENT OBJECTIVES A. CONTEXT AT APPRAISAL Context 1. The Mauritania Public Sector Governance Project (P146804) was approved on March 28, 2016, in the amount of US$11.60 million (US$10.30 million IDA-D1030 and US$1.3 million in counterpart funds) and became effective on June 24, 2016. It was designed to support the GoM to improve monitoring and transparency of selected government entities and the administration of property and mining taxation. An AF (P165501) and First Restructuring was approved in July 2018, in the amount of US$16.40 million (US$14.5 million IDA-D3450 and US$0.9 million in counterpart funds) to consolidate and scale-up activities under the Original Financing (OF) and expand its scope. It introduced revisions to the PDO, Results Framework, Components, and closing date. A Second Restructuring in June 2021 introduced further limited changes. The Project closed on December 31, 2022, with a disbursement rate of 97.3 percent. Country Context 2. In 2016, Mauritania had just become a lower middle-income country displaying improving economic growth. In the preceding decade, the country reaped the benefits of historically high commodity prices. The super-cycle spurred solid economic growth (averaging 5.5 percent), allowing for significant investments in infrastructure and its elevation to lower middle-income status. A gross national income per capita of US$1,270 was driven by a thriving extractive sector. Moreover, the poverty rate had dropped from 44.5 percent to 33.0 percent from 2008 to 2014. However, Mauritania still ranked at 157th among 188 countries on the United Nations Human Development Index (HDI) in 2016. Sector Context Public Financial Management (PFM) 3. Medium-term planning and programming were at a nascent stage. Although the GoM introduced global and sectoral MTEFs in 2000, these programming tools were not systematically developed and had little influence over annual budget allocations. Also, the envisaged timetable for their preparation did not facilitate their rational incorporation into the budget preparation process. This was due to a combination of the limited capacity of sectoral ministries to undertake medium term programming, the failure to ensure regular updating of MTEFs and poor attempts to monitor and align medium-term programming and annual budget processes. 4. Although budget execution rates were high, the quality of public spending was affected by variations in the composition of expenditures and poor systems for monitoring and controlling public spending. There were significant differences between budgeted and actual expenditures within and among budget categories, with under-spending in some and overspending in others. There was also uncertainty about the eligibility of spending. Furthermore, almost a third of government spending was devoted to ‘unspecified expenses’, with no information available on which sectors received these funds or what type of expenditures they financed. 5. Budget information systems did not provide a clear, real-time overview of budget execution. A rapid GFMIS diagnostic carried out by the Bank in 2014 found that electronic financial management information systems were largely uncoordinated, fragmented and not effectively used. Many systems depended on multiple data sources and manual re- entry. There were redundancies and lack of interfaces between systems, and some suffered from reliability and data quality issues. The result was that reports from different systems often showed significant variations, which introduced uncertainty into budget analysis and monitoring. Page 1 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Domestic Resource Mobilization (DRM) 6. There was a need to expand the tax base and improve tax collection to limit the country’s vulnerability to mining tax volatility. The government’s commitment to taxation reforms since 2010 had yielded significant results. The widespread use of taxpayer identification numbers had increased the number of declaring firms and this, combined with coordination with the customs authorities and better tax audits, had led to a tripling in the number of taxpayers between 2010 and 2012 (MoF). New progressive tax rates were introduced in 2014 and excise taxes and taxes on capital gains increased. The government had also closed mining taxation loopholes by creating the legal basis for taxing the transfer of mining assets between non-residents. As a result, total revenues more than doubled in absolute terms, from MRO1 64 billion (US$198 million) in 2010 to MRO 140 billion (US$441 million) in 2014. There was, however, significant scope to further broaden the revenue base and enhance the tax administration system. 7. Major challenges remained in regularizing land tenure and modernizing the systems for land administration, which also undermined property tax revenue generation. While Mauritania had initiated a process to rationalize and improve the management of land information to establish a modern cadaster, the process remained incomplete. Given the lack of a comprehensive and consolidated system for managing land information, overlapping, and conflicting claims to the same land parcels presented a problem for much of the territory. This was also seen as undermining property tax revenue generation. As part of a national process to develop a modern land reform policy, the GoM created a strategic inter-ministerial committee and a Land Reform Technical Commission (Commission Technique chargée de la Réforme Foncière – COTREF) in 2016. The GoM was also committed to support initiatives to strengthen the capacity of the General Directorate of Land Management and State Property (DGDPE) to accompany and implement the land reform policy. Transparency 8. Oversight institutions were unequipped to effectively audit public accounts. The General Financial Inspectorate (Inspection Générale des Finances – IGF)2, which reports to the minister of Finance, was severely underfunded, had little freedom in determining and executing its work program, and there was no systematic follow-up on its recommendations. The General State Inspectorate (Inspection Générale d’Etat, IGE), which reported to the Prime Minister and was vested with the responsibility of performance and functional audits was similarly hampered. Despite relatively strong capacity, coordination with other control bodies was poor and implementation of recommendations uneven. The internal audit units of key line ministries were also underfunded, lacked practical tools and training, and only covered less than ten percent of their intended targets. The Supreme Audit Institution (Cour des Comptes) was equally constrained by limited resources and experiencing significant delays. Given shortcomings of internal and external state oversight institutions, public institutions, including SOEs and Autonomous Government Agencies (AGA), tended to rely on private auditors. 9. Inadequate control of the parastatal sector was heightening fiscal risks. Despite efforts to strengthen the state ownership function and improve internal and external controls in the sector, the Central Ownership Unit, the General Directorate for Financial Oversight (Direction de la Tutelle Financiére – DTF), the General State Inspectorate (Inspection Générale d’Etat – IGE) and the Court of Accounts had difficulties in accessing comprehensive, up-to-date financial information. Financial statements and reports were infrequent, incomplete and, in the case of Public Administrative Entities (Ëtablissements Publics Administratifs – EPAs), not standardized. Moreover, national audit standards were deficient, and audits irregular and of limited quality. The DTF did no prepare regular fiscal risk analyses, performance assessments or portfolio reports, and had only just started to produce consolidated information on the state’s portfolio. 10. Despite the introduction of a modern procurement code and the strengthening of institutional foundations the procurement system was inefficient and limited in effectiveness. Challenges included: a legal framework missing operational regulations and standard bidding documents; an unclear and inefficient institutional setup with sometimes Page 2 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) overlapping mandates; a lack of operational knowledge in core procurement institutions; a lack of controls and audits; ineffective mechanisms for reporting allegations of corruption; and a complete absence of civil society participation. Moreover, the Procurement Regulatory Authority (Autorité de Regulation des Marchés Publics – ARMP) did not publish any information on procurement contracts that it reviewed during the year. Although weaknesses in the procurement system appeared not to have affected budget execution substantially, they likely had prompted a rise in expenditures managed by the parastatal sector, which were not subject to national procurement legislation. Rationale for World Bank Group Support 11. In this context, the Project intended to advance important reforms to improve public spending, reinforce control over the parastatal sector and enhance compliance with the procurement framework. It directly aligned with the GoM’s “Strategy for Accelerated Growth and Shared Prosperity 2016‐2030” (Stratégie de Croissance Accélérée et de Prospérité Partagée – SCAPP)’s overarching aim to strengthen governance in all its dimensions, and to inform policy reforms in the areas of economic governance, institutional accountability, and investment climate. Moreover, it also directly aligned with the WBG’s FY14‐FY16 CPS Pillar 2: Economic Governance and Service Delivery, and specifically CPS Objective 2.3 Public Sector Development, Outcome 10 – Efficient Management of Public Financial Resources. Theory of Change (Results Chain) 12. The Project Appraisal Document (PAD) did not include an explicit Theory of Change (ToC). Given that Bank guidelines and procedures did not mandate it no ToC diagram was elaborated at the time of Appraisal. A basic Results Chain was later added at AF stage (Annex 6.2). Based on the results narrative contained in the Project Documents an implicit ToC articulating the underlying design logic has been formulated by the Implementation Completion and Results Report (ICR) author (Annex 6.1). Project Development Objectives (PDOs) 13. The PDO as stated in the Original Financing Agreement (dated April 13, 2016) was: “to improve monitoring and transparency of selected government entities and the administration of property and mining taxation”. Key Expected Outcomes and Outcome Indicators 14. The original PDO statement captured two expected outcomes: (i) “improved monitoring and transparency of selected government entities”; and (ii) “improved administration of property and mining taxation”. Each outcome was measured by two (2) PDO indicators, the first by: (a) Timely public disclosure of reports on SOE/AGA performance issued by the directorate in charge of monitoring SOEs/AGAs, the DTF; and (b) Coverage of internal audits in the Ministries of Health and Primary Education; the second outcome by: (a) Properties on which fees and taxes are being levied; and (b) Mining companies subjected to tax audits. Components 15. The Original Financing (OF) consisted of the following three components: • Component 1: Improving transparency and Control in Public Resource Management (US$5.20 million). This component was designed to support the authorities’ efforts to enhance transparency and improve controls over 1 In 2017, the Central Bank of Mauritania redenominated its currency at a rate of 1:10. In this context, the ISO Currency Codes for the ouguiya were amended to MRU and the existing codes of MRO were retired (as per ISO 4217 Amendment Number 165). 2 The IGF’s mandate is very similar to that of the IGE. Coordina tion between the two control organs is very limited despite a clear need for good coordination, given their overlapping mandates and each institution’s limited resources and coverage. Page 3 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) the use of public resources through an updated and more integrated GFMIS; improve monitoring of SOEs and AGAs; improve accounting and auditing standards; strengthen internal and external oversight; and ensure a more efficient public procurement system. • Component 2: Strengthening the Administration of Property Registration and Taxation and Mining Taxation (US$4.70 million). This component was designed to help broaden the tax base and modernize tax administration to create a more predictable and stable source of revenue; to improve mining sector taxation by using a tax model and a risk-based methodology for audits to combat Base Erosion and Profit Shifting (BEPS); and to help modernize the mining registry, and strengthen the capacity of the Ministry of Mining for geoscientific analysis. • Component 3: Project Management (US$1.70 million). This component was designed to support the recipient to hire and maintain a Project Implementation Unit (PIU), including personnel and equipment to ensure technical support for the implementation of the planned activities. It also financed operating costs including staff costs, office rental, office equipment, travel, operating expenditures, and external audits of project accounts (PAs). B. SIGNIFICANT CHANGES DURING IMPLEMENTATION (IF APPLICABLE) Revised PDOs and Outcome Targets 16. The project was restructured twice over the course of its implementation. • The 2018 AF and First Restructuring (AF FA dated August 16, 2018) was formally requested by the GoM through a letter dated February 26, 2018, to scale-up and expand the scope of the Parent Project. It added US$14.5 million to the Project’s financing envelope (increasing it to US$27.0 million), revised the PDO statement, added one component, and introduced changes to other components and subcomponents. • The 2021 Second Restructuring (Amendment to AF FA dated June 10, 2021) was formally requested by the GoM through a letter dated 29 April 2021, to introduce activities to support the operationalization of a new Presidential Delivery Unit (Cellule de suivi de l'exécution des priorités stratégiques – CSEPS). This simple restructuring also reallocated US$0.5 million from Component 2 to Component 4. 17. The revised PDO was: “to enhance transparency and improve the mobilization, allocation and management of public resources”, now capturing three updated expected outcomes: (i) Improve Allocation and Management of Public Finances; (ii) Improve Mobilization of Public Resources; and (iii) Enhance Transparency of Public Resources. Revised PDO Indicators 18. PDO indicators were revised as part of the 2018 AF and First Restructuring to reflect the revised PDO and better capture outcomes. Out of four (4) original PDO indicators: (i) one (1) indicator (Mining companies subjected to tax audits) was retained – and had already been achieved; (ii) two (2) indicators (Timely public disclosure of reports on SOE/AGA performance issued by the directorate in charge of monitoring SOEs/AGAs, the DTF and Properties on which fees and taxes are being levied) were reformulated to more effectively capture Project achievements; (iii) one (1) indicator (Coverage of internal audits in the Ministries of Health and Primary Education) was dropped, because one (1) of the revised existing indicators, together with one (1) new indicators were seen as more adequate measures of the associated outcome; and (iv) three (3) new indicators (Transmission of the budget execution bill to the Court of Accounts within the mandated timeframe, Alignment between Medium-Term Expenditure Framework estimates and annual budget estimates in 2 selected sectors, and Improved public access to fiscal information were introduced (see Table 1 and Annex 7.1). Page 4 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Table 1: Revised PDO Indicators Revised/new indicators Original PDO indicators Rationale (at time of AF) Timely public disclosure of [Reformulated] Public disclosure of reports on SOE/AGA annual consolidated reports on the To refine this measure of Project achievements (in terms of performance issued by the financial performance and fiscal risks Outcome 3: Enhance Transparency of Public Resources) directorate in charge of of public corporations (entreprises monitoring SOEs/AGAs, the publics et établissements publics) DTF issued by the DTF Together the revised PDO indicator on consolidated SOE Coverage of internal audits reports (s. above) and the new PDO Indicator on Improved in the Ministries of Health Dropped public access to fiscal information (s. below) were seen as and Primary Education3 more adequate measures of Project achievements (in terms of Outcome 3: Enhance Transparency of Public Resources) [Reformulated] Urban land parcels To provide a more adequate measure of Project Properties on which fees with use or ownership rights achievements (in terms of Outcome 2: Improve Mobilization and taxes are being levied recorded in a land information of Public Resources) system (gender disaggregated) Mining companies subject Retained N/A (achieved since 2017) to tax audits [New] Transmission of the budget Newly introduced measure of Project achievements (for execution bill (Projet de loi de Outcome 1: Improve Allocation and Management of Public réglement) for the preceding year to Finances) tracking the functionality of Government N/A the Court of Accounts within the Financial Management Information Systems (GFMIS) mandated timeframe (on or before core modules that enable the timely and automated 31 December) production of reliable information on budget execution [New] Alignment between Medium- Newly introduced measure of Project achievements (for Term Expenditure Framework Outcome 1: Improve Allocation and Management of Public N/A estimates and annual budget Finances) tracking improvements in evidence-based and estimates in 2 selected sectors results-focused annual allocation of resources Newly introduced measure of Project achievements (for [New] Improved public access to Outcome 3: Enhance Transparency of Public Resources) N/A fiscal information (measured as tracking production and publication of information across elements of fiscal information) the fiscal management chain, including audit reports Revised Components 19. The Project was significantly scaled-up and its components were revised. As shown in Annex 3.1 and Annex 7.2, the 2018 AF and First Restructuring significantly scaled-up the Project (US$14.5 million in additional funds), amended the scope of the three (3) original components, modified multiple sub-components, and introduced a new component 4. Under the Second Restructuring, Components 2 and 4 were further modified. Specific revisions were as follows: 20. Component 1: Enhancing Transparency and Efficiency in Public Resource Management (US$10.7 million). Under 3 This indicator was ultimately a somewhat flawed measure not reflective of: (i) the successfully executed activities under the associated subcomponent 1.3, which included (risk-based) audit training to the IGE and Court of Accounts, the online publication of annual audited budget execution reports of the Court of Accounts (2007 to 2012) and assessments of the internal audit inspectorates of the MEF, Ministry of Education, and Ministry of Health (a legal covenant of the Project); as well as (ii) both the existing (improved monitoring and transparency of selected government entities) and revised associated project outcomes. Page 5 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) the AF and First Restructuring this component was renamed, significantly scaled-up (US$5.5 million in additional funds), and all its sub-components were revised. This revision included: (i) (re)allocating US$5.5 million in additional funding to subcomponent 1.1. and revising its name from Enhancing Transparency and Reporting on Public Resources to Enhancing the systems for transparent public financial management and reporting; (ii) (re)allocating US$0.72 million in additional funding to subcomponent 1.2: Increasing Monitoring of SOEs and Autonomous Agencies; (iii) dropping subcomponent 1.3 Improving Accounting and Auditing Standards and Internal and External Oversight and reallocating the remaining funds; and (iv) renumbering subcomponent 1.4: Enhancing the Public Procurement System as subcomponent 1.3. 