Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) Report Number: ICRR0023613 1. Project Data Project ID Project Name P146804 MR Public Sector Governance Project Country Practice Area(Lead) Mauritania Governance L/C/TF Number(s) Closing Date (Original) Total Project Cost (USD) IDA-D1030,IDA-D3450 15-Feb-2020 24,128,723.69 Bank Approval Date Closing Date (Actual) 28-Mar-2016 31-Dec-2022 IBRD/IDA (USD) Grants (USD) Original Commitment 10,300,000.00 0.00 Revised Commitment 24,800,000.00 0.00 Actual 24,128,723.69 0.00 Prepared by Reviewed by ICR Review Coordinator Group Paul J. Kaiser Clay Wescott Jennifer L. Keller IEGEC (Unit 1) 2. Project Objectives and Components DEVOBJ_TBL a. Objectives According to the Financing Agreement (FA) dated 13 April 2016, the project development objective (PDO) of the Mauritania Public Sector Governance Project was: "to improve monitoring and transparency of selected government entities and the administration of property and mining taxation.” Page 1 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) According to the Additional Financing (AF) Agreement and first project restructuring dated 16 August 2018, the revised PDO was: "to enhance transparency and improve the mobilization, allocation and management of public resources." For this ICR Review, the objective is parsed into three sub-objectives: 1. Improve the Allocation of Public Resources; 2. Improve the Mobilization of Public Resources and 3. Improve the Management of Public Resources. b. Were the project objectives/key associated outcome targets revised during implementation? Yes Did the Board approve the revised objectives/key associated outcome targets? No c. Will a split evaluation be undertaken? No d. Components The original project comprised three components (FA, pages 4-6). Component 1: Improved Transparency and Control in Public Resource Management (US$ 5.20 million estimate at appraisal) to (i) enhance transparency and reporting in public resource management to improve the Government Financial Management Information System (GFMIS), (ii) increase monitoring of state- owned enterprises (SOEs) and Autonomous Public Agencies through improved performance and accountability, (iii) improve accounting and auditing standards and internal and external oversight, and (iv) enhance the public procurement system by implementing reforms for the new institutional and legislative framework relating to public procurement. Component 2: Strengthen the Administration of Property Registration and Taxation and Mining Taxation (US$ 4.70 million estimate at appraisal) to (i) strengthen tax administration and compliance by supporting ongoing tax reforms aimed at increasing domestic revenue mobilization and widening the tax base, (ii) develop a national cadaster, (iii) improve fiscal management in the mining sector, and (iv) enhance the management of the Mineral Registry and Geoscientific Data. Component 3: Project Management (US$ 1.70 million estimate at appraisal) to support the Government of Mauritania (GoM) to manage the project. The revised project (AF and First Restructuring dated 16 August 2018) scaled up and expanded the scope of the original project to (i) add US$14.50 million to the project’s financing envelope (increasing it to US$27.0 million), (ii) revise the PDO statement, (iii) add one component, and (iv) introduce changes to other components and subcomponents (as described below). Revised Component 1: Enhancing Transparency and Efficiency in Public Resource Management (US$10.7 million estimate at AF). This component was renamed and significantly scaled up (by US$5.5 million), and its sub-components were revised by (i) (re)allocating US$5.5 million in additional funding to subcomponent 1.1. and changing its name to Enhancing the Systems for Transparent Public Financial Management Page 2 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) and Reporting, (ii) (re)allocating US$0.72 million in additional funding to subcomponent 1.2 focusing on monitoring SOEs and Autonomous Public Agencies, (iii) dropping subcomponent 1.3 on improving accounting and auditing standards and internal and external oversight and reallocating the remaining funds, and (iv) renumbering subcomponent 1.4 focusing on enhancing the public procurement system to subcomponent 1.3. Revised Component 2: Strengthening the Administration of Land Registration and Mining Taxation (US $9.0 million estimate at AF). This component was renamed and significantly scaled up (by US$ 4.8 million). Its four subcomponents were consolidated into 2.1 Strengthening the Administration of Land Registration and 2.2 Broadening the Tax Base and Strengthening Fiscal Management in the Mining Sector. The scale-up included support for land registration pilots to increase the number of formally registered land parcels. 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) resulted in an unsuccessful bid. Revised Component 3: Project Management (US$3.55 million). The closing date was extended to reflect an expanded scope, institutional arrangements were modified, and resources allocated to this component were increased (by US$1.5 million). New Component 4: Strengthening National Statistical Capacity, Medium-term Programming, and Annual Budget Processes (US$3.75 million). This component was added to strengthen national statistical capacity and enhance macroeconomic and fiscal analysis 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. The Second Restructuring (Amendment to AF FA dated 10 June 2021) introduced activities to support the operationalization of the Presidential Delivery Unit (CSEPS), which had the mandate to monitor GoM priorities. The CSEPS developed a digital monitoring tool with clear indicators that enable it to systematically assess progress and implementation challenges – 145 presidential engagements, equivalent to 1185 projects, were monitored, covering 16 sectors (45 percent in education and 16 percent in agriculture). CSEPS also began organizing regular briefings for the Council of Ministers chaired by the President, providing updates on program implementation and highlighting specific projects for deeper discussion and strategic decision-making. The AF and First and Second