63390 Report on Country Experience Contents Section One-Country Experience .............................................................. 1 Preface .......................................................................................................................... 5 Abbreviations and Acronyms ........................................................................................ 6 Executive Summary ..................................................................................................... 7 Lessons from the Pilot Experience ........................................................................................................ 7 Going Forruard ................................................................................................................................ 10 Background ................................................................................................................ 13 Scope ofthis Report .......................................................................................................................... 13 Non-formal Pilots ............................................................................................................................. 14 Consultations with Ministers ofDeveloping Countries ...................................................................... 14 Evolving Relationships with Partners ................................................................................................ 14 Lessons Learned .......................................................................................................... 16 Long-term Vision and Strategy: a Prerequisite for Sustainable Development ...................................... 16 Enhancing Country Ownership: the Country in the Driver's Seat ...................................................... 20 Stronger Partnership Among Stakeholders ......................................................................................... 24 Focus on Accountability for Development Results .............................................................................. 27 Overall Assessment............................................................................................................................ 30 Implications for Wider Application ............................................................................ 31 Links with PRSP and with Bank Instruments and Processes .............................................................. 31 Applying the CDF Approach at the City Level .................................................... :.............................. 35 Changing the ~y the Bank ~rks ................................................................................................... 36 Annexes Annex 1: Methodology for Tracking Progress ............................................................. 41 Annex 2: Country Assessments ................................................................................... 42 Annex 3: Major Donors Per Sector in Pilots ............................................................... 54 Annex 4: Non-formal CDF Pilot Countries ............................................................... 55 Annex 5: Instruments in CDF Pilots .......................................................................... 56 Annex 6: The CDF and PRSPs .................................................................................. 57 3 Comprehensive D evelopment Framework co ntents, continued Section Two- A Proposal for a Comprehensive Development Fratnework ........................................................................ 59 Introduction ............................................................................................................... 63 Part I - A Concept~A Balance Sheet with Two Sides, A Coin with Two Sides, a Duet with Two Parts .............................................. 64 Part II-A Proposal for a Broader Approach to Partnership and to Management of the Development Process ................................................ 70 Conclusion ................................................................................................................. 73 Annex 1: A Prerequisite for Sustainable Growth and Poverty Alleviation .................. 74 Annex 2: New Development Framework-Bolivia .................................................... 7S Section Three-Questions and Answers .................................................... . 77 Background and Origins ............................................................................................. 79 The Principles ............................................................................................................ 80 Issues to Which CDF Relates ..................................................................................... 81 Roles Under the CDF ................................................................................................. 83 Processes to Which CDF Relates ................................................................................ 86 Implementation .......................................................................................................... 88 CDF and the World Bank ........................................................................................... 90 4 Report on Country Experience Preface the 1997 Annual Meetings of the Board of shows that countries have been most successful in laying Ai Governors of the World Bank and International onetary Pund, I raised the need for inclusion, since too many in the developing world were not being the groundwork for developing a comprehensive develop­ ment strategy, in enhancing inclusion through national consultations to build consensus on priorities, and in helped sufficiently by the development process, and we forging more strategic partnership among all actors. But, were in danger of losing the war against poverty. At the the report also shows that we are only at the beginning of Annual Meetings in 1998, I took this idea further by the process and that there is much more to do to deepen raising the need to explicitly balance our concern for and widen the implementation of the COP. . sound macro-economic policy and growth with an equal concern for effective poverty reduction, and an increased A5 we look ahead, it is our intention to continue to attention to institutions. In January 1999, I proposed a support countries that are interested in implementing the Comprehensive Development framework (CD F) to take COP. Since Poverty Reduction Strategy Papers, which the into account in an integrated manner the concerns I had Governors endorsed at the last Annual Meetings, should previously highlighted. At that time, I promised that I be based on the COP principles, we shall cast the net would report back to you in 12 to 18 months on the wider to learn from the broader experience from this experience gained with a dozen or so countries which I larger group of countries. We also intend to learn from hoped would volunteer to apply this approach. This the growing number of other countries that are imple­ report does that. menting principles compatible with the COP, and from sub-national experiences of applying the CDF principles, In March 1999, we began to track implementation of the such as City Development Strategies and Community­ CDF and to draw lessons from the emerging experience. driven Development. We recognized that some countries were already heading in the direction advocated by the CDF, and that many of The recent G-7 Statement at Okinawa, as well as the our partners also had expressed similar views in their Ministerial Meeting of the Development A5sistance policy documents. Since launching the CDF proposal, Committee of the Organization for Economic Co­ we have held regular meetings within our own institution, operation and Development in May, expressed a commit­ and with all our partners, to discuss progress and ex­ ment to the COP-and the PRSP-as the way forward change views and experience. Today, I can report that the to enhance country ownership and the achievement of countries applying the COP have made progress, and international development goals. We intend to continue while some have had to contend with severe external and to direct the energy of our institution to make this a internal shocks that have slowed the process of change, reality. others have been able to make steady progress. This report James D. Wolfensolm President World Bank Group 5 Comprehensive Development Framework Abbreviations and Acronyms ACC United Nations Administrative Committee on Coordination ADLI Agricultural Development Led Industrialization AFDB African Development Bank AHLC Ad Hoc Liaison Committee APL Adaptable Program Loan CAS Country Assistance Strategy CCA Common Country Assessment CCPOQ Consultative Committee on Program and Operational Questions of the ACC CDD Community - Driven Development CDP Country Development Partnership CDS City Development Strategy CEM Country Economic Memorandum CG Consultative Group CPIA Country Policy and Institutional Assessments DAC Development Assistance Committee DEC Development Economics Department ECOSOC Economic and Social Council of the United Nations EU European Union ESW Economic and Sector Work HCMC Ho Chi Minh City HDF Holistic Development Framework IDA International Development Association IMF International Monetary Fund IPRSP Interim Poverty Reduction Strategy Paper LIL Learning and Innovation Loan MDB Multilateral Development Bank MTEF Medium Term Expenditure Framework MTPDP Medium Tenn Philippines Development Plan NAP National Action Plan NEPFP National Economic Policy Framework and Program NGO Non Government Organization NIR National Institutional Review ODA Official Development Assistance OECD Organization for Economic Cooperation and Development OED Operations Evaluation Department PA Poverty Assessment PEAP Poverty Eradication Action Plan PER Public Expenditure Review PERC Public Expenditure Review Credit PRGF Poverty Reduction and Growth Facility PRSP Poverty Reduction Strategy Paper RDB Regional Development Bank SIM Sector Investment and Maintenance Loan SS Sector Studies TAS Tanzania Assistance Strategy UN United Nations UNDAF United Nations Development Assistance Framework UNDP United Nations Development Program WTO World Trade Organization 6 Report on Country Experience Executive Summary T he proposal for a Comprehensive Development Over the long term, the criterion for judging the success Framework (CDF) was introduced by World of the CDF is better achievement of development goals. Bank President Wolfensohn in January, 1999. At this stage, given the long-term nature of the changes Building on the lessons of development experience, the sought by the CDF approach, its comprehensiveness, and CDF is a holistic approach to development that balances the short time span since the pilots began to be tracked, it macroeconomic with structural, human, and physical would be difficult to link specific development results development needs. The framework is anchored in four directly to CDF activities. key interrelated principles and objectives to be pursued at the country level: As the CDF itself recognizes, however, the key to better development resuits lies in the processes that are put in • a long-term vision and strategy-a prerequisite for place, so an early assessment of progress with the CDF sustainable development; must be vitally concerned with changes in processes. This • enhanced country ownership of development goals and report therefore seeks to judge whether the actions that actions; have been taken are consistent with CDF principles, and • more strategic partnership among stakeholders; and to weigh the quality of the processes set in motion, and, • accountability for development results. therefore, the extent to which the CDF may be making a difference. Since March 1999, implementation of the CDF has been tracked in the West Bank and Gaza and in the following A planned three-year research evaluation of the CDF by eleven countries: Bolivia, C6te d'Ivoire, the Dominican the Bank's Operations Evaluation Department, joindy Republic, Eritrea, Ethiopia, Ghana, Kyrgyz Republic, with the Development Economics Department, is Morocco, Romania, Uganda, and Vietnam. A growing expected to shed more conclusive light on the impact of number of other countries have also embraced the CDF the new approach. The OED evaluation is expected to approach. I consider the costs and benefits of implementing the CDF. 2 The Bank has put in place various mechanisms to facilitate information exchange and learning as the CDF Lessons from the Pilot Experience is implemented: regular meetings of a learning group of CDF pilot-country directors, chaired by Mr. Wolfensohn; Experience since the pilots began to be tracked is exam­ meetings with the Bank's Executive Board, and meetings ined below under each of the four key objectives of the with networks of CDF bilateral, UN, and multilateral CDF, and in relation to balancing better macro-economic focal points. A questionnaire updated quarterly by the and structural and social needs, with an identification of Bank's CDF pilot country teams has proved useful for what has worked well, and where key challenges remain. tracking progress in a structured way. Overallprogress Scope ofthis report Overall, all the pilot countries are making progress, with The COP proposal stated that results from implementing more than half of them taking action or having largely the CDF in countries that embraced the idea would be developed a majority of the CDF elements. Individual assessed in 12-18 months time. Accordingly, this report country performance has varied from Bolivia and Ghana examines the experience since the first pilots began to be which have made the most overall progress, to Ethiopia, monitored, and draws out salient implications for the Morocco, West Bank and Gaza, and Kyrgyz Republic Bank and other actors in the development community. which have made the least. The area of greatest progress is on the long-term vision and strategy, where nine of the The piloting of the CDF has not been approached as an twelve countries have action well in hand. Least progress experiment with a clearly defined protocol to be tested. has been made in putting in place open and transparent Fundamentally, the CDF is about societal transformation. development management information systems; only two 7 Comprehensive Development Framework of the twelve countries (Bolivia and Ghana) have action • Countries are now giving greater attention to balancing well in hand. Bolivia, the Oominican Republic, Eritrea, macroeconomic with structural, human, and physical and Ghana (and within Government, Vietnam) stand out requirements. Correspondingly, they are making more in giving meaning to the concept of country ownership. effortS to identify the tradeoffs entailed in balancing Bolivia, Ghana, and to a lesser extent Eritrea, Uganda, priorities. and Vietnam have made meaningful progress in putting • All countries piloting the COF have, to varying degrees, mechanisms in place to enhance partnership. Looking at begun a process of national consultations for formulating countries' progress in relation to when tracking started­ development strategies or medium-term action plans, rather than absolute progress-Bolivia, Ghana and though mechanisms and progress vary considerably across Romania have gone furthest in about the last 16 months. countries. The Oominican Republic, the Kyrgyz Republic, Uganda and Vietnam have all also been making progress, albeit Remaining challenges from very different starting points. • Institutionalizing national consultation processes is Define long-term vision and strategy-a proving to be politically sensitive; clearly, the pace cannot prerequisite for sustainable development be faster than the capacity of existing democratic institu­ tions permits. The COF goal of achieving faster, sustainable develop­ • Focusing on the long term can be very difficult where a ment for poverty reduction recognizes that poverty has country faces a crisis. Four pilot countries either do not multiple facets: income, physical security, environmental yet have a long-term vision or have only recently begun sustainability, and the ability of poor people to confront work towards one. Three countries do not yet have their future with confidence. Given the breadth of the medium-term strategies. development challenge, for a country to achieve sustain­ • Implementing all the four key COF principles simulta­ able development it needs to implement all the COF neously-which is an important lesson emerging from principles, perhaps over a 20-year time frame, though the country experience-remains a challenge particularly progress will not necessarily be at the same speed on all for some countries. fronts. These actions need to be built on a sound macro­ economic framework and institutions-good govern­ Enhance country ownership-putting the ment, an effective legal system, a well-organized and country in the driver's seat supervised financial system, social safety nets and social programs. An overall conceptual framework, or shared Managing development is the responsibility not of vision, that captures the country's development aspira­ development assistance agencies but of countries-their tions, is needed to provide direction, consistency, and governments and their people. Hence the need to have focus. The vision needs to be complemented by a strategy the country (government at all levels, parliament, civil that sets out how the country will make progress. Such a society, the private sector and other domestic stakehold­ holistic framework allows for more strategic thinking and ers) firmly in the driver's seat. better sequencing of policies, programs, and projects as well as better pacing of reforms. What has worked well What has worked well • Governments are starting to assert ownership by taking the lead in aid coordination activities, including chairing • Some concrete steps have been taken to formulate long­ in-country meetings with donors on a regular basis. term national development frameworks, drawing on • Experience shows that holding the main consultative broad-based participation and generally complemented group (CG) meeting in the country's own capital is a by medium-term strategies with clearly defined priorities valuable way to nurture and broaden country ownership, and monitorable development goals. Some existing and does not adversely affect the debate or the level of visions that predate the COF are being reviewed. Most of participation from donor capitals-as some donors had the countries have well-articulated medium-term strate­ feared . Many COF pilot countries and some that are not gies linked to the visions. formal pilots have recently had successful in-country CG meetings. 8 Report on Country Experience • Where civil society and the private sector have become What has worked well actively involved in the policy debate, this can help deepen and widen country ownership of the development • Stronger partnership is emerging in varying degrees in agenda, and the sustainability of the CDF approach. The all pilot countries, both among assistance agencies and inclusive approach, now reinforced by the Poverty between these agencies and the countries. Reduction Strategy Process (PRSP) where applicable, • Sector and thematic groups comprising both govern­ should further strengthen the involvement of domestic ment and donor representatives are now operational in stakeholders in the policy debate. several countries and meet regularly to exchange informa­ tion and facilitate learning. Remaini1lg Challenges • In several pilot countries, donor assistance strategies are increasingly better aligned to the national medium-term • The Bank and development partners generally need to development strategy. show more confidence in country ownership, by allowing • Donors are gradually becoming more selective in their the time and space needed for ownership to be expressed, interventions, following their comparative advantage. and being prepared to let go. • There is a much greater sense of urgency for harmoniz­ • The attainment of full country ownership will require ing donor policies and procedures to reduce the burden more strategic support for capacity building and changes on clients and make the aid delivery process more in the policies, practices, and procedures of the wider effective. development community to nurture what is often a delicate process. Remaining challenges • Countries, in collaboration with their external partners, should consider defining additional concrete steps for • Concrete progress in harmonizing donor practices and making progress in supporting government leadership, procedures remains limited both at the institutional level e.g. through stronger country involvement in upstream and at the country level, reflecting long-standing ways of joint analytical work-before policies and programs are doing business as well as constraints in donor capitals. formulated . • The need for donors to demonstrate their individual • Governments generally prefer domestic stakeholders to contributions reduces aid effectiveness in almost all pilot be engaged in the policy dialogue through established or countries. Where it dominates, it preempts more effective strengthened democratic institutions, including parlia­ government leadership. ments, rather than through ad hoc consultation mecha­ • Achieving greater selectivity and reducing duplication of nisms. Some governments still question the need to effort and wasteful competition will require much better involve domestic stakeholders in pohcy discussions, since upstream coordination of analytical work among part­ , from their point of view, it is unclear to whom these ners. stakeholders are accountable and since these governments • Development of institutional capacity in partner are the elected representatives of the people. countries needs strategic-not project by project­ attention to allow for more effective partnership. Enhance strategic partnership among • As can be seen from the reactions at the WTO meeting stakeholders in Seattle, and the April 2000 World BankJIMF meetings in Washington, and as foreshadowed for the World Bank! Development experience shows that there is too little IMF Annual Meetings 2000 in Prague, much suspicion coordination of effort, too much suspicion among the still exists on the part of certain well-organized members various actors, too little transparency and consultation, of civil society. This must be overcome. and not enough focus on accountability for performance. For greater poverty reduction, there are clear benefits to be had from stronger partnership and better coordination among assistance agencies, and greater selectivity of effort, based on agencies' comparative advantage. 9 Comprehensive Development Framework Increase focus on accountability for Going Forward development results The CD F has implications for how the Bank works and To be accountable for development results, development for the larger development community. Beyond the managers need to make their goals clear, monitor the pilots, a number of other countries have already embraced progress of programs and projects, and share the informa­ the CDF approach. In adopting the PRSP process in tion that becomes available. Indicators of progress should September 1999, ministers decided that it should be focus on development results, rather than inputs, and based on CDF principles. And with the significant given that most countries have very limited statistical and increase in the number of PRSPs expected, application of monitoring capacity, it is better to choose a few interme­ the CDF principles well beyond the current pilots is diate indicators that can be assessed regularly than to have gaining momentum. At the subnationallevel, this is resulcs indicators that can only be assessed irregularly. happening in both low- and middle-income countries, for Transparency and open sharing of information on example through the City Development Strategy initia­ development goals and progress by a country and its tive, which applies CDF principles and objectives at the partners helps to make development more effective and city level. greater poverty reduction possible. Achieving this objec­ tive, for example through a CDF-type matrix, would As the CD F process evolves, the Bank needs to pursue a allow greater attention to development gaps, sequencing number of actions as set out below. External partners and of interrelated development activities across sectors, and the countries themselves may wish also to draw out the identification of comparative advantages. Ultimately it implications from their own perspectives. This report would allow much greater focus on resulcs and account­ presents some measures they may wish to consider. ability than has been the case so far. Actions by the Bank What has worked well The Bank's six Regions are already considering the region­ • Governments increasingly recognize the need to take a specific implications of a wider application of the CDF more strategic approach to the gathering and dissemina­ approach, including actions required at the country level, tion of information regarding the CDF and a number of the relationship with the country's key external partners, country-specific websites are already operational. and internal change in support of the CDF approach. • Progress is being made in some pilot countries to develop a CDF matrix, or one like it, setting out details Experience suggests that in order to implement COF of individual stakeholders' activity sectOr by sector. more broadly, the Bank should more systematically align its instruments, processes and way of working with the Remaining challenges CDF approach. In particular, it should: • Progress in developing the CDF matrix has been slower • Better align the CAS and CPlA (country policy and than originally anticipated. There are still barriers to the institutional assessments), as proposed in the recent CAS disclosure of information. Retrospective and in accordance with the proposal by the • While country-specific indicators of performance are IDA deputies at their recent Lisbon meeting. As envis­ available for a few pilots, most have not yet completed aged in the CAS Retrospective, the CAS can be used in their preparation. non-pilot countries to introduce or deepen the CDF • Much work is still to be done on monitoring and approach, as has been done in some countries such as evaluation capacity in-country. Zambia. The recent CAS for the Philippines also reflects an approach that embodies CDF principles. In this 10 Report on Country Experience context, the Social and Structural Reviews (SSRs) should bear in designing and promoting alternative modes for more also be better aligned with the CAS and the CPIA. effective private-sector engagement in the CDF context. • Approach economic and sector