21. Component 2: Strengthening the Administration of Land Registration and Mining Taxation (US$9.0 million). Under the AF and First Restructuring this component was renamed, significantly scaled-up (US$ 4.8 million in additional funds), and its four subcomponents consolidated into two subcomponents: 2.1 Strengthening the Administration of Land Registration 2.2 Broadening the Tax Base and Strengthening Fiscal Management in the Mining Sector which became sub- component 2.3 The scale-up included support for the land registration pilots to increase the number of formally registered land parcels in Mauritania. Under the Second Restructuring US$0.5 million was reallocated from this component to Component 4 after the procurement process for a US$1.125 million contract under sub-component 2.2 for the equipment purchase and training program for the General Tax Directorate (DGI) ultimately resulted in an unsuccessful bid. 22. Component 3: Project Management (US$3.55 million). To reflect an expanded scope, extended closing date and modifications to institutional arrangements, resources allocated to this component were increased under the AF (US$1.5 million in additional funds). 23. Component 4: Strengthening national statistical capacity, medium-term programming, and annual budget processes (US$3.75 million). This component was newly introduced under the AF and First Restructuring to provide support to strengthening national statistical capacity and enhancing macro-economic and fiscal analysis and to strengthen the linkages between medium term programming and annual budgeting processes. Three sub-components were originally included: 4.1 Enhancing the Capacity of the National Statistical System to Produce Timely and Quality Statistics (US$2.55 million); 4.2 Improving medium-term planning and budgeting (US$0.4 million) and 4.3 Enhancing access to statistical information (US$0.3 million). A fourth sub-component 4.4. Supporting government capacity in strategic planning and implementation monitoring through the new Delivery Unit (US$0.5 million) was added under the Second Restructuring. Other Changes 24. The AF and Restructurings also introduced some other changes. Under the AF and First Restructuring, the closing date was extended from February 15, 2020 to December 31, 2022 to allow for: (a) the completion of the new activities under the newly introduced component 4; (b) the introduction and effective functioning of budget and accounting GFMIS modules; (c) the implementation of land registration pilots; and (d) contingencies, including time delays expected because of added complexity of procurement processes required for larger-scale contracts envisaged under the AF. Moreover, some adjustments were made to implementation arrangements4. Rationale for Changes and Their Implication on the Original Theory of Change 25. The AF and First Restructuring scaled-up and expanded the Project in response to an emerging GoM need to reinforce public sector capacity to mobilize and manage public resources transparently. Due to lower commodity prices and increasingly limited fiscal space, the GoM was facing growing pressure to reinforce public sector capacity to mobilize 4 This included the nomination of an ad hoc Technical Advisory Committee by the Project Steering Committee; the inclusion of the COTREF, the National Office of Statistics (Office Nationale de Statistiques – ONS) and others, as new principal beneficiaries of the AF as members of the Project Steering Committee; the removal of representatives of the Health and Education ministries due to the discontinuation of Parent Project activities to support internal control inspectorates in these ministries; and the revision of the Manual of Procedures, mainly to clarify roles and responsibilities of Project beneficiaries. Page 6 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) and manage public resources transparently. The AF was therefore prepared with a view to: (a) enhancing the capacities and functionalities of the GFMIS through the modernization and interfacing of two core budgeting and treasury accounting information systems; (b) strengthening statistical, and macroeconomic and fiscal forecasting capacity and enhancing medium-term programming and budgeting processes; and (c) expanding the tax base and optimizing revenue mobilization via scaled-up support for land registration pilots and reinforcing audit capacity in the mining sector. To reflect this scale-up, the PDO was revised, a new component added, and changes to other components introduced. As outlined in the previous section, the implicit ToC prepared by the ICR author is reflective of the important changes under the AF. 26. The Second Restructuring aimed to further strengthen strategic planning and monitoring of GoM priorities. At the time of the Second Restructuring in 2021, the GoM was confronted with the impact of the COVID-19 pandemic. In this context, it identified an emerging need to strengthen strategic planning and implementation monitoring of GoM priorities. This specifically entailed support for the operationalization of the Delivery Unit (CSEPS) the GoM had recently created to enhance performance orientation in the public sector. To this end, a new subcomponent “4.4. Supporting government capacity in strategic planning and implementation monitoring through a new Delivery Unit” and associated Intermediate Results Indicator (IRI) were added, and some funds reallocated (US$0.5 million). This aligned well with the implicit ToC by directly contributing to and enriching the PDO outcome related to management of public resources. II. OUTCOME A. RELEVANCE OF PDOs Assessment of Relevance of PDOs and Rating 27. The relevance of the PDO is rated Substantial. Over its lifetime the Project directly aligned with the GoM’s “Strategy for Accelerated Growth and Shared Prosperity 2016‐2030” (SCAPP5)’s overarching aim to strengthen governance in all its dimensions, and to inform policy reforms in the areas of economic governance, institutional accountability, and investment climate. It further directly aligned with, and effectively contributed to, the WBG’s FY14‐FY16 CPS Pillar 2: Economic Governance and Service Delivery, and specifically CPS Objective 2.3 Public Sector Development, Outcome 10 – Efficient Management of Public Financial Resources. The Completion and Learning Review (CLR) for the FY14‐16 CPS found that over the CPS period the Project effectively supported the GoM in advancing important reforms to optimize public spending, reinforce control over the parastatal sector and enhance compliance with the country’s procurement framework (FY18–FY23 Country Partnership Framework, p.66). Finally, the Project also directly aligned with the WBG’s FY18–FY23 CPF Focus Area 3: Strengthen Economic Governance and Private Sector‐Led Growth, and specifically CPF Objective 3.1: Strengthen Fiscal Management. 28. The Project effectively responded to emerging GoM and World Bank priorities. From the outset the Project represented a key implementation arm for the GoM’s deepened commitment to strengthen medium-term planning and programming, monitoring and control over public spending, tax collection, and regularizing land tenure and modernizing land administration. The AF and First Restructuring in 2018 subsequently scaled-up and expanded the scope of the Project, which entailed a revision of the PDO, the introduction of a new Component 4: Strengthening national statistical capacity, medium-term programming, and annual budget processes, and changes to other components. The rationale for this was to support the GoM in addressing growing pressure to reinforce public sector capacity to mobilize and manage public resources transparently, as it was now facing lower commodity prices and increasingly limited fiscal space. With the AF the Project also became a core element of the WBG’s FY18–FY23 CPF for Mauritania – both were processed in parallel 5 The Stratégie de Croissance Accélérée et de Prospérité Partagée (SCAPP) was adopted on October 19, 2017, and followed the Framework for the Fight Against Poverty 2001‐2015 (Cadre Stratégique de Lutte contre la Pauvreté – CSLP). It is also strongly aligned with the 2017 SCD and the subsequent FY18–FY23 CPF. Page 7 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) and approved on June 4 and 13, 2018, respectively, with the revised PDO and CPF Objective 3.1. Strengthen Fiscal Management sharing much of the same wording6. The Second Restructuring in May 2021, which occurred in the context of the COVID-19 pandemic, responded to an emerging need to further strengthen strategic planning and monitoring of GoM priorities, and entailed support for the operationalization of the Presidential Delivery Unit (CSEPS) the GoM had recently created to enhance performance orientation in the public sector. This final change was also directly relevant to both the GoM’s and the World Bank’s emerging priorities, further enhancing management of public resources. B. ACHIEVEMENT OF PDOs (EFFICACY) Assessment of Achievement of Each Objective/Outcome 29. The ICR assesses three expected outcomes captured in the revised PDO “to enhance transparency and improve the mobilization, allocation and management of public resources”, i.e. (i) Improve Allocation and Management of Public Resources; (ii) Improve Mobilization of Public Resources; and (iii) Enhance Transparency of Public Resources”. Table 2 shows the achievement of PDO indicators at the end of the Project organized by these expected outcomes. 30. No split rating is applied to assess the expected outcomes. According to the 2019 World Bank ICR Guidelines for IPF, changes made under this specific Project do not call for the application of a split rating7. Specifically, the AF and First Restructuring revised the PDO statement, but because the scope of the Project expanded and it became overall more ambitious, this does not trigger a split rating. The original outcomes also remained contained in the revised PDO8. The AF and First Restructuring also introduced changes to PDO indicators – including the dropping of one (1) indicator. Given these changes were made to introduce better measures of the Project’s achievements (s. Table 1) and the ambition was raised, again, no split rating is triggered. Table 2: PDO Indicator achievement Achievement Indicator Baseline Target 12/31/2022 Outcome 1: Improve Allocation and Management of Public Resources Transmission of the budget execution bill (Projet de loi de After 12/31 N+1 On 12/31 Achieved reglement) for the preceding year to the Court of Accounts 06/30/2016 12/31/2022 on time since 2018 within the mandated timeframe Alignment between Medium-Term Expenditure Framework Not aligned 95% Partially Achieved 04/20/2018 12/31/2022 (89.7% vs. 95%) 6 CPF Objective 3.1 Strengthen Fiscal Management aims “to enhance transparency and efficiency in the mobilization, allocation and management of public resources”, by: (a) expanding the tax base and optimizing revenue mobilization in the mining sector; (b) reinforcing the alignment between evidence‐based policies, medium term planning of resource allocations and annual budgeting processes; (c) enhancing the efficient management of public resources by strengthening the fiscal management of SOEs and autonomous agencies, reinforcing government PFM information systems and enhancing public procurement systems; and (d) facilitating improved public access to fiscal information to enhance the transparent management of public resources. 7 “Revision of the PDO statement or outcome targets may or may not call for applicat ion of a split rating in the ICR, depending on whether the scope of the project narrowed, expanded, or remained the same… if the project became overall more ambitious, generally a split rating is not applied… unless good reasons can be presented as to why a split rating makes sense…” (paragraph 60), and: “changes to PDO indicators: dropping indicators and/or adding new ones does not trigger a split rating, as such changes may reflect different (and presumably better) measures of a project’s achievement rather than raising or lowering a project’s ambition. Project teams are encouraged to adopt better indicators whenever necessary and appropriate…” (paragraph 61). 8 The original PDO statement “to improve monitoring and transparency of selected government entit ies and the administration of property and mining taxation”, included unpacked objectives on monitoring, tax administration, and transparency, which are pr eserved within the more representative outcomes in the revised PDO statement, i.e., (i) Improve Allocation and Management of Public Resources; (ii) Improve Mobilization of Public Resources; and (iii) Enhance Transparency of Public Resources”. Page 8 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) estimates and Annual Budget estimates in two selected sectors 9 Outcome 2: Improve Mobilization of Public Resources Urban land parcels with use or ownership rights recorded in a 35,000 75,000 Achieved land information system (gender disaggregated) 04/20/2018 12/31/2022 207,763 (30% female / 70% male) Mining companies subjected to tax audits 61% 71% Achieved 03/30/2018 12/31/2022 86% Outcome 3: Enhance Transparency of Public Resources Public disclosure of annual consolidated reports on the financial 0 6 Achieved performance and fiscal risks of public corporations (entreprises et 11/30/2015 12/31/2022 7 établissements publics) issued by the DTF Improved public access to fiscal information (measured as 3 6 Achieved elements of fiscal information) 12/31/2014 12/31/2022 7 Coverage of internal audits in the Ministries of Health and 10% 20% Dropped Primary Education 11/30/2015 06/30/2020 (at AF stage) Outcome 1: Improve Allocation and Management of Public Finances 31. Budget execution bills (Projet de loi de règlement) for the preceding year are now transmitted to the Court of Accounts within the mandated timeframe. By providing support to enhancing the functionality of GFMIS core modules to enable the timely and automated production of reliable information on budget execution, the Project helped enable the GoM to submit the budget execution bill for all years since 2018 on time. Moreover, the GoM has published all budget execution bills of the last ten years (2009-2018). This has significantly improved the comprehensiveness of the GoM’s aggregate fiscal position and controls over public spending. 32. The Alignment between MTEF and Annual Budget estimates was strengthened. The MTEF estimates for the years 2021-2023 of two selected ministries, the Ministry of Equipment and Transport (MET) and the Ministry of Social Affairs, Childhood, and the Family (MASEF), were prepared and transmitted on March 31, 2021. While achieving this significant improvement, the final alignment rate of these MTEF estimates with the disclosed budgets was calculated at 89.7 percent, slightly lower than the end target of 95 percent. According to the authorities the larger than expected variation between the MTEF and annual budget estimates was due to a downward revision of all budgets because of the Corona Virus Disease 2019 (COVID-19). Despite this slight shortcoming, the improved alignment between the MTEF and budget estimates helped make the annual allocation of resources significantly more evidence-based and results-focused. 