Restructuring reinforced the public sector's capacity to mobilize, allocate, and manage public resources transparently. The AF and First restructuring (i) enhanced the capacities and functionalities of the GFMIS through the modernization and interfacing of two core budgeting and treasury accounting information systems, (ii) strengthened statistical, macroeconomic, and fiscal forecasting capacity and enhanced medium-term programming and budgeting processes, and (iii) expanded the tax base and optimized revenue mobilization through scaled-up support for land registration pilots and improved audit capacity in the mining sector. The Second Restructuring further strengthened strategic planning and monitoring of GoM priorities by operationalizing CSEPS and strengthening its capacity in strategic planning and implementation monitoring. Page 3 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) e. Comments on Project Cost, Financing, Borrower Contribution, and Dates Project Cost: The original total project cost was US$11.60 million (US$10.30 million IDA-D1030 and US$1.3 million in counterpart funds). An AF (P165501) and First Restructuring were approved in July 2018 for US$16.40 million (US$14.5 million IDA-D3450 and US$0.9 million in counterpart funds). The final project cost estimate was US$27 million, with an actual disbursement of US$26,328,724, representing 97.3 percent. The ICR did not provide the reason for the difference between the revised project cost estimate and the actual disbursement. Financing: IDA (IDA-D1030) financed SDR 7.5 million (US$10.30 million equivalent), and an additional IDA Grant (IDA-D3450) funded SDR 10.1 million (US$ 14.50 million equivalent). Borrower Contribution: The GoM provided US$ 1.3 million in counterpart funding for IDA-D1030 and US$ 0.9 million for IDA-D3450. Dates: The project was approved on 28 March 2016, became effective on 24 June 2016, and was restructured two times along with one AF. The AF and First Restructuring (approved on 16 August 2018) consolidated and scaled up activities, expanded the project’s scope and extended the closing date to 31 December 2022. The Second Restructuring (approved 10 June 2021) reallocated funds from Component 2 to Component 4 and added a new sub-component to Component 4. A split evaluation will not be undertaken because the project’s revised PDO and activities continued to reflect the original PDO. The two restructurings expanded the project's scope and ambition. 3. Relevance of Objectives Rationale The quality of overall public spending needed to be improved due to weak planning, programming, monitoring, and control. According to the ICR, there were significant differences between budgeted and actual expenditures within and among budget categories, with underspending in some categories and overspending in others. There was also uncertainty about the eligibility of spending, and 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. Information and communication technology (ICT) systems did not provide a real-time picture of budget execution; oversight institutions did not effectively audit public accounts; there were increased fiscal risks for parastatals due to poor internal and external controls; procurement systems and processes were inefficient; and mining tax volatility demonstrated the need to expand the tax base and improve tax collection. Political Context: At the time of approval, the country faced several governance-related challenges that impeded fiscal and economic management. 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. The GoM recognized the need to develop a public sector that can plan, Page 4 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) budget, execute, and account for public resources in a more effective manner. This was a key condition for Mauritania to consolidate social stability, create jobs, and reduce poverty. The GoM expressed its commitment to addressing these issues. Economic Conditions: At the time of approval, Mauritania was a lower-middle-income country with a gross national income per capita of US$1,270, driven by a thriving extractive sector and high international commodity prices. The PAD notes that a decline in mineral export prices and international demand showed how Mauritania’s strong economic performance was based in part on favorable external factors such as strong demand for high commodity prices. Annual real gross domestic product (GDP) growth was projected to decelerate markedly to 3.2 percent in 2015 from 6.4 percent in 2014, and real GDP growth was expected to return to rates observed before the commodity price boom (2011–2014), slowing down to 4.5 percent in 2016 and 2017. Total public spending doubled between 2009 and 2014 in nominal terms or by 57 percent in real terms, yet 2015 poverty data demonstrated a modest decrease in absolute poverty from 46.8 percent to 41.2 percent and extreme poverty from 16.5 percent to 9.9 percent between 2008 and 2014. This was impacting the delivery of essential services as well, with development indicators in health, education, water and electricity access, and food security lagging behind Millennium Development Goal (MDG) targets and Sub-Saharan Africa (SSA) averages. The GoM recognized that despite the recent strong economic growth performance, there was a need to put in place programs to ensure shared growth and poverty reduction, specifically focusing on supporting a public sector that could effectively plan, budget, execute, and optimize public spending. Development Priorities: The project directly aligned with the GoM’s “Strategy for Accelerated Growth and Shared Prosperity 2016‐2030” (Stratégie de Croissance Accélérée et de Prospérité Partagée) 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. The project also supported GoM priorities to complete the upgrade and expansion of critical budget (TAHDIR, RACHAD) and tax (JIBAYA) information systems, strengthen the alignment between Medium-Term Expenditure Frameworks (MTEFs) and Annual Budget estimates, ensure the timely transmission of budget execution bills, and broaden the tax base/modernize tax administration for more predictable and stable revenue sources. The project was also aligned with, and effectively contributed to, the World Bank Group’s (WBG’s) FY14‐FY16 Country Partnership Strategy (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 noted that the project supported the GoM in advancing 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). 