work, identifYing the • Explore the introduction ofmulti-year administrative constraints to development and poverty reduction and the budgets at the country department level, and continue work priorities for action, with a three-pronged purpose of i) to see how the Bank can increase the development impact of enhancing partnership by facilitating dialogue on analyti­ its safeguard and fiduciary policies, especially in the context cal standards and policy options; 2) enabling the pursuit ofsector-wide approaches to lending. of broad-based consensus; and 3) knowledge transfer. • Create among Bank staffa better enabling environment for This framework can provide a basis for the Bank's support the CDF. This requires further improvements in: 1) for country leadership and for its professional judgement leadership behavior at all levels of staff; 2) the organiza­ on the adequacy of country policies and processes for tional environment-making the matrix approach excel; Bank programs. and 3) the approach to learning and training. Specifi­ • WOrk towards greater selectivity in country assistance cally, the Bank should further develop action learning, strategies, building on the Bank's comparative advantage, together with clients and partners, as used in some of the and closer collaboration with partners in formulating pilots; promote slcills that support worlcing in a partner­ support and its timing in individual countries. ship mode; and create a community ofCDF change • Move towards a greater focus on programmatic lending, to agents who support one another in nurturing the CDF provide for a medium-term approach that is adaptable to approach. These changes should be pursued in a phased country circumstances, consistent with a results-based and tailored manner, concentrating on those cases where approach. In this context, experience in the CDF pilot both the country and the Bank are ready to adopt this countries suggests that a greater use of programmatic way of worlcing, building on the accumulated experience. lending instruments such as adaptable program loans • More closely align recruitment practices and the incentive (APLs), sector investment and maintenance loans (SIMs), structure for assessing performance and promotion to support and programmatic structural adjustment loans and credits CDF implementation, by lending more weight for example to (PSALs/PSACs) facilitates strengthened country owner­ partnership-related competencies. Greater progress in ship. linlcing incentives to worlcing in this new way will send • Promote concrete action on harmonization ofoperational more consistent signals to encourage staff to "walk the policies and practices at the institutional and country levels. talk". The Bank's Regions plan to set up an internal CDF This will help to reduce the transaction costs for partner focal points group, together with the CDF Secretariat, to countries and institutions, and facilitate more program­ enhance collaboration on CDF implementation. matic approaches to the delivery of development assis­ ·Explore the implications for Board practices. For example, tance. the presentation of Ghana's development strategy to the • Consider aligning its support more closely to the country's Bank's Board by the Government was an explicit expres­ own budget process. This would ensure greater predictabil­ sion of efforts to strengthen country ownership. Although ity of future resource flows. it is still early, a wider application of this initiative needs • In the PRSP process, continue to ensure that CDF prin­ to be considered. ciples are fully incorporated in the way staffsupport these countries. Also, any outstanding CDF-related issues need Implications for partner organizations to be addressed in the joint Bank/Fund assessments, as has been done in an exemplary manner in the Ghana The key consideration for all external partners is the need case. for greater harmonization of policies, practices, and • Encourage the introduction and dissemination ofCDF procedures. Experience shows clearly that this cannot be principles. Use various mechanisms to introduce the CDF achieved solely on the basis of action at the country level. in the dialogue with countries, including at the sub­ Indeed all actors, including the Bank, see this as an area national level, for example, through the City Develop­ that requires action at the institutional level. OECDI ment Strategy. DAC has been encouraged by bilateral development • Playa stronger role in bringing international experience to ministers to proceed with identifying the constraints on 11 Comprehensive Development Framework progress. This work should have the full support of the must be supported in taking the long-term view. This is Bank and other multilateral development banks. More particularly relevant in PRSP countries, which have a specifically: relatively strong incentive to focus on the short term. • Seeking maximum synergy among programs designed to • The business plans ofall partners should be derived from improve country capacity-such as the Partnership for the country's strategy, or poverty reduction strategy in low­ African Capacity Building initiative. Institutional capacity income countries. This has implications for individual is central to implementing all the CDF principles of donor visibility. building ownership, forging more strategic partnership, • The sector-wide approach is a promising instrument to formulating and implementing policies, and enhancing establish effective coordination at the country level as well as accountability for development results. reduce transactions costs. External partners, including the • Moving forward with the wider and foster application of Bank, must ensure that they do not superimpose their in-country consultative group meetings. The World Bank own requirements and thus defeat the partnership. should collaborate and encourage its partners, such as • Steps need to be taken to help countries improve their UNDP and the regional development banks, to work in capacity to monitor development results. Here it is impor­ this direction. tant to ensure coherence among various donor initiatives • Countries will continue to be encouraged to open up the including with ongoing work by OECD/DAC on dialogue further to include all representative domestic statistical capacity and on international development stakeholders. To the extent feasible this dialogue should be indicators, and in improving country monitoring and conducted through existing democratic institutions, evaluation capacity. rather than setting up parallel ad hoc consultation mechanisms that can undermine fragile existing institu­ Implications for partner countries tions by implicitly questioning their legitimacy. • While all the efforts to put in place CDF or CDF-type These include: matrices are incipient, they should be further supported­ whether through the Development Gateway Initiative or • The holistic approach presents challenges for all countries other efforts. This work contributes to transparency and but is essentialfor focusing on greater poverty reduction. In accountability, as well as helping to create a better­ this context, formulating an appropriate development informed development management environment. vision, complemented by a medium-term strategy with • Governments should widely disseminate their strategies so well defined goals, is a fundamental need. Pilot experi­ as to ensure full understanding by all stakeholders, and ence shows that many countries are faced with multiple increase Government accountability. Where this is not possible strategies. Countries should be supported in done, the commitment of stakeholders-even those rationalizing the content of donors' strategies to ensure within Government-is weakened. coherence of effort. Similarly, countries that have success­ • Lastly, pilot experience shows that all the CDF prin­ fully devised short-term strategies, partly in response to ciples and objectives should be pursued simultaneously, crises, but have made less progress on a long-term vision, because progress in one depends on progress in the others. 12 Report on Count,) Experience Background Scope of this Report T he Comprehensive Development Framework (CDF), piloted in eleven countries and West Bank and Gaza, was introduced by World Bank The CDF proposal stated that results from implementing President Wolfensohn in January, 1999. 3 Building on the the CDF in countries that embraced the idea would be lessons of development experience, the CDF seeks to assessed in 12-18 months time. Accordingly, this report enhance development effectiveness through coordinated assesses the experience since the first pilots began to be support of country ownership of a well-defined develop­ tracked, and draws out salient implications for the Bank ment agenda. It is a holistic approach to development and other actors in the development community. Previous that balances macroeconomic with structural, human, reports on the CDF limited themselves to describing and physical development needs. The framework is progress and identifying promising practices and emerg­ anchored in four key interrelated principles and objectives ing challenges. 4 to be implemented at the country level: Ultimately, the criterion for judging the success of the • a long-term vision and strategy-a prerequisite for CDF is better development results. At this stage, given sustainable development; the long-term nature of the changes sought by the CDF • enhanced country ownership of development goals and approach, its comprehensiveness, and the short time span actions; since the pilots began, it would be difficult to link • more strategic partnership among stakeholders; and specific development results directly to CDF activities. • accountability for development results. As the CDF itself recognizes, however, the key to better The Bank's Executive Board endorsed the proposal to development results lies in the processes that are put in pilot the CDF in March, 1999. A pilot program was then place. An early assessment of progress with the CDF must assembled on the basis of Bank/Country dialogue, with be vitally concerned with changes in processes. This Bolivia and Ghana (two countries that had already report therefore seeks to judge whether the actions that embarked on approaches similar to the CDF) coming have been taken are consistent with CDF principles, and forward very early. Nine more countries (Cote d'Ivoire, to weigh the quality of the processes set in motion, and, the Dominican Republic, Eritrea, Ethiopia, Kyrgyz therefore, the extent to which the CDF may be making a Republic, Morocco, Romania, Uganda, Vietnam) and difference. West Bank and Gaza followed. Fundamentally, piloting the CDF is an investment in laying a more solid basis for Following this report, a three-year phased research sustainable poverty reduction, whose returns will be evaluation of the CDF will be undertaken by the Bank's generated over time. The emphasis has been on learning Operations Evaluation Department (OED) and Devel­ by doing and distilling the experience. opment Economics Department (DEC) . The evaluation intends to: i) verify the extent to which the CDF prin­ In March 1999, the President established a small CDF ciples are being practiced in diverse country contexts; ii) Secretariat, supported by bilateral secondments, as a identify the difference the principles are making in central focal point to provide support in the implementa­ promoting development; and iii) assess how the principles tion of the CDE Various mechanisms were put in place to are reflected in the Bank's own instruments and processes facilitate information exchange and learning as the CDF and in poverty reduction strategy papers (PRSPs). The is implemented: regular meetings of a learning group of evaluation will use both cross-country analysis and case CDF pilot-country directors, chaired by Mr. Wolfensohn; studies and, to the extent possible, involve the Bank's meetings with the Bank's Executive Board; and meetings partners and client countries. This evaluation will also with networks of CDF bilateral, UN, and multilateral address costs and benefits of the CDE5 focal points. A tracking mechanism updated quarterly by the Bank's CDF pilot country teams has allowed struc­ tured monitoring of progress. 13 Comprehensive Development Framework The remainder of the present chapter describes recent Evolving Relationships with Partners events in the development community with regard to the CDF. The second chapter, Lessons Learned, takes stock of Dissemination of the CDF proposal and consensus­ the pilot experience. It assesses progress at the country building around its key principles was a major area of level over the last year and half in implementing various focus straight after the proposal was launched. An aspects of the CDF, responding to requests from close important goal of that effort was to ensure that the Bank's observers for a more evaluative approach, albeit one based key multilateral and bilateral partners were fully briefed on qualitative rather than quantitative judgments. The and to see whether a consensus might develop around the third chapter, Implications for Wider Application, exam­ approach. Shortly after the World Bank's Board of ines implications and lessons for the Bank for possible Executive Directors discussed the CDF in March 1999, replication in moving forward with CDF principles. the development Ministers from several European countries met with Mr. Wolfensohn in Berlin. The Non-formal Pilots ministers expressed support for moving forward with implementation of the CDF, and the first network of Several countries that are not formally part of the CDF CDF bilateral focal points was established. pilot tracking mechanism have launched processes consistent with the CDF approach or expressed an The network of CDF UN focal points was established interest in doing so. They include a growing number of soon afterwards. In addition, the Development Assistance middle-income countries. For example, both Thailand's Committee of the Organisation for Economic Coopera­ Holistic Development Framework and the Philippines' tion and Development (OECD/DAC) started a network Medium-term Development Plan seek to balance macro­ of multilateral secretariats. This network took up the issue economic considerations with structural and social of the CDF in relation to other country-based pilot interventions. In both those countries, the strategy is experience that was being sponsored by the DAC and homegrown and has been developed through participa­ other institutions. tory processes involving the private sector and NGOs. The assessment in this report draws on some of the Further to these formal exchanges, consultations on the experiences of non-formal pilot countries. Annex 4 CDF with partners have been continuous, and previous outlines how some low-income and middle-income non­ CDF progress reports have documented them. The Bank's formal pilot countries have applied the CDF principles, Board of Executive Directors has been kept abreast of and the role of the Bank in this process. major outcomes from the exchanges. Systematic meetings have been held to discuss the CDF with ministers of Consultations with Ministers of Developing developing and transition countries, and visits made to Countries some countries implementing the CDF. Regular consultations on the CDF have been carried out Bilateralfocal points during the Spring and Annual Meetings of the Bank and International Monetary Fund. These consultations have The persons nominated to be focal points are mostly allowed for exchange of views between the President of senior staff at the headquarters of development agencies. the Bank and finance ministers and senior officials of Their role has been to keep abreast ofCDF implementa­ both CDF pilot countries and non-pilot countries. These tion experience in the countries where the agencies are at meetings have added to understanding of the CDF and work, and to keep the network and the Bank informed also led to requests for Bank support in implementing the about progress and challenges as seen from their perspec­ approach in non-pilot countries. Developing country tive. The CDF focal points networks have met three times ministers have underscored the importance of treating in the sixteen months, and the substantial experience each country according to its own circumstances. Some exchanged helped to shape this and previous reports. have also underscored the fact that countries interested in implementing the CDF can do so on their own initiative Equally, the network has been an important source of and do not need the Bank or other partners to be in­ support to keep the momentum of the CDF going. volved. Specific issues raised by the agencies have been carefully 14 Report 011 Country Experience followed up. In the course of implementation of the CDF ters recognized that CDF principles can be difficult to in the pilot countries, most issues related to coordination put into practice, because they may require fundamental have been dealt with at the country level. Others that change in the mindset of development agencies. How­ needed action at the institutional level have been dis­ ever, they also stressed the need for such changes in order cussed at bilateral focal points meetings; examples are the to make the most of the new development partnership, harmonization of practices and procedures, alignment of including through better engagement with local civil country assistance strategies to the national strategy, and society, the use of sector-wide approaches, the simplifica­ budgetary support for sector-wide approaches. tion and harmonization of procedures, and the delegation of authority where possible to field level staff. In this UN agencies regard, they emphasized that there should be full coher­ ence berween the CDF and the Poverty Reduction Close working relationships have also been developed Strategy Papers, which are to be prepared in accordance with various UN agencies and bodies such as the UN with CDF principles (see chapter on Implications for Development Group, through the UN focal points Wider Application below). nerwork. This nerwork has worked to strengthen the integration of UN instruments-in particular the Civil Society common country assessments and development assistance frameworks-with the implementation of the CDF.6 Outreach to and consultation with civil society has taken Work with the UN has also focused on keeping informa­ a number of forms. In the pilot countries, the primary tion on the CDF flowing to UN bodies such as role in promoting such dialogue has rested with Govern­ ECOSOC and the CCPOQ. While parts of the UN ment, as discussed in the chapter, Lessons Learned, below. system still have some doubts about the CDF, these Elsewhere, many development partners (both bilateral groups have changed their views about the CDF substan­ and multilateral) have engaged in such debate-at global tially over the last year and half Today, the focus of and regional level. The Bank has welcomed and encour­ attention is not on whether the Bank will overwhelm UN aged such exchanges. Its own contributions have in­ instruments; rather it is on achieving better partnership cluded rwo on-line, electronic dialogues, one in May and among the UN agencies and the Bank in supporting June 1999, the other in June and July 2000; together country-led development efforts. with seminars linked to the Spring and Annual meetings of the Bank and IMF; and a long series of ad hoc OECDIDAC meetings with individuals and groups, in headquarters, at regional level and in-country. CDF is also a key item in Work with the OECD/DAC on the CDF continues with the World Faiths Dialogue on Development co-chaired good progress being made. The President of the Bank by the President of the Bank and the Archbishop of presented the CDF to the DAC Ministerial-level Meeting Canterbury. These contacts have provided a great in May 1999, and working-level contacts intensified with diversity of comments and suggestions, many of which the goal of ensuring greater coherence berween the CDF are reflected throughout this report. Some particularly and the partnership strategy espoused by the DAC. This prominent themes included: culminated late in 1999 with a DAC-sponsored state­ - the importance of the Bank's actions being seen to ment, On Common Ground,? which builds on the CDF match with the language of the CDF; principles and integrates similar concepts from the - the need for World Bank staff to internalize CDF, so as current strategies of many partners in the development to adapt their own behaviors to the partnership approach community, including the European Commission, the set out in CDF; IMF, MOBs, and the UN. On Common Ground sought to - participation, consultation and inclusion, however put to rest the notion that the CDF competes with other defined, need to be authentic to be meaningful. This kind strategies. It emphasized the consensus that now exists in of inter-action takes time; the development community on the principles of the -the importance of the focus on results- and results CDF and the resolve to translate them into reality. defined not through generic indices, but with reference to those most nearly concerned, i.e. the marginalized and The DAC Ministerial Level Meeting of May 2000, the vulnerable poor. expressed the support of ministers for the COP. Minis­ 15 Comprehensive Development Framework Lessons Learned on the long term in the midst of a crisis, but has also shown that in some cases the use ofCDF approaches has This chapter examines the pilot experience under each of helped governments sustain a longer-term focus even at the four key objectives of the CDF: putting in place a such times. development vision and strategy; enhancing country ownership; forging stronger partnership under govern­ Experience also shows the need for sound institutions that ment leadership; and a focus on development results. It respond to the interests of the people by providing good, identifies what has worked well over the last year and a clean, representative government; an effective legal and half, and where key challenges remain. The last section of justice system; a well-organized and supervised financial the chapter provides an overview of progress. system; and a social safety net. These structures need to be accessible to as much of the population as possible-often Data for the assessments in this chapter come from a this will mean that they need to recognize issues of variety of sources. Using a questionnaire that is updated regionalism and decentralization. The pilots have shown quarterly, the Bank's CDF secretariat and the country that the lack of such sound structures is an obstacle to teams track all the key elements of the CDF approach. taking CDF forward, both in itself and because their The assessment also draws on information from the focal absence prevents the confidence-building between points representing the major bilateral agencies, the UN government and other parts of society that is essential for system, and multilateral development banks, and from effective dialogue. In most of the countries piloting the structured interviews held in June 2000 with cross­ CDF, at least some of these structures remain to be fully sections of stakeholders in several of the pilot countries. developed 9 • Experience over the last year has shown that Annex 1 outlines the approach used for making the one benefit of CDF has been to make this unfinished assessments of progress, while Annex 2 provides the agenda more transparent, and to facilitate public discus­ results of country by country assessments. sion of ways to take it forward. In this sense, the CDF may be said to have had a catalytic effect. Long-term Vision and Strategy: a Prerequisite for Sustainable Development Setting a strategic direction Achieving faster, sustainable development for poverty To build on these foundations at the country level reduction-the goal towards which CDF aims to contrib­ requires an overall conceptual framework, or vision, that ute-recognizes that poverty has multiple facets, of which provides the direction, consistency, and focus essential to income or wealth are only an element: others include sustain any long-term process. lO Experience from the physical security, environmental sustainability, and the pilots shows that such a vision must have regard to all the ability of poor people to confront their future with CDF principles and must be country-specific (Boxes 1 confidence. This goal also recognizes that the CD F is and 2). about societal transformation. Given the breadth of this development challenge, CDF identifies the need for a To establish such a vision, the following elements are broadly based foundation, on which to build a long-term needed: vision grounded in a holistic approach, which is in turn • A basic understanding ofthe nature ofthe opportunities translated into medium-term development strategies. and problems facing the country, together with knowledge of and experience about the constraints they face, Experience from the pilots has shown that the foundation including the government's capacity limits. needs to include a sound macroeconomic framework. If • A simple shared vision statement that sets out the country's this is disrupted, countries face real difficulties in main­ aspirations. This is about capturing the aspirations of the taining a long-term perspective of any kind. Short-term people; it need not specifY concrete objectives. Realism decision making can then quickly erode the accumulated and concreteness are desirable, but it is more important benefits for the poor of previous long-term approaches. that the vision authentically reflect the broad aspirations The experience has confirmed that it is difficult to focus of the country. 