33. Although the acquisition of a new Treasury accounting system could not be completed, notable progress was achieved in the modernization and expansion of several other GFMIS. Due to protracted issues encountered during the procurement process, the acquisition of a new Treasury accounting system (from Oracle South Africa) was eventually abandoned in 2021, at signature stage. Despite this significant challenge, the Project successfully supported the GoM in completing the upgrade and expansion of critical budget (TAHDIR, RACHAD) and tax (JIBAYA) information systems, as well as the development of modules, interfaces, and the acquisition of related servers and licenses. 34. The Budget Preparation System (TAHDIR) was upgraded. It was launched in 2008 by the Budget Directorate (DGB) to support the preparation of the central government annual budget (custom software based on MS Access). Under 9 The Project originally targeted the alignment of MTEF and annual budget estimates in the health and agriculture ministries (see AF and First Restructuring Paper from June 4, 2018, p. 24). However, given that the Ministry of Agriculture was merged with the Ministry of Livestock and that the Ministry of Health, faced with COVID-19, had other more pressing priorities, in September 2020, the GoM decided to target the MET and the MASEF instead. Page 9 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) the Project the TAHDIR system was upgraded and used to support the implementation of the Organic Law related to the Finance Laws (LOLF, Loi Organique relative aux lois de finances) and Treasury Single Account (TSA) operations (launched in January 2020). Moreover, in 2022 the new system has been used for the preparation of 2023 budget (initial phase). TAHDIR is hosted in the DGB server room but currently still missing a recovery solution. Also, software development is still in progress with the DGB still using the old TAHDIR database for access to current and historical data (since 1980). 35. The Budget Execution System (RACHAD) underwent improvements. Expenditures are covered by the automatic expenditure network RACHAD, which also covers eligible public administrative institutions (since 2017) and autonomous public agencies (since 2018). The DGB completed the upgrade of the system (RACHAD2) and the acquisition of Oracle licenses, servers, and storage units in 2021. RACHAD2 is accessible to all authorized budget users and allows financial controllers to exercise their authority over the approval of expenditure commitments, delegations of appropriations and payment orders. The upgraded system makes it possible to track the execution of the budget and to produce tables in real time with implementation rates by type of budget, economic nomenclature, availability of appropriations, months, etc. A better administrative and geographical repartition of wage bill items also fosters better management and predictability of the wage bill. Several budgetary powers on credit transfers and imprest accounts are deconcentrated to line ministries. This led to improved processing times for payments, access for 28 payers (one for each ministry), the capability to attach e-documents, and database updating with the Central Bank every 15 minutes. 36. The Tax Management Information System (JIBAYA) was upgraded in 2021. JIBAYA was initially launched in 2014 as a customized web-based system. It is hosted in the DGI server room (no disaster recovery solution yet) and maintained by the IT team. New system capabilities include electronic declaration, electronic payments (mobile), and geolocation of taxpayers on an electronic map (based on Google Street View). Since 2019 the following online services are available through the new website: online declarations, consultations, information exchange, and system access through accreditation. In addition, new servers, data storage units and Oracle licenses have been purchased to provide broader access to new modules. JIBAYA is linked with RACHAD2 for daily data exchange based on web services / APIs. The customs system interface is partially completed to share updates on taxpayer data. The European Union will fund the establishment of a new data center, and the Request for Proposal has been issued. 37. A Presidential Delivery Unit (CSEPS) was created with a mandate to monitor the priorities of the Presidential Program. Under the leadership of its Coordinator, the Unit is fully operational and housed in offices financed by the Government. CSEPS has developed a digital monitoring tool with clear indicators, which allows it to systematically assess progress and implementation challenges. Since the summer of 2022, it has organized regular briefings for the Council of Ministers chaired by the President of the Republic, providing updates on overall Priority Program implementation and highlighting 1-2 projects for deeper discussion and strategic decision-making. CSEPS has exchanged with other Delivery Units in the region and beyond to study good international practices and further improve its performance. A strategic challenge for the success of the Unit in the next phase will be its continued institutionalization and the sustainability of its resources. The Project helped finance its operationalization. Outcome 2: Improve Mobilization of Public Resources 38. Progress has been achieved in the modernization of the computer systems of the General Directorate of Mines and Geology. As of 2019 both the Geological and Mining Information System (Système Informatique Géographique Minéral – SIGM) and the mining title management system "Flexicadastre” are online and accessible to inv estors and stakeholders in the sector. Public access to the SIGM, which hosts geological and geophysical data compiled over the years as well as data acquired under PRISM 1 and 2, is provided online and on-site at the headquarters of the Directorate General of Mining and Geology (Direction Générale des Mines et de la Géologie – DGMG). The DGMG expressed a need for in-depth geological mapping to expand the SIGM database to attract investors in the sector. The "Flexicadastre”, which is used to award and monitor mining permits from initial prospection of resources to extraction and eventual closure can Page 10 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) be accessed online (https://portals.landfolio.com/Mauritania/fr/). The Project supported a comprehensive reassessment of procedures and decision-making roles and system redesign, installation of software, and procurement of hardware. 39. The Project helped facilitate Extractives Industries Transparency Initiative (EITI) compliance in 2019 and 2020. The Flexicadastre and the SIGM set-up with the support of the Project were key in enabling Mauritania’s EITI compliance in terms of access to and accountability of mineral license management and transparency of data pertaining to mineral resources and annual production. EITI compliance can help improve a country’s investment climate, increase tax revenue, economic development, governance reform, mitigating corruption and building accountability in resource governance. The Project also financed several dissemination campaigns of the annual EITI reports which resulted in adequate public awareness and engagement with civil society as per EITI requirements. 40. Mining sector tax audits are now being conducted according to a risk-based approach. As of 2021, the three principal mining companies (SNIM, TASIAST and MCM) are subject to risk-based audits. Similarly, 16 of the 19 main subcontractors are now subject to the same principles. The number of tax audits of mining companies and subcontractors (19 out of 22 companies) carried out by the DGI thus exceeded the associated target. It is expected that, over time, this will lead to increased mining sector tax receipts, and help combat BEPS. 41. The results of the tax census financed by the Project are being used to expand the tax base and for the determination and collection of taxes. In 2020 the DGI completed the tax census (businesses and properties) in the three largest cities of Nouakchott, Nouadhibou and Rosso. By using the increased amount of fiscal data on businesses (turnover, staff, plants/equipment etc.) and properties (size, value, use) for the expansion of the tax base with reliable information and for the determination and collection of taxes from 2021 onwards, the DGI already started to exploit the results of the census of the cities of Nouadhibou and Rosso. 42. Activities related to the strengthening of land administration have achieved good progress. Pilot operations to secure land tenure have progressed well, both in urban and rural areas. For the pilot operations in urban areas, the field surveys have been completed and the service provider, in collaboration with the DGDPE, has begun the land registration phase for the plots of land in the first pilot site in Nezaha. This. This should allow the issuance of land titles or occupancy permits, subject to the lifting of the suspensions of administrative acts by the competent ministry. For the pilot operations in rural areas, the field surveys in the four pilot communes have also been completed. In the presence of authorities, secure documents were handed out to about 100 households in Nouakchott on November 28, 2022. The client is expected to continue the distribution of documents which were cleared for issuance at the end of the Project. Strengthened property tenure and administration is expected to stimulate economic activity. 43. The Project also succeeded in helping the GoM improve the electronic management of land tenure. At the start of the Project there were 35,000 parcels registered overall in the land management information systems of the Direction des Domaines, Agence de Développement Urbain (ADU) and Société de Construction et de Gestion Immobilière de la Mauritanie (ISKAN). With 56,596 parcels in the ADU database and 151,167 in the ISKAN database, a total of 207,763 parcels have been registered as of November 28, 2022 – considerably exceeding the end target of 75,000 parcels. This is expected to eventually generate important impacts in terms of increasing property tax receipts. Outcome 3: Enhance Transparency of Public Resources 44. The Project significantly improved public access to fiscal information. The following seven (7) elements of fiscal information are now available and published: (a) Documents relating to the draft annual budget of the executive power: The Finance Law was transmitted to Parliament on October 29, 2021 and published on the Treasury website on November 5, 2021; (b) Pre-budget statements: General parameters of the executive branch's budget proposal regarding expenditure, projected revenue and debt are made public at least four months before the start of the fiscal year. MTEFs are developed and approved by the MoF; (c) Macroeconomic forecasts: The forecasts are made public within one week of their approval. Page 11 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) MTEFs were prepared based on these forecasts; (d) Adopted Budget: The annual budget law approved by the legislature is made public within two weeks of its adoption. The 2022 finance law was promulgated on January 13, 2022, and published on the DGB website as of January 26; (e) In-year reports on budget execution: Reports are systematically published within one month; (f) Audited financial statements, incorporating the external audit report, or accompanied by this report: Reports are made public within twelve months of the end of the financial year. The budget execution bill for 2021 was approved by the Council of Ministers on November 3, 2022, i.e., 10 months after the end of the financial year; and (g) Other external audit reports: non-confidential reports on central government consolidated operations are published within six months of submission. Several have been the subject of external audits, such as the National Hydrocarbons Revenue Fund, the COVID Fund, the EITI report, etc. 45. The Project also achieved several strong results in terms of SOEs transparency and accountability. This includes the publication of economic and budget information, as well as the preparation of aggregate portfolio reports for SOEs for the years 2015-2021 and their publication on the website of the Directorate of Financial Supervision (www.dtf.mr.gov). The aggregate portfolio reports include public enterprises, EPAs and public institutions of an industrial and commercial nature (Établissements publics à caractère industriel et commercial – EPICs) that are published on the DTF website and attached to the budget proposal. Highlights of the reports include a comprehensive overview of the net performance of SOEs over the period covered, net profits/losses, dividends paid, taxes paid, grants/subsidies received, arrears and outstanding debts, including contingent liabilities. Reports are due no later than one year after the period covered. Support was also provided with implementing and monitoring two pilot performance contracts for the Société des Transports Publics (STP) and the Société Nationale des Forages et des Puits (SNFP). 46. National statistical capacity has been significantly strengthened. In particular, the following activities were carried out: (i) rapid survey on COVID-19 (6 waves of data collection including reports); (ii) elaboration of a new National Strategy for the Development of Statistics (NSDS) 2021-2030; (iii) elaboration of the project document of the new population and housing census (RGPH V) and realization of regional monographs; (iv) a methodological document for setting up a system of sub-annual employment surveys; (v) support for the Permanent Survey on Living Conditions of Households in Mauritania (EPCV) 2019; (vi) training for a diploma in statistics at the Institut Supérieur des Métiers de la Statistique (ISMS); and (vii) the acquisition of tablets for the General Census of Population and Housing (RGHP). Justification of Overall Efficacy and Rating 47. Overall Efficacy is rated Substantial. With regards to Outcome 1: Improve Allocation and Management of Public Resources the Project met the target for the PDO indicator Transmission of the budget execution bill but fell short of the target for the PDO indicator Alignment between Medium-Term Expenditure Framework estimates and Annual Budget estimates in two selected sectors – 89.7 percent vis-a-vis 95.0 percent. The Project also met two of the associated IRIs. However, the third IRI on Core Budget and Treasury Accounting Management Information Systems upgraded, integrated and interfaced with other principal financial management information systems – arguably the most important one – was missed. The achievement of Outcome 1 is thus judged to be Modest. With regards to Outcome 2: Improve Mobilization of Public Resources, the Project exceeded the target for the PDO indicator Urban land parcels with use or ownership rights recorded in a land information system –207,763 parcels vis-à-vis 75,000 parcels. It also exceeded the target for the PDO indicator Mine companies subjected to tax audits – 86 percent vis-à-vis 71 percent. It also exceeded all associated IRIs. Therefore, the achievement of Outcome 2 is judged to be Substantial. With regards to Outcome 3: Enhance Transparency of Public Finances, the Project exceeded the targets for PDO Indicator Improved public access to fiscal information (measured as elements of fiscal information) and PDO indicator Public disclosure of annual consolidated reports on the financial performance and fiscal risks of public corporations – both with seven (7) vis-à-vis a target of six (6). The initial PDO Indicator on Coverage of internal audits in the Ministries of Health and Primary Education was dropped at AF stage because it was considered that newly introduced PDO Indicators were better measures of Project achievements. The Page 12 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Project also exceeded all associated IRIs. The achievement of Outcome 3 is therefore also judged to be Substantial. Taken together, these three individual Outcome ratings lead to an overall Efficacy rating of Substantial. C. EFFICIENCY Assessment of Efficiency and Rating 48. The PAD and AF Paper cited several quantifiable benefits expected from the Project. These include: (i) tax revenues and fees from an improved property tax system estimated to increase by 20 percent – assuming 5 percent inflation and 5 percent annual increase in taxes and fees collected; (ii) transfer pricing documentation and disclosure requirements leading to revenue collection benefits of about 0.6 percent of GDP; and (iii) 1 percent of GDP in budgetary savings from a decline in extra-budgetary spending and carryforwards in the parastatals sector. These benefits were not systematically tracked as part of the Project and could not be substantiated by the ICR author. 49. Expected indirect benefits of the Project mainly related to improved service delivery. These include: (i) an improved property registry system and secure property titles could increase the value of property and enable its use as collateral; (ii) a modernized mineral registry and better services for prospective investors could lead to increased foreign direct investment and additional fees and taxes; (iii) automated budgeting and accounting systems would lead to a host of savings and efficiency gains; (iv) enhanced Central Government oversight over SOEs would reduce fiscal risks and costs; (v) improved Public Investment Management would increase allocative efficiency of public spending; and (vi) improved statistics and macroeconomic analysis capacity would boosts transparency and encourage citizen engagement. 50. An Economy-Wide Rate of Return (EWRR) was cited in the PAD as benchmark for expected financial and economic benefits. While the PAD did not define a minimum Internal Rate of Return (IRR) for Project viability, the EWRR of Mauritania’s Public Investment Program (PIP), at Appraisal, was estimated at 12 percent. Consequently, the Project was expected to generate similar financial and economic benefits. 