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. With the AF/First Restructuring, the project also became a core element of the WBG’s FY18–FY23 CPF for Mauritania – both were processed in parallel 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 wording. 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 recently established CSEPS mandated to enhance public sector performance. Page 5 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) Rating Relevance TBL Rating High 4. Achievement of Objectives (Efficacy) EFFICACY_TBL OBJECTIVE 1 Objective Improve Allocation of Public Resources Rationale Improvements in planning, programming, procurement, monitoring, control, and oversight were required to improve the quality of public spending in Mauritania. ICT tax and budget systems needed to be upgraded and expanded to improve functionality and positively impact the quality of public spending, which was not adequately coordinated or cohesive. There was no theory of change (ToC) in the PAD. It was developed for the ICR. The ToC assumed that project support to improve expenditure controls through an updated, more integrated GFMIS, combined with measures to enhance accounting, auditing, oversight, and procurement standards, would constitute necessary steps toward addressing these constraints. There were three intermediate results indicators (IRIs).  Core Budget and Treasury Accounting Management Information Systems upgraded, integrated and interfaced with other principal financial management information systems. Baseline: No (30 June, 2016). Target: Yes (31 December, 2021). No (2 December, 2022). Partially achieved. The new Treasury accounting system could not be completed due to procurement issues. Nevertheless, the project supported the GoM to upgrade and expand critical budget and tax information systems, along with relevant modules, interfaces, servers, and licenses. This IRI measures an essential area of project support linked to the two PDO indicators described below.  Share of Procurement Committee Leads (Personnes Responsables des Marches Publics) certified through a procurement certification scheme. Baseline: 0% (30 November, 2015). Target: 40% (30 December, 2022). Achieved: 96% (2 December, 2022). The project supported increasing the capacity of procurement authorities by increasing the percentage of tender committee members certified under the training and certification program.  Delivery Unit Matrix of Policy Priorities. Baseline: A matrix of policy priorities monitored by the Delivery Unit is unavailable (29 April 2021). Target: A matrix of policy priorities monitored by the Delivery Unit is prepared and agreed upon (30 December 2022). Achieved: A matrix of policy priorities monitored by the Delivery Unit is ready and agreed upon (2 December 2022). The project helped finance the Unit, including an ICT-based monitoring system and regular briefings for the Council of Ministers chaired by the President. Page 6 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) There were two PDO indicators. Transmission of the budget execution bill (Projet de loi de Reglement) for the preceding year to the Court of Accounts within the mandated timeframe (31 December). Baseline: After 31 December (30 June, 2016). Target: Yes, on or before 31 December 2022. Achieved: Yes, on 2 December, 2022. By providing support to enhance the functionality of GFMIS core modules that enable the timely and automated production of reliable information on budget execution, the project helped the GoM to submit the budget execution bill starting in 2018. This significantly improved the comprehensiveness of the GoM’s aggregate fiscal position and controls over public spending.. Alignment between Medium-Term Expenditure Framework (MTEF) estimates and Annual Budget estimates in two selected sectors. Baseline: No alignment (20 April 2018). Target: 95% (30 December, 2022). Partially Achieved: 89.7% alignment (2 December, 2022). The MTEF estimates for 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 31 March 2021. While achieving this represented a 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. The variation between the MTEF and annual budget estimates was due to a downward revision of all budgets because of COVID-19. The improved alignment between the MTEF and budget estimates helped make the annual allocation of resources for these ministries significantly more evidence-based and results-focused. Rating Modest OBJECTIVE 2 Objective Improve Mobilization of Public Resources Rationale This component was initially designed to (i) broaden the tax base and modernize tax administration to create a more predictable and stable source of revenue, (ii) improve mining sector taxation by using a tax model and a risk-based methodology for audits to combat Base Erosion and Profit Shifting, and (iii) modernize the mining registry and strengthen the capacity of the Ministry of Mining for geoscientific analysis. Under the AF and First Restructuring, this objective was renamed and significantly scaled up support for land registration pilots to increase the number of formally registered land parcels in Mauritania. There were three IRIs.  Tax census in 3 largest cities (properties and businesses). Baseline: None (30 November, 2015). Target: Nouakchott, Nouadhibou, and Rosso tax censuses are completed. Achieved: Nouakchott, Nouadhibou, and Rosso tax censuses completed in 2020 by the DGI. By using the additional data on businesses (turnover, staff, plants/equipment etc.) and properties (size, value, use), DGI expanded the tax base with reliable information to increase tax revenue collection.  A risk-based annual action plan conducts mining sector tax audits. Baseline: 0 (30 March, 2018). Target: 80 (30 June, 2022). Achieved: 86 (2 December, 2022). This action plan enabled the GoM to Page 7 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) identify high-value tax revenue collection mining companies for targeted tax audits. Mauritania’s three principal mining companies, along with 16 of 19 main subcontractors, were subject to risk-based audits.  