16 Report on Country E"perience The vision needs to be complemented by a strategy that All parts of government then need to relate their own sets out how the country can make progress towards it. activities to the national strategy. The aim should be that This strategy needs to be realistic, and framed in terms of all branches of government do so, together with all sectors concrete time-bound actions geared to delivering specific of activity, and all levels (national, regional, local). In so development results. Partly because of this specificity, doing, they will need to address both policy and imple­ strategies cannot be projected as far ahead as visions, and mentation capacity. The greater the coverage of this process, will need to be reviewed periodically as circumstances the greater the likely consistency in pursuing the vision. change. The vision and strategy should be extensively disseminated to ensure widespread commitment and support. Box 1: Long-term Vision A strong long-urm vision will 100ft forward at least tm ytars. and inclutk a focus on Itty povmy rtduction aims. including tht role of gmdn; and propost rtsults-mtasurts kr which to asms progrm. Bolivia "Bolivia towards the 21 " Century" vision launched as part of national dialogue. Focuses on results; pover£y reduction through higher, sustainable growth is main aim, with gender as a cross-cutting issue. cate d'Ivoire "Vision 2025" promotes growth as means to reduce pover£y. Some discussion of results, but treatment of gender limited. It now needs to be reviewed. Dominican Ten-year vision, with partial focus on pover£y reduction. Little discussion of results. Some recognition of Republic gender issues. Eritrea Twen£y-year National Economic Policy Framework and Program (NEPFP), strongly focused on pover£y reduction, and specific section on gender. Results not covered in detail. Being reviewed in light of conflict with Ethiopia. Ethiopia Agricultural development-led industrialization (ADLI) vision not time bound. Evolves over time, based on pro-poor growth. Gender is integrated in government policy. Some treatment of results. Needs review in light ofconflict with Eritrea. Ghana "Vision 2020" with strong focus on pover£y reduction through economic growth. Gender is integrated, as are indicators of progress on results. Kyrgyz Republic "Vision 2010" now under development through national and provincial workshops. Three areas offocus: Pover£y Reduction and Social Protection; Sustainable Economic Growth; and Good Governance, Legal and Judicial Reform. Due by end 2000. Morocco No clearly articulated long-term vision. Romania UNDP-sponsorcd National Strategy for Sustainable Development 2000-2020 consistent with EU accession. Poverty issues addressed by some aspects; gender partly covered. Results not yet spelt out. Uganda Current work on "Economic Vision 2025", to build on Poverty Eradication Action Plan (PEAP), which fucuses on reducing poverty. Gender-integral. PEAP goals not yet translated into result measures. Vietnam Twen£y-year vision and ten-year strategy being prepared. Pover£y reduction, equity and vulnerability as central themes, as wiII be shift to market based economy. Gender is recognized as major issue. Results not yet covered in detail. West Bank No clearly articulated long-term vision. &Gaza 17 Comprehensive Del,elopment Framework The programming of work should be tailored to specific recognizing that some will advance more rapidly than country circumstances, with a view to realizing all others. Some countries, particularly where long-term potential synergies. Achieving an effective vision requires prospects are hard to predict, have established medium­ a series of prior actions relating to consultation and term strategies and related expenditure frameworks inclusion. Although logic places the development of the without having a vision in place. vision at the beginning of the CDF process, pilot experi­ ence has shown that in practice it may not be the first Where the expenditure framework covers several years, action taken, and that it can be valuable to pursue the links between that framework and the strategy need to different elements of the CDF simultaneously while be carefully established when they are put in place, and Box 2: Medium-term Strategies and Expenditure Frameworks Any long-term vision needs to be supported by a medium-term strategy and other implementation p/ans; such strategies may also exist even where no vision is in p/ace. Bolivia National Action Plan (NAP) 1997-2002, with detailed results indicators linked to Government spending plans and international goals. Not yet linked to new vision. Being updated as part of PRSP process. cate d'Ivoire Two strategies, both linked to VISion 2025. Growth-oriented "Elephant ofAfrica" and separate poverty reduction strategy, endorsed by 1998 Consultative Group, with focus on results. To be reviewed as part of PRSP process. Dominican Not adequate at present. A key challenge for newly-elected government. Republic Eritrea Current priorities distorted by conflict with Ethiopia. However, five-year plan deriving from National Economic Policy Framework and Program is in preparation. Ethiopia Current priorities distorted by conflia with Eriuea, but some work in hand, building on sector strategies. Ghana VISion 2020 includes five-year "steps". First covered 1996-2000. Separate medium- term expenditure framework. linked to planning framework. and well presented. Second step being prepared for 2001­ 2005. Kyrgyz Republic A national Poverty Reduction Strategy is developing a three year expenditure plan for 2001 to 2003. Morocco Five-year development plan before Parliament. Because of political ttarlSition. not clear how this will ttarlSlate in to activi ties. Romania New Medium Term Development Strategy for 2001-2004 (not poverty focused) and accompanying Action Plan (modest treatment ofpoverty. mainly monitoring) part of EU accession. Uganda Medium-term Expenditure Framework provides robust, concrete, strategic basis for taking forward Poverty Eradication Action Plan. Needs linking ro Economic Vision 2025. Vietnam Five-year plan under development. due for approval early 200 1, which will be relared to proposed longer­ term strategies. West Bank Elements exist. with little poverty focus. but work is in hand to build on them. &Gaza 18 Report on Countl)' E"perience their continuing consistency must be monitored during structural, social, and physical ones, and between long­ implementation. Such strategies and expenditure frame­ and short-term goals. works need to be updated periodically to reflect changing circumstances and the passage of time, as several pilot Pilot experience has shown the synergies that can be countries are currently doing. Obviously this is especially achieved among different elements of government-and necessary where external or internal events, such as war or the incoherence that can arise from uncoordinated actions natural disasters, significantly change the problems a (Box 3). Managing the synergies can be especially country faces. challenging in the context of decentralization, where sector programs will need to be cross-linked with horiwn­ Holistic approach essential tal initiatives at the regional or local level. The lessons emerging from experience of City Development Strategies The CDF is predicated on a holistic approach, which and Community-Driven Development can help clarify avoids compart-mentalization and acknowledges the the likely key synergies and incoherences, and so playa synergies between the macroeconomic perspective and the role in shaping these choices. Box 3: Holistic and Balanced Approaches A holistic. balaTlCtd approach wiD msurt: adeqfUlU attmtion to both th~ macro~conomic mmtials and structural and soci41 issues. strik~ a balanc~ b~tw~m Iong-t""' and short-term priorities. and txamin~ key intn'-linkag~s. Bolivia Approach is holistic and balanced, and seeks to capture dynamic linkages between sectors. Implementa tion designed to support cross-sectoral working. cate d'Ivoire Vision emphasizes economic growth and docs not consider adequately how social and structural issues interact with growth. but PRSP process should help. Implementation remains highly compartmentalized. Dominican Balance of priorities in vision, but no discussion of the linkages among them. Republic Eritrea Strategic approach aims to be holistic and implementation seeks to reflect that. However, more work is needed on structural issues and inter-linkages. Ethiopia Strategic approach holistic, but structural coverage is incomplete. and how this approach translates into implementation is unclear. Ghana Strategic approach is holistic and implementation seeks to reRect that Kyrgyz Republic Current planning framework still under development. Some clements of holistic approach emerging. Morocco New medium-term strategy includes both sectoral and cross-sectoral components. Not yet under implementation Romania Plans focus on EU accession-without identifying hard challenges ahead. Implementation is compart mentalizcd. However, Government recognizes need to use COP process to become more holistic. Uganda Strategic approach aims to be holistic, but docs not yet provide full coverage. Vietnam Thinking becoming quite holistic, as reflected in strategy documents. Macro, financial and Structural issues assessed in light of their social consequences. WcstBank Articulation of holistic view being supported through COP. &Gaza 19 Comprehensive Development Framework Enhancing Country Ownership: the Country ment leadership, and with broad-based participation by in the Driver's Seat all parts of society. Where appropriate, the Bank should use its leadership role for the time being to nurture Countries themselves need to own and manage the country ownership, for example by supporting Consulta­ development agenda if it is to be successfully imple­ tive Groups (CGs) held in-country, transferring their mented and progress sustained, as the literature on aid leadership to the government, and by facilitating broad­ effectiveness has increasingly underscored. II Certain based domestic participation. features of the aid relationship, such as donor-driven reforms, dependent on externally-imposed conditionality Government's role for their implementation, have undermined country ownership, instead of enhancing it.12 Achieving such The government needs both to exercise leadership and to ownership requires a strong leadership role by govern­ have the capacity to analyze development opportunities ment, and active involvement of other parts of society, a and problems and plan and implement solutions. complex and time-consuming process. The requirements ofownership are best captured through Experience in the pilots emphasizes that the move four criteria set out by the Bank's Operations Evaluation towards stronger country ownership needs to be ap­ Department: proached through realistic concrete steps, under govern­ Box 4: Homegrown Strategies Homegrown strategies art tkveloped and owned by the country, drawing on externaJ advice whtrt appropriate. Bolivia Government clearly leads strategy development, with change agents to take it forward. Challenge is to broaden beyond change agents. cate d'Ivoire Previous government initiated work with partners and had some change agents in place. While some of that structure still available, future government role depends on outcome of current transition. Dominican Current vision results from broad national engagement, by all major political figures, including incoming Republic government. Priority now to put in place change agents to carry it through. Eritrea Strategy developed, and strongly endorsed, by the Eritrean Government, including key change agents. Ethiopia Government has clearly led strategy development, and is committed to its implementation. Ghana Government led strategy development, and is publicly committed to the key goals. Key senior officials are active change agents. Kyrgyz Republic The authorities have worked hard to push CDF, but parmer technical inputs remain key. Morocco Government prepared the plan that is now before Parliament. Bank assisting with follow-on sector analysis. Romania Government intermittently active proponent ofCDF. Key change agents face competing pressures from other key aims, only partially reconciled. Uganda Government leadership has been strong, with donor support. Government has a long tradition of strong leadership and independent mindedness. West Bank CDF process initially led by partners, but Palestinian Authority now developing planning capacity to &Gaza lead. Key change agents face many competing pressures. 20 Report on Country Experience • the locus of initiative must be in the government; commitment to new ideas of these same few that can • key policy makers must be intellectually convinced; make the difference in ensuring their sustainability. • there must be evidence of public support from the top political leadership; and, Several CDF pilot countries have recently had elections or • there must be broad-based stakeholder participation I3 . are now preparing for them. Their experiences should provide insights into the sustainability of the CDF Pilot experience as regards these ownership criteria is approach where there is a change of government. As shown in Box 4. As to the locus ofinitiative, a growing regards the commitment ofthe top political leadership, number of governments are taking the lead in initiating support is often found at the highest levels of govern­ policy changes and in program implementation. How­ ment-the head of government or the ministry of ever, a key test is the ability of the countty to say "no" finance-but the necessary commitment at the level of where the locus of initiative is not from within. For sectoral ministries can take longer to nurture. heavily aid-dependent countries, this can be difficult to do. As to the intellectual conviction ofkey policy makers, As far as broad-basedparticipation, for a government to most of the pilot countries have only a few key players, playa strong role, it must consult with multiple stake­ who are often forced to act in response to short-term holders, and identify and often implement appropriate crises in the domestic political economy. But it is the strategic responses. Government needs to have due regard Box 5: Government Capacity Atkqua~ govm'lmmt capacity to own and 11IIlnllg~ thrir t.iewlopmmt agmda. Bolivia Capacity is concentrated in well-placed change agents in the executive branch; Instirutional Reform Project recognizes capacity as a strategic priority, but it will take time. <:ate d' IvoUe Capacity for implementation of medium-term programs fair, but weaker for long-term strategy. Partners supporting strategic capacity developmem. Dominican Capacity weak, but political commitment has been strong, and Government plans public sector reform to Republic strengthen capacity. Erinea Strategy capacity exists but sparse; implementation capacity weak. Capacity development a strategic priority. Ethiopia Strategic capacity strong; implementation capacity varies by ministry. Strategy for capacity development being put in place. Ghana Government capacity relatively strong for region. Further capacity development a strategic priority. Kyrgyz Republic Very limited-and overextended-capacity. Now recognized as key constraint. Morocco Strategic capacity fair, but needs further strengthening Romania Strategic and implementation capacity both weak. Uganda Government capacity relatively strong for region, but inadequate to the tasks at hand. Further capacity development a strategic priority. Vietnam Capacity for central planning strong, but weak in developing more integrative CDF-style strategy. West Bank Capacity weak. &Gaza 21 Comprehensive Development Framework to the concerns of all the parts of society that are engaged Experience from the pilots shows that the lack of ad­ in supporting the overall process. In particular. it requires equate government capacity is a major constraint a relatively well-developed administrative framework to more rapid progress on all fronts. Capacity building through which to own and manage the development should therefore be an integral part of the agenda. not an agenda. Effective capacity also entails systematic institu­ add on (Box 5. page 21). tional arrangements within government for managing the work of implementing. overseeing. and reviewing the Beyond the government progress of strategies. and sufficient influence to ensure these activities are given the priority they need. In many countries piloting the CDF. civil society and the private sector are emerging as important forces for Box 6: Consultation and Inclusion of Stakeholders An 4foctive consultative process wiD folly engage with a broad range oforganizationsfrom both civil society and the private sector, and wiD be institutionalized. i.e. made a regular and continuingftature ofgovernmmt administration. Bolivia Broad involvement across stakeholders. although some felt ill-prepared. Process being renewed in course of preparing the second dialogue as a basis for the Poverty Reduction Strategy. cate d'Ivoire Highly centralized tradition ofgovernment. so patterns of dialogue new, but current Government making efforts at broad consultation. Dominican Extensive consultation over several months. to aniculate national vision and associated strategy. Inclusion Republic ofdiverse national stakeholders now a continuous process. Eritrea Wide domestic consultation is pan of informal tradition. Consistently inclusive process. but not yet formally institutionalized. Ethiopia Extensive grassroots consultations were held. but with limited involvement ofNGOs and private sector. Unclear whether national consultations will be repeated. Ghana Vision was discussed at forum of national stakeholders. after it was written. Current consultations for Second Step more extensive. and continuing. But they may lack credibility without adequate follow­ through. Kyrgyz Republic Multiple consultations on currently emerging vision, and robust dialogue has begun. However, effOns to include all national stakeholders have been uneven. Elements for instirutionalization emerging, but some risk it could be a one-off experience. Morocco Involvement of national stakeholders. through sector working parties. A specific consultation on a broad issue is unusual. but consultations on narrower topics are common. and public think tanks are being established to support these processes. Romania National consultations held to initiate CDF effort. but dialogue needs to be sustained. Consultations not yet formally institutionalized. Uganda Broad engagement with civil society and private sector, and in a continuing manner. Scope for further development and institutionalization. Vietnam Government has supported broad and unprecedented consultation efron. Consensus-based decision processes are integral to the national system. but the inclusion ofsmall private sector and civil society organizations has been new. West Bank Consultations fairly narrow and sector-oriented, although broader consultations are planned. It remains &Gaza to be seen whether Palestinian Authority-civil society consultations become routine. 22 Report on Country Experience change. And evidence is growing that participation improves the quality and sustainability of development Box 7: Vietnam: Private Sector Forum efforts. 14 The Uganda poverty assessment, for example, The Private Sector Forum is a direct result of the inclusive consulted with poor communities on their most urgent approach being taken by Vietnam in the context of the needs. As a result previously unconsidered dimensions, CDF and is seen as a catalyst for promoting comprehensive such as risk, vulnerability, physical and social isolation, devdopment. The Forum has focused on devdoping a powerlessness and insecurity, are included in the analysis shared vision and established working groups on legal. and reflected in policy decisions. banking, and manufacturing and distribution. It has enabled a regular dialogue with government and good But the structured involvement of domestic stakeholders, progress is being made in a number of areas including on beyond government, in decision making remains spotty, regulatory issues. In a major breakthrough, the Working and the pilot experience shows that seeking to elicit and Group on the Banking sector built the platform for the incorporate the views of multiple stakeholders can present first-ever discussions between Government and the private formidable challenges (Box 6). Even in those countries banking sector. The Private Sector Forum has also been which have made most progress in implementing CDF, instrumental in purring forward regulatory proposals for institutional structures for engaging civil society and the the consideration ofGovernment. private sector are still rudimentary. Moving forward, developing such structures wrIl be a key part of the agenda, as will the need for greater consistency and encouraging evidence of progress in a number of CDF transparency in their use. piEot countries including Vietnam (see Box 7), Romania, Ghana, the Dominican Republic, and Uganda. Some governments, however, take the view that domestic stakeholders should seek to engage in the policy debate Similarly, the run-up to recent in-country CG meetings only through existing democratic institutions, especially in Cote d'Ivoire, Ghana, Uganda and Vietnam have all their parliamentary representatives. As was noted in the included consultations with the private sector. In some CDP Mid-term Progress Report, there are concerns about cases, the consultations have been quite extensive. the risk of undermining fragile democratic institutions. However, giving a seat to the private sector at the main And while governments are accountable to the people, CG meeting is still resisted in part because the CG they sometimes question who civil society is accountable mechanism is seen as a forum for engaging the govern­ to. Even where governments have made efforts to engage ment in a debate on the country's policies. But an civil society in policy discussions, this has often been a important threshold is being crossed and the perspective perfunctory exercise, undertaken largely in response to of the private sector should enrich the debate, especially pressure from donors. in countries where private sector involvement in the policy debate has been minimal in the past. A key challenge is to define the rules of engagement. 15 Where the views of civil society are reflected in the In the case of Romania, the Romanian-American Business outcome of consultations, this tends to build trust, as was Network was launched in January 2000 to tap into the the case recently in Zambia. 16 skills, experience and resources of emigre Romanians in facilitating private sector development in the country. The Private Sector The private sector in Romania has also participated actively in recent government-led consultations on a Consistent with the inclusiveness advocated in the CDF national strategy. Several other countries, building on approach, and the increasing role of the private sector in earlier initiatives, are moving towards greater private development, a number of CDF pilot countries have sector involvement in policy discussions though progress, taken steps to encourage a more active role by the private in many cases, remains relatively modest. Overall, the sector in policy discussions. But in the absence of ad­ emerging experience with private sector involvement in equate structures for regular consultations with Govern­ the CDF context shows that the Bank Group has an ment in many countries, ad hoc approaches may not fully important role to play in bringing international experi­ address the concerns of either side about how the public­ ence to bear on alternative modes for more effective private sector relationship should work. Still, there is private sector engagement. 23 Comprehensive Development Framework Box 8: Effective Partner Coordination Effictive partner coordination requires suitable in-country arrangements to ensure good exchange ofinformation and building ofrapport, together with clear government leadership and direction. Bolivia Government leads and chaired last CG, but coordination capacity limited. They hold bi-monthly meetings with parmers. Subgroups, chaired by Government and parmer co-leaders, meet regularly. cate d'Ivoire Panner coordination led by World Bank/UNDP/France. Government chairs working group with parmers twice yearly. Other meetings irregular. Coordination in education sector good, but spasmodic elsewhere. Dominican Quarterly parmer meetings, chaired by Government. But coordination is otherwise fragmented and Republic Government coordination capacity needs to be strengthened. Eritrea Government leads and actively manages all parmers, including choosing whom to engage with. No regular coordination meetings in past; Government hosted meetings when it judged them desirable. Now committed to more regular cycle. Ethiopia World Bank coordinates parmers locally. No regular high-level meetings with Government, outside CG. Four active sectoral parmer-government groups. Ghana CG now held in-country and now chaired by Government. They have also established quarterly meetings of a mini-CG, and regular sectoral groups. Partners have divided up lead support roles for each of these groups. Kyrgyz Republic Bank chairs CG, and UNDP chairs information meetings among locally-based partners. Government holds bilateral meetings, but its capacity is very limited Morocco Government holds ad hoc, informal bilateral meetings. No other coordination mechanism. Romania Last CG held in Brussels in 1997 - World Bank/EU chair. Regular meetings among parmers for some sectors, some ofwhich the Government chairs, but capacity limited. Uganda CG held in-country, organized by Government, but World Bank chairs. There are monthly meetings between Government and partners, with Bank chairing. Vietnam In principle Government leads. CG meets in-country twice a year, with Bank chairing. UNDP hosts monthly partner lunch. sometimes with Government. 