51. The Project contributed to the cleaning up of the government payroll. According to the DGB, the Project enabled substantial savings with the removal of 4,000 duplicate staff from their systems. The total investment for this activity is estimated at US$2.0 million (MRU 68.0 million). The savings of duplicate wages is projected over 10 years from 2018 to 2027, with an increase of 2 percent per year, and it is assumed that the Project contributed 25 percent of the results. As per projections, by 2027, the Net Present Value (NPV) of savings for the GoM will be 804.4 million MRU (US$23.7 million) and the IRR (for this individual activity) 162 percent. 52. The Project improved performance and accountability of SOEs through stronger monitoring, oversight, and results monitoring by authorities. By strengthening the state’s capacity to become a more informed and active owner of its portfolio by setting clear strategic targets and expectations and actively holding SOEs to account, the Project contributed to increased performance in the SOE sector. The financial and the economic analyses yield tangible results. Regarding the financial analysis, the NPV stands at MRU 5,513 million (US$162.1 million), and the financial IRR is 20.4 percent. The economic analysis, which represents the benefit to the entire nation, is represented by the contribution of SOEs to value added (VA), with an NPV of MRU 2,159.3 million (US$63.5 million) and an IRR of 25.38 percent. Project Implementation Efficiency 53. The Project took 6.5 years to implement, for about 2.5 times the initial amount. Throughout the lifetime of the Project, disbursements were relatively consistent. Total disbursements reached US$26.33 million – a rate of 97.3 percent. Ultimately, the Project required about 2.5 times the original financing amount of US$10.3 million, and due to its expanded financing and scope, its implementation took 6.5 years, rather than the original 3.5‐year duration. Page 13 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) 54. There were procurement challenges and implementation delays, mainly related to the upgrade of the GFMIS, exacerbated by restrictions imposed by COVID‐19. Major procurement processes related to GFMIS ultimately failed. Most importantly, this included: (i) the cancellation of the large (US$4.3 million) Treasury accounting system contract (with Oracle South Africa) in June/July 2021; and (ii) the cancellation of the Treasury banking software contract (US$1.4 million) in May 2022. Other procurement processes were also affected by COVID-19 restrictions. 55. Overall Project management costs were in line with expected standards. The Project cost decomposition presented in Annex 3 indicates that the implementation cost of the Project was US$3.55 million – 13.4 percent of total cost, at Project closing. This seems somewhat elevated, but acceptable for a lower-capacity context. Assessment of Efficiency and Rating 56. Overall Efficiency is rated Substantial. The Project generated several financial and economic benefits related 10 mainly to increased monitoring of SOEs and AGAs, and some payroll savings. By adding all financial benefits, MRU 5.9 billion (US$173.4 million) of NPV in terms of financial flows generated by the Project over its course have been estimated. This amount represents 2.6 percent of Mauritania GDP at the beginning of the Project in 2016. The financial IRR stands at 18.94 percent. Regarding economic benefits, the analysis yields an NPV of 2,2 billion MRU (US$63.5 million) and an IRR of 25.38 percent. The IRRs for the financial and economic benefits that could be estimated, exceed the original minimum rate of return for Project viability stated in the PAD (i.e., the EWRR). A more detailed analysis of the gains and benefits is presented in Annex 4. With a view to implementation efficiency, the Project disbursed a total of US$26.33 million or 97.3 percent of the total (or 2.5 times the OF amount) over 6.5 years – vis-à-vis the original 3.5 years. While actual component costs compared to estimated component cost at appraisal, essentially doubled for each original component (Annex 3.2) the additional expected outcomes under the AF were mostly commensurate with the additional funding. Project Management costs amounted to 13.4 percent, which seems somewhat elevated but acceptable for a lower-capacity context. Overall Efficiency is therefore judged to be Substantial. D. JUSTIFICATION OF OVERALL OUTCOME RATING 57. The Project achieved Substantial Relevance, Efficacy and Efficiency ratings. The relevance of the PDO over the Project lifecycle was Substantial, as it was directly aligned with the GoM’s and the World Bank’s relevant strategies and it responded well to emerging priorities. The revised PDO also adequately captured the scale-up and expansion of scope under the AF and First Restructuring in 2018, and minor changes under the Second Restructuring in 2021. The Project also realized its expected outcomes with Substantial Efficacy and Substantial Efficiency. 58. The Overall Outcome is rated as Moderately Satisfactory. Despite Substantial individual ratings, it is the ICR’s judgement to rate the Overall Outcome as Moderately Satisfactory (Table 3). This judgment mainly relates to the Modest Efficacy of Outcome 1 Improve Allocation and Management of Public Finances. The lower rating is reflective of two issues. Firstly, the partial achievement (89.7 vs. 95.0 percent) of PDO Indicator Alignment between Medium-Term Expenditure Framework estimates and Annual Budget estimates in two selected sectors. Aside from being a “near miss”, this indicator originally targeted different line ministries, undermining its credibility to some extent. Secondly, repeated challenges with larger GFMIS-related procurements, which led to the crucial IRI Core Budget and Treasury Accounting Management Information Systems upgraded, integrated and interfaced with other principal financial management information systems being ultimately missed, as well as connected questions regarding the use and sustainability of the IT systems that were successfully procured. This leads to the Moderately Satisfactory Overall Rating (s. Table 3). 10The Project aimed to also generate important positive impacts on property and mining tax revenues. However, such impacts are generally challenging to attribute to individual Projects (e.g., due to global mineral price volatility) and the preparation of credible estimates was also further constrained by limited data availability. They were therefore not included in this analysis. Page 14 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Table 3: Overall Outcome Rating Sub-Ratings (H: High; S: Substantial; M: Modest; and N: Negligible) Overall Outcome Rating Relevance Efficacy Efficiency Substantial Substantial Substantial Moderately Satisfactory* * According to the Bank Guidance on ICRs for IPF (2019, p.38) if there is a Modest achievement of one or more of the outcomes used in the assessment of the Overall Outcome, it can be rated Moderately Satisfactory, even when all individual ratings are Substantial. E. OTHER OUTCOMES AND IMPACTS Gender 59. The Project was not gender tagged but included a gender disaggregation for one (1) of the PDO indicators. Although not gender tagged, the PDO Indicator on Urban land parcels with use or ownership rights recorded in a land information system (gender disaggregated) included a gender disaggregation. At Project closing, the PIU indicated a 30 percent female vis-à-vis 70 percent male ratio for this indicator. Institutional Strengthening 60. Institutional strengthening and improved collaboration were a key impact. The Project further strengthened institutional capacities and improved collaboration on economic governance among line ministries, internal and external oversight entities, and other government entities, including the ARMP and the CSEPS. The GoM specifically highlighted this as an important impact of the Project in its a main official comment on this ICR (s. Annex 5). Mobilizing Private Sector Financing 61. The Project contributed to added transparency in the extractives sector. By helping to set-up information and title management systems and facilitating EITI compliance in 2019 and 2020, the Project has potentially helped to lay some foundations to improve the investment climate for private operators in the extractives sector. Poverty Reduction and Shared Prosperity 62. Support to the CSEPS could help facilitate implementation of GoM priorities and create tangible benefits for citizens. The CSEPS is contributing to improved monitoring of GoM priorities. With the help of an electronic monitoring tool and automatic dashboards based on strategy documents (Presidential Priorities and SCAPP), it conducts evidence- based and data-driven monitoring of the implementation performance of key GoM objectives and programs. Since the summer of 2022, CSEPS has organized regular briefings for the Council of Ministers, providing updates on overall Priority Program implementation and highlighting 1-2 projects for deeper discussion and strategic decision-making. 63. The Project provided support for the forthcoming General Census of Population and Housing (RGHP). Following a Treasury banking system procurement cancellation, funds were reallocated to replacement activities, most importantly the acquisition of tablets for the realization of the RGPH by ANSADE in late 2023. The RGHP will generate much needed data to effectively tailor policies to the needs of the citizenry, including the poor, vulnerable and most at risk. Other Unintended Outcomes and Impacts 64. Following an unsuccessful procurement in early 2022, approximately US$1.4 million of funds for the purchase of Treasury banking software were again reallocated to replacement activities. While the largest share went towards the acquisition of tablets for the realization of the RGPH by ANSADE, another share remained designated to the Treasury to finance: (i) the audit of dormant funds and certified checks; (ii) the modernization and digitization of archives; (ii) the acquisition of a telepayment module; and (iv) the electronic management of checks and endorsed drafts. Page 15 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) III. KEY FACTORS THAT AFFECTED IMPLEMENTATION AND OUTCOME A. KEY FACTORS DURING PREPARATION 65. The Project was aligned with GoM and WB priorities and strategy documents and built on prior operations. The most relevant prior operations were: (i) the Public Sector Capacity Building Project (Projet de Renforcement des Capacités du Secteur Public – PRECASP) – which supported improvements of performance, efficiency, and transparency of public resources management, from 2006 to 2014; and (ii) the Mining Sector Capacity Building Projects (Projet de Renforcement Institutionel du Secteur Minier – PRISM 1 and 2), from 1999 to 2013.The Project therefore benefitted, in principle, from an enhanced understanding of the Mauritanian country context, sector challenges, and lessons learned. B. KEY FACTORS DURING IMPLEMENTATION 66. At the time of the AF and First Restructuring in 2018, there was an emerging need to further strengthen PFM and DRM. Due to lower commodity prices and increasingly limited fiscal space, the GoM was facing mounting pressure to reinforce public sector capacity and mobilize and manage public resources transparently. It is in this context, that the significant scale-up and expansion of the Project was undertaken – see Section 1 for more details. 67. At the time of the Second Restructuring in 2021, the GoM was facing the impact of the COVID-19 pandemic. In this context, the GoM identified an emerging need to strengthen strategic planning and implementation monitoring, specifically via Bank support for the operationalization of a Presidential Delivery Unit the GoM had recently created to enhance performance orientation in the public sector – see Section 1 for more details. 68. Cancellation of large procurement process for Treasury accounting system. After the Second Restructuring, the large procurement process for the new Treasury accounting system under Subcomponent 1.1 failed due the contractor’s refusal to sign the awarded contract at signature stage (letter from Oracle South Africa dated June 11, 2021). The GoM subsequently decided that the resulting freed up funds, in the amount of US$4.3 million, be allocated to replacement activities split between the Treasury (US$1.8m), the DGI (US$1.3m) and the DGB (US$1.2m) – see Annex 8.1 for details. 69. Cancellation of the procurement process for Treasury banking software. Following another unsuccessful procurement in early 2022, approximately US$1.4 million of funds that had been reallocated for the purchase of Treasury banking software, were again reallocated to replacement activities. While an important share remained designated to the Treasury to finance different activities, the largest share of these funds (US$635,000) went towards the acquisition of tablets for the realization of the forthcoming RGPH by ANSADE. IV. BANK PERFORMANCE, COMPLIANCE ISSUES, AND RISK TO DEVELOPMENT OUTCOME A. QUALITY OF MONITORING AND EVALUATION (M&E) M&E Design 70. Over the course of the Project its PDO became broader reflecting a scale-up and expanded scope. The original PDO (2016) was “to improve monitoring and transparency of selected government entities and the administration of property and mining taxation”. The revised PDO (2018) became “to enhance transparency and improve the mobilization, allocation and management of public resources”. This was reflective of the scale-up and enhanced scope of the Project under the AF. The broadened PDO was also accompanied by a restated and expanded intervention logic. 71. The Project did not follow an explicit ToC but a solid narrative and Results Chain guided implementation. Given that Bank guidelines and procedures did not mandate it, no explicit ToC was elaborated at the time of Appraisal. Page 16 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) However, the narrative provided around the PDO was solid and a basic Results Chain was also introduced at AF stage organizing existing and new PDO Indicators around three expected development outcomes (Annex 6.2). 72. The RF was highly reflective of Project objectives and activities, but some additional minor adjustments could have been considered. The scale-up and expansion of the scope under the AF and First Restructuring in 2018, led to revisions of the Results Framework (RF). Out of four original PDO indicators: one was retained (and had already been achieved); two were reformulated to better capture Project achievements; one was dropped, because one revised existing indicator, together with one of the new indicators, were seen as more adequate measures of the associated outcome; and three new indicators were introduced. Similar changes were made introduced to IRIs. After that, the RF remained mostly unchanged as only one final IRI was added under the Second Restructuring in 2021. The absence of any further adjustments to the RF is a potential point of as the Project later faced recurring challenges with important IT procurements, which ultimately led to the reallocation of substantial corresponding funds (over US$4.0 million) to several replacement activities. While this only resulted in the non-achievement of a single IRI (albeit a key Project result), none of the replacement activities were captured in the RF. 73. The Project’s M&E system was generally adequately designed. Under the technical mandate of the MEF, a PIU was set up to ensure fiduciary responsibility and technical coordination of activities. It reported directly to the Minister and supported a Project Steering Committee (Comité de Pilotage) comprised of the technical leadership of all Project implementing agencies, in ensuring oversight and monitoring. PIU core staff included a project coordinator; a deputy coordinator; an accountant; a procurement officer; a finance officer; an M&E specialist; and other support staff. The PIU M&E Specialist was responsible for monitoring and reporting on results defined in the RF – as per an established method, data source and frequency for each indicator. Baseline values were calculated based on statistical records, reports and data collected from the central administration. The M&E system also relied on focal points in each implementing agency. In doing so, the Project also helped reinforce monitoring capacity within each of the targeted entities. The M&E expert produced semi-annual reports with the latest data for each indicator made available to beneficiaries and stakeholders. M&E Implementation 74. Project M&E Performance was initially rated Satisfactory. M&E Performance was rated Satisfactory in the first three (3) Implementation Status & Results Report (ISRs), dated 24 June 2016, 27 January 2017, and 8 July 2018, respectively. The MTR Mission from 23 October – 4 November 2017 identified a number of M&E-related shortcomings, including that: (i) limited progress had been made in several reform areas (auditing and accounting norms, GFMIS and fiscal audit capacity in the mining sector); (ii) the impact of Project financing on some activities was not consistently captured by the RF; and (iii) the formulation of some results indicators created challenges for monitoring progress. Moreover, it found that the Project Steering Committee met only once a year – whereas it should have held at least two sessions to fulfil its mission, and noted that the multiplicity of beneficiaries made technical coordination difficult. 