Geological database system accessible to the public on-site and online. Baseline: No (30 November, 2015). Target: Yes (30 June, 2022). Achieved: Yes (2 December, 2022). These databases helped the GoM achieve Extractive Industries Transparency Initiative compliance in 2019 and 2020, positively impacting the country’s investment and building accountability in resource governance. There were two PDO indicators.  Urban land parcels with use or ownership rights are recorded in a land information system (gender disaggregated). Baseline: 35,000 (20 April, 2018). Target: 75,000 (30 December, 2022). Achieved: 207,763 (2 December 2022). By increasing the number of parcels registered in the land management information systems, the GoM was able to build a more reliable database to increase property tax receipts sustainably. According to Annex 1 of the ICR, the indicator achieved the target of 30 percent female and 70 percent male.  Mining companies are subjected to tax audits. Baseline: o (30 March, 2018). Target: 80% (30 December, 2022). Achieved: 86% (2 December, 2022). Based on the risk-based annual action plan described above, the additional tax audits will enable the GoM to increase mining sector tax receipts over time and help combat Base Erosion and Profit Sharing. Rating Substantial OBJECTIVE 3 Objective Improve the Management of Public Resources Rationale To improve the management of public resources, this object focused on strengthening the GoM’s audit function, specifically focusing on state-owned enterprises. At the time of approval, GoM oversight institutions needed to be adequately equipped to audit public accounts and systematically follow up on audit recommendations. The inadequate control of the parastatal sector also heightened financial risks. Financial statements and reports needed to be more frequent, complete, and standardized. The procurement system had gaps in the legal framework, including operational regulations and standard bidding documents. The institutional framework suffered from overlapping mandates, limited procurement capacities, a lack of controls and audits, ineffective mechanisms to report allegations of corruption, and an absence of civil society participation. The improved production, use, and dissemination of statistical data was meant to inform medium-term programming and planning, focusing on the National Statistics Office (Office National des Statistiques -- ONS), the General Directorate of Reform Studies and Monitoring and Evaluation (Direction Générale des Etudes, des Réformes et du Suivi-Evaluation – DGERSE) and the General Budget Directorate (Direction Générale du Budget – DGB) of the Ministry of Finance. Page 8 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) There were three IRIs.  Performance agreements are elaborated, signed between the State and SOEs, and monitored. Baseline: 0 (30 November, 2015). Target: 2 (30 December, 2022). Achieved: 2 (2 December, 2022). The project implemented and monitored two pilot performance contracts for the Société des Transports Publics and the Société Nationale des Forages et des Puits, complementing the PDO focus on publishing economic and budget information (see below).  Qualified statisticians employed by the National Statistics System. Baseline: 15 (20 April, 2018). Target: 35 (30 December, 2022). Achieved: 36 (30 December, 2022). The project complemented support provided by the European Union and the International Monetary Fund to (i) enhance the capacity of the National Statistical System to produce timely and quality statistics, (ii) improve macro- economic forecasting capacity and strengthen the linkages between medium-term programming and annual budgeting processes, and (iii) increase access to statistical and fiscal information.  User satisfaction with the availability of publicly accessible budget information. Baseline: 25% (30 April, 2018. Target: 50% (30 June, 2022). Achieved: 56.14% (2 December 2022). Measuring user satisfaction with access to budget information enabled the GoM to understand better how project interventions were viewed by the users surveyed so that demand-driven policy solutions could be developed. There were three PDO indicators (one was dropped at AF).  Public disclosure of annual consolidated reports on public corporations' financial performance and fiscal risks (enterprises et établissements publics) issued by the Direction de la Tutelle Finaciere (DTF). Baseline: 0 (30 November, 2015). Target: 6 (30 December, 2022). Achieved: 7 (2 December, 2022). This resulted in publishing economic and budget information and aggregate SOE portfolio reports.  Improved public access to fiscal information (measured as elements of fiscal details). Baseline: 3 (31 December, 2014). Target: 6 (30 December, 2022). Achieved: 7 (2 December, 2022). The project supported improved public access to seven key elements related to GoM budget forecasting and execution, along with projected annual revenues and debt.  Coverage of internal audits in the Ministries of Health and Primary Education. Baseline: 10% (30 November, 2015). Target: 20% (30 June, 2020). Not Achieved: Dropped at AF/First Restructuring. Rating Substantial OVERALL EFF TBL OBJ_TBL OVERALL EFFICACY Rationale PDO 1: Improve Allocation and Management of Public Resources. The project met the target for the PDO indicator on the transmission of the budget execution bill but fell short of the PDO indicator on the alignment between MTEF and annual budget estimates in two selected sectors. The GoM introduced MTEFs in 2000, Page 9 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) but these programming tools were not systematically developed and had little influence over annual budget allocations. There was limited capacity of sectoral ministries to undertake medium-term programming, ensure regular updating of MTEFs, and monitor and align medium-term programming and annual budget processes. Given the GoM’s limited experience and capacity in aligning MTEF and budget estimates, the project focused on two sectors. By providing