20 Government-donor parmership groups now seeking to place donor programs within policy and institutional frameworks and will lay out strategies to next CG meeting. West Bank In principle Government leads. but Bank chairs CG. Norway chairs Ad-Hoc Liaison Committee. and &Gaza both held outside region. Regular monthly meetings of Government and partners, plus sector working groups, some ofwhich Government leads. Stronger Partnership Among Stakeholders the same goal of better strategic alignment, the agencies are also taking a more participatory approach to designing Relations between development assistance agencies and their assistance strategies, and having more purposeful their partner countries are becoming more structured. consultations with governments. In addition. while much Experience has shown that almost all assistance agencies progress has been made in modifying the CG process, are now starting to put greater emphasis on aligning their only three governments have chaired the CG, or equiva­ strategies with those of partner governments and of other lent donors' meetings to date (Box 8). In some pilots. the donors, and on forging closer partnerships with one government would still rather go hand-in-hand to a CG another in their partner countries to achieve this. Many with the Bank. In some other cases, the Bank finds it is agencies are finding that greater decentralization of premature to let go. authority to the field facilitates such partnerships. With 24 Report on Country Experien e But the experience from the pilots shows that there are Selectivity many challenges still ahead. At the highest level, develop­ ment partners are now committed to partnership, and Selectivity of intervention-working together, looking to their in-country representatives are generally prepared to use the comparative advantage of each partner, and work closely to this end with the Bank and others. translating that into the choice of what programs to However, there is sometimes a disconnect berween the support-is one of the central tenets of CDF. Some policy principle and working practice, so that in-country progress is beginning to show in selectivity of intervention staff do not always receive strong signals of support for among donors (Box 9). But the frequency of sectors with partnership from their headquarters. Addressing this issue seven or more active development partners vividly shows calls for action at the institutional level. how far there is to go. Annex 3 shows the numbers of donors-not taking into account the various UN agencies Box 9: Alignment with the Country Strategy-and Selectivity of- Partners' Assistance Bolivia Increasing partner alignment focused on National Action Plan 1997-2002 and matrix. Some selectivity among partners in evidence, but room for further development. cate d'Ivoire Real partner alignment yet to emerge. Some selectivity emerged naturally among limited partner group that was active from early 1980s through the mid-1990s. Dominican Fragmentation of agencies dealing with partners and lack of clear coordination are obstacles to alignment. Republic However, CDF provides opportunity for dialogue. Selectivity beginning to emerge in some sectors as a result. Eritrea doser alignment, based on Government leadership and partner support for overall strategy, emerging following development partners' meeting. Some sectoral selectivity among partners driven by Govern ment. Ethiopia Relatively good alignment, being strengthened through sector programs, although bilaterals' strategies are more variable than multilaterals. Little strategic selectivity, but parmers are few. Ghana Fairly close and growing alignment, given partner suppon for overall strategy, and effective local coordi nation. Best in sectors with strong local leadership. Selectivity and reduced duplication emerging from sector programs, within context of CD F. Kyrgyz Republic Partners broadly agree with National Plan currently before Parliament. Natural selectivity-based on respective priorities-has emerged among partners. Morocco Government holds ad hoc, informal bilateral meetings. No other coordination mechanism. Romania Degree ofalignment unclear. Some, natural selectivity among partners beginning to emerge, particularly in context of EU accession priorities. Uganda Alignment with partner-supported PEAP improving, but some way to go. Selectivity explicitly addressed in context of CG with some success, but now need to develop it. Vietnam Bank CAS and UNDAF built around Government's plans. Many bilaterals increasingly aligning assistance at sector level. Partners committed to improve selectivity. Pilot schemes underway in several sectors, but more work needed. West Bank. Degree of alignment unclear, since no clearly articulated national strategy. Selectivity among panners, by &Gaza sector, is beginning to emerge. 25 Comprehensive Development Framework and civil society organizations-that were active in 1996­ serious consideration. For their part, certain client 98 in different sectors in the CDF pilot countries. countries are used to working with certain partners on Though no one disputes the potential value of selectivity, certain issues and may want to continue to do so, even if individual donor countries' concerns about visibility, and other donors can provide more effective support. about their freedom to frame their development coopera­ tion policies in the context of their overall foreign and Establishing the comparative advantage of individual trade policies, often pre-empt better partnership with partners, including the World Bank, can be difficult other donors and government leadership of the agenda in technically as well as politically,17 and this issue has yet to their client countries. In one country piloting the CDF, a be addressed on a broad front. Innovative approaches are sector-wide approach is frustrated by donors' insistence needed. As an example, in recent discussions between the on supporting only particular activities. Some donors Government ofTanzania and donors, it was suggested earmark funds, as mandated by the legislative bodies in that an independent group should be established to judge their capitals. And the public relations aspect of, say, donor performance. Such approaches might become a moving out of girls' education into building power plants, part of determining the comparative advantage of even where that is apparently the correct choice, can be a different partners. Box 10: Harmonization among Development Partners Harmonization ofprocedurtS and practices is likely to make the dnlelopmmt process mort 1foaive. Bolivia Some joint appraisal, negotiation, monitoring and evaluation. Government would like to extend this to other practices and procedures. COte d'Ivoire Some harmonization of appraisal, monitoring and evaluation. None on procurement yet, although work underway with AIDB on a regional approach to procurement. Dominican No harmonization. Republic Eritrea Some ad hoc coordination. Ethiopia Some harmonization ofappraisal, monitoring, and evaluation policies being devdoped through sector programs, but none on procurement or financial management. Ghana Now an active topic. Progress varies by secror, but includes analysis, appraisal, procurement and monitor­ ing, particularly where sector programs in place. Kyrgyz Republic Coordination on analytical work considerably improved, with case by case collaboration on acrivities but to date procedures and pracrices not harmonized. Morocco Virtually no harmonization, although some cooperation on procurement legislation has been evolving. Romania Some limited harmonization of appraisal, monitoring and evaluation approaches. Uganda Sector programs facilitating some harmonization of appraisal, monitoring, and evaluation. Use of basket funding may enable progress on procurement. Vietnam No harmonization in past, but issue given prominence at CG meetings. Three largest donors (World Bank, AsDB, and Japanese Government) have just completed joint porrfolio review , and working actively with government on harmonization. West Bank VirtUally no harmonization. &Gaza 26 Report on Country Experience Donor comparative advantage becomes less important to followed. Recent developments in the DAC indicate the extent that donors can be convinced to move from that, in the short run, the international community will micro to macro delivery methods, from projects to budget have to find ways to harmonize under the constraints of support (via sector programs); selectivity is then internal­ tied aid to most countriesY The Bank should work ized in the client country's own processes of choice. closely with the DAC and with other multilaterals to move this agenda forward in the coming months, possibly Harmonization under DAC leadership. Harmonizing donor policies, practices, and procedures is Focus on Accountability for Development another important area where the gap between intentions Results and the reality is stiU wide (Box 10). Several events and institutions over the last year have called for harmoniza­ At this stage of the pilots it is too soon to expect a tion. 18 At the Stockholm workshop in August 1999 19 , detectable change in development results that could be Tanzanian President Mkapa eloquently described the linked to CDF-related activities-even if there were burden created by the lack of partner harmonization, adequate baselines and systems for monitoring progress, explaining that the multitude of missions, guidelines, and which is rarely the case.2J This report thus concentrates on reports Tanzania has to deal with makes it almost impos­ assessing the state of the mechanisms that are needed to sible for it to claim ownership of its own development provide transparent public information on development process. progress and results. Such information enables: Harmonization has to address policies and rules (procure­ Government, as overall manager, to: ment, evaluation, environmental assessments, anti­ • understand how the implementation of the CDF corruption policies, etc.) and also practices on the principles is unfolding; ground, such as joint program preparation and appraisal, • identify the priority needs for action and adjustments; use of common reports, and joint or synchronized and missions. Harmonization at the institutional level, with • explain its own policies and actions. donors harmonizing with one another, and harmoniza­ • All those participating in the process of implementation, tion at the country level, with donors harmonizing with but especially civil society and the private sector, to local procedures, both need to be pursued, and it will understand how they can contribute, and how their require considerable attention to prevent the two from contributions are being used and drawn on. moving in different directions. 20 • Those outside the process to have a picture of it, over time, as objective evidence on impact accumulates. The multilateral development banks are now discussing more intensively the scope for harmonization in areas Defining and collecting information such as procurement (where some concrete progress has already been made in developing master bidding docu­ A key initial step is to identify the types o/information ments for goods), as well as environment assessments, needed to manage the country's strategies and report on social safeguards, financial management and evaluation progress in implementing them. Best practice suggests where tangible progress is yet to occur and much sus­ these information needs should be defined during strategy tained effort is required. Bilateral donors, e.g., through development, in terms of results and indicators. Typically, OECD/DAC, have increasingly expressed willingness to the development results sought will be linked to the engage in serious attempts at harmonization. 21 Ongoing internationally agreed development goals. Indicators, in discussions on linking multilateral and bilateral efforts the form of objective and verifiable measures, are needed aim to scale up these efforts. to assess how far those results are being achieved, and hence judge the progress made towards the goals set out An important issue in the harmonization discussion is the in the vision and national strategy. untying of aid or use of common funding pools-an arrangement where several donors contribute to a single Government must ensure that the information needs fund, through which one set of project procedures are defined are consistent with the capacity in place-inside or 27 Comprehensive DeIJe/opme11t Framework Box 11: Government Mechanisms to Track Development Results Tracking dev~lopmmt results r~quir~s ckar m~asum or indicators ofsucctsS, and m~chanisms to track changts in thts~ indicators Bolivia Government and panners have agreed on intermediate indicators, and on funher bench marks and targets, incorporated with objectives for Bolivia's budget cycle. These are presented at annual CG. cate d'Ivoire Yet to be discussed. beyond existing strategy framework. Dominican Principles of tracking agreed, means of implementation yet to be determined. Republic Eritrea CDF matrix will be used for tracking. Ethiopia Yet to be addressed. Ghana Sector groups have identified relevant indicators. available for both CG and CDF purposes, and being funher developed in context of Poverty Reduction Strategy. Kyrgyz Republic Too early in the process. Some results being identified in context of matrix. Morocco Too early in the process. Romania Process at early stage. but some elements being identified through matrix, and suppon from UNDP. Uganda Not a priority at present, but will emerge with time. Vietnam No harmonization in past. but issue given prominence at CG meetings. Three largest donors {World Bank. AsDB, and Japanese Government} have just completed joint portfolio review. and working actively with government on harmonization. West Bank Too early in the process. &Gaza outside government-to record information on a regular system in place takes time-in this case, it took a year for basis. Experience shows that it is better to choose a few all donors and government agencies to agree on the good, intermediate indicators that can be assessed on a indicators to be used. Even then these indicators are regular and continuing basis, than to have a larger subject to revisions. But for many countries an initial number of precise measures that can only be assessed on eIement in CDF implementation will need to be the an irregular basis. development or strengthening of arrangements for monitoring progress. The sooner such arrangements are Much work is still to be done on monitoring and evalua­ in place, the sooner a baseline of information can be tion mechanisms; few CDF pilot countries have reason­ established against which countries' subsequent progress ably complete systems (Box 11). Some have good record can be assessed. keeping systems, at least in some sectors, and several are beginning to relate those records back to their manage­ All actors, and particularly external development partners, ment systems. This is most obvious in the case of Bolivia. will need to be transparent about their contributions to whose results-based budget links the initial objectives and the results sought. Most development partners are in resource allocations with actual outlays and results principle committed to this approach, in line with the achieved, in an iterative cycle. However, putting such a PARIS 21 Initiative on Partnerships in Statistics for 28 Report on Country Experience Development in the 21 Century. As with several other SI Disseminatio" aspects of the CDF, the key is to translate the commit­ ment into reality. The current state of such information is The reason for collecting information on progress is to far from perfect (Box 12). support a transparent focus on results. Dissemination of accurate and timely information will be crucial, both to Box 12: Development Information on Partner Contributions to Results Governmmt and their pamurs need to understand what thrir collective contributions are, and how these help achieve the mults in the overall vision. The CDF matrix is one tool to help achieve this. Bolivia No formal information system in place. although partner coordination intended to help fill gap. Efforts underway to develop baseline information for health sector. The Government has its own CDF-style matrix, including indicators. in place. COte d'Ivoire System in use needs improvement, an effort the Bank is supporting. CDF matrix. developed in 1999. is seen as a long-term commitment and contract between Government and its partners-with progress to be assessed in three years. Dominican Inadequate information on partner activity. Early indications that new Government intends Republic to make use of indicative matrix prepared by Bank (in context of CAS). Eritrea No system in place. but Government exerts strong control on who does what. Government and partners have agreed to use CDF matrix for feedback. Ethiopia No systematic means for sharing information on partner activities and results. Education sector system was constructed. but is not in use. Ghana Available system inadequate. but construction of lending database under discussion within context of CD E Matrix may emerge from process. but sector annexes are primary source of information for all partners. Kyrgyz Republic As part of CDF process. partners working with Government to develop a system. Partial draft CDF matrix available on national website. Morocco Government System in place. CDF sectoral working groups may lead to matrix. Romania Debt management system being insralled should assist Government. Joint indicators will be developed for joint evaluations-using the matrix as a broad framework Uganda Government does not have a system, although UNDP constructed a tracking system. Matrix has proven of limited use. Government intends to use Medium-term Economic Framework and Public Expenditure Review to assign accountabilities. Vietnam The government has systems at sector level (e.g. Agriculture and Rural Development). UNDP is transferring its Developmem Cooperation Database to government. A joint donor-government web site is to be prepared over the coming months. West Bank Computerized database of partner activity exists. but may not be optimally used. Matrix is in &Gaza use by the Palestinian Authority, but it is unclear to what extent partners will make the necessary commitment. 29 Comprehensive Development Framework ensure government has what it needs to manage the CDF all involved, and enable more informed decision making. approach properly, and to enable other parts of society to As policies and activities change, so should the informa­ play their roles. tion in the matrix. Repeated iteration of this kind was intended to be fundamental. It was also recognized that in Overall effective dissemination will require a strategic many cases, information would be only partially com­ approach. Pilot experience has clearly shown the impor­ plete, but that even partial information could help move tance of tailoring the dissemination of information to the the process forward. But, in some cases, partners have different interests, approaches, languages, backgrounds, been hesitant about quantitative information, which and educational attainment of the various participants. would allow comparisons of support, being included in Experience has also emphasized how challenging that task CDF-type matrices. is, particularly given capacity constraints. In Ghana, for example, their vision was first established and publicized A key reason for using the matrix is to make information in 1995. Despite subsequent publicity including frequent publicly available as widely as possible and in an easily reference to the vision in government statements, aware­ accessible form, so that development stakeholders can ness of the vision, and more particularly of its content, draw information from it and contribute information to remains very uneven, particularly outside the middle-class it. Some of the pilot countries have developed national in Accra. While the government recognizes the need to CDF websites displaying the matrix to help achieve this improve awareness country-wide, this is placing a major end. So far there are six live sites: in Bolivia, Cote burden on the planning Ministry and on the often weak d'Ivoire, Ghana, Kyrgyz Republic, Romania, and Viet­ regional administrations, which has to compete with nam 24 • more immediately pressing priorities. Similarly, in Bolivia, the Government's own CDF-inspired "Marco de Overall Assessment Relacionamiento" is hardly known beyond the level of senior officials. The CDF approach represents a major shift in collective thinking in the international development community CDFmatrix about the nature of development, the relationship between government and domestic stakeholders, and The CDF proposal put forward the use of a matrix that collaboration among external partners to support govern­ would show the activities of all partners across all sectors ment leadership in reducing poverty. and be kept up to date. The goal of the matrix is to give all players a framework of information that can ensure As emphasized above, it is too early to reach definitive openness and a basis for coordination of effort and for conclusions from the pilots about the results of the CDF. judgment of the effectiveness of programs and strategies. Equally, it is not possible to quantifY value added at this point in the sense of measuring changes that are specifi­ The pilots have yielded less experience than was hoped cally attributable to the CDF. The CDF is not an add-on, about how the CDF matrix can be used. Some countries but rather an organizing framework that allows for an have felt that developing a matrix should be an output of integrated approach to poverty reduction efforts. Overall, the CDF process. Others have relied on other ways to progress has been uneven because of: different starting achieve greater sharing of information, ways with which dates and conditions for the pilots; unforseen events such they were ailready familiar. These are judgments for as civil conflict, changes in government; differences in the individual governments to make. However, those availability and use of domestic capacity. Consensus countries that have established matrices, whether at building takes time both between Government and other national or sector level, have generally felt the benefit stakeholders and, in some instances, within Government. from doing so, and plan to build on the experience. The key to improved development results, as noted above The CDF matrix has sometimes been seen as a static in this report, lies in the processes now being put in place. product reflecting an idealized position. This was not the Accordingly, any early assessment of progress must be intent-the matrix is meant to be an evolving manage­ concerned with these processes, which have been the ment tool that can help channel information from and to major focus of the pilots. Given the very different points 30 Report on Gauntly Experience of departure, history, and institutions in the pilots, inter­ • Overall, the greatest area of progress is in working country comparisons are not appropriate, but there is towards a long-term vision and strategy, where nine of the evidence of progress which points to worthwhile prac­ twelve pilots are more than halfway there. Least progress tices. The country assessments show the following: has been made in putting in place open and transparent development management information systems; only two • More than half of the COP pilot countries are taking of the twelve countries are considered to be at or beyond action or have largely developed a majority of the COP the halfway point. elements. Two of them have largely developed a majority of those elements. All COP pilots are making some Implications for Wider progress. • Bolivia and Ghana have made the largest overall Application progress in implementing the COP. This seems to be the case across all key objectives of the COP. The COP has implications for how the Bank works and • Progress remains modest in Ethiopia, Morocco, and for the larger development community. Ultimately, all West Bank and Gaza, with little change from the situa­ actors in the development community must consider the tion in March 1999. There are obvious reasons for this, as implications from their own perspective, with the goal of discussed earlier. Absolute progress in Kyrgyz Republic facilitating more effective collaboration in support of has also been modest, but recognizing the low base from country leadership. This chapter considers the implica­ which they started, there is progress to record. tions of the COP, in particular, for the Bank under three • Bolivia, the Dominican Republic, Eritrea, and Ghana broad headings: stand out in giving meaning to the concept of country ownership. Their development strategies are largely • Links with PRSP and Bank instruments and processes; homegrown, and have been the subject of broad-based • Applying the COP approach at the city level; consultations with stakeholders. These countries could be • Changing the way the Bank works. said to be in the driver's seat. Vietnam has a long tradi­ tion of Government ownership, but they are still trying out step by step their level of comfort in relating to civil Links with PRSP and with Bank Instruments society and the private sector. and Processes • Bolivia, Ghana, and to a lesser extent Eritrea, Uganda, and Vietnam have made meaningful progress in putting Experience shows that within the Bank, broader COP mechanisms in place to enhance partnership. Bolivia and implementation calls for more systematic alignment of Ghana have appropriate aid coordination systems, Bank instruments and processes, including contributions resulting in close alignment of assistance strategies to to the PRSP process, country assistance strategies, and these countries' own strategies. The other three appear to economic and sector work. 25 • UNOAF, PRGP, and the be making good progress towards this objective. Bank's CAS are some of the key business plans or pro­ • Bolivia, and to a lesser extent the Dominican Republic grams for supporting the country's strategy. These links and Ghana, have made relative progress in putting in are illustrated in the Chart overleaf. place mechanisms to make development information available and to adequately track development results. This chart representing the scope of the COP has been • Looking at countries' progress in relation to their the product of extensive discussion both internally and starting points-rather than absolute progress-Bolivia, outside the Bank and has benefited from a well informed Ghana and Romania have gone furthest in the last 18 debate about the relationship of various key development months. Romania has made significant progress on all instruments. While it does not encompass all relevant aspects of both the creation of a long-term vision and instruments, it provides a useful abstract about the enhancing country ownership; while Bolivia and Ghana operational implications of the COP. In short, the chart have made considerable progress in both of these areas describes a typical country situation, where the country's and on partnership. The Dominican Republic, the strategy (in middle income countries), and the country's Kyrgyz Republic, Uganda, and Vietnam have all also been poverty reduction strategy (in low income countries), are making significant, relative progress, albeit from very based on the COP principles. The formulation of these different starting points. strategies is supported by analytical work by partners, and 31 W N ~ ~ COmnreh~&AU .-..-n'l'W'tlework ~ ~ ;::s ..... ~. ... I COllbtn'. StrateevlPoftrtv RedudiolaStrate2V I rl Long Tenn HoIl~ VI_ II Coun~ Ownenhlp I Part~IP II Devdop~nt R""'~ ~ ~ ~ ~ .... I T UN~~:Ali7'.... .._ ._""..".....L .._._......._......".,_._."....._._ .."........"......1..........__...".. ...."......... ..._...".............! L".._._._..........."._ .._ ... ;:s I ~- I .. ~~.~ ~ E R = = tI· , : +:i ~ '" ~ ., , <::> A ~ T I Physical/. +- ~ Macroeconomicl ~ Structurall SociaV ...... ~ MTEF V I •• -I r+ III E .... 1 J Institutional ... Human RuraVUrban Financial II, PRSP GOVERNMENT InVCSlments P Private Sector 1/' Business Plan R NOOs I CSOs 1/' I o Business Plan I BiIaunl Partners C I:::: ' I UNDAF 1 E UN Partams 1­ Business Plan S RDBs S World Bank 1­ CAS ! 