75. The AF and First Restructuring introduced some M&E related changes. To address the challenges identified in the MTR and to mitigate new potential risks to the PDO related to the scale-up and expanded scope of the Project, the AF and First Restructuring introduced some M&E-related changes. A Technical Advisory Committee attached to the Steering Committee would be set up to facilitate regular monitoring of progress towards Project results to enable just- in-time adjustments to implementation modalities. Also, to strengthen institutional capacity, the Project would support the recruitment of several technical advisers to assist the PIU and beneficiary institutions in developing Terms of Reference, and monitoring contractor performance. This was specifically done with a view to potentially inadequate institutional capacity related to the support for GFMIS improvements. Moreover, given existing challenges associated with technical leadership of the GFMIS reform process, it would also be ensured that technical PFM and functional IT expertise within the GoM would be effectively mobilized. Given several failed procurements after the AF, in particular those related to GFMIS, these M&E-related measures do not seem to have fully worked as intended. Page 17 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) 76. After the MTR, M&E Performance was consistently rated Moderately Satisfactory. In the ten (10) ISRs covering the nearly 5-year duration following the MTR – starting with ISR #4 from 27 February 2018 and ending with ISR #13 of 26 December 2022, M&E Performance was consistently rated as Moderately Satisfactory. The Second Restructuring in June 2021 brought about no further changes, limiting itself to stating that: (i) appropriate institutional arrangements and capacity are in place for Project implementation; (ii) the Project team was well-qualified and -staffed; and that (iii) Interim Financial Reports and annual audited financial statements were of acceptable quality and submitted on time. 77. A government ICR was produced, and M&E-related data requested from the PIU were readily provided. At Project closure a Government ICR (rapport d’achèvement) was produced to capture achievements. It was shared with the Bank Task Team and ICR author and was generally of good quality. However, the cut-off date for the report was September 30, 2022, three months prior to Project closure – at which point final data was not yet available for several indicators. The PIU was, however, highly cooperative in obtaining updated M&E-related data from the implementing agencies/beneficiary institutions, so that Project results at closing could be readily confirmed. M&E Utilization 78. M&E was somewhat effectively used to inform Project management and decision-making. The Project M&E System was effectively used to inform the MTR and the subsequent AF and First Restructuring and led to the introduction of major changes to overall Project design relatively early on. However, thereafter the system seems to have lagged in identifying challenges related to larger procurement processes – most notably the Treasury Accounting system11. Also, no corresponding adjustments were made to the RF and/or M&E System to fully capture and track the activities that replaced cancelled activities, including: (i) the upgrade of the Tax Management Information System (JIBAYA); (ii) the introduction of the Jira Work Management collaboration tool at the MoF; (iii) the acquisition of tablets for the realization of the RGPH by ANSADE12; (iv) other activities, such as the audit of dormant funds and certified checks, the digitization of archives, the training program for public procurement stakeholders, the implementation of a large PPP project plans, etc. A more complete Second Restructuring might have been helpful to revise both the RF and overall M&E System. Justification of Overall Rating of Quality of M&E 79. The overall Quality of M&E is rated as Modest. The M&E system was largely built on the experience of previous operations, PRECASP and PRISM 1 and 2, and initially appeared to be adequate. The MTR laid bare several challenges, some of which were subsequently addressed, but some weaknesses remained. Although, the Project did not originally include a ToC, it provided a solid narrative on how the PDO was to be achieved. Moreover, under the AF and First Restructuring the PDO was revised, and a basic Results Chain introduced organizing existing and new PDO Indicators by three development outcomes. The AF and First Restructuring also introduced changes to implementation arrangements, including M&E arrangements (mostly based on the MTR). After that, M&E arrangements continued unchanged over the remaining 4.5 years of the Project. Some remaining weaknesses manifested later when multiple larger procurements had to be cancelled and substituted with replacement activities. A stronger M&E system might have identified or initiated remedial actions for these issues earlier. While this situation only resulted in the non-achievement of a single IRI, none of the replacement activities were captured in the RF. No specific M&E-related adjustments were made to address actual 11 First Generation replacement activities: Following the Second Restructuring, the large procurement process for the Treasury accounting system under Subcomponent 1.1 ultimately failed due the contractor’s refusal to sign the contract at signature stage (letter from Oracle South Africa dated June 11, 2021). The GoM subsequently decided that the allocated funds, in the amount of US$4.3 million, be allocated to “replacement activities” split between the Treasury ($1.8m), the DGI ($1.3m) and the DGB ($1.2m). 12 Second Generation replacement activities: Following another unsuccessful procurement in early 2022, approximately US$1.4 million of funds that had been reallocated for the purchase of Treasury banking software, were again reallocated to replacement activities. While an important share remained designated to the Treasury to finance different activities, the largest share of these funds (US$635,000) went towards the acquisition of tablets for the realization of the forthcoming RGPH by ANSADE. Page 18 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) or potential impacts of COVID-19, although the pandemic was cited as the reason for the cancellation of several activities (and rationale for the Second Restructuring). It might have also been opportune to introduce some final revisions to the RF and M&E system under the Second Restructuring. B. ENVIRONMENTAL, SOCIAL, AND FIDUCIARY COMPLIANCE 80. Implementation of environmental and social safeguards is deemed Satisfactory. The Environmental Assessment Category was rated as “C” and no safeguard policies were triggered. The Project consisted of technical assistance activities, as well as the provision and installation of IT equipment. It did not finance civil works and there were no negative impacts on the physical environment. For investment promotion in the mining sector, the Project supported the Mines Inspection and Control System which monitors operations and reports on measures and policies to safeguard the environment and local populations. The overall environmental and social risk rating was Low. 81. Most Project components did not entail any social risks. The only area with potential social risks involved the land registration pilots, given the sensitive and often contested nature of land rights. As there were no changes in the overall design and scope of the pilots, the Project was classified as Category C. To mitigate against any negative impacts, such as access restrictions because of the land registration activities, pilots were selected with a view to avoiding contested areas. In addition, social assessments were conducted for each of the pilot areas with the inclusion of a contractual condition in the contract of the international firm responsible for supporting the pilots to ensure the prior completion of the assessments, and any mitigation measures. This approach embedded a solid risk management dimension into the operation to facilitate the adoption of participatory and inclusive processes to land registration. 82. Overall financial management was rated Satisfactory across most of the Project lifetime. Assessments conducted by the World Bank team generally rated financial management performance as Satisfactory. The only two exceptions occurred in ISR #2 of 27 January 2017 and ISR #11 of 17 March 2022, when financial management performance was temporarily downgraded to Moderately Satisfactory. The ISRs are largely silent on the reasons for the downgrade and upgrade. The final disbursement rate was approximately 97.3 percent. 83. Compliance with procurement procedures was downgraded after the MTR. Compliance with procurement procedures was rated Satisfactory in the first three (3) ISRs, dated 24 June 2016, 27 January 2017, and 8 July 2018, respectively. After the MTR Mission from 23 October – 4 November 2017, all ten (10) remaining ISRs rated compliance as Moderately Satisfactory. This is reflective of some previously unidentified procurement challenges, which – despite related adjustments under the AF and First Restructuring – continued to affect the Project throughout implementation. C. BANK PERFORMANCE Quality at Entry 84. Quality at Entry is assessed as Moderately Satisfactory. The Project was directly aligned with GoM and WB strategy documents, i.e., the SCAPP 2016‐2030 and the FY14‐FY16 CPS (and later the FY18–FY23 CPF). Although an explicit ToC was not formulated, the underlying intervention logic was sufficiently clear for an implicit ToC to be derived – in particular, once the PDO statement was revised and a (basic) Results Chain added under the AF – see also Section II A) on Relevance. Quality at entry of the RF is, however, somewhat limited, as some of the results indicators could have (also) targeted the quality of expected outcomes and results – rather than a quantity (number) or binary (yes/no) values. 85. The Project factored in experiences from previous Bank operations. During preparation the Task Team drew on the experience of the previous PRECASP and PRISM 1 and 2 operations, including for carrying out the different technical assessments and defining respective implementation arrangements. Project design therefore benefitted, in principle, from an enhanced understanding of the country context, sector challenges, and lessons learned. Page 19 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) 86. The Task Team likely underestimated the Project’s complexity at entry. Comprehensive public sector reforms with complex PFM elements take a minimum of six to seven years to complete. Yet only a 3.5 year-duration was originally foreseen in 2016. Project design thus likely underestimated the complexity of the targeted reforms and attempted to realize them in too short of a timeframe. Even after the extension of the Project duration under the AF in 2018 to a total of 6.5 years, the timeframe was still rather short – especially given the scale-up and expansion. Pressures resulting from the complexity and short duration were subsequently further compounded by the impact of the COVID-19 pandemic. Quality of Supervision 87. World Bank Supervision performance is assessed as Moderately Satisfactory. The Task Team comprised staff with expertise in governance (lead), extractives, and land administration, as well as social and environmental safeguards, procurement, and financial management. Over its 6.5-year duration, the Project had four different Task Team Leaders (TTLs) that provided supervision and technical support throughout implementation – supervision quality ultimately suffered somewhat due to the rather frequent change of TTLs. Supervision missions were organized bi‐annually, and Aide Memoires and ISRs prepared in a timely fashion. Between 24 June 2016 (ISR #1) and 26 December 2022 (ISR #13) the Bank Team prepared a total of thirteen ISRs. From 23 October – 4 November 2017 an MTR mission was conducted that directly informed the AF and First Restructuring in 2018. Another minor Restructuring was completed in 2021. 88. Performance reporting was mostly candid, but there were some shortcomings. Reporting was generally of sufficient quality and candor, as it systematically covered challenges and provided recommendations on how to address them. This was especially true for the MTR mission which candidly identified challenges in terms of Project design and implementation. It directly informed the AF and First Restructuring in 2018, which revised the PDO, and introduced a basic Results Chain organizing existing and new PDO Indicators across three expected outcomes. The AF also introduced changes to implementation arrangements (including M&E) but was not seized as an opportunity to revise the RF more fully. After the MTR through the closing of the Project, ISRs consistently rated Implementation Progress, Procurement, and M&E as Moderately Satisfactory (down from Satisfactory). The final three ISRs also lowered the rating of overall progress towards the PDO to Moderately Satisfactory (from Satisfactory). Considering some of the significant challenges faced later during Project implementation, some of these rating might have been lacking some candor. 89. There were challenges related to Procurement. The Bank team played an important role in helping the GoM improve its capacity for compliance with environmental and social safeguards (ESS), financial management, and procurement. However, later into Project implementation, several larger procurements had to be cancelled/failed – most importantly the Treasury accounting system and Treasury banking system procurements. A stronger focus on procurement and more robust M&E might have helped identify or initiate remedial actions earlier. Justification of Overall Rating of Bank Performance 90. Overall Bank Performance is rated Moderately Satisfactory. This reflects both Moderately Satisfactory Quality at Entry and Quality of Supervision. Despite some shortcomings, original Project design was relatively solid. Although an explicit ToC was not formulated at Appraisal, the underlying logic of the intervention was sufficiently clear for an implicit ToC to be derived. The Project had one comprehensive AF and Restructuring in 2018, and another minor Restructuring in 2021. Under the AF, the original PDO was revised, and a basic Results Chain introduced organizing existing and new PDO Indicators around three expected outcomes. Based on the findings of the MTR, the AF also introduced changes to implementation arrangements, but it was not seized as an opportunity to revise the RF more fully. No specific adjustments were made to address impacts of COVID-19, although the pandemic was cited as an important reason for the cancellation of several activities (and rationale for the Second Restructuring). Under the AF, several larger IT procurements had to be cancelled and substituted with replacement activities. While this situation only resulted in the non-achievement of a single IRI, none of the replacement activities were captured in the RF – despite generating some Page 20 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) important results. Project complexity was generally somewhat underestimated as only a 3.5-year duration was originally foreseen. Despite the later extension of the closing date (under the AF) to a total of 6.5 years, the duration was still rather short for such a complex PFM reform operation. Supervision quality ultimately also suffered somewhat due to the rather frequent changes of TTLs, and some of the supervision ratings might have ultimately lacked some candor. D. RISK TO DEVELOPMENT OUTCOME 91. The Risk to Development Outcome is assessed as Moderate. While, at the time of completion, the Project has generated several substantial outcomes with regards to PFM, DRM and Transparency, there are still some shortcomings in these areas, as well as potential risks that threaten the sustainability of achieved outcomes moving forward. They relate mostly to the areas of PFM and DRM and are predominately of a technical nature – see Annex 8.2. and 8.3 for an illustration of Mauritania’s PFM information systems. The shortcomings and risks are mitigated by the fact that several actionable recommendations have been identified in recent technical assessments, such as the 2022 GovTech Maturity Index, and the 2022 TADAT assessment, and that the GoM is already working on addressing some of them with the support of other development partners. The GoM is, for instance, committed to further enhancing tax administration under a new IMF program, including through: (i) establishing an e-filing and e-payment platform linked to JIBAYA in 2023, making e-filing and e-payment mandatory for large taxpayers as of 2024; (ii) expanding access of the automated customs data system (ASYCUDA), so that customs agents can declare their merchandise online; and (iii) strengthening tax and customs administration personnel and processes (taxpayer registry, taxpayer filing, compliance risk management, tax arrears collection, post-release controls). The Risk to Development Outcome is therefore considered to be Moderate. V. LESSONS AND RECOMMENDATIONS 92. Targeting SOE transparency can be impactful and yield important financial and economic benefits. Support under this Project focused mainly on strengthening the state’s capacity to become a more informed and active owner of its portfolio of SOEs and AGAs by setting clear strategic targets and expectations and actively holding them to account through monitoring and competent technical inputs on business plans, performance contracts, etc. The outcomes included, most notably, the preparation of aggregate portfolio reports, their publication on the oversight institution’s website (www.dtf.mr.gov) and their inclusion in the country’s budget proposals. Highlights of the reports include a comprehensive overview of the net performance of SOEs, net profits/losses, dividends paid, taxes paid, grants/subsidies received, arrears and outstanding debts, including contingent liabilities. The EFA carried out as part of this ICR yielded important financial and economic benefits for this support, exceeding the NPV and IRR targets (s. Annex 4 for details). Given that this transparency-focused support to SOE reform proved highly impactful, following a similar approach should be considered when designing future SOE-related Governance operations. 