support to enhance the functionality of GFMIS core modules that focus on the timely and automated production of reliable information on budget execution, the project helped the GoM to submit the budget execution bill every year since 2018 on time. MTEF estimates for 2021-2023 of two selected ministries (MET and MASEF) were prepared and transmitted on 31 March 2021. While achieving this significant improvement, the final alignment rate of these MTEF estimates with the disclosed budgets was 89.7 percent, below the target of 95 percent. The project met targets for two IRIs, falling short of the target for the IRI on upgrading, integrating, and interfacing core budget and treasury accounting management information systems with other principal financial management information systems. The achievement of PDO 1 is rated as Modest. PDO 2: Improve Mobilization of Public Resources. The project exceeded the targets for the PDO indicators, focusing on urban land parcels with use or ownership rights recorded in a land information system and mine companies subjected to tax audits. As of 2019, the Geological and Mining Information System (Système Informatique Géographique Minéral) and the mining title management system "Flexicadastre” were online and accessible to investors and stakeholders in the sector. As of 2021, the country’s three principal mining companies were subject to risk-based audits, with 16 of the 19 main subcontractors subject to the same principles. The number of tax audits of mining companies and subcontractors (19 out of 22 companies) carried out by DGI thus exceeded the associated target. The targets for all IRIs were also exceeded. The achievements in regularizing land tenure and modernizing systems for land administration were notable since they laid the foundation for improved property tax revenue generation. While the PDO indicators were achieved, the PDO is rated as Substantial. PDO 3: Improve the Management of Public Resources. The project exceeded the targets for PDO indicators, focusing on improved public access to fiscal information and public disclosure of annual consolidated reports on public corporations' financial performance and budgetary risks. The project significantly improved public access to fiscal data, including (i) documents relating to the draft annual budget of the executive power, (ii) pre-budget statements, (iii) macroeconomic forecasts, (iv) adopted budgets, (v) in- year reports on budget execution, (vi) audited financial statements, and (vii) external audit reports. The original PDO indicator on the coverage of internal audits in the Ministries of Health and Primary Education was dropped at AF because the revised PDO indicator on the public disclosure of annual consolidated reports and the new PDO indicator on improved public access to fiscal information were assessed to be more adequate measures. The project exceeded all IRIs. The improvements in public access to financial information and opportunities for the public to monitor the financial performance of SOEs and autonomous government agencies were notable achievements that enhanced the overall transparency of public finances. The accomplishment of PDO 3 is rated as Substantial. Overall Efficacy Rating Substantial Page 10 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) 5. Efficiency Economic Efficiency: No economic or financial rate of return was calculated at appraisal. The PAD (p. 21) uses an Economy-Wide Return of 12 percent as a benchmark for expected financial and economic benefits, based on “an ongoing Bank study” on the economic growth impact of Mauritania's 2014-16 Public Investment Program. A footnote in the PAD also mentions an ongoing Bank study on the economic growth impact of the 2014-16 Public Investment Program in Mauritania that notes a Financial Internal Rate of Return estimated at 6 percent and the Economic Internal Rate of Return estimated at 14 percent “based on conservative regional averages and the concessional nature of available financing.” Still, these amounts are not calculated or used for any estimates. Other specific assumed economic and financial benefits mentioned in the PAD and the AF Project Paper 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. The economic and financial analyses in the PAD were not presented, and data sources were, in part, based on an ongoing World Bank study without adequate documentation. The AF Project Paper did not provide any additional or updated estimates on the overall expected economic benefits of the project. The ICR noted these limitations and conducted economic and financial analyses that identified some ‘tangible results” related to increased monitoring of SOEs and autonomous government agencies and some payroll savings (Annex 4). The economic and financial analyses in the ICR were limited to the data available to the team. The working assumptions for these analyses were also clearly stated and reasonable. Operational Efficiency: Partly reflecting its expanded scope, the project required about 2.5 times the original financing of US$10.3 million, and its implementation took 6.5 years instead of the originally planned 3.5 years. There were procurement challenges and implementation delays, mainly related to the upgrade of the GFMIS and exacerbated by restrictions imposed by COVID‐19. GFMIS procurement challenges included the cancellation of (i) a US$4.3 million Treasury accounting system contract (with Oracle South Africa) in June/July 2021 and (ii) a Treasury banking software contract for US$1.4 million in May 2022. Project management costs aligned with initial expectations, representing US$3.55 million, or 13.4 percent of the total cost at project closing. Better due diligence and contingency planning for these complex IT procurements would have improved operational efficiency. Efficiency Rating Modest a. If available, enter the Economic Rate of Return (ERR) and/or Financial Rate of Return (FRR) at appraisal and the re-estimated value at evaluation: Rate Available? Point value (%) *Coverage/Scope (%) 0 Appraisal 0  Not Applicable Page 11 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) 100.00 ICR Estimate  25.38  Not Applicable * Refers to percent of total project cost for which ERR/FRR was calculated. 