1 IMP 1­ PROF EU 1-­ Indicative frog . ...... I Mid-tenn JmplcmentatioDlBvalUIIioaIJAamins J .... CAS: World Bank's Country Assistance Strategy MTEF: Medium-Term Expenditure Framework, prepared by government PRGF: International Monetary Fund's Poverty Reduction and Growth Facility ROB: Regional Development Bank(s) . UNDAF: United Nations system's Development Assistance Framework PRSP: Poverty Reduction Strategy Paper, prepared by government ( required for IDA, HIPC. PRGF countries only) Report on Country Experience is guided by international development goals based on Experience in the IDA countries among the CDF pilots UN conferences -of which poverty reduction is the shows that countries implementing the CDF as their primary goal. The chart shows the matrix of activity development framework have been at the forefront of embedded in the country's strategy. It explicitly recog­ those preparing PRSPs. Notably, Bolivia, Ghana, nizes the issue of strategic balance defined in a holistic Uganda, and Vietnam are basing their PRSP processes on manner, and the contributions of various illustrative national visioning exercises, in which representative players, both domestic and external. groups of society are participating and to which they are contributing effectively. They are drawing up implemen­ In a real country situation, this matrix shows where the tation action plans and forming representative sector priorities are concentrated and the areas where there are groups that will be charged with defining sector strategies duplications or gaps. The chart also underscores a major and desired development outcomes. In some of the non­ aspect of the CDF, that is, that business plans emerge pilot low-income countries that have adopted CDF from the country's strategy, and are not developed principles, such as Tanzania and Zambia, work already independently outside the CDF processes. For example, done in the context of the CD F has also facilitated more in this situation, the government prepares a PRSP which rapid progress in adopting the PRSP process. directly translates the country's long-term strategy into a time-bounded action plan. Similarly, the Bank develops Notwithstanding progress, the Bank will need to ensure its country assistance strategy drawing from the country's that it provides active support to countries to fully strategy, ensuring strategic alignment with country owned incorporate the CDF principles in the PRSP process, in priorities, taking into account the comparative advantages the same way that the principles should shape its own of all internal and external actors. Finally, the matrix is financial support. Before the introduction of the PRSP, simply an information management tool which is the Bank and Fund had often not explicitly recognized expected to change over time as the CDF process matures the paramount importance of country ownership in a way and the various country development programs are that is operationally relevant. The challenge for their own aligned. There are several examples already about how programs and policy advice is to reflect this broader, more this process works in practice, such as in Ghana, where balanced approach with more time and policy space the CDF process has helped the Government to formu­ granted to client countries, where warranted. To quote late its strategy and programs with the UN's CCA as an the July 21,2000 Okinawa G-7 Statement, 'The Com­ input. prehensive Development Framework (CDF) and the Poverty Reduction Strategy papers (PRSPs) should Poverty reduction strategy paper (PRSP) become the basis for programmes that have strong ownership by the recipient countries.'27 The PRSP is an operational vehicle which can be a specific output of the CDF or of processes based on CDF Country assistance strategies (CAS) principles26 in low-income countries. Its intent is to integrate countries' strategies for poverty reduction into The CDF processes are changing the nature of the Bank's coherent, growth-oriented macroeconomic frameworks CAS. In countries where there is a homegrown CDF and to translate these strategies into time-bound action process, the CAS becomes the Bank Group's own business plans, to be revised over time. In the PRSP process, it is strategy in support of the country's development strategy. the government, not the Bank and the IME that takes the The country strategy in essence becomes the basis of the lead in preparing the country poverty reduction strategy, CAS, containing the diagnosis of the issues as well as the drawing on broad-based participation of civil society and government's program 28 • The government of Ghana, for other stakeholders to formulate the strategy and monitor example, in March, 2000, presented its strategy and the its implementation. The PRSP then provides the guiding underlying analysis directly to the Bank's Board, drawing framework for aligning external development assistance. upon the country's CDF approach. Bank staff followed It is expected that all active IDA borrowers will prepare with a CAS assessing the Government's strategy and PRSPs during the next two years. presenting the Bank's business plan to support its imple­ mentation. 33 Comprehensive Development Framework As envisaged in the CAS Retrospective,29 the CAS can be In some of the pilot countries it is becoming more used in non-pilot countries to introduce or deepen the common for partners (such as UNDp, EU, IMF and CDF approach, as has been done successfully in countries other assistance agencies together with the government), such as Zambia. to work together to identify knowledge gaps to be filled and to joinrly undertake the necessary work. In Vietnam, Going forward, the Bank will be designing its assistance for example, a poverty analysis document has been strategies proactively defining its comparative advantage. prepared joinrly by a working group with representatives Information sharing, working closely with key partners, from the government, international NGOs, and donor and pooling diagnostic, analytical, evaluation, and agencies, and a public expenditure review has been financial resources, both in the country and in capitals, undertaken jointly with the government by the Bank and will now be essential. donor agencies. Doing upstream ESW jointly with the government and other partners is likely to help broaden As the Bank's support for CDF implementation becomes the ownership of the analysis and the policy options more integrated with the support of other partners, this identified. support will increasingly be closely linked to the country's budget formulation and be reflected in the country's Country policy and institutional assessments medium-term expenditure framework, as has been the (CPIAs) case of Bolivia, Ghana and Uganda, relatively advanced CDF pilots. In designing its assistance strategies, Bank management sets out its own view of country performance, commit­ Economic and sector work (ESW) ment, and progress, to provide a bridge between the country's vision and long-term strategy and the Bank's The CDF also has implications for the Bank's economic own business plan for the country. The CPIA, which and sector work, which identifies the constraints to supports this process, is currently a Bank-centered staff development and poverty reduction, and identifies assessment and rating tool of the country's policy and priorities for action. Experience from CDF pilots shows institutional performance in areas relevant to economic that ESW needs to be approached with the more explicit growth and poverty reduction. The CPIA also informs the three-pronged purpose of: allocation of IDA resources. The SSR (Social and Structural Review) offers a comprehensive review and • enhancing partnership by facilitating dialogue on analysis of social and structural policies and has been analytical standards and policy options; piloted since the 1997 East Asia crisis. Core issues • enabling the pursuit of broad-based consensus on policy covered by pilot SSRs to date are: the public sector and directions; and governance, the private sector business environment, the • becoming an important vehicle for knowledge transfer. financial sector and capital markets, and the social protection system, " ... all within a medium-term macro­ ESW approached in this manner can provide the analyti­ economic, growth, and poverty reduction framework"30 cal tools to support country leadership as envisaged in the CDF and PRSP. This approach also provides a basis for Given the paramount importance of country ownership the Bank's professional-due-diligence-judgement on and partnership in the CDF/PRSP processes, the SSR and the adequacy of country policies and processes for Bank the CPIA will need to be transformed into a transparent programs. In terms of partnerships, al] ESW, from assessment of country performance including the relevant whatever source, should feed into the country's formula­ stakeholders. The Bank's own professional judgement tion of its vision and a shared diagnosis of the constraints should be informed by the process and should be linked to development and poverty reduction. What is needed is to its business plan for supporting a country's strategy. an explicit assessment of the comparative advantage of The transparent development and use of the CPIA and its each partner, plus harmonization of the modalities of wider sharing with partners, including in policy dialogue, working together. was recommended by IDA Deputies at the June 2000 Lisbon meetinWI. 34 Report on Country Experience Lending instruments and Consultants Guidelines apply to adjustment loans only when they have been made specifically applicable as In principle, the CDF facilitates and provides a promising a part of the loan. Experience shows that the increasing environment for much more programmatic support from use of sector-wide approaches (e.g. APLs) in CDF pilot assistance agencies. In cases where there is government countries, support the ability of these countries to administrative and leadership capacity, confidence in the rationalize their work at the sector level. Accordingly, it is quality of governance, and willingness on the part of appropriate to explore the application of safeguard other external partners, the Bank should consider aligning policies in a sector-wide approach. Staff guidance will be its support more closely to the country's own budget needed. process. This would ensure greater predictabifity of future resources flows for the country, and would rein­ Applying the CDF Approach at the City Level force the potential of the sector-wide approach. The City Development Strategy (CDS) is an application The pilot experience in CDF countries suggests the of the CDF at the levef of cities, and is being imple­ usefulness of increased use of programmatic lending mented in several countries that are not formally piloting instruments such as: adaptable program loans (APLs) , the CDF at the national level. The CDS approaches the sector investment and maintenance loans (SIMs), and development of a city from a holistic perspective, giving programmatic structural adjustment loans and credits appropriate weight to economic, financial, institutional, (PSALs/PSACs). These instruments can facilitate a long­ social, human, and physical factors. It sees participation, term development perspective, catalyze coordinated inclusion, ownership, and transparency as vital to ensure donor support of country-owned sector and national the long-term sustainability of city programs. In addition, strategies, and leverage development impact beyond the the CDS calls for a clear focus on development results­ scope of individual projects. It is revealing to see that particularly poverty reduction-and strong partnership CDF pilot countries are making extensive use of these with external partners to ensure coherence of approach programmatic lending instruments (Annex 5).32 Going and integrated support. forward, the mix of instruments will reflect individual country circumstances and continue to be determined by The CDS introduces the principle of comprehensiveness a country-by-country basis through the CAS. at the local level, in large part, because of world wide shifts in the structure and roles of government. More than In addition to attention to lending instruments, the 70 countries are decentralizing, and the locus of spending, specific situation in the CDF pilot countries shows that of public sector reform and action on the development there is great scope for better alignment of ESW and the agenda are shifting to sub-national levels. The COSH is CAS to the requirements of the CDF and PRSP. In most of part of the Bank's response to these world wide changes. these countries, the opportunities to do so exist (see Annex 5). CDS complements the current CDF framework by addressing "vertical" issues in governance, that is the Multi-year administrative budgets and safeguard subnational units of government, and eventually linking policies these back to national policy. A multi-year administrative budget for country depart­ The CDS is being implemented in 27 cities, including ment can provide more flexibility to better align the three cities in formal CDF pilot countries-Vietnam and possible need for relatively higher expenditures up-front, Uganda (see Box 13). The largest concentration of effort with lower expenditures down-stream in the CDF is in Asia, accounting for 21 CDS programs. 34 This implementation support process. This has been the program shows how CDF principles can begin to be experience of some CDF pilot country teams and its introduced at the sub-national level in countries where a wider application will be considered. national approach to the CD F is not yet possible. Regarding safeguard policies, these have been designed largely with projects in mind and existing Procurement 35 Comprehensive Development Framework phased and tailored manner, concentrating on those cases where both the country and the Bank are ready to adopt Box 13: The City Development Strategy this way of working, building on the accumulated in Ho Chi Minh City experience. The CDS in Ho Chi Minh City illustrates how Leadership behavior at al/levels ofstaff external partners can come together to support an integrated, more open, city development Examples of new leadership behavior include greater program. Under CDS, the city has developed a efforts to build trust and mutual respect, empower long-term vision and shorter-term strategies. It individual staff members and teams, give priority to has begun holding consultations with stake­ national experience and capacity, think more holistically, holders, including NGOs and the private work as pan of networks, cede leadership to others, and sector, although it is confronting the complex­ shift the focus of management from inputs to develop­ ity of city size and trying to minimize the risk ment results. of fragmentation of the process. The govern­ ment has expressed strong ownership, as In the pilots, country directors have been the main Vietnam's national government has done in the leverage points for incorporating the CDF principles. case of the CD F. But, it is still very early in the They have acted as role models for their country team process and a more traditional concern with members and champion the CDF approach externally in identification of priority projects and programs their interactions with clients and partners. In addition, has received extensive attention. The Ho Chi all staff members have had the responsibility for acting on Minh City Official Development Assistance this basis in their day-to-day work. But they have also Partnership, which bring all key donors needed consistently strong signals from senior managers, together with the government, is seeking to who themselves are called to model the new way of mobilize coordinated support from donors conducting the Bank's business, including the way they according to their comparative advantage, to address obstacles to change. Senior managers can help in assist in overall strategy formulation and encouraging the breaking of silos across sector units implementation. This partnership is a key which is essential to carry out the holistic approach. element of the implementation of the CDS. Supportive organizational environment-making the matrix approach excel Changing the Way the Bank Works Changes in individual behavior are influenced by the Staff involved in implementation of the CDF in pilot organizational environment, as reflected in the Bank's countries have internalized and incorporated the CDF matrix structure, work processes, and internal culture. principles into their ways of thinking and relating to Pilot experience suggests that even small changes to clients, partners, and each other. In its collaboration with facilitate working across sectoral and regional boundaries, the governments in these countries, the Bank has increas­ decentralize decision making, and modifY cultural norms, ingly acted as convener, capacity builder, coach, and can significantly support new behaviors. Further progress change facilitator. Experience shows that when carried with decentralization and empowerment of country teams out well, these roles have helped to strengthen relation­ wiD also help to cultivate an organizational culture of ships with other stakeholders in the development process. partnership and ownership. The Bank's key support units, for example, those working on leadership, organizational But, creating an enabling environment for the CDF change and learning, should work together in a synergistic among Bank staff beyond the pilots, requires further way to support managers and staff to incorporate CDF changes in leadership behavior at all levels, in the organi­ principles into the way they work. zational environment, and in the approach to learning and training. These changes should be pursued in a 36 Report on Country Experience Alignment oflearning/training with CDP Based on promising experience of the pilots to date, the Bank should take steps to ensure that the units mentioned Box 14 summarizes ways of working that the Bank has above develop an integrated program of support for used to facilitate the implementation of the CDF in some country departments. Given their comparative advantage, of the pilot countries. It takes into account three key offer a package of well-concerted support geared to enabling factors: individual leadership behavior; organiza­ delivering results at the country level. Specifically, the tional environment; and the learning approach. An package should seek to further develop: independent assessment concluded that in some formal - action learning, in which managers and their teams and non-formal CDF pilots, a customized action-learning learn while addressing real work challenges in real time; approach used by Bank teams and their national partners - de-emphasize traditional classroom lecturing. has been crucial for adopting the CDF principles. The - joint learning with clients and partners; approach catalyzed innovative institutional change, -learning of process skills that support working in a enhanced leadership competencies consistent with CDF partnership mode; and requirements, and led to enthusiastic support for the new -exchange of experience among staff members--creating way of doing business 35 • a community of CDF change agents who support one another in nurturing the CDF approach. 37 Comprehensive Development Framework Box 14: Promising Changes in the Bank's Way ofWorking Exampln from Banlt's WIlJ ofworking with pilot countri~ thatfacilitated incorporation ofCDFprincipln (one cou7l!ry per Ton shown). Leaderstm Behavior Organizational Learning Approach (roles, s . s, attitudes) Environment (learning, context, (structure, processes, content, process) culture) Bolivia Empowering teams incL ACS Decentralization ofdecision Using a resubs- aNi decision­ staffaNi infusingpassion malting facilitated receptive­ orimted learning approach inspired a higher level of ness to emerging opportuni­ promoted a results- and effon and forged more ties. decision oriented work committed internal and culture together with the external relationships. government. Ghana Givingpriority to national BuiltJing a cuitulT ofmutual BuiItJing upon lessons experience aNi capacity mpect aNi trust gave the learned in Bolivia and encouraged government to government the opportunity applying an action- take stronger leadership role. ro present their long-term learning approach sped the country strategy directly to process ofjoint learning. the Board. Morocco Adaptingour~Sp7'llCh(n Developing cross-sectoral Facilitation ofcountry team to the dynamics in the workingprach(es promoted ITtreat by process expert country and to the timing movement towards a more enhanced team process of the national process for holistic approach. skills and effectiveness. developing country strategy improved the relationship between government and Bank. Romania &ing molT innovative aNi Leveraging the mlZtrix Leveraging txtemai change worlting within the broader structulT facilitated inter­ process expertise into a joint context together with the sectoral teams, both within learning experience sup­ government is helping to the Bank and within the ported vigorous national create a netWork for change government. dialogue, including with inside the country and to civil society. open up dialogue between the government and the private sector and other members of civil society. Vietnam Performing in a nttworlting Modeling molT opm aNi Sharing ofknowledge aNi role and ceding leadership to transparent work cuiturr aNi joint learning supported the others facilitated synergies processn encouraged institutionalizing ofbi­ among development panners government to take a more annual mini-CG-meetings, open and inclusive approach bringing together internal with civil society and private and external stakeholders. sector. 38 Report on Country Experience Notes IFor some examples of these, see Annex 4. 12 Paul Collier, ibid; pp.51-78. 2The working assumption within the Bank is that CDF implemen­ t) World Bank Structural Adjustment and S~ctor Adjustment Opera­ tation is budget neutral Bank-wide, although internal reallocations tiom: The Suond OED Review. World Bank Operations Evaluation of resources have taken place. Experience from the Country Department, Report No. 10870, June 30, 1992. Directors shows that so far some expect to save resources while others have needed more. Ultimately, this depends on country­ I, See World Bank, The World Bank and Participation, (OED, Sept. specific requirements and the support they need from the Bank. 1994); also OECDIDAC, Final Report ofthe Ad Hoc Working Group on Participatory Developmmt and Good Governance (Paris, 3 See Section 2-CDF Proposal. 1997). 4This report has two predecessors-Compr~hemive Developmmt 15 Consultations do not imply consensus. Earlier discussions with Framework( CDF): Progress Report, Sept. 14, 1999 (SecM99­ outside sources on the Bank's partnership strategy offered a pointed 642);Comprehemive Development Framework: Mid-term Progress reminder about this: "In practice, it was extremely unlikely that an R~port,Sec.M2000-320, June I, 2000). A draft of the latter was uncontested national comensUJ could be developed in any country on considered at an informal meeting of the Executive Board on May key issues ofpublic policy; and evm where it could, it was unlikely that 19,2000. such a commsus would favor the kind ofsubstantial structural chang~ that was implicit in most Bank-supported reform programs. Indud, jA note on the proposed approach has been discussed with the radical chang~ oftm required brave and unpopular tUcisiom by the Board's Subcommittee on Development Effectiveness. While OED political kadn-ship. "See Partnership for Developmmt: From Vision to and DEC will present two distinct final reports because of their Action (Report of European Roundtable Meeting held at the different mandates and perspectives, every effort will be made to Overseas Development Institute, London, on 2 July, 1998). World assure coherence through a common evaluation and research Bank,1998. program along with a common advisory group-including the CDF Secretariat-and joint workshops at the beginning of the 16 For more on this, and other non-pilot country experience with evaluation to define an appropriate methodology. adopting the CDF approach, see Annex 4. 6The Chairman of the UN Development Group sent a memoran­ 17 For the Bank, increased selectivity can have considerable internal dum to all UN resident coordinators in mid-1999, encouraging consequences. It may mean pulling out of sectors in certain their involvement and support for CDF implementation at the countries, where Bank staff feel they have at least an absolute country level; such signals from headquarters can greatly help to advantage in technical competence. It may call for a different skills forge more strategic partnerships at the country level. mix, in technical terms and in terms of being able to work in partnership. Of course, pulling out of a sector in one country may 7On Common Ground: Converging Views on Developmmt and be offiet by moving into the same sector, with similar skills needs, D~velopmmt Cooperation at th~ Turn ofthe Cmtury. Development in another country, but it is also possible that a more institutional Assistance Committee, Organization for Economic Cooperation comparative advantage may emerge, with consequences for Staff and Development, September 1999. careers and the Bank's overall skills mix. • See paragraphs 48, 49 and 71 of the draft meeting record DCDI 18 These include DAC's Development Partners' Forum and Senior DAClM(2000)4/PROV. and High Level Meetings in December 1999 and May 2000; the Utstein Group of Development Ministers; a workshop in 9See CDF Mid-term Progress &port (SecM 2000-320), June I, Stockholm, co-hosted by the Nordic Countries and the World 2000. Bank, that involved bilateral and multilateral donors and developing countries; and the aid coordination studies produced by the Bank's 10 For simplicity this framework is called a vision, although there are OED and by UNDP. a number of related terms, including national strategies for sustainable development as proposed by the 1992 Rio Conference 19CDF Stockholm Workshop Report (SecM99-685), October IS, on Environment and Development, and the UNDP-sponsored 1999. National Long-Term Perspective Studies. 20To use procurement as an example: today borrower countries have II See for example, Paul Collier, "The Failure of Conditionality" in to deal with widely varying, donor-imposed procurement rules, Gwin and Nelson, eds., Perspectiv~s on Aid and Developmmt with enormous transaction COStS for the country. Institutional level (Washington, D.C., Johns Hopki.ns University Press, for the harmonization among partners could reduce these COStS, but this is Overseas Development Council, 1997), pp. 51-78. Also World not an easy task since often these rules are themselves imposed on Bank, Parmership for Dev~lopment: Proposed Aaiom for the World the partner agency by their own legislation. The solution lies in a Bank (Washington, D.C., May, 1998); esp. pp.8-11. two-fold approach: partners should seek to harmonize their rules and procedures, starting by a more flexible interpretation of existing requirements. Second, the partners should suppOrt the development 39 Comprehensive Development Framework of country capaciry, such as in procurement, tailored to meet acceptable standards for all. 29 World Bank, Country Assistance Strategies-Retrospective and Implications (R99-228, December 7, 1999) 21 The UK Department for International Development (DFID), for 30 World Bank, Supporting Country Development: World Bank Role example, recently made known its intention to move towards and Instruments in LOUJ-and Middle-Income Countries, Questiom and common procedures on disbursement, accounting and audits. AnsUJers. August 2, 2000, (SecM2000-43511); page 11. DFID also plans to collaborate with other donors in moving away from project to sector assistance and in making longer-term 31 Summary o/IDA 12 Mid-Teml Meeting, Lisbon, Portugal (IDA/ commitments. SecM 2000 - 328), June 16. 