93. Strategic support to the Presidential Delivery Unit proved highly effective. A comparatively small investment of US$500,000 under the Project was a catalyst for the operationalization of the newly created Presidential Delivery Unit (CSEPS). Under the Second Restructuring the Project began to support the operationalization of the CSEPS, which is housed in offices financed by the GoM and has a mandate to monitor the priorities of the Presidential Program. The CSEPS has developed a digital monitoring tool with clear indicators that allows it to systematically assess progress and implementation challenges – 145 presidential engagements, equivalent to 1185 projects, are monitored, covering 16 sectors (45 percent in the education and 16 percent in agriculture). Since the summer of 2022, CSEPS has organized regular briefings for the Council of Ministers chaired by the President of the Republic, providing updates on overall Priority Program implementation and highlighting 1-2 projects for deeper discussion and strategic decision-making. Based on these encouraging achievements, continued Bank support could include: (i) strengthening CSEPS and providing extensive capacity building, especially through peer-to-peer exchanges in the region and beyond, (ii) encouraging CSEPS to further prioritize the projects it monitors (highlighting 3-5 projects with high visibility and impact, creating synergies Page 21 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) with the other components, e.g., PIM and SOE), (iii) helping to strengthen communication and citizen engagement around these key projects in view of strengthening the social contract. 94. Complex IT procurements should be carefully planned. In mid-2021, the large procurement process for the new Treasury accounting system under Subcomponent 1.1 ultimately failed due the contractor’s refusal to sign the awarded contract at signature stage. The GoM subsequently decided that the allocated funds, in the amount of US$4.3 million, be reallocated to several replacement activities. Some of these required a further, more limited, but still complex IT procurement, which again failed in early 2022 (s. Section III B) on Key Factors During Implementation). This constitutes a lesson to carefully plan for the successful realization of IT procurement processes, which often constitute core elements of PFM reform projects. Beyond the procurement itself, there should also be sufficient resources to ensure completion, testing, interfacing, as well as built-in provisions to ensure maintenance and sustainability. 95. To strengthen Quality at Entry, PDO and IRI Indicators of future operations could be even more ambitious, and specifically target quality of expected outcomes and results. Rather than limiting themselves to setting quantitative (number) or binary (yes/no) values for PDO and IRI Indicators – as this operation has ultimately mostly done, future Governance operations in Mauritania and elsewhere, could endeavor to identify targets that more effectively measure the quality of expected outcomes and results. This could serve to foster increased ownership and accountability among stakeholders and make future projects even more impactful. 96. Future engagements should follow a systematic approach. While there is plenty of room and demand for future engagements around SOE reform, Public Investment Management (PIM), DRM, decentralization and GovTech, the next generation of Governance engagements in Mauritania should follow a structured approach that can heighten the focus, increase development impact, and lead to stronger synergies across the board. While the Project has produced strong and important outcomes, as documented by this ICR, this came despite the absence of solid analytical underpinnings and sustained policy dialogue. It was based primarily on ad hoc client requests that led to re-designs and restructurings. Importantly, however, these were closely linked to emergent priorities reflective of contextual developments and captured in Bank and GoM strategies. This helped to ensure a strong client ownership anchored Project implementation. . Page 22 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) ANNEX 1. RESULTS FRAMEWORK AND KEY OUTPUTS A. RESULTS INDICATORS A.1 PDO Indicators Objective/Outcome: The PDO is to enhance transparency & improve the mobilization, allocat.& managmt of public Resources Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Improved public access to Number 3.00 6.00 7.00 fiscal information 31-Dec-2014 30-Dec-2022 02-Dec-2022 Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Transmission of the budget Text After 31 December Yes Yes execution bill (Projet de loi de N+1 reglement) for the preceding year to the Court of Accounts 30-Jun-2016 30-Dec-2022 02-Dec-2022 within the mandated timeframe Comments (achievements against targets): Page 23 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) The Government has submitted the budget execution bill on time since 2018 Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Public disclosure of annual Number 0.00 6.00 7.00 consolidated reports on the financial performance and 30-Nov-2015 30-Dec-2022 02-Dec-2022 fiscal risks of public corporations (entreprises publics et etablissements publics) issued by the DTF Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Alignment between Medium- Text No alignment 95.00 89.7% Alignment Term Expenditure Framework completed. estimates and Annual Budget estimates in two selected sectors 20-Apr-2018 30-Dec-2022 02-Dec-2022 Comments (achievements against targets): Page 24 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Urban land parcels with use Number 35,000.00 75,000.00 207,763.00 or ownership rights recorded in a land information system 20-Apr-2018 30-Dec-2022 02-Dec-2022 (gender disaggregated) Comments (achievements against targets): 30% female / 70% male Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Mine companies subjected to Percentage 61.00 71.00 86.00 tax audits 30-Mar-2018 30-Dec-2022 02-Dec-2022 Comments (achievements against targets): A.2 Intermediate Results Indicators Component: Improving Transparency and Control in Public Resource Management Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Page 25 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Core Budget and Treasury Yes/No No Yes No Accounting Management Information Systems 30-Jun-2016 31-Dec-2021 02-Dec-2022 upgraded, integrated and interfaced with other principal financial management information systems Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Share of Procurement Percentage 0.00 40.00 96.00 Committee Leads (Personnes Responsables des Marches 30-Nov-2015 30-Dec-2022 02-Dec-2022 publics - PRMPs) certified through procurement certification scheme (Percentage) Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Page 26 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Performance agreements Number 0.00 2.00 2.00 elaborated, signed between the State and SOEs and 30-Nov-2015 30-Dec-2022 02-Dec-2022 monitored. Comments (achievements against targets): Component: Strengthening the Administration of Property Registration and Taxation and Mining Taxation Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Tax census in 3 largest cities Text None Nouakchott , Nouakchott , (properties and businesses) Nouadhibou and Nouadhibou and Rosso tax census are Rosso tax census have completed been completed 30-Nov-2015 31-Dec-2020 02-Dec-2022 Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Mining sector tax audits are Percentage 0.00 80.00 86.00 conducted in accordance with a risk-based annual 30-Mar-2018 30-Jun-2022 02-Dec-2022 action plan Page 27 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Geological database system Text No Yes Yes accessible to the public on- site and on-line 30-Nov-2015 30-Jun-2022 02-Dec-2022 Comments (achievements against targets): Component: Project Management Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion User satisfaction on Percentage 25.00 50.00 56.14 availability of publicly accessible budget 30-Apr-2018 30-Jun-2022 02-Dec-2022 information Comments (achievements against targets): Component: Strengthening national statistical capacity, medium-term programming and annual budget processes Indicator Name Unit of Measure Baseline Original Target Formally Revised Actual Achieved at Page 28 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Target Completion Qualified statisticians Number 15.00 35.00 36.00 employed by the National Statistics System 20-Apr-2018 30-Dec-2022 30-Dec-2022 Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Delivery Unit Matrix of Policy Text A matrix of policy A matrix of policy A matrix of policy Priorities priorities monitored priorities monitored priorities monitored by the Delivery Unit is by the Delivery Unit is by the Delivery Unit is not yet available. prepared and agreed. prepared and agreed. 29-Apr-2021 30-Dec-2022 02-Dec-2022 Comments (achievements against targets): Page 29 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) B. KEY OUTPUTS BY COMPONENT Objective/Outcome 1: Improve Allocation and Management of Public Finances 1. Transmission of the budget execution bill (Projet de loi de reglement) for the preceding year to the Court of Accounts within the mandated timeframe Outcome Indicators 2. Alignment between Medium-Term Expenditure Framework estimates and Annual Budget estimates in two selected sectors 1. Core Budget and Treasury Accounting Management Information Systems upgraded, integrated and interfaced with other principal financial management information systems Intermediate Results Indicators 2. Share of Procurement Committee Leads (Personnes Responsables des Marches publics – PRMPs) certified through procurement certification scheme (Percentage) 3. Delivery Unit Matrix of Policy Priorities Component 1) 1. Budget execution bills (Projet de loi de règlement) for the preceding year are now transmitted to the Court of Accounts within the mandated timeframe Key Outputs by Component 2. Alignment between MTEF and Annual Budget estimates strengthened (linked to the achievement of the Objective/Outcome 1) 3. Significant progress in the modernization and expansion of several other GFMIS Component 4) 4. A new Presidential Delivery Unit (DU) was operationalized Objective/Outcome 2: Improve Mobilization of Public Resources 1. Mine companies subjected to tax audits Outcome Indicators 2. Urban land parcels with use or ownership rights recorded in a land information system (gender disaggregated 1. Tax census in 3 largest cities (properties and businesses) 2. Mining sector tax audits are conducted in accordance with a risk-based annual Intermediate Results Indicators action plan 3. Geological database system accessible to the public on-site and on-line Page 30 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Component 2) 1. Modernization of IT systems of General Directorate of Mines and Geology 2. EITI compliance in 2019 and 2020 Key Outputs by Component 3. Mining sector tax audits are now being conducted in accordance with a risk- (linked to the achievement of the Objective/Outcome 2) based annual action plan 4. Results of tax census used to expand the tax base and for the determination and collection of taxes Objective/Outcome 3: Enhance Transparency of Public Resources (cross-cutting) 1. Improved public access to fiscal information (measured as elements of fiscal information) Outcome Indicators 2. Public disclosure of annual consolidated reports on the financial performance and fiscal risks of public corporations (entreprises publics et etablissements publics) issued by the DTF 1. Performance agreements elaborated, signed between the State and SOEs and monitored Intermediate Results Indicators 2. Qualified statisticians employed by the National Statistics System 3. User satisfaction on availability of publicly accessible budget information Component 1) 1) Strong results in terms of state-owned enterprises (SOEs) transparency and accountability Key Outputs by Component Component 4) (linked to the achievement of the Objective/Outcome 3) 2. Significantly improved public access to fiscal information – i.e. seven (7) elements of fiscal information are now available and published 3. National statistical capacity significantly strengthened Page 31 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) ANNEX 2. BANK LENDING AND IMPLEMENTATION SUPPORT/SUPERVISION A. TASK TEAM MEMBERS Name Role Preparation Kjetil Hansen, Eric Brintet Task Team Leader(s) Moustapha Ould El Bechir Procurement Specialist(s) Fatou Fall Samba Financial Management Specialist Oumou Goukoye EP Gado O H Team Member Salamata Bal Team Member Vivek Srivastava Peer Reviewer Yacouba Konate Social Specialist David A. Bontempo Team Member Dolele Sylla Team Member Johanna van Tilburg Team Member Nicola J. Smithers Peer Reviewer Morten Larsen Team Member Siobhan McInerney-Lankford Counsel Aissatou Diallo Team Member Daniel Roberge Team Member El Hadramy Oubeid Team Member Gianluca Mele Team Member Phylicia Akpene Mortey Team Member Melissa C. Landesz Social Specialist Page 32 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Shiho Nagaki Team Member Nina Inamahoro Team Member Aleksandar Kocevski Team Member Bronwyn Grieve Team Member Yoko Kagawa Team Member Prospere R. Backiny-Yetna Team Member Supervision/ICR Marie J. Bolou, Angelo Donou Task Team Leader(s) Brahim Hamed, Laurent Mehdi Brito, Mountaga Ndiaye Procurement Specialist(s) Yeo Yenemanyan Financial Management Specialist Mohamed Niokane Team Member Mamadou Samba Sow Environmental Specialist Cheikh Hamallah Diagana Social Specialist Lucas Bochud Team Member Joelle Nkombela Mukungu Environmental Specialist El Hadramy Oubeid Team Member Moritz Meyer Team Member Fatou Fall Samba Team Member Immanuel Frank Steinhilper Team Member Nikolai Alexei Sviedrys Wittich Procurement Team Djibril Ndoye Team Member Maimouna Toure Team Member Siobhan McInerney-Lankford Counsel Morten Larsen Team Member Anta Tall Diallo Procurement Team Johanna van Tilburg Team Member Dolele Sylla Team Member Aminata Cisse Team Member Page 33 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Yacouba Konate Social Specialist Salamata Bal Team Member B. STAFF TIME AND COST Staff Time and Cost Stage of Project Cycle No. of staff weeks US$ (including travel and consultant costs) Preparation FY14 14.450 91,394.11 FY15 63.241 272,958.66 FY16 43.452 145,872.39 FY17 10.115 31,366.63 FY18 25.317 122,454.19 Total 156.58 664,045.98 Supervision/ICR FY15 1.850 23,128.53 FY16 2.682 8,872.45 FY17 15.803 60,903.01 FY18 12.265 101,341.76 FY19 20.432 122,260.91 FY20 18.566 78,272.37 FY21 20.651 63,475.00 FY22 22.452 85,424.93 FY23 20.984 148,920.88 Total 135.69 692,599.84 Page 34 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) ANNEX 3. PROJECT COST BY COMPONENT Amount at Approval Actual at Project Percentage of Approval Components (US$M) Closing (US$M) (US$M) Enhancing Transparency and Efficiency in Public Resource 0 10700000.00 0 Management Strengthening the administration of land 0 9000000.00 0 registration and mining taxation Project Management 0 3550000.00 0 Strengthening national statistical capacity, medium- 0 3750000.00 0 term programming and annual budget processes Total 0.00 27,000,000.00 0.00 Page 35 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Annex 3.2 Project Cost by Component Credit Number IDA- D1030 IDA- D3450 IDA-D1030 + IDA-D3450 Second Actual Actual Original AF & First Restructuring Revised expenditure expenditure Amount Restructuring AF Revised Amount, at Project vs. planned Project Component (April 13, (August 16, Amount total (US$M Closing cost at 2016) 2018) (June 10, equivalent) (US$M Project 2021) equivalent) Closing (in %) Component 1: Improving Transparency and Control in 5.20 5.50 5.50 10.70 10.70 205.8% Public Resource Management Component 2: Strengthening the Administration of Land 4.70 4.80 4.30 9.00 9.00 191.5% Registration and Mining Taxation Component 3: Project 1.70 1.85 1.85 3.55 3.55 208.8% Management Component 4: Strengthening national statistical capacity, medium- - 3.25 3.75 3.75 3.75 115.4% term programming and annual budget processes Total Project Costs 11.60 15.40 15.40 27.00 27.00 232.8% Counterpart Funding 1.30 0.90 0.90 2.20 2.20 169.2% Total Bank Financing 10.30 14.50 14.50 24.80 24.80 240.7% Page 36 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) ANNEX 4. EFFICIENCY ANALYSIS Economic and Financial Analysis (EFA) 1. The objective of this economic analysis is to estimate the expected financial and economic gains that are attributable to this Project. The main difference between economic analyses and standard accounting or financial analyses is to consider benefits that accrue to society as a whole and not only the direct beneficiary of the Project, in this case, the Government of Mauritania (GoM). Many non-measurable potential sources of economic gains could be attributed to the activities of the Project, in particular those related to transparency and efficiency in public resource management (Component 1), and improved statistical capacity, medium-term programming and annual budget processes (Component 4). 