6. Outcome The project received a Substantial rating for Efficacy and a Modest rating for Efficiency. Most of the PDO indicators met or exceeded targets. The PDO remained aligned with and relevant to the country context, GoM, and World Bank strategies. The revised PDO 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. This ICRR rates overall Outcome as Moderately Satisfactory since PDO Relevance is rated as High, Efficacy as Substantial and Efficiency as Modest. a. Outcome Rating Moderately Satisfactory 7. Risk to Development Outcome Despite progress in achieving the PDO, there are risks that threaten the sustainability of achieved outcomes moving forward. These risks relate to sustainability or PFM reforms and the mobilization of public resources. Despite substantial investments in financial management ICT systems (RACHAD and JIBAYA), they continue to be fragmented, with missing interfaces and the need for a centralized database and shared platform (see ICR Annex 8.2. and 8.3 for a helpful table and diagram that clearly illustrates this fragmentation). While the alignment between MTEF and annual budget estimates was strengthened for two ministries from 2021-23, it is not clear if the GoM is committed to scaling and sustaining this to additional ministries. This is needed to ensure that the annual allocation of public resources is more evidence-based and results-focused. The project financed the operationalization of the CSEPS to monitor government priorities, but for this to be effective, the GoM will need to commit the resources needed to institutionalize and sustain its operations in the future. 8. Assessment of Bank Performance a. Quality-at-Entry Quality at Entry is rated as Moderately Satisfactory. When the project became effective in June 2016, planned activities were directly aligned with GoM and Bank strategies for Mauritania, including the 2016‐2030 Strategy for Accelerated Growth and Shared Prosperity and the FY14‐FY16 County Partnership Strategy. There was no ToC in the PAD, with an implicit ToC and Results Chain added under the AF/First Restructuring. The PAD's results framework (RF) did not adequately track achievement toward the PDO. The RF did not have an indicator tracking Page 12 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) revenue generation, which is fundamental to understanding the impact of project activities on public research mobilization, a key part of the PDO. The indicator measuring the alignment with MTEF and Annual Budget estimates focused on two ministries. Project documents did not provide the rationale for the choice of ministries for this indicator, making it difficult to understand the broader impact of the project beyond the ministries that were tracked. During preparation, the Task Team drew on the experience of the previous World Bank projects, such as the Projet de Renforcement des Capacités du Secteur Public (PRECASP) and Projet de Renforcement Institutionnel du Secteur Minier (PRISM) 1 and 2 operations based on lessons learned from these operations. The project’s simple design was informed by PRECASP’s experience, which was too complex for a low-capacity environment such as Mauritania (five components and five ministries). PRECASP’s experiences also highlighted the importance of establishing a strong focus on M&E at the beginning (hiring a full-time M&E officer with a clear, yet realistic, data collection protocol), ensuring robust supervision arrangements that allow for frequent in-country support missions, along with focusing on donor coordination and GoM ownership of project activities. PRISM 1 and 2 provided opportunities for the project to build on and coordinate with PRISM’s ongoing activities in the mining sector. Quality-at-Entry Rating Moderately Satisfactory b. Quality of supervision The Task Team was comprised of staff with expertise in governance (lead), extractives, land administration, social and environmental safeguards, procurement, and financial management (FM). Over its 6.5-year duration, the project had four different Task Team Leaders (TTLs) that provided supervision and technical support throughout implementation. The ICR noted that supervision quality suffered somewhat due to the frequent change of TTLs. Supervision missions were organized bi‐annually, and Aide Memoires and implementation status reports (ISRs) were prepared promptly. A total of 13 ISRs were generated between June 2016 to December 2022, and in November 2017, a midterm review (MTR) mission was conducted. As accurately noted in the ICR, reporting was generally of sufficient quality and candor, and systematically covered challenges and provided recommendations on addressing them. This was especially true for the MTR mission, which candidly identified project design and implementation difficulties. It directly informed the AF and First Restructuring in 2018, which revised the PDO, and introduced a Results Chain organizing existing and new PDO indicators across three expected outcomes. The AF also introduced changes to implementation arrangements (including monitoring and evaluation - M&E) but still needed to revise the RF to reflect activities fully. Following the MTR until project closing, 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). The World Bank team helped the GoM improve its capacity for compliance with environmental and social safeguards, FM, and procurement. However, later in project implementation, several more significant procurements had to be canceled – most notably the Treasury accounting system and Treasury banking Page 13 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) system procurements. A stronger focus on GoM procurement capacity issues might have identified remedial actions earlier and prevented the canceled procurements. Overall Bank Performance is rated as Moderately Satisfactory. This reflects Moderately Satisfactory ratings for Quality at Entry and Quality of Supervision. Despite some shortcomings, the original project design was adequate. Since an explicit ToC was not formulated at appraisal, an implicit ToC had to be derived. Under the AF/First Restructuring, the original PDO was revised, and a Results Chain was 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 could have used this opportunity to revise the RF more fully. No specific adjustments were made to address the impacts of COVID-19, even though the pandemic was cited as an essential reason for canceling several activities (and the rationale for the Second Restructuring). Under the AF/First Restructuring, several significant ICT procurements were withdrawn and replaced with replacement activities. While this resulted in the non-achievement of one IRI target, none of the replacement activities were captured in the RF – despite generating some critical results. Despite the extension of the closing date (under the AF) to 6.5 years, the time was still insufficient for PFM reforms focusing on improving the mobilization, allocation and management of public resources. Supervision quality also suffered somewhat due to the relatively frequent changes of TTLs, and some of the supervision ratings might have lacked some candor. Quality of Supervision Rating Moderately Satisfactory Overall Bank Performance Rating Moderately Satisfactory 9. M&E Design, Implementation, & Utilization a. M&E Design The M&E design evolved during implementation due to PDO changes requiring an updated RF. Previous operations, PRECASP and PRISM 1 and 2 informed M&E and project design more generally, at appraisal. The scale-up and expansion of the scope under the AF/First Restructuring in 2018 led to revisions of the RF. Out of four original PDO indicators, (i) one was retained (and had already been achieved), (ii) two were reformulated to capture project achievements better, (iii) 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 (iv) three new indicators were introduced. Similar changes were introduced to IRIs. After that, the RF remained intact, with one IRI added under the Second Restructuring in 2021. While the PAD did not have an explicit ToC to inform the RF (World Bank guidelines did not require a ToC at this time), there was a detailed narrative explaining the PDO. The primary Results Chain introduced at AF did not, however, adequately organize existing and new PDO indicators around three expected development outcomes (see ICR Annex 6.2). There were gaps in the RF. The third PDO was not well named and did not fully capture the focus on building the GoM capacity to effectively manage public Page 14 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) resources. The absence of revenue mobilization indicators in PDO 2 was also a shortcoming that made it difficult to fully assess the impact of project activities on revenue mobilization. The project’s M&E system was adequate. A project implementation unity (PIU) was established to ensure fiduciary responsibility and technical coordination of activities. The PIU reported directly to the Minister and supported a Project Steering Committee (Comité de Pilotage) comprised of project implementing agencies’ technical leadership, ensuring oversight and monitoring. PIU core staff included an M&E Specialist responsible for monitoring and reporting results defined in the RF – 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, reinforcing monitoring capacity within each targeted entity. The M&E Specialist produced semi-annual reports with the latest data for each indicator made available to beneficiaries and stakeholders. b. M&E Implementation M&E was initially rated as Satisfactory in ISRs, falling to Moderately Satisfactory after the MTR mission. The MTR identified several M&E shortcomings, including (i) slow progress in several reform areas (auditing and accounting norms, GFMIS, and fiscal audit capacity in the mining sector), (ii) limited impact in some activities that the RF needed to capture consistently, (iii) the formulation of some results indicators that created challenges for monitoring progress, and (iv) insufficient technical coordination since the Project Steering Committee only met once a year. The AF/First Restructuring addressed some of these challenges by establishing a Technical Advisory Committee attached to the Steering Committee to facilitate regular monitoring and enable just-in-time adjustments to implementation modalities. Also, to strengthen institutional capacity, several technical advisers were recruited to assist the PIU and beneficiary institutions in developing Terms of Reference and monitoring contractor performance, mainly supporting the GFMIS procurements and the overall reform process. Given the failed ICT GFMIS procurements after the AF/First Restructuring, these measures were needed to address this issue effectively. Several new activities were added in the Second Restructuring, but the RF was not revised to capture them, so the impact of these investments was not adequately recorded. A Government ICR (rapport d’achèvement) captured the project’s main achievements at the closure. However, the completion date for the report was 30 September 2022, three months before project closure, which did not allow for including final data for several PDO indicators and IRIs. The PIU obtained updated M&E-related data from the implementing agencies/beneficiary institutions to finalize project results for project closing. c. M&E Utilization M&E was effectively used to inform the MTR and the subsequent AF/First Restructuring and led to significant changes to the overall project design relatively early during implementation. After AF/First Restructuring, M&E was less effective in identifying challenges related to more extensive procurement processes – most notably the Treasury Accounting system. No corresponding adjustments were made to the RF and/or M&E framework to monitor and capture data for the activities that replaced canceled Page 15 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) activities, including (i) the upgrade of the Tax Management Information System, (ii) the introduction of the Jira Work Management collaboration tool at the Ministry of Finance, (iii) the acquisition of tablets for the realization of the General Census of Population and Housing by the National Agency of Statistics and Demographic Analysis, and (iv) the audit of dormant funds and certified checks, the digitization of archives, the training program for public procurement stakeholders, and the implementation of a significant public-private partnership project plans. The Second Restructuring did not adequately address these issues in the RF. Adding one or more IRIs to the RF could have handled this shortcoming. M&E Quality Rating Modest 10. Other Issues a. Safeguards Most project components did not entail any social risks. Given the sensitive and often contested nature of land rights, the only area with potential social risks involved the land registration pilots. Pilots were selected to avoid contested areas to mitigate any negative impacts, such as access restrictions because of the land registration activities. Social assessments were conducted for each pilot area, including a 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 adopting participatory and inclusive processes for land registration. b. Fiduciary Compliance Assessments conducted by the World Bank team generally rated FM performance as Satisfactory. The only two exceptions were Implementation Status Report (ISR) #2 (January 2017) and ISR #11 (March 2022), which rated FM as Moderately Satisfactory. The ISRs did not provide clear rationales for these downgraded scores. The final disbursement rate was approximately 97.3 percent. Procurement compliance was rated Satisfactory in the first three ISRs, with the remaining ten rated as Moderately Satisfactory. This reflects the IT procurement challenges described above that negatively impacted project implementation. c. Unintended impacts (Positive or Negative) The unintended impacts identified in the ICR focused on the reallocation of funds from unsuccessful procurements to new replacement activities. Page 16 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) d. Other No other issues were raised in the ICR. 11. Ratings Reason for Ratings ICR IEG Disagreements/Comment Moderately Outcome Moderately Satisfactory Satisfactory Moderately Bank Performance Moderately Satisfactory Satisfactory Quality of M&E Modest Modest Quality of ICR --- Modest 12. Lessons Small but targeted investments in strategic planning capacity in the executive branch can support the broader goals of governance operations. A comparatively small investment of US$ 500,000 was a catalyst for the operationalization of the newly created CSEPS. Based on the encouraging achievements described in Section 2.d, additional support for CSEPS could further PFM reform in Mauritania, focusing on improved public sector project monitoring and coordination. This support could include (i) building capacity through peer-to-peer exchanges in the region and beyond, (ii) encouraging CSEPS to prioritize further the projects it monitors (highlighting 3-5 projects with high visibility and impact, creating synergies with the other components, and (iii) helping to strengthen communication and citizen engagement around these critical projects given strengthening the social contract. Complex ICT procurements should be carefully planned at appraisal, with sufficient due diligence before initiating the procurement process. Due to protracted issues encountered during the procurement process, acquiring a new Treasury accounting system (from Oracle South Africa) was eventually abandoned in 2021 at the signature stage. The GoM subsequently decided that these funds (US$ 4.3 million) be reallocated to several replacement activities. Some of these activities required additional ICT procurements, which were also not successful. Procurement planning and due diligence would have addressed some of these challenges. These types of procurements should dedicate sufficient resources to ensure completion, testing, interfacing, and built-in provisions to ensure maintenance and sustainability. To effectively monitor implementation and assess the impact of governance projects, the RF should be fully aligned with the PDO from effectiveness to closure, capturing outputs and outcomes throughout implementation. The RF was extensively revised during the AF/First Restructuring and, to a lesser extent, the Second Restructuring, making it difficult to track progress and impact. The addition of a new component with the AF/First Restructuring (strengthening national statistical capacity, medium-term programming, and annual budget processes) and adding a new subcomponent (supporting the operationalization of the CSEPS) during the Second Restructuring Page 17 of 18 Independent Evaluation Group (IEG) Implementation Completion Report (ICR) Review MR Public Sector Governance Project (P146804) were not clearly linked with the PDO (which was also revised during the AF/Second Restructuring), making it difficult to monitor progress and assess impact over time. In addition, the project did not have an indicator that tracked revenue collection, a fundamental data source for the mobilization of public resources. 13. Assessment Recommended? No 14. Comments on Quality of ICR The ICR presents a detailed and coherent description of project activities, documenting implementation challenges and achievements. There are eight annexes to the ICR, including (i) the results framework and key outputs, (ii) World Bank lending and implementation support/supervision, (iii) project cost by component, (iv) a detailed efficiency analysis, (v) ToC and RF diagrams, and (vii), helpful tables summarizing changes related to the AF and two project restructurings. These annexes provide adequate activity-level data and analysis to understand project implementation. The ICR correctly noted that more due diligence and analysis regarding the procurement and implementation of ICT solutions would have strengthened and deepened project outcomes. Overall, the analyses provided in the ICR provided a detailed understanding of project outputs and outcomes based on the available data, but a more robust assessment of project weaknesses in the RF and coherence of the two restructurings would have provided the basis for more targeted lessons learned for future governance operations in Mauritania and elsewhere. The ICR would have also benefitted from a more extensive editorial review to improve the flow and readability of the document. a. Quality of ICR Rating Modest Page 18 of 18