2000. 22However, the Okinawa G8 Communique of July 23, 2000 noted : 32Since tracking of the pilots began, seven of the formal pilot To achieve increased effictiveness o/ODA, UJe resolve to untie our aid to countries have used eleven adaptable program loans (APLs) to the Least Developed Countries. on the basis 0/progress made in the sustain changes in institutions, organizations, or behavior needed to Organization for Economic Cooperation and Development (OECD) to successfully implement programs. Ghana has used three APLs and date and a fair burden-sharing mechanism that UJe UJili agree UJith our two sector investment and maintenance loans (SIMs) , which are OECD partners. We believe that this agreement should come into effiet most appropriate where a sector expenditure program needs on January 1. 2002. extensive coordination. Bolivia has used two APLs and 1 learning and innovation loan (L1L) to support institutional change and 2.lThe extent of changes will be examined over time, including by development goals. Four more countries have initiated L1Ls DEC and OED in the evaluative studies that were mentioned supporting small pilot-type investment and capacity-building earlier. projects. 2, See the World Bank's CDF web-site (hnp:llwww.worldbank.org/ 33 Recommended in the Bank's strategy for urban development and cdO for more information. governance. World Bank 1999, Cities in Transition: A Strategic Vit'UJ o/Urban and Local Govenzment Issues (Infrastructure Group, PSI). 25 The PRSP is a country-owned document. However. the PRSP­ interpreted here as covering the interim PRSPs (IPRSPs) as well-is 34 Experience of CDS in Asia was recently reviewed at a conference included in this section because of the close connection with the in Fukuoka, Japan. The mayors of the Asian cities discussed at Bank's own instruments and processes. length the implications of implementing the CDF principles at the city level. Mayors were concerned about poverty reduction and city 26See Annex 6 on the relationship between the CDF and the PRSP growth. They were concerned about how to link CDS to national process. policies. They also recognized the value of institutionalizing the various stakeholder consultation processes launched . They also 27 G-7 Statement, Okinawa. July 21, 2000. agreed that they should share CDS experience on a more continu­ ous basis and with the support of the Bank's Urban Group intend ro 28 The CAS has traditionally had three parts: a broad analysis of the launch an on-line network in the near future. country's economic and financial situation and development prospects; the Bank's recommended development strategy for the The assessment was made by the Society for Organizational 35 country; and the business plan to support this strategy. Learning, guided by an internal task force. 40 Report on Country Experience Annex 1 Methodology For Tracking Progress From the inception of the CDF pilots, tracking progress was regarded as a key part of the process. Four inter­ looking into developing country-specific indicators for related approaches have been used so far: first, a tracking monitoring progress. Nevertheless, as noted in the main questionnaire was introduced covering aJl major aspects text, some pilots now have good record keeping systems, of CDF activity and updated by pilot country teams on a at least for some sectors and several are beginning to relate quarterly basis. Second, to promote learning and informa­ those records back to their management systems. tion exchange, a Learning Group of pilot Country Directors, chaired by Mr. Wolfensohn, was established Overall, however, available information is necessarily and has met regularly since. Third, groups of focal points uneven, for two reasons. First, there is no CDF 'blue­ representing major bilateral agencies, the UN system and, print', so fuJI 'cross-sectional' data cannot be compiled. the Regional MOBs, were formed to keep track of Countries start at different 'initial conditions', and make developments in the pilots, identifY challenges and progress along a variety of trajectories. Second, there are exchange information. Finally, in June 2000, structured very few countries in a position to make substantial interviews were held with broad cross-sections of key progress simultaneously on all fronts in terms of CDF stakeholders in several CDF pilot countries. principles i.e. putting in place the prerequisites for improved outcomes, enhanced country owhership, more It is the triangulation of information from the various strategic partnership and a focus on accounbbility for sources that has facilitated making assessments of perfor­ development results. Thus, it is to be expected that there mance for all pilot countries and area of activity. These is great variation even within a country. assessments are given in Annex 2 and essentially compare performance between March 1999 and July 2000 for The cost of data collection-and its impact on data individual countries. Five criteria are used: availability-should also not be under-estimated. • Little or No Action - Due ro a wide variety of circum­ Finally, capacity limitations remain a problem and cut stances, including political developments, capacity across individual countries and CDF principles from limitations, unforeseen events, action has remained at a preparing the vision/strategy to keeping track of inter and virtual standstill in some CDF areas of activity, in some intra-sectoral linkages. A wider application of the CDF countries. will benefit from reinforcing existing arrangements for • Elements Exist/Being Considered - There is some basis monitoring progress, taking into account specific country for making progress, either through what already exists, or circumstances. definite plans. • Action Being Taken - Progress is being made, although not yet enough, and the basis exists for even more substantive progress. • Largely Developed - Significant action taken already, although some further action is needed. • Substantially in Place - The activity is virtually accomplished. These assessments are based on the information available and it is particularly important to emphasize that cross country comparisons are not appropriate given the vastly different nature of countries' institutions, histories, forms of government, etc. Most CDF pilot countries are still 41 Comprehensive Development Framework Annex 2 Bolivia Putting in place a long-term vision-a prerequisite for sustainable development Is there a long-term vision/strategy? I I Is it focused on development results? Docs it adequately balance structural. human. physical and macro priorities? I Arc there adequate medium-term programs? I Enhancing counn ownership-the country in the dnvers seat Are the vision or strategy home grown? -- - Has the Government involved all relevant stakeholders? J Have national consultations been institutionalized? I I Does Government have the capacity to formulate and implement policy? Partnership among stakeholt1ers Are there effective in-country fora for parmer coordination? I Docs government lead the coordination of development parmers? Are parmers' assistance strategies aligned with the country strategy? I Are parmers being selective. or taking steps to reduce duplication of effort? Are parmers' operational practices harmonized? ... Focus on accountability for development results Does the government have an adequate develop­ ment information system? .. l Is development information being made transpar­ ent. e.g.• via a CDF matrix? Is the government putting in place mechanisms to track development results? I I Little Elements Action Largely Substantially or No Exist! Being Developed in Place Action Being Taken Considered June 2000 42 Annex 2 Report on Count,), Experience Cote d'Ivoire Putting in place a long-term visUm-a prerequuite for sustainable development Is there a long-term vision/strategy? . I Is it focused on development results? I Does it adequately balance suuctural, human, I physical and macro priorities? I I Are thete adequate medium-term programs? Enhandng cou,,!? ownership-the country in the driver's seat Are the vision or strategy home grown? I Has the Government involved all rdevant I stakeholders? • Have national consultations been institutionalized? l- Does Government have the capacity to formulate and implement policy? I Partnersmp among stakeho/Jers Are thete dfective in-counuy fora for partner coordination? ~ Does government lead the coordination of development partners? l- I I Are partners' assistance strategies aligned with the counuy strategy? • I Are partners being sdective, or taking steps ro reduce duplication of effon? • I = Are partners' operational practices harmonized? Focus on accountability for development results Does the government have an adequate develop­ ment information system? I L Is development information being made transpar­ ent, e.g., via a CDF mattix? I J I Is the government putting in place mechanisms to I track development results? ,­ Little Elements Action Largely Substantially orNo Exist! Being Developed in Place Action Being Taken Considered June 2000 ~ 43 Comprehensive Development Framework Annex 2 Dominican Republic Putting in place a long-term vision--a prerequisite for sustainable development Is there a long-term vision/strategy? I l I Is it focused on development results? I Does it adequately balance structural, human, I physical and macro priorities? I I Are there adequate medium-term programs? Enhancing coun~ ownership--the country in the drivers seat Are the vision or strategy home grown? Has the Government involved all relevant stakeholders? Have national consultations been institutiona1ized? I I Does Government have the capacity to formulate and implement policy? Partnership among stakeho/Jers Are there effective in-country fora for partner coordination? .­ I Does government lead the coordination of development partners? Are partners' assistance strategies aligned with the country strategy? Are partners being selective, or taking steps to reduce duplication of effort? Are partners' operational practices harmonized? ~ Focus on accountability for development results Does the government have an adequate develop­ ment information system? Is development information being made transpar­ ent, e.g., via a CDF matrix? 1 Is the government putting in place mechanisms to track development results? Little Elements Action Largely Substantially orNo Exist! Being Developed in Place Action Being Taken Considered June 2000 44 Annex 2 Report on Country E"perience Eritrea Putting in pillce a long-term vision-a prerequisite for sustainable development Is there a long-term vision/strategy? Is it focwed on development results? • I Does it adequately balance structural, human, • I physical and macro priorities? I I I Are there adequate medium-term programs? - Enhancing coun~ ownership--the country in the dnver's seat Are the vision or strategy home grown? Has the Government involved all relevant stakeholders? I Have national consultations been institutionalized? I I Does Government have the capacity to formulate and implement policy? Partnership among stakeholders Are there effective in-counuy fora for partner coordination? Does government lead the coordination of development parmers? I Are parmers' assistance strategies aligned with the country strategy? Are parmers being selective, or taking steps to reduce duplication of effort? Are partners' operational practices harmonized? Focus on accountability for development results Does the government have an adequate develop­ ment information system? • I Is development information being made transpar­ I ent, e.g., via a CDF matrix? L Is the government putting in place mechanisms to I track development results? Little Elements Action Largely Substantially or No Exist! Being Developed in Place Action Being Taken Considered June 2000 45 Comprehensive Development Framework Annex 2 Ethiopia Putting in pillce a long-term vision-a prerequisite for sustainable tlevelopment Is there a long-term vision/strategy? I I I Is it focused on development results? • I Does it adequately balance: structural, human, physical and macro priorities? I I L ALe there adequate medium-term programs? Enhancing coun~ oumership--the country in the dnvers seat ALe the vision or strategy home grown? I I Has the Government involved all relevant I stakeholders? I Have national consultations been institutionalized? • I Does Government have the capacity to formulate _I and implement policy? Partnership among stakeholders ALe there effective in-country fora for parmer L I coordination? I Does government lead the coordination of I development partners? I Are partners' assistance: strategies aligned with the country strategy? Are parmers being selective, or taking steps to reduce duplication of effort? Are parmers' operational practices harmonized? Focus on accountability for tlevelopment results Does the government have an adequate develop­ I ment information system? Is development information being made transpar­ ent, e.g., via a CDF matrix? ~ Is the government putting in place mechanisms to track development results? e Little Elements Acllon Largely Substantially orNo Exist! Being Developed in Place Action Being Taken Considered June 2000 46 Annex 2 Report on Country Exp erience Ghana Putting in plAce a long-term vision-a prerequisite for sustainable development Is there a long-term vision/strategy? • I Is it focused on development results? Does it adequately balance structural, human, • I I physical and macro priorities? I I I Are there adequate medium-term programs? Enhancing coun~ oumersh~the country in the tlrfvers seat Are the vision or srrategy home grown? Has the Government involved all relevant • I stakeholders? I I I Have national consultations been institutionalized? I I Does Government have the capacity to formulate and implement policy? Partnership among stakeholtlers Are there effective in-country fora for partner coordination? Does government lead the coordination of development parmers? Are parmers' assistance srraregies aligned with the country srrategy? I I I Are parmers being selective, or taking steps to reduce duplication of effort? • L Are parmers' operational practices harmonized? ;:~on accountability for development Does the government have an adequare develop­ ment information system? Is development information being made transpar­ ent, e.g., via a COF matrix? I I I Is the government putting in place mechanisms to I track development results? Llnle t.lements Action Largety ~u~ s tantially orNo Exist! Being Developed in Place Action Being Taken Considered June 2000 47 Comprehe1lSive Development Framework Annex 2 Kyrgyz Republic Putting in place a long-term vision-a prerequisite for sustainable development Is there a long-term vision/strategy? • Is it focused on development results? l- I Does it adequately balance structural, human, physical and macro priorities? l- I Are there adequate medium-term programs? l- I Enhancing coun~ ownership--the country in the driver's seat Are the vision or strategy home grown? I. Has the Government involved all relevant L. I stakeholders? Have national consultations been institutionalized? L. [ I Does Government have the capacity to formulate L. and implement policy~ Partnership among stakeholders Are there effective in-country fora for parmer coordination? Does government lead the coordination of development parmers? ~ Are parmers' assistance suategies aligned with the country strategy? • Are parmers being selective, or taking steps to l- I reduce duplication of effort? Are parmers' operational practices harmonized? ~ Focus on accountability for development results Does the government have an adequate develop­ ment information system? ... I Is development information being made transpar­ ~ I ent, e.g., via a CDF matrix? Is the government putting in place mechanisms to ~ I track development results? Little Elements Action Largely Substantially or No Exist! Being Developed in Place Action Being Taken Considered June 2000 48 Annex 2 Report on Country Experience Morocco Putting in plAce a ~-term vision-a prerequisite for sustainable development Is there a long-term vision/suategy? Is it focused on devdopment results? Does it adequately balance structural, human, - I I I l- physical and macro priorities? I I Are there adequate medium-term programs? Enhancing counf? ownership-the country in the dnver's seat Are the vision or strategy home grown? Has the Government involved all relevant stakeholders? I I Have national consultations been institutionalized? I I Does Government have the capacity to formulate and implement policy? Partnership among stakeholders ~ Are there effective in-country fora for parmer coordination? Does government lead the coordination of devdopment parmers? ... I Are parmers' assistance suategies aligned with the l- I country strategy? I Are partners being sdective, or taking steps to I -,:: reduce duplication of effort? Are parmers' operational practices harmonized? l- Focus on accountability for development results Does the government have an adequate devdop­ ment information system? - . ~J - ­ Is devdopment information being made uanspar­ I ent, e.g., via a CDF matrix? Is the government putting in place mechanisms to track devdopment results? ~ Little Elements Action Largely Substantially or No Exist! Being Developed in Place Action Being Taken Considered June 2000 ~ 49 Comprehensive Development Framework Annex 2 Ronlania Putting in pwe a long-term vision-a prerequisite for sustainable development Is there a long-term vision/strategy? I J Is it focwed on development results? I­ I ;~' I Does it adequately balance strucrural, human, physical and macro priorities? l- I AIe there adequate medium-term programs? l­ Enhancing counr? oW1U1'$hi~the country in the tirtver's seat Are the vision or strategy home grown? Has the Government involved all relevant • )- stakeholders? J Have national consultations been institutionalized. I , I Does Government have the capacity to formula~e and implement policy? Partnership among stakeho/Jers Are there c:ffective in-country fora for partner coordination? I. Does government lead the coordination of development partners? L. Are partners' assistance strategies aligned with the -:. country strategy? Are partners being selective, or taking steps to I -;., reduce duplication of effort? I Are partners' operational practices harmonized? I' I FOCUI on accountability for development results Does the government have an adequate develop­ ment information system? I -:~ - Is development information being made rranspar ent, e.g., via a CDF matrix? - co J~ Is the government puttin§ in place mechanisms to track development results. Little Elements Action Largely Substantially or No Exist! Being Developed in Place Action Being Taken Considered June 2000 50 Annex 2 Report on Country Experience Uganda Putting in place a long-term vWon--a prerequisite for sustainabk development Is there a long-term vision/strategy? Is it focused on devdopment results? Does it adequately balance structural, human, physical and macro priorities? Are there adequate medium-term programs? Enhancing counf") oumersh~the country in the dnver's seat Are the vision or strategy home grown? Has the Government involved all rdevant stakeholders? Have national consultations been institutionalized? Does Government have the capacity to formulate and implement policy? Partnership among stakeholtlers Are there effective in-country rora for partner coordination? Does government lead the coordination of devdopment partners? Are partners' assistance strategies aligned with the country strategy? Are partners being selective, or taking steps to reduce duplication of effort? Are partners' operational practices harmonized? f:::k on accountability for development I-=======================~ Does the government have an adequate devdop­ ment information system? Is devdopment information being made transpar­ ent, e.g., via a COP matrix? Is the government putting in place mechanisms to track devdopment results? Little Elements Action Largely Substantially orNo Exist! Being Developed in Place Action Being Taken Considered 51 Comprehensive Development Framework Annex 2 Vietnam Putting in pl4ce a long-term vision--a prerequisite for sustainable tlevelopment Is there a long-term vision/strategy? Is it focused on development results? Does it adequately balance structural, human, physical and macro priorities? Are there adequate medium-term programs? Enhancing cfJUnr? ownership-the country in the Jrlver~ seat Are the vision or strategy home grown? Has the Government involved all relevant stakeholders? Have national consultations been instirurionalized? Does Government have the capacity to formulate and implement policy? Partnership among stalteholJers Are there cffccrive in-country fora for partner coordination? Docs government lead the coordination of development parmers? Arc partners' assistance strategies aligned with the country strategy? Arc partners being selective, or taking steps to reduce duplication of effon? Arc partners' operational practices harmonized? Docs the government have an adequate develop­ ment information system? Is development information being made transpar­ ent, e.g., via a COP matrix? Is the government putting in place mechanisms to track development results? Little Elements Action Largely Substantially or No Exist! Being Developed in Place Action Being Taken Considered June 2000 52 Annex 2 Report on Country Experience West Bank & Gaza Putting in place a long-term vUwn-a prerequisite for sustainable tlevelopmmt Is there a long-term vision/strategy? Is it focused on devdopment results? Does it adequately balance Structural, human, physical and macro priorities? Are there adequate medium-term programs? Enhancing Ctnm~ ownersh~the country in the dnver's seat Are the vision or strategy home grown? Has the Government involved all rdevant stakeholders? Have national consultations been institutionalized? Does Government have the capacity to formulate and implement policy? Partnership among stakeholt1ers Are there effective in-country fora for partner coordination? Does government lead the coordination of develOpment partners? Are partners' assistance strategies aligned with the country strategy? Are partners being selective, or taking steps to reduce duplication of effon? Are panners' operational practices harmonized? Focus on accountability for tlevelopmmt results Does the government have an adequate devdop­ ment information system? Is devdopment information being made transpar­ ent, e.g., via a CDF matrix? Is the government putting in place mechanisms to track development results? Little Elements Action Largely Substantially orNo Exist! Being Developed in Place Action Being Taken Considered June 2000 53 VI ~ ~ ~ ~ ~ ~. Major Donors Per Sector in Pilots o '" ~ Number of Major Donors per Sector in Pilot Countries (excluding UN agencies and civil society organizations) ~ -.:; . - ~ ~ Macro StnJctural Human Physical Specific .... ~ "'i, ~ ., ;::; C\ ? ;; n ~ 0 0 :; .., 0 -, ~ n .., S­ !: CD ~ 3 "; '~ " > E:~ < :: ::: :: n .., " ,. - [. c W Co: :: !T1 0­ a III e: .., -i 3 c: :: ;;­ .., fr. :!, < *­ ~' VJ ~ "C ~ 2 Cft ., c: ., :r c: S 0' rr n' :; S ~ o r. :: M < :< 0: n ,. 0­ c: S II> ::> ~ c: :; ~ ::; ii't: n n' =.: g ' ~ c' II> g '0 0' § C g ' v ::. :. -< g, ~ ~ 5­ :: S 5 a ~ Bolivia I 9 4 3 5 8 2 7 6 I I J 12 I COte d'ivoire 4 3 I I 4 6 0 I 4 3 0 2 10 I Dominican Rep 0 I I I 4 5 I 0 0 0 0 I I 0 Eritrea I 9 4 3 5 8 2 7 6 I I 3 12 I Ethiopia I 9 4 3 5 8 2 7 6 I I 3 12 I Ghana I 9 4 3 5 8 2 7 6 I I 3 12 I Kyrgyz Rep I 3 2 2 1 3 0 0 0 3 0 1 4 2 Morocco 0 0 2 1 3 I I 3 () 4 0 4 4 3 Romania 0 I 2 I I 0 I I 0 I 0 0 3 2 Uganda 5 5 6 I 8 9 3 I 8 5 I 3 7 2 Viet Nam 3 6 (, 3 S l) 4 () 8 8 I 8 13 I WCSl [Jank & Gaza 0 5 10 () (, () 0 2 8 5 () 3 3 2 Activity defined in tenns of new aDA commitments during period 1996-98. Major donor defined as commitments of US$ 1 million or more. Source: DAC Database A :::: 1;; ?-: \.