2. At appraisal, the total cost of the Project was US$11.6 million (World Bank: US$10.3 million; GoM: US$ 1.3 million), broken down between the following original components: *Component 1: Improving Transparency and Control in Public Resource Management (US$5.20 million) * Component 2: Strengthening the Administration of Property Registration and Taxation and Mining Taxation (US$4.70 million) * Component 3: Project Management (US$1.70 million) 3. Following the 2018 Additional Financing (AF) and First Restructuring, the Project budget increased by US$15.4 million (World Bank: US$14.5 million; GoM US$0.9 million), to reach in total US$27.0 million. Components 1 and 2 were revised, and a fourth component added. *Component 1: Enhancing transparency and efficiency in public resource management (US$10.7 million) 4. The revised objective of this component is to support the GoM’s efforts to make the use of public resources more transparent and efficient through: (i) an updated and better integrated GFMIS; (ii) increased monitoring and oversight of the parastatal sector; and (iii) a more efficient public procurement system. * Component 2: Strengthening the administration of land registration and mining taxation (US$9.0 million) 5. The revised objectives of this component are: (i) to support the authority’s efforts to broaden the tax base and enhance the effectiveness of the tax administration in the mining sector to create a more predictable and stable source of revenue for the state; and (ii) to create the foundational institutional arrangements needed to manage land registration, as a precursor to enhancing the mobilization of property taxes. * Component 3: Project Management (US$3.55 million) – not evaluated as part of EFA *Component 4: Strengthening national statistical capacity, medium-term programming and annual budget processes (US$3.75 million) 6. The objectives of this component are: (i) to support the authorities in strengthening national statistical capacity and improving macroeconomic and budgetary analysis as a basis for policy and program development based on reliable and timely data; and (ii) to strengthen the linkages between medium-term programming and annual budgetary processes to facilitate results-based resource allocation and improve allocative efficiency. Page 37 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) EFA at appraisal 7. The PAD and AF Paper cited several quantifiable benefits expected from the Project. These include: (i) tax revenues and fees from an improved property tax system estimated to increase by 20 percent; (ii) transfer pricing documentation and disclosure requirements leading to revenue collection benefits of about 0.6 percent of GDP; and (iii) 1 percent of GDP in budgetary savings from a decline in extra-budgetary spending and carryforwards in the parastatals sector. 8. Expected indirect benefits of the Project mainly related to improved service delivery. These include: (i) an improved property registry system and secure property titles could increase the value of property and enable its use as collateral for loans; (ii) a modernized mineral registry and more responsive services for prospective investors could lead to increased foreign direct investment and additional fees and taxes; (iii) automated budgeting and accounting systems would lead to a host of savings and efficiency gains; (iv) enhanced Central Government oversight over SOEs would reduce fiscal risks and costs; (v) improved Public Investment Management will increase allocative efficiency of public spending; and (vi) improved statistics and macroeconomic analysis capacity would boosts transparency and encourage citizen engagement in policy discussions. 9. An economy wide rate of return (EWRR) was cited as reference for expected financial and economic benefits. While the GoM, at appraisal, did not define a minimum rate of return for Project viability, the average EWRR of its public investment program (PIP) was estimated at 12 percent. The Project was therefore expected to generate similar financial and economic benefits. EFA at completion 10. The Project has been implemented over the period 2016-2022. Component 1: Enhancing transparency and efficiency in public resource management (US$10.7 million) 11. The objective of this component is to support the authorities’ efforts to make the use of public resources more transparent and efficient through: (i) an updated and better integrated GFMIS; (ii) increased monitoring and oversight of the parastatal sector; and (iii) a more efficient public procurement system. Based on the main activities in this component, the following benefits could be derived: Improved management of public finance 12. Through the improvement of public finance management, it is expected an improvement of absorptive capacity of various ministries and enhanced efficiency of government expenditure. In particular, the component will support reforms to address the main areas of weakness regarding public procurement, improving the quality of procurement input in budget preparation and budget execution, and strengthening the capacity of procurement authorities. Although it won’t be easy to measure the increase of efficiency of the government spending, the increase capacity of the GoM to absorb the budget can be measured. 13. From the table below, it can be seen a slight improvement in the budget execution rate, from an average of 96.3 percent prior to the Project, to a 98.7 percent during the Project. However, it would be risky to draw conclusions about the impact of the Project, given the fluctuations in the budget execution rates from one year to the next and the small difference between the averages, which does not seem statistically significant. Page 38 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Table 1: Budget implementation rate (MRU billion) Average Average 2013/ 2016/ 2013 2014 2015 2015 2016 2017 2018 2019 2020 2021 2021 A. Budget law: 34.5 42.9 44.1 41.7 42.1 45.5 47.5 60.1 70.0 Total expenditure B. Actual 34.3 40.4 42.0 41.1 43.4 45.5 47.8 55.9 67.7 expenditure Execution rate 99.3% 94.3% 95.2% 96.3% 98.7% 103.1% 100.0% 100.7% 93.0% 96.7% 98.7% (B/A) Source: PEFA 2014 and 2020, LDR 2019-2021 b. Cleaning the payroll 14. The Project contributed to the cleaning up of the government payroll. The operation started in 2015, before the Project, but underwent two important phases, namely: (i) the integration of public administrative establishments (2017) and (ii) integration of development Projects in 2018 in the clean-up process. According to the General Directorate of Budget, this operation has enabled substantial savings with the removal of 4,000 staff from the system as duplicates. 15. Main assumptions for the analysis: • The baseline is assumed to be in 2017; the Project started in 2016, and it would be surprising if it could be engaged in such an operation in its first year of operation. • The total cost for the Project for this operation is estimated at US$2.0 million (MRU 68.0 million), based on information given by the PIU; • The cost of lost wages is projected over the next 10 years (from 2018 to 2027), with an increase of 2 percent per year, because it is assumed that if these ghost workers had remained on the payroll, they would have received the regular career advancement and pay raises that all government workers receive. • Since the process of cleaning the payroll started before the inception of the Project, and in view of the amount invested by the Project in that process, it is assumed that it contributed only to 25 percent of the results. Table 2: Resources saved from payroll (millions MRU) Baseline Resources saved 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 Total cash 435.2 443.9 452.8 461.8 471.1 480.5 490.1 499.9 509.9 520.1 flow Project cash -68.0 108.8 111.0 113.2 115.5 117.8 120.1 122.5 125.0 127.5 130.0 flow NPV 804.41 IRR 161.99% Source: Author’s estimates 16. According to the projections, by 2027, the NPV will be 804.4 million MRU (US$23.7 million, with an exchange rate of US$1 = MRU 34) and the IRR 162 percent, in terms of savings for the GoM. Page 39 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) c. Increasing Monitoring of SOEs and Autonomous Agencies 17. This subcomponent supported the improved performance and accountability of SOEs and AGAs through stronger monitoring, oversight, and results monitoring by the authorities. It focused mainly on strengthening the state’s capacity to become a more informed and active owner of its portfolio of SOEs and AGAs by setting clear strategic targets and expectations and then actively holding them to account through performance monitoring and competent technical inputs and views on company business plans, performance contracts, and so on. 18. These activities should have an impact over the long term on the financial situation of SOEs. Comparing pre-Project and during-Project trends should allow to derive conclusions regarding its impact. Unfortunately, it was not possible to get data on SOEs before the Project, except for 2015, which is too short a period to be able to derive any pre-Project trend. Table 3: SOEs financial relation with Central Government (Billion MRU) Financial analysis 2015 2016 2017 2018 2019 2020 2021 Costs for the Central Gov. 3.0 3.0 3.3 4.5 5.1 4.8 6.3 Subsidies received by SOEs from 3.0 3.0 3.3 4.5 5.1 4.8 6.3 central Government Revenue for the Central 6.2 7.5 5.8 6.9 7.5 12.8 12.0 Government % of total Gov. Revenue 13.54% 17.49% 12.20% 12.33% 14.18% 22.18% 17.28% Tax revenues paid by SOEs 5.3 6.5 5.7 5.3 6.0 6.1 6.0 Dividends paid by SOEs 0.9 1.0 0.1 1.6 1.6 6.7 6.0 Net gain for Central 3.3 4.6 2.5 2.4 2.5 7.9 5.7 Government Source: Rapports de performance des entreprises publiques de Mauritanie 19. From 2015 till 2021, years with detailed information on SOEs, the central government has been receiving substantial financial net gains from SOEs. But much of these benefits, particularly in recent years, are coming from SNIM, the national company in charge of exploitation of iron ore, and its financial results are strongly dependent on the iron prices on the world market. 20. Furthermore, SOEs have an important economic impact, contributing 15.9 percent of total GDP in 2021 (see Table 4). Table 4: Economic impact (Billion MRU) 2015 2016 2017 2018 2019 2020 2021 Value Added (VA) 12.2 24.1 21.0 21.2 33.6 45.7 57.2 GDP 156.9 225.5 241.9 266.6 296 312.6 360.5 VA in % of GDP 7.78% 10.69% 8.68% 7.96% 11.36% 14.62% 15.87% Source: Rapports de performance des entreprises publiques de Mauritanie Page 40 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) 21. To determine the contribution of the Project, the following main assumptions have been made: • For the financial analysis, it is assumed that one third of the SOEs net gain is due to the Project; • For the economic analysis, it is assumed that 5 percent of the SOEs VA is due to the Project • These are rather conservative assumptions, i.e., the real contributions are likely greater. • Based on the above, the following financial and economic IRR and NPV have been estimated. Table 5: Financial and economic analysis (Million MRU) Financial analysis 2016 2017 2018 2019 2020 2021 Net gain for Gov. 4,570.0 2,485.0 2,378.0 2,480.0 7,944.0 5,692.0 Contribution of the 820.1 784.7 818.4 2,621.5 1,878.4 Project Cost of the Project 40.1 (Component 1) Net cash flow -40.1 820.1 784.7 818.4 2,621.5 1,878.4 NPV 5,512.5 IRR 20.4 Economic analysis 2016 2017 2018 2019 2020 2021 SOEs contribution to VA 24,100 21,000 21,200 33,600 45,700 57,200 GDP 225,500 241,900 266,600 296,00 312,600 360,500 VA in % of GDP 10.69% 8.68% 7.96% 11.36% 14.62% 15.87% Contribution of the Project 1,050.0 212.3 336.3 457.1 572.1 Cost of the Project 40.1 (Component 1) Net cash flow -40.1 1,050.0 212.3 336.3 457.1 572.1 NPV (million MRU) 2,159.30 IRR (%) 25.38 Source: authors estimates 22. Both the financial and the economic analysis yield tangible results. Regarding the financial analysis, which represents the benefit for the GoM, the NPV stands at MRU 5,513 million (US$162.1 million). For an initial investment of MRU 40.1 million (US$1,18 million), for every US$1 spent, the net benefits are US$137.5. The financial IRR is 20.4%, 23. The economic analysis, which represents the benefit to the entire nation, is represented by the contribution of SOEs to value added (VA), with an NPV of MRU 2,159.3 million (US$63.5 million) and an IRR of 25.38%. Therefore, the project contributed to enhance both the Government revenues and the country GDP. Page 41 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Component 2: Strengthening the Administration of Property Registration and Taxation and Mining Taxation (US$9.0 million) 24. The objectives of this component are: (i) to support the authority’s efforts to broaden the tax base and enhance the effectiveness of the tax administration in the mining sector to create a more predictable and stable source of revenue for the state; and (ii) to create the foundational institutional arrangements needed to manage land registration, as a precursor to enhancing the mobilization of property taxes. Overall, it should boost domestic resources mobilization (DRM). Figure 1: Project impact on DRM (illustration) Trend after Trend before the Project the Project Impact of the Project Start of the Project 25. To analyze the impact of the Project on increasing DRM, the trend of resource collection before and during the Project is typically analyzed. The idea (see Figure 1 for an illustration) is to compare the two trends and evaluate if the Project managed to enhance it, in order to attribute any specific impact. For instance, if the pre-Project trend of resource collection was an increase of 3.0 percent per year, and that trend changed to 5.0 percent per year during the Project, it can be reasonably said that it contributed to increase DRM by 2.0 percent. Figure 2: Property tax (MRU million) 1,600 1,346.2 1,400 1,250.8 1,200 1,096.7 1,112.8 1,000 902.0 722.9 739.4 714.9 800 627.9 621.7 600 400 200 0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Source: OECD. Stat web page Page 42 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) 26. Property tax, in particular, was supposed to increase during Project implementation as per the EFA at appraisal. While the OECD has detailed public revenues data, including for Mauritania, for property tax revenues there is, unfortunately, no data after 2018. Therefore, the Project period is covered only for 3 years (2016-2018). In the loi des reglements (Budget implementing Act) it was not possible to distinguish property tax. Moreover, when looking at the available data (Figure 2), there is a decreasing trend of property taxes at the start of the Project. Consequently, it was not possible to draw conclusions for the specific impact on property tax revenue. Figure 3: Total Government revenue from 2013-2022 (Billion MRU) 100 90 80 70 60 50 40 30 20 10 0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Source: IMF 27. Looking at total government revenue (Figure 3), there is an increasing trend over the course of the Project, with an acceleration in recent years and a particularly strong increase in the last two years. Table 6: Central Government revenue, excluding grant (Billion MRU) 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Gov. Revenue 41.1 40.4 43.2 43.0 47.7 55.5 53.1 57.6 69.4 86.0 Non-extractive 28.2 29.4 37.8 40.5 43.3 47.9 48.5 51.1 56.3 64.0 Tax 20.4 22.3 23.8 27.2 30.5 35.4 35.4 33.5 38.8 47.7 Non-tax 7.8 7.1 14.1 13.3 12.8 12.5 13.1 17.6 17.5 16.3 Extractive 13.0 11.0 5.4 2.5 4.4 7.6 4.6 6.5 13.1 22.0 Oil and gas 2.1 0.6 1.3 1.1 1.9 6.0 1.8 0.5 1.2 1.2 Mining 10.9 10.4 4.0 1.4 2.5 1.6 2.8 6.0 11.9 20.8 Source: IMF 28. As shown in Table 6, the increase in Central Government revenue is in large part due to increased extractive revenues, particularly mining. These, in turn, are likely driven by higher mineral prices on global markets. These revenue increases are therefore mostly not attributable to the Project. Page 43 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Component 4: Strengthening national statistical capacity, medium-term programming and annual budget processes (US$3.75 million) 29. The statistical capacity development component has been included in the 2018 AF and First Restructuring of the project. It complemented support provided by other donors (EU and IMF) to: (a) enhance the capacity of the National Statistical System to produce timely and quality statistics; (b) improve macro-economic forecasting capacity and strengthen the linkages between medium term programming and annual budgeting processes; and (c) increase access to statistical and fiscal information. 30. One of the economic benefits of this component is to help better identify poor segments of the population through improved statistics, allowing for better targeted policies, and hence, the possibility of enhanced growth and prosperity for all. Strengthening the link between medium term programming and annual budgeting processes is conducive to improve efficiency and effectiveness of public expenditure. This component should therefore, in the medium to longer term, improve economic growth through better targeting and improved efficiency of public expenditure. It is, however, very difficult to quantify these benefits, without further information. Summary 31. Based on this EFA, Substantial financial and economic benefits have been achieved by the project. Table 7: Total Financial benefits (MRU million) 2016 2017 2018 2019 2020 2021 2022 Payroll savings -68.0 108.8 111.0 113.2 115.5 117.8 SOEs -40.1 820.1 784.7 818.4 2,621.5 1,878.4 contribution Total -40.1 752.1 893.5 929.4 2,734.7 1,993.9 117.8 NPV 5,894.8 IRR % 18.94 Source: authors estimates 32. By adding all financial benefits (Table 7), MRU 5.9 billion (US$173.4 million) of NPV in terms of financial flows generated by the Project over its course have been estimated. This amount represents 2.6 percent of Mauritania GDP at the beginning of the Project in 2016. The financial IRR stands at 18.94%. 33. Regarding economic benefits, the SOEs impact on GDP has been estimated in Table 5. The analysis yields an NPV of 2,2 billion MRU (US$63.5 million) and an IRR of 25.38%. 34. Overall, based on the EFA, the Efficiency of the Project is Substantial. Page 44 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) ANNEX 5. BORROWER, CO-FINANCIER AND OTHER PARTNER/STAKEHOLDER COMMENTS Comments from the Borrower We believe that the report should highlight the fact that this project has really helped to further improve collaboration on economic governance between the various stakeholders, notably the Ministry of Economic Affairs, the Ministry of Finance, the Court of Auditors, the IGE and the ARMP. Page 45 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) ANNEX 6. THEORY OF CHANGE Annex 6.1: Theory of Change Page 46 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Annex 6.2: AF Results Chain (from PP) PDO-Level Indicator AF Interventions PDO Dimension Support for systems and processes to Enhanced transparency in 1) Improved public access to fiscal enhance production and facilitate the mobilization, allocation information publication of information across the and management of public fiscal management chain. resources Support to enhance the functionality 2) Transmission of the budget of GFMIS core modules to enable the execution bill to the Court of Improved management of timely and automated production of Accounts within the mandated public resources reliable information on budget timeframe execution 3) Public disclosure of annual Support to enhance DTF’s financial consolidated reports on the Enhanced transparency in oversight capabilities in the financial performance and fiscal the management of public parastatal sector and ensure public risks of public corporations issued resources access to information on the sector by the DTF Support to improve the annual 4) Alignment of MTEF estimates with allocation of resources by making Improved allocation of annual budget estimates in 2 them evidence-based and results- public resources selected sectors focused Support to strengthen land 5) Urban parcels with use or information systems and registration ownership rights recorded in a land Improved mobilization of processes to facilitate accelerated information system (gender public resources and comprehensive administration of disaggregated) property taxation Support to improve tax 6) Mining companies subjected to tax Improved mobilization of administration mining sector audit audits (already achieved in 2017) public resources coverage Page 47 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) ANNEX 7. SIGNIFICANT CHANGES DURING IMPLEMENTATION Annex 7.1: Revisions to PDO and Outcome Indicators Time Change Rationale AF and First Revised Project Development Objective • “The PDO has been revised to cater for the specific Restructuring Original PDO objectives resulting from the introduction of a new (August 16, • “to improve monitoring and transparency of selected Component 4 designed to enhance the allocation of 2018) government entities and the administration of property resources”. and mining taxation.” • “The revised PDO also seeks to better reflect the Revised PDO breadth of support provided through the project to • “to enhance transparency and improve the mobilization, selected reforms across the fiscal management allocation and management of public resources”. chain – from revenue mobilization to public resource allocation and management”. Retained Project Outcome Indicator N/A (achieved since 2017) Mining companies subject to tax audits Revision to Project Outcome Indicator Original Indicator • “Timely public disclosure of reports on SOE/AGA performance issued by the directorate in charge of To refine this measure of project achievements (in monitoring SOEs/AGAs, the DTF”. terms of Outcome 3: Enhance Transparency of Public Revised Indicator Resources) • “Public disclosure of annual consolidated reports on the • financial performance and fiscal risks of public corporations (entreprises publics et etablissements publics) issued by the DTF”. Revision to Project Outcome Indicator Original Indicator • To provide a more adequate measure of project • “Properties on which fees and taxes are being levied”. achievements (in terms of Outcome 2: Improve Revised Indicator Mobilization of Public Resources) • “Urban land parcels with use or ownership rights recorded in a land information system (gender disaggregated)”. Dropped Project Outcome Indicator • Together the revised PDO indicator on consolidated Coverage of internal audits in the Ministries of Health and SOE reports (s. above) and the new PDO Indicator Primary Education on Improved public access to fiscal information (s. below) were seen as more adequate measures of project achievements (in terms of Outcome 3: Enhance Transparency of Public Resources) New Project Outcome Indicator • Newly introduced measure of achievements (in • Transmission of the budget execution bill (Projet de loi de terms of Outcome 1: Improve Allocation and reglement) to the Court of Accounts within the mandated Management of Public Finances) tracking the timeframe functionality of GFMIS core modules that enable the timely and automated production of reliable information on budget execution New Project Outcome Indicator • Newly introduced measure of achievements (in • Alignment between Medium-Term Expenditure terms of Outcome 1: Improve Allocation and Framework estimates and annual budget estimates in 2 Management of Public Finances) tracking selected sectors improvements in evidence-based and results- focused annual allocation of resources Page 48 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Time Change Rationale New Project Outcome Indicator • Newly introduced measure of achievements (in • Improved public access to fiscal information terms of Outcome 3: Enhance Transparency of Public Resources) tracking production and publication of information across the fiscal management chain, including audit reports Second • No change to PDO and Outcome Indicators. Restructuring N/A (June 10, 2021) Page 49 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Annex 7.2: Revisions to Project Components Original Financing AF and First Restructuring Second Restructuring (April 13, 2016) (August 16, 2018) (June 10, 2021) Revised component name Original name Component 1: Enhancing • “Improving Transparency and Control in Public Transparency and Efficiency in Public Resource Management” NA Resource Management Revised name • “Enhancing Transparency and Efficiency in Public Resource Management” Original resource allocation Revised resource allocation NA • US$5.2 million • US$ 10.7 million (US$5.5 million in AF) Revised subcomponent name Original name Subcomponent 1.1: Enhancing the • “Enhancing Transparency and Reporting on systems for transparent public Public Resources” NA financial management and reporting Revised name • “Enhancing the systems for transparent public financial management and reporting” Original resource allocation Revised resource allocation NA • US$2.1 million • US$7.45 million (US$5.5million in AF) Subcomponent 1.2: Increasing Modified objective Monitoring of SOEs and • Improved performance and accountability of NA Autonomous Agencies SOEs and parastatals through stronger monitoring and internal and external oversight. Original resource allocation Revised resource allocation NA • US$1.18 million • US$1.9 (US$0.72 million in AF) Subcomponent 1.3 (dropped): Dropped subcomponent Improving Accounting and Auditing • Dropped and remaining resources reallocated NA Standards and Internal and External Oversight Original resource allocation Revised resource allocation NA • US$1.25 million • US$0.47million (already disbursed) Subcomponent 1.3(4): Enhancing Renumbered subcomponent NA the Public Procurement System • Renumbered as Subcomponent 1.3. Original resource allocation Revised resource allocation NA • US$0.67 million • US$0.93 million (US$0.26 million in AF) Revised component name Original name Component 2: Strengthening the • “Strengthening the Administration of Property • Reallocation from Administration of Land Registration Registration and Taxation and Mining Taxation” subcomponent 2.2 to and Mining Taxation Revised name subcomponent 4.4 • “Strengthening the Administration of Land Registration and Mining Taxation” Revised resource allocation Revised resource allocation Original resource allocation • US$9.5 million (US$4.8 million in AF) • US$9.0 million (US$0.5 • US$4.7 million million reduction in Second Restructuring) Page 50 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Original Financing AF and First Restructuring Second Restructuring (April 13, 2016) (August 16, 2018) (June 10, 2021) Restructured subcomponent • All Land Administration activities consolidated Revised subcomponent name (Modified) Subcomponent 2.1: Original name Strengthening the Administration of • “Strengthening Tax Administration and NA Land Registration Compliance” Revised subcomponent name • “Strengthening the Administration of Land Registration” Original resource allocation Revised resource allocation NA • US$0.9 million • US$5.1 million (US$4.15 million in AF) (Dropped) Subcomponent 2.2: Consolidated subcomponent Supporting the Authorities’ Efforts to • Consolidated and remaining funds reallocated NA Development a National Cadastre Original resource allocation Revised resource allocation NA • US$1.25 million • US$1.01 million (already disbursed) Restructured subcomponent • All Mining sector activities consolidated Revised subcomponent name (Modified) Subcomponent 2.2(3): Original name • US$0.5 million reallocated Broadening the Tax Base and • “Strengthening Fiscal Management in the from subcomponent 2.2 to Strengthening Fiscal Management in Mining Sector” subcomponent 4.4 the Mining Sector Revised subcomponent name • “Broadening the Tax Base and Strengthening Fiscal Management in the Mining Sector” Revised resource allocation Revised resource allocation Original resource allocation • US$2.167 million (US$0.65 million in AF) US$1.67 million (US$0.5 million • US$1.25 million reallocated) (Dropped) Subcomponent 2.4: Consolidated subcomponent Enhancing Management of the • Consolidated and remaining funds reallocated NA Mineral Registry and Geoscientific Data Original resource allocation Revised resource allocation NA • US$1.30 million • US$1.23 (already disbursed) Component 3: Project Management Additional resource allocation NA Original resource allocation Revised resource allocation NA • US$1.7 million • US$3.55 million (US$1.85 million in AF) Component 4: Strengthening national statistical • Reallocation from NA capacity, medium-term programming and annual subcomponent 2.2 to budget processes subcomponent 4.4 Revised resource allocation Original resource allocation NA US$3.25 million (US$0.5 million in • US$3.25 million Second Restructuring) Subcomponent 4.1: Enhancing the Capacity of the NA National Statistical System to Produce Timely and NA Quality Statistics NA Original resource allocation NA Page 51 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Original Financing AF and First Restructuring Second Restructuring (April 13, 2016) (August 16, 2018) (June 10, 2021) • US$2.55 million in AF Subcomponent 4.2: Improving medium-term NA NA planning and budgeting Original resource allocation NA NA • US$0.4 million in AF Subcomponent 4.3: Enhancing access to statistical NA NA information Original resource allocation NA NA • US$0.3 million in AF Subcomponent 4.4: Supporting government capacity in NA NA strategic planning and implementation monitoring through the new Delivery Unit Original resource allocation US$0.5 million in Second NA NA Restructuring (from subcomponent 2.2) Page 52 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Annex 7.3: Summary of Other Changes Time Change Rationale First AF and First Extension of project closing date to December 31, (a) inclusion of new activities under component 4, Restructuring 2022. requiring additional time for implementation, (b) time (August 16, 2018) required to introduce and ensure effective functioning of budget and accounting GFMIS modules, (c) timeframe for implementation of land registration pilots, and (d) contingencies, including time delays expected because of added complexity of procurement processes required for larger-scale contracts envisaged under AF. Adjustments to implementation arrangements To strengthen implementation based on the lessons • The Project Steering Committee will nominate learned from the parent project an ad hoc Technical Advisory committee responsible for overseeing substantive quality of outputs financed by the AF and reviewing progress towards results on a regular basis. • The inclusion of the COTREF, ONS, DGERSE and CMAP as principal beneficiaries of the AF and members of the Project Steering Committee. • The removal of representatives of the Health and Education ministries from the Project Steering Committee due to the dropping of parent project activities to support internal control inspectorates in these ministries. • The Manual of Procedures will be revised to address certain shortcomings identified under the parent project and to clarify the roles and responsibilities of all government departments that are beneficiaries to the project. Page 53 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) ANNEX 8. SUPPORTING DOCUMENTS Annex 8.1: Replacement activities Estimated Target cost in Target Delivery Activities Contracting Thousands date Date of USD ($) 1. Treasury Banking System 1800 12/31/2021 March 2022 1.1 Continued updating and securing of the ARKAM 150 12/31/2021 March 2022 accounting kernel 1.2 Acquisition of the banking system (CORE- banking) 500 12/31/2021 March 2022 1.3 Integration of the Treasury into the RTGS system and e- 200 12/31/2021 May 2022 clearing (development and physical infrastructure) 1.4 Acquisition of equipment and servers 400 12/31/2021 March 2022 1.5 Licenses 400 12/31/2021 March 2022 1.6 Improving interfaces between existing systems and 150 12/31/2021 June 2022 interfacing with banking systems 2. DGI information system update (Update JIBAYA) 1300 12/31/2021 March 2022 2.1 Integration of some analysis/control/cross-checking 60 functionalities into the JIBAYA system, currently done manually 2.2 Overhaul of the remote services system using Angular 350 technologies (on the interface layer) 2.3 Implementation of an alert and notification system 90 11/30/2021 January 2022 2.4 Migration and stabilization of the Oracle DB without the price of licenses, several test activities will have to be carried out to establish version compatibility between the OS, the application server, 100 the DBMS and the application to guarantee the stability of JIBAYA and to avoid the risks of possible blocking, and to ensure regular monitoring for a minimum of 3 months 2.5 Telepayment and Teledeclaration 300 11/30/2021 January 2022 2.6 Equipment and servers 400 12/31/2021 March 2022 3. Interconnections and information systems for coordination 400 March 2022 June 2022 (Minister's office) 4. TA and training of Ministry of Finance staff 800 12/31/2021 December 2022 Page 54 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Annex 8.2: PFM systems in Mauritania (November 2022) # System Mauritania > System Name Supported PFM functions Platform + interfaces ASW / DB Since Organization Preparation of annual budget / TAHDIR was developed by GTI, CSW on MS SQL DCSI / DGB, Ministere 1 TAHDIR Budget Preparation System 2021 MTBF and Program Budgeting Mauritania 2019 des Finances Réseau Automatisé de Chaîne de la Budget allocations, Commitments, RACHAD 2 was developed by GTI, CSW on Oracle DB/ DCSI / DGB, Ministere 2 RACHAD 2 2021 Dépense Payment orders Mauritania Oracle Reports des Finances Accounting and reporting of Developed by FD Consulting, DGTCP, Ministere des 3 ARKAM Treasury Accounting System CSW on Oracle DB 2021 revenues and expenditures Tunisia. Finances Electronic file exchange w/ BCM on Developed by BCM w/ support DGTCP, Ministere des 4 BCM TSA BCM TSA Monitoring System CSW on Oracle DB 2020 payment orders and deposits from local consultants. Finances Tax Administration System + Tax assessment, filing, collections, Developed by Arab Soft, Tunisia. DGI, Ministere des 5 JIBAYA + NIF CSW on Oracle DB 2019 Numéro d'Identifiant Fiscal case mgmt Online serv by ADIAS, France Finances SYDONIA DGD, Ministere des 6 SYstème DOuaNIer Automatisé Customs administration Developed by UNCTAD COTS on Oracle DB 2016 World Finances SIGADE / Système Intégré de Gestion DDE, Ministere des 7 External debt management Developed by UNCTAD COTS on Oracle DB 1985 DMFAS Automatisée de la Dette Externe Finances Public Investment Budget Programming and monitoring Developed by MoF w/ support fm DPB, Ministere des 8 SYBSIM CSW on Oracle DB 2010 Monitoring System consolidated public inv budget local cons. Finances Dev Asst Project Monitoring & Developed by Synergy, US Min of Economic Affairs 9 DAD Development Assistance Database COTS on MS SQL 2013 Public Investment Mgmt (www.synisys.com) & Development Système Informatique de Gestion Developed by Tunisian PA 1992 MF + Min of Civil Serv & 10 SIGPE HRM CSW on Oracle DB du Personnel de l’Etat Committee 2000 Moderniz of Admin Réseau Automatisée du Traitement CSW / Open Source DCSI / DGB, Ministere 11 RATEB et Salaires des Employés Payés sur CS Registry and Payroll System Java and MS SQL 2010 > Java, MS SQL des Finances Bul. Developed by MoF w/ support fm DCSI / DGB, Ministere 12 EL MAACH Pension Mgmt System Management of Pension Payments CSW on Oracle DB 2011 local cons. des Finances TEHLIL & Land Registration System & Online Electronic mgmt of land titles & Developed by MoF w/ support fm CSW / Open Source 2014 DGDPE, Ministere des 13 LEEGOUD Services Online verification & regularization local consultants and ADIAS, FR. > Java, MySQL 2022 Finances Developed by S-Consult AG, CH Inspection Générale 14 i-World Audit Software Audit and Risk Mgmt System COTS > MS SQL 2015 (www.sconsult.ch) d’État National Digital ID (biometric Dev by Morpho/SAFRAN, FR Ministry of Interior and 15 National ID National Identification System COTS 2012 included but not used) (http://www.morpho.com) Decentralization Source: Rapid assessment of PFM systems by WB team based on information provided by MoF officials. Page 55 of 56 The World Bank Mauritania Public Sector Governance Project (P146804) Annex 8.3: Status of FMIS modules in Mauritania (November 2022) Source: Rapid assessment of PFM systems by WB team based on information provided by MoF officials. Page 56 of 56