-., Annex 4 Report on Country Experience Non-formal CDF Pilot Countries Examples of non··iormal CDF pilot countries implementing the CDF approach (examples shown for low-income countries and middle-income countries) How ARE CDF PRINCIPLES APPLIED? WHAT IS Til E BANK'S ROL E? Bhutan • Bhutan has a well-articulated long-term development strategy, following • CAS outlines the Bank's limited role in three main sectors a balanced and holistic approach with emphasize on development as • Joint anal}1ical work with government and other donors social transformation (Bhutan 2020 - A vision for Peace, Prosperity, and Happiness); the Five-year plans map into the long term strategy • Bhutan is fully in the driver' s seat of their development process • National stakeholders are routinely consulted and form part of any planning and development process; strong commitment of all stakeholders ·Government has strong sense of comparative advantage of the various donors and determines where assistance is needed; strong government leadership in donor coordination · I Philippines Medium Term Philippines Development Plan (MTPDP) 1999-2004 is a holistic development framework, balancing macroeconomic, structural, · • CAS follows integrated approach ofMTPDP CAS concentrates on few activities for programmatic and social interventions • MTPDP entirely prepared by Government through a participatory process involving private sector and NGOs , . lending through APLs over 10-12 years duration Actively reaching out for collaboration with other international partners ·CG meeting 2000 held in country and chaired by the government · Encouraging Government to continue on path to fully implement CDF approach with emphasize on increasing partnerships ! coordination and adopting clear outcome j indicators Thailand • Thailand's Holistic Development Framework (HDF) adopts • Next CAS will explicitly support the priorities set in HDF comprehensive approach, consistent with CDF principles by the Government • HDF is government-driven and was formulated in a highly participatory process with strong involvement of private sector and civil society • Because of limited need to borrow Bank is exploring a organizations different approach, a Country Development Partnership • The Ninth Plan will be built on HDF principles (COP), as an amalgam of elements of an adjustment loan. a technical assistance operation, and a knowledge management activity. The country-led COP should support Government's programs in a true partnership mode. with private sector and civil society participation Tanzania • Government has moved to take the lead in setting the country's policy agenda · In the context of a partic ipatory Medium Term Expenditure Frame (MTEF) process government has · Government has suengthened the adoption of ownership and partnership and is making efforts at even more effective partnership with donors and civil society · identified a select number of priority areas Implementation ofMTEF is monitored under the annual participatory public expenditure review (PER) process, • Government is developing the Tanzania Assistance Strategy (TAS), jointly with donors and internal stakeholders based on CDF principles I • Preparation of PRSP in a broad participatory manner, including a series of national and zonal level workshops. [-PRSP in advanced preparation Zambia · Government has launched process for developing a shared, long term vision · The Bank's CAS played a catalytic role in stimulating CDF. During the first round of a broadly participatory · Government uses CDF as an organizing tool for coordinating activities among many players to support the country's long \e(])] vision CAS a process to develop Zambia's long term vision and priorities was launched · • CDF approach has strengthened internal and external partnerships Zambia was one of the first countries to present the [-PRSP · Supporting Government in process for developing a shared long term vision 55 Comprehensive Development Framework Annex 5 Instruments in CDF Pilots ECONOMIC I-PRSPI CAS NEW LENDING AND SECTOR PRSp l INSTRUMENTS 2 WORK Bolivia PER, NIR, PA I-PRSP 1012000 2 APL. LIL I (Up-date) Cote d'lvoire t PER, CEM l-PRSP APL. LIL expected Dominican Republic NON~R8P 7/1999 ~ Eritrea CEMIPER Transitional APL, LIL Support Strategy Ethiopia PER,CEM; PA I-PRSP Transitional LfL I Support Strategy I expected Ghana SS I-PRSP 6/2000 3 APL. 2 SIMS Kyrgyz Republic ' pA I-PRSP expected , Morocco NON-PRSP LIL COU1ll1")1 Romania CEM NON-PRSP 10/2000 2APL carmtry .? expected Uganda PER, SS PRSP APL Vietnam CEM PRSP expected 5/2000 APL (Progress I I Report) West Bank & Gaza l(Interim) poverty reduction strategy paper completed or expected in calendar year 2000. 2 New lending instruments applied in FY 1999-2000. 56 Annex 6 Report on Country Experience The Comprehensive Development Framework (CDF) and Poverty Reduction Strategy Papers (PRSP) Joint Note by James D. Wo/fensohn and Stanley Fischer . The Comprehensive Development Framework (CDF) A PRSP must be broadly endorsed by the Bank and Fund was proposed by the World Bank in early 1999 as a Boards to provide a basis for both institutions' programs means by which countries can manage knowledge and in low income countries, and for countries to obtain debt resources to design and implement effective strategies for relief under the HIPC Initiative. Thus, the PRSP is an economic development and poverty reduction. It brings operational vehicle - which can be a specific output of the together many current trends in development thinking CDF or of processes based on CDF principles - that is and is centered on a long term vision - prepared by the intended to translate a country's poverty reduction country through a participatory national consultation strategy into a focused action plan. Indeed, countries process - that balances good macroeconomic and using the CDF (such as Ghana, Uganda and Bolivia) have financial management with sound social, structural and been at the forefront of those successfully preparing human policies. The CDF, however, is not a blueprint. It PRSPs. is voluntary, and each country must decide on, and own, its priorities and programs. In order to ensure the most The CDF and PRSP should be mutually reinforcing. The effective use of human and financial resources, the CDF PRSP process will focus the attention of a large number emphasizes partnerships between government (at the of governments on CDF principles. It will also ensure national, and local levels), civil society, the private sector, more effective collaboration between the Bank and the and external assistance agencies. It encourages coordina­ Fund in supporting countries, as specifically requested by tion to improve efficiency and coherence in the use of their major shareholders. The PRSP inevitably brings financial flows and services, and to take advantage of with it some challenges. First, there is the challenge of synergies among development partners. In addition, as allowing the time needed for the development of a fully the international community has increasingly come to participatory process while not delaying the delivery of recognize, partnership and coordination of efforts can debt relief or development assistance. Second, there is the enhance the capacity of governments to manage foreign need to ensure that all development partners are also development assistance. included fully and early in the process. Third, care needs to be taken to ensute that country-led and owned The Poverty Reduction Strategy Paper (PRSP) is based on processes are not weakened by the need to produce PRSPs CDF principles. It integrates poverty reducing policies or progress reports according to an annual timetable. We into a coherent, growth oriented macroeconomic frame­ are committed to working together with countries and work. As with the CDF, national governments are our development partners to meet these challenges and responsible for the preparation of PRSPs with the reduce poverty. participation of domestic and external partners. &ternal partners are encouraged to assist governments in prepar­ April 5, 2000 ing PRSPs, and to link their development efforts to them . . Then Acting Managing Director of the International Monetary Fund. 57 A Proposal for a Comprehensive Development Framework (a Discussion Draft) James D. Wolfensohn January 21, 1999 Proposal The Comprehensive Development Framework February 9, 2000 ust over a year ago, on January 21, 1999, I circu­ that are implementing CDF-like principles in their l lated a Proposal for a Comprehensive Development Framework (CDF)-a Discussion Draft. The sponse has been overwhelmingly supportive. By way of illustration, in September 1999, the Development Assistance Committee of the Organization for Eco­ development strategies. In addition we have received valuable comments on the CDF from our partners in the industrialized and developing worlds, both from the official development assistance community, as well as from the private sector and civil society. Our partners nomic Cooperation and Development (OECD) and country counterparts have raised a number of prepared On Common Ground, a paper which reflects questions on issues such as the role of macroeconomic the consensus reached in the international development fundamentals, gender, trade, labor and Parliaments in community on the COP's main tenets. Another sign of the CDF. We welcome these questions and are doing this growing consensus is the recent endorsement by the our best to clarify how these and other factors fit into Governors of the World Bank Group and International the CDF Proposal. To this end, we have produced a set Monetary Fund (IMF) of CDF principles as the basis of Questions and Answers (Q&As) on CDF which we for poverty reduction strategies for developing countries update periodically. seeking Bank or IMF assistance, or debt relief under the Highly Indebted Poor Country Initiative (HIPC). As As implementation experience accumulates and new the international development community accepts the questions arise, we intend to continue to build on the CDF as the approach to development which comple­ original CDF Proposal and the latest Q&As are ments the necessary macroeconomic growth strategy attached to this note. As you read these documents without which poverty reduction cannot be achieved, together, please let us know of issues that need clarifica­ the CDF is evolving from a Bank proposal into a widely tion, or of any new issues that you feel should be used tool. addressed. Over the last twelve months, we have been working with a dozen countries that volunteered to implement the CDF proposal, as well as several other countries James D. Wolfensohn President, The World Bank Group 61 Proposal Introduction' Poverty A11eviation and Development Effectiveness During recent months I have been considering what I have learned in my first three and a halfyears as President ofthe I have been considering the special role of our institu­ World Bank Group and am particularly grateful to all of tion and its effectiveness in poverty alleviation and you for the advice and guidance you have provided. With sustainable development. Together we have worked very your help, I have had a unique opportunity to visit 84 hard over these last years, building on the extraordinary countries, Part I and borrowing countries alike. I have work done in the past, to redirect our institution to one visited hundreds ofprojects, met with government officials, that is results-based and not volume-or procedure­ private sector representatives, members ofcivil society, from based. I am extremely grateful to all of you for the hard trade uniom and employee organizations to religious work that is already bearing fruit. We are fortunate groups, from flundatiom to global and local NGOs of because we have 54 years of experience and several every type, size and character. I have also participated in institutional frameworks, including the IBRD, IDA, and benefited enormously from meetings with other IFC, MIGA, as well as related institutions such as multilateral organizations, starting with my regular Consultative Group for International Agricultural breakfast and meetings with my friend, Michel Camdessus, Research - Executive Secretariat (CGIAR), Global and with the leaders and colleagues in the regional banks. Environment Facility Secretariat (GEF), and Consulta­ I acknowledge my many exchanges with members ofthe tive Group to Assist the Poorest (CGAP). We can be UN family and with bilateral agencies with whom we proud of our history and of the role we have played. We work extensively throughout the year. have extremely experienced people in most areas of development - or at least access to them. We are Obviously I believe that we and all ofthe above groups making use of partnerships with others who have more have contributed significantly to the betterment ofman­ effective skills or broader reach of resources than we kind and to the improvement in the lives ofmany in have. We are indeed learning to listen more and to be a poverty. I am convinced ofthe importance ofconsultation better partner for the governments and the people we and participation. But the fact remains that progress is too serve and for those with whom we work in the interna­ slow. With three billion people still living under $2 a day, tional and local communities. with growing inequity between rich and poor, with forests being degraded at the rate ofan acre a second, with 130 In addition, I believe we have a better articulation of million children still not in school, with 1.5 billion people our role with the IME Broadly, our sister institution has still not having access to clean water, and two billion the responsibility for macroeconomic stabilization for people not having access to sewerage, we cannot be compla­ our client countries and for surveillance. We have the cent. More than this, we must be concerned that 80 to 90 responsibility for the struCtural and social aspects of million people are being added annually to our planet, development. Obviously, these are not two isolated mainly in the developing world. Two billion more souls roles and we work together very closely on a day-to-day must feed themselves by the year 2025, hampered by wars, basis. with growing inequity, and with distortions ofeconomies and politics as evidenced in crises from Indonesia to Russia As I have said before, the two functions are like breath­ and from Latin America to Africa. With the reduction in ing in and breathing out. An appropriate macroeco­ Overseas Development Assistance and current imtability in nomic framework is essential for our work, but the the international financial markets, there is much to be social, structural, and human agenda, which we share concerned about. with the regional banks, members of the UN system, and other partners in development, is essential for the IMF which cannot and does not prescribe in a vacuum. Together we must serve the hopes and aspirations of the people in our client countries, or our clients will not 'January 21, 1999 achieve their objectives in peace and stability. And To: The Board, Management, and Staff of the World Bank Group together, we must work with and support the work of From: James D. Wolfensohn A PropoSldfor a Comprt:hensive Developmmt Framework (A Discussion the World Trade Organization which is so critical to the Draft) trading arrangements and future of our client countries. 63 Comprehensive Development Framework In particular areas, such as strengthening the financial But let me return to my balance sheet example. Unlike systems around the world, we work together as partners macroeconomic analysis which brings everything with the IMP, regional banks, the BIS, and other together in a familiar consolidated form, we in the institutions; each of us contributing according to the development field have been less successful in giving an needs of the situation and our available human re­ accountable presentation of the status of structural sources. Our partnerships with the international work and social progress. This is not surprising since community are many and varied and serve our clients multilaterals and bilaterals alike are limited by re­ well. sources, experience. and reach and none except the government of the country in question has an overall Part I responsibility. Governments have the responsibility for putting it all together in a comprehensive review of all A Concept-A Balance Sheet with the elements required for growth and poverty allevia­ Two Sides, a Coin with Two Sides, tion. But we know that not all of the governments we A Duet with Two Parts serve have the capacity to do so, or the resources, or sometimes even the will. Now is there an agreed When I think of a development framework for a framework for presentation. country and for regions, I think of a balance sheet with two sides. On the left is the macroeconomic presenta­ We also know that we "players" in the development tion including the Article IV reports of the IMF, the business are surely not accustomed to working together National Income Accounts, the Balance of Payments in harmony, neither the UN system and multilaterals and Trade Statistics, and all the other financial and with bilaterals nor NGOs with the private sector. We economic analysis which are at the core of our current certainly cooperate more than we did in the past. We at appraisal system. All of us are used to quoting GOP the Bank are committed to strengthening such coopera­ statistics, interest rates, reserves statistics, percentage tion. But there is still suspicion and many historic growth statistics, and so on as a basis for monetary and grudges and perceptions. What is necessary is an fiscal policy. Based on analysis of the information, we overarching framework - an approach agreed with the can decide whether a country is Part I or Part II, IDA government concerned - which will allow us all to eligible, or HIPe eligible. It is the language that work together to meet our goals for poverty alleviation Finance Ministers find comfortable, and we all use it to and environmental sustainability. On the basis of such make decisions. work, we would then be able to present a right-hand side of the Country Balance Sheet which would allow The Need for the Right-Hand Side for a more comprehensive analysis and more soundly based action. There is however, a clear need for a second side which reflects more adequately an analytical framework that The Comprehensive DeveloJ?ment presents the structural, social, and human aspects. It Framework and the InternatIonal must go beyond the familiar statistics of infant and Financial Architecture maternal mortality, unemployment and children in school, to address fundamental long-term issues of the Within and without governments, in a multitude of structure, scope and substance of societal development. research and private organizations, in the press and public discourse, analysis is proceeding as to how the Let me explain this a little more, but before doing so, world financial and economic system should be let me say that I am not too convinced about the changed, and what role the Bretton Woods institutions imagery of a Balance Sheet. Perhaps we could speak of are to play. I am of the personal view that with some two sides of a coin, or two parts of a duet. What is key few changes, including expanded and more transparent is that the two parts, namely macroeconomic aspects on financial information. the basic international architec­ the one side and the social, structural and human on ture has served us well. Of course, it can no doubt be the other, must be considered together. 64 Proposal strengthened and I am certain that many suggestions One of the reasons for developing such comprehensive, will be made. I wish to deal here with only one aspect holistic framework is to allow us to think more strategi­ of the debate. cally about the sequencing of policies, programs, and projects and the pacing of reforms. While the compre­ The Comprehensive Development Framework I am hensive approach emphasizes that we must advance on proposing highlights a more inclusive picture of all fronts, certain steps need to be taken before others. development. We cannot adopt a system in which the macroeconomic and financial is considered apart from Let me give some examples of what I mean. The fact is the structural, social and human aspects, and vice versa. that the success of most projects is dependent on many Integration of each of these subjects is imperative at the assumptions extraneous to the project itself. Building national level and among the global players. It is not new schools is of no use without roads to get the possible to separate these subjects in Part I countries children to the schools and without trained teachers, where the structure of economic and social governance books and equipment. Establishing banks and financial exists. It is certainly not possible to separate these institutions without a banking system that is supervised subjects in Part II countries where there is much less will lead to chaos. Initiatives to make progress creating tolerance for risk due to fragile structures. A wrong step equal opportunities for women make no sense if on the macroeconomic side can have dire consequences women have to spend many hours each day carrying for the structural, social and human dimension. In clean water, or finding and gathering fuel for cooking. addition, profligate and unbridled spending without Seeking universal primary education without prenatal regard to resource constraints and fiscal and monetary and postnatal health care means that children get to policy can also have dire consequences. school mentally and physically damaged. Establishing a health system but doing nothing about clean water and The Prerequisites for Sustainable sewerage diminishes enormously the impact of any Growth and Poverty Alleviation effort. Seeking equity when government is riddled with corruption and has inefficient and untrained officials is What are the basic structural, social, and human an objective that will never be realized. prerequisites that should balance the macroeconomic considerations? Let me set forth my list which we Privatization prior to establishing an effective regulatory should examine and test over the next 12-18 months. or competition framework can be a recipe for a disaster; But before doing so, let me make one additional the benefits of lower prices for consumers may well not important assertion. I believe that unless we think of be achieved. We know, at least from hindsight, that part having all the basic prerequisites, say over a 20-year of the failures in Russia were due to paying insufficient timeframe, we will endanger, and sometimes ruin the attention to the preconditions for a market economy. effectiveness of individual projects and programs which Too often in the past, we have gone after the "easy" we undertake with our clients. Clearly not all the targets, saying that we would attack the more difficult objectives can be approached simultaneously. The (often institutional) issues later on. In doing so, we have framework should not become a straight jacket. We failed to recognize the essential complementarities. need the flexibility to adjust to the varied conditions of each country. There will be a need for setting priorities, By contrast, good business strategy attempts to identify for phasing of action based on financial and human bottlenecks - the hard to solve problems that are capacity and based on necessary sequencing to get to impediments to success - and it begins by attacking our objectives. But over time, all the requirements these first. We must learn to apply these lessons to within a holistic framework must be addressed if there attack poverty and bring about development. is to be stable, equitable, and sustainable development. 65 Comprehensive Development Framework It is also clear to all of us that ownership is essential. labor, bankruptcy, commercial codes, personal rights Countries must be in the driver's seat and set the laws and other elements of a comprehensive legal course. They must determine goals and the phasing, system that is effectively, impartially and cleanly timing and sequencing of programs. Where there is not administered by a well-functioning, impartial and adequate capacity in the government to do this, we honest judicial and legal system. must support and help them to establish, own, and implement the strategy. And we must work to achieve 3. A Well-Organized and Supervised Financial System the strategy with our colleagues in the government, in the international development community, the civil We have recent significant evidence from Asia and society, and the private sector. In some countries the other parts of the world that unless a financial system is long and short term goals will be set by a process of well organized, audited and supervised, any country public debate and consensus building led by the and region is at risk and the people who suffer most government with all sections of society. In other from crisis are the poor. Accordingly, a government countries, the establishment of goals will continue to be must establish an internationally accepted and effective set more centrally. supervisory system for banks, financial institutions and capital markets to ensure a well-functioning and stable Let me now set down a possible framework for present­ financial system. Information and transparency, ing and managing a holistic approach to the structural, adequately trained practitioners and supervisors, and social and human aspects of development. internationally acceptable accounting and auditing standards will be essential. Regulation and supervision A. Structural must include banking, savings institutions, insurance and pension plans, leasing and investment companies. 1. Good and Clean Government Capital markets should also be developed and strength­ ened as resources allow. A country must have an educated and well-organized government. This requires capacity building, an open 4. A Social Safety Net and Social Programs legislative and transparent regulatory system, properly trained and remunerated officials and an absolute Clearly, a country's history and culture as well as its commitment to clean government. While building an state of economic development, will dictate the extent effective government framework is difficult, it will and nature of social programs a government can or become impossible if there is corruption which is the wishes to provide. But whether by informal arrange­ single most corrosive aspect of development and must ment, familial or tribal support or by government­ be fought systemically at all levels. Particularly it must provided programs, provision must be made for the start with a vigorous commitment from the leadership elderly, the disadvantaged and disabled , for children, to fight corruption on all levels, with initiative both to for the those men and women unable to find work, and prevent it from happening and a system for finding and those affected by natural disasters and the aftermath of punishing wrongdoers where corruption exists. The war. In some transition economies, the social safety net lead must come from the top and efforts must be is needed for those put out of work as a result of large­ persistent and unyielding. scale privatizations. Employment opportunities and the terms of employment are crucial to any functioning 2. An Effective Legal andJustice System system. Governments must also provide special pro­ grams for indigenous people whose needs are different Without the protection of human and property rights, and whose culture and integrity must be preserved. and a comprehensive framework of laws, no equitable development is possible. A government must ensure In the process of development, traditional institutions that it has an effective system of property, contract, and relationships are often undermined, weakening the fabric which holds society together. There may actually 66 Proposal be a degradation of social capital. Violence and social education, literacy and lifelong learning must be unrest may increase. Effective development must combined with the fundamental recognition that address these social concerns. It must both help re­ education of women and girls is central to the process establish a sense of community and knit the entire of development. A government must also be careful to society together. learn lessons of practice and history from indigenous peoples and communities, so that education is not This whole area of social programs is very difficult and imposed from afar but benefits from relevant local, is heavily dependent on available budgets. But it is communal experience. Finally, preschool education crucial to the long-term peace and stability of any must be given its full weight in programs. This can be a country and must rank high on the agenda, particularly key to the development of a child, the level of educa­ for international aid and development agencies working tion reached, and thus the eventual achievement. with governments. In addition, I should observe that developments in While macroeconomic management is never perfect ­ science, technology, and knowledge transfer offer a there will always be some fluctuations in output and unique possibility to countries to catch up with more employment - the most effective safety net is a policy technologically advanced societies. which maintains full employment. Deep recessions and depressions have adverse effects on virtually every one 6. Health and Population Issues of the elements of the development strategy: health deteriorates, schooling is interrupted, and poverty It is obviously crucial that mothers are supported and increases. Formal safety nets are but an imperfect stop­ that children get adequate health care before and during gap measure in addressing the failures of effective macro school years or they will have their capacities dimin­ policies to maintain the economy at full employment. ished. Governments must ensure the provision of health It is on this subject that the link between the two sides services for adults and elderly at communal and local of our balance sheet is most crucial. levels, as well as services for family health care and family planning. These services can come from a variety Let me now switch gear and suggest six other elements of sources, both public and private. The sheer growth in which are basic to effective development and poverty population is itself a critical issue which must be alleviation. Let me start with two human aspects, addressed in various ways depending on belief and perhaps the most fundamental of all, dealing with culture. It is linked to education and to religion, and to strengthened capacity of individuals in a society. I refer, available health services, and must be addressed by of course, to education and health. governments as they see fit. Specialized health-care facilities should also be provided on a national or B. Human regional basis. 5. Education and Knowledge Imtitutiom Unless population growth is brought under control, the less developed countries face a losing battle, with most All agree that the single most importanr key to develop­ of the scarce savings being used simply to forestall a ment and to poverty alleviation is education. This must decline in standards of living. While in recent years in start with universal primary education for girls and boys many countries, the percentage of those in poverty has equally, as well as an open and competitive system of declined, global population growth has been so rapid secondary and tertiary education. Construction of that the absolute number of individuals in poverty has schools, modern curricula geared to the new techno­ continued to increase. logical age, and the real needs of the emerging local market, and effective teacher training and supervision We are also confronted with major problems of disease all contribute to successful educational programs. Adult which range from tuberculosis and malaria to AIDS which in all too many countries is being inadequately 67 ComprehensizJe Development Framework addressed. Not only can health be a human issue of In addition to physical communications, access to great proportions but in many countries, health is a telecommunications for trade, information and educa­ barrier to equitable development and to growth. tion will be absolutely essential to development in the next century. Without appropriate telecommunication, And now let me pass to the key physical needs of whether it be telephone or e-mail, computers or wind­ development. up radios without batteries, poverty will not be fought and equity and opportunity will not be provided. C. Physical Without access to modern communications, the difference between rich and poor will increase due to 7. Wtzter and Sewerage the knowledge gap, and growth will be restrained. With 1.5 billion people not having access to dean water 10. Sustainable Development, Environmental and and two billion without access to sewerage, and with Cultural/Hues the increasing demand for water from industry and agriculture, an effective method of distribution, There is a growing agreement that protection of our delivery, finding, and saving water is fundamental. So planetary environment is an issue for all of us and that too is a strategy for sewerage, which not only pollutes this translates into regional, national, and local strate­ water supplies but also affects health in a dramatic way. gies. Evidence can be found everywhere, whether it be The regional aspects of water supply will have an in Russia, Thailand, or Japan, that pollution can not increasing impact on peace, investment, and develop­ only kill but it can have severe adverse impacts on ment in years to come, as well as on the individual lives economic activity and on growth. Volumes have been of people, particularly women, in rural and urban areas. written on the subject of environment - on the preservation of our natural resources from forests to 8. Power biodiversity, on the quality of our air and water, on its significance as an economic factor. The continuing Two biJIion people without access to power resort to degradation of important natural resources, like the use of wood and fossil fuels, resulting in health and forestry, aquifers and so on, represent a silent crisis that breathing problems. Availability of power is not only an will be difficult to reverse. Let me simply flag the issue issue of convenience but saves the time of women here as a vital element in any assessment for the health searching for alternative fuels. The environmental of a society. impact is also great, it having been evident for centuries with forest destruction altering weather patterns and Cultural preservation is also crucial not only historic affecting the quality of air we breath. It is also a major sites, artifacts and books, but also the spoken word and issue for private investment which calls for an adequate, the arts. I believe that there can be no true national reliable, and appropriately priced source of power. development without preserving peoples' history and culture, particularly in a new, globalized environment 9. Roads, Transportation and Telecommunications where there is pressure for "sameness" in all countries. Culture can be justified for tourism, for industry and Many leaders have told me that an adequate road for employment, but it must also be seen as an essential system is the starting point for development. Rural and element in preserving and enhancing national pride and urban roads make possible trade and services, provisions spirit. I will not easily forget my visit to Mali, one of of health care, and getting children to school. Trunk the poorest countries in the world which, more than a roads are essential to link rural, urban and regional millennium ago, led an empire that stretched up to areas. Rail and air transportation systems are also key to Egypt. Only this week, I met with the Vice President of growth and link countries to regional and international Bolivia who told me that the largest city in the Ameri­ markets. cas was once in his country and that the preservation of its history is part of their national pride. 68 Proposal Some believe that culture is a luxury - low on the list special problems of urban management. It is clear that of development priorities. I do not agree and nor does governments must have an urban strategy which differs any single leader of countries to whom I have spoken. from an overall national strategy to the extent that But this is an issue for another day when we can ask concentration of population causes special and unique what would France, Germany, Italy and even Australia problems. Urban planning and appropriate action will be without their defining culture. be crucial in the next millennium. D. Specific Strategies - Rural, Urban, and 13. Private Sector Strategy Private Sector It is clear that the engine of growth is the private sector, Finally, let me shift gear once more to three specific both domestic and foreign . A vibrant private sector groupings of strategic issues requiring special attention, requires that crucial elements of structural policy are in namely a rural strategy, an urban strategy, and strategy place. These include trade policy, tax policies, competi­ to promote and maintain private investment. Each of tion and regulatory policy, and corporate governance. these strategies will build upon the issues already Conditions must be created for a climate of investor discussed, but because of the importance and special confidence - with appropriate laws, transparent nature of these three subjects, we set them apart for regulations, and predictable taxes. Whether the issue is individual attention and review. protection of property rights or fair and equitable labor practices, governments must give certainty to the 11. Rural Strategy. investor about the "rules of the game". Provision of credit, guarantees, sources of funding for projects all With the largest concentration of poor in rural areas in playa part in the competitive search by governments most countries, it is important for governments to for investment and for job creation. Nothing is more establish a coherent rural strategy. It is not sufficient to significant to economic growth than the private sector. have new crops and agricultural extension programs if there is not provision for trading, for microcredit, for 14. Special National Considerations storage, for transportation, and for non-monopolistic outlets. In addition, there must be technical assistance For completion of this list of prerequisites, I would to farmers and converters of agricultural produce. leave an empty box (#14) along the top of the matrix Governments need to think of integrated solutions to for Special Considerations depending on the country or rural development, not just individual programmatic the region. In Bolivia, for example, the box was filled help. Integrated action does not mean a return to by the government with a strategy for an Anti-Cocaine complex comprehensive and complicated state plan­ Production Initiative. In other countries, it will be filled ning, but we must get beyond individual programmatic in according to the special needs of the country or help in order to be effective. region. My purpose in suggesting an extra heading (or more, if necessary) in the matrix is to give flexibility for 12. Urban Strategy specific country considerations. With 66 megacities of more than ten million people All these issues together constitute the Right-Hand Side expected to be established in developing countries by of the Balance Sheet. the year 2025, with growth in all urban concentrations, and with our existing experience from Jakarta to Mumbai (Bombay), we have ample illustration of the 69 Comprehensive Development Framework Part II-A Proposal for a Broader The matrix will look as follows: Approach to Partnership and to Management of the Development Process If we can accept for the moment that the above-mentioned listing is a plausible Th~ Prerequisites for Sustainable Growth and Powrty Allevi4tion statement of the structural, social and ·5 human prerequisites for sustainable development, we can now devote attention ~ Ie i II 3 to a consideration of what is being done in ~ I these areas and by whom. It is obvious to i! ~ me that there is much too little coordina­ tion of effort, much too much suspicion I~ ~~ '!::-.. .. C> between participants and in many cases a .t: simple absence of a framework to coordi­ .. ·5 .:: ... nate and bring together under government ~ guidance an agreed set of objectives and " ~ I effective and accountable programs. There is too little transparency, much too little consultation and toO Iitde accountability for performance. Before discussing this matrix, let me make general preliminary points: We would like to test as a management tool a matrix. On the top of the chart - the horizontal axis - lists, First, there is no way that the World Bank should be we list the 14 subjects referred to in Part I. On the seen as assuming the role of the coordinator of all vertical axis, it will list the "players" in the development programs in the matrix. In some cases, under the business. guidance of government, we will lead the process or The players in the development field seem to be four: segments of programs. In other cases, we will follow the lead of others, and in further cases, we will not partici­ • The Governments - national, state, pate at all. The existence of the matrix is not a clandes­ city and municipal, within each country, tine attempt on the part of the Bank to dominate the and in some cases, regional groupings of international development arena, or the donor dialogue governments. I would add that we should in a given country. Quite the contrary. It is a tool to not forget the impact of the have greater cooperation, transparency, and partnership. parliamentary bodies which also constitute both an element in govern­ Second, stated more simply, the foremost objective of ment and a representative of civil society. the matrix is to give all the players, but most especially • Multilateral and bilateral agencies national governments and parliamentary bodies, a • Civil society in all its forms framework of information which can ensure openness, a • Private sector, domestic and foreign basis for coordination of effort, and for judgment of the effectiveness of programs and strategies. The matrix is open to all. It is a step towards inclusion, transparency and to accountability. Used correctly, it should stop 70 Proposal much of the mud slinging and allow for legitimate and Government should include not only national pro­ constructive praise and criticism - and above all, give grams, but provincial and state, city and municipal to a basis for evaluation and accountability. the extent that they are relevant. Third, I recognize that the pace of coordination and of 2. Multilateral and Bilateral participants: inclusion, of openness and accountability, win vary by country and by stage of political development. But in The listing of those involved in the programmatic this sense, the matrix is neutral, and the government thrusts is long, but let me give an incomplete but and the society it represents can alone determine the indicative listing. pace at which it wishes to move to a comprehensive IMF program of coordination and measurement of perfor­ UN agencies and programmes mance. Ultimately, the matrix is a tool for the govern­ WTO ments and people of the countries we serve. It is they European Union who must own the programs, not us, and it is they who Regional development banks must set the pace. Bilateral agencies International organizations Fourth, the matrix and annexes can and should be kept up to date in real time. The matrix will be a summary All of these participants, as well as the World Bank management tool. But behind each heading there will Group, are involved in projects and programs for be Annexes for each subject area, containing a substan­ development. At a time of lessening resources for tive description and far more detailed listings of short overseas development assistance and budgetary re­ and long-term goals, programs, their present status, straints on agencies which reduces available human timing, cost and progress. These annexes can, and resources, each of us needs to know what the other is should, be kept up-to-date using modern communica­ doing so that we can cooperate and avoid duplication tion and information technology, possibly with open of effort. designated websites. 3. Civil Society A Proposal for the Matrix of Development Activity In all its forms, civil society is probably the largest single factor in development. If not in its monetary Having discussed the top line extensively in Part I of contribution, then certainly in its human contribution this paper, let me now turn to the vertical axis on the and its experience and its history. chart, broken down into the following four participant groups in the development process: It is by its nature somewhat disorganized, due to the diversity of groups involved, although individual 1. Government projects and initiatives are often meritorious, effective and of very long standing. There is, however, little At the first level, the governmental structure of a accountability with some non-governmental organiza­ country must be in charge of the process of develop­ tions. Certainly greater cooperation with governments, ment strategy and implementation. Government should multilateral and bilateral agencies and the private sector aspire to have programs under each of the 14 headings would be beneficial to all. along the top of the matrix and these will be entered into the grid. Obviously, the entries will have to be The list of participants in civil society is great, includ­ made in a form of shorthand and as I just noted, ing, of course, elected parliamentary assemblies which annexes behind each subject heading will give fuller are included also in the government sector. An incom­ details. For example, an annex on Justice Systems, an plete list is as follows: annex on education, giving far more detail on each subject. 71 Comprehensive Development Framework (i) Religions and religious organizations; more effective and accountable manner. Accordingly, (ii) Foundations; the matrix will look as shown on Exhibit 1. This matrix (iii) Trade unions and employee organizations; will allow us to see quickly what is going on in a (iv) Employer organizations; country from the point of view of structural and social (v) Non-governmental organizations with interna­ development and will also show us what is not going tional reach; on. (vi) Local non-governmental organizations; (vii) Local groups organized for consultation and In my judgment, if we can develop the matrix effec­ for implemention of projects; and tivdy, it will be essential for governments and ministers (viii) Organizations of indigenous peoples alike to look at both sides of a country's balance sheet when they come to assess a country's position. It will Depending on local political circumstances, civil society not only be crucial to look at the macroeconomic, has a greater or lesser voice, but our experience is that financial and trade statistics but it wiU be equally by engaging civil society in projects and programs, important to look at the structural and social represen­ better results are achieved both with design and tations. implementation and usually greater effectiveness, including more local ownership. I think we all recog­ Goals, Achievements & Results nize more and more that local ownership is the key to success and project effectiveness. The Annexes to the matrix will playa crucial role. They might start with a general overview of the objectives of 4. Private Sector the government over the long term in each subject area. It will be crucial in each annex to set forth where the It is absolutely clear that domestic and foreign private country stands in terms of achievement and where they investment is the key to economic growth and employ­ want to go. The matrix should be read in terms of the ment. It offers know-how, training and investment stipulated and agreed goals. There would follow a which is essential for development and for the creation strategy for implementation with a timeiine. Thereafter, of employment opportunities. Private sector involve­ one could imagine a more detailed listing of projects ment is essential for science and technology - a critical achieved, projects underway, and projects planned, factor for growth in all countries. There is a responsibil­ together with a listing of those institutions providing ity on governments to provide an appropriate climate assistance and a detailed description of the projects for investment, but there is also a growing understand­ planned and undertaken with their results. The format ing on the part of business leadership that it is not only of the annexes should be set according to the subject morally good but good business to invest with a strong and to those participating in preparing and managing sense of social responsibility. it. One should also note that many public projects can For each of the annexes, specialists would meet under now be undertaken by the private sector; e.g. water, the guidance of the government or minister concerned power, and communications, and that in many econo­ perhaps setting forth the program for the next one to mies privatization of state-owned industries is a three years within a ten to twenty-year framework. significant element in sustainable growth and in These annexes would be kept up-to-date as interaction balancing the budget. with all the interested parties occurs. The information would be transparent and available to all. It would be a Sharing of Information and Cooperation critical management tool. If it were possible for all four groups to share informa­ It would also be possible to link on one internet site all tion on what they are doing and plan to do, we would the "players" so that a continuing dialogue can be have a real chance of achieving longer term targets in a maintained and the maximum cooperation achieved. 72 Proposal Participants wanting advice or reaction to an initiative What is new is an attempt to view our efforts within a could get help from all other participants and have long-term, holistic and strategic approach where all the access to best practices available in the development component parts are brought together. Such develop­ community. ment should, in our judgment, be a participatory Proactive knowledge management will allow all of us to process, as transparent and as accountable as possible share best practices and new research results. It will within the political climate prevailing in each country. challenge us to improve our understanding of linkages This is not a return to central planning. It is a holistic and causality affecting poverty and set the pace for new and strategic approach to development based on analytical work and an invigorated research agenda. We country ownership and partnership. hope to work on such an agenda with our partners in government, academia, and business. What is new is the commitment to integration of effort, essential in today's global economy where overseas aid is I believe the impact of technology on development declining significantly. It is also a commitment to cooperation will be profound and far-reaching if used expanded partnerships, transparency, and accountability effectively. Already, we at the Bank are linking all our under the leadership of the government. overseas offices with voice, data, and video communica­ tion by satellite and this can be a basis for a single, What is new is that the international financial architec­ inclusive and transparent global community. ture must reflect the interdependence of macroeco­ nomic and financial, with structural and social and The Test Phase human concerns. We are in the process of agreeing with a dozen or so I personally believe that unless we adopt this approach countries to try out the Comprehensive Development on a comprehensive, transparent, and accountable basis, Framework on an inclusive, transparent, and account­ we will fail in the global challenge of equitable sustain­ able basis. Already, our colleagues working in Bolivia able development and poverty alleviation. We will fail have produced their own form of matrix which is to build a sustainable international architecture for the attached. We will continue to experiment as we go coming millennium. forward. Certainly, we should give this approach a chance, work Crucial to the success will be open discussions with all with our chosen countries, with our partners, and participants to learn from their experience, to have measure our results in a 12 to 18 month timeframe. I them join in the experiment to the extent that they am not wed to every word of this approach. I want to wish. We will be totally open and looking for full test it, and if it can be improved and developed so that partnership. Without it, this program cannot work. we can all be held to higher and more accountable and comprehensive standards, then our goal of making a Conclusion better and fairer world will be closer at hand. To conclude, let me say that none of this would be possible without the work being done individually by all our institutions in giving advice and support on projects and programs. Clearly this must continue with even greater efficiency and effectiveness. 73 -....l ~ o ~ ~ A Prerequisite for Sustainable Growth and Poverty Alleviation ~ '" ~ ~. t; Structural Human Physical Specific Strategies ~ ~ ~ ;:! ~ ... (1) (2) (3) (4) (5) (6) (7) (8) (9) ( 10) (ll) (12) (13) (14) Gt:xx1 Justice Finan- Social' Education Health Water and Energy Roads. Environ- Rural Urban Private (Country ;r ::::i and System cial Safety and and Sewerage Trans- mental Strategy Strategy Sector Specific ;:! Clean Govern- System Net Knowledge Institutions Popula­ tion portati()n and and Cultural Strategy Headings) '" ~ and ;l l ance Social Tele- Issues ~ 0 Pro- i comuni­ > S grams cations 3: a. 0 CI> I 0 '"t) GO\'er~nt ~ - National ~ 0 - Pro\'incial - LocJll (;! sr S­ O Multilateral 0 0 and J < 0 Bilateral .g Institutions I I I 8 0 a I I I ~ () Chil Society 0 CI> CI> I I --­ I i Prhate ~tor ::t:.. ;:s ;:s ~ '"­ :::t... ~ New Development Framework-Bolivia ~ ~ ~ Poverty Alleviation OPPORTUNITY EQUITY INSTITUTIONALITY DIGNITY Higher Rates of Sustainable Improve Income Distribution Governability for Remove Itself from Economic Growth and Inclusion Opportunity and Equity Coca Drug Trafficking Circuit . .. : I: ~ '5 j HI U ~ ~ .... =1 i l .!!, ~ !j .. I j1 & I ~~G "lit .g, . I. I U If It I 111 1 III: t f:C J • Transport · !l~ • Regulotory ~ . Financial 11 • Biodiversity if - Agro JIlt - Panicipatory il3 !~ .:i - Education !li - Municipal ·lnSlitutional I.. . - Judicial 1 lad ·Na· ~ ::!. 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For Higher Educalion ACClOunlllbilily mic:roflCllls • Transport- -Wilts • Ecological - Agricullural • Buic · Educalion · Social • Nalional • JUSlice Power Regulatory Eo viron.menlal Tourism Sector Sanilation for Reform Participation Oovemance Program • Urban Reform Regulations Small - Buic Heallh Sirengthening 8 !XI Developmenl · SCCloral Municipalilies -Child • Housing Privatizalion • Micro- Developmenl enlerprise ·CAF Roads • Canada . US AID - USAID · Netherlands • OPEP Rural · Sweden and · Nelhtslaodli - USAID . . USAID . USAID ·US- • Korea Privale Micro-linance NalUral Rural Water and UNDP Educalion Admin· Governance Comple­ Allornaliv. ErTad- AID Roads Investmonl ·CAF Resources Tdecoms. And Sanitation Reform iSlllltive . Sweden. menlary Develop­ ication Development Financial ·KFW Energy ·KFW -Germany Decenb'll· Denmarl<. and activities ",ent ~ . Sweden SySlem Biodiversity · Spain Rural sewerage Education izalion GTZCivil by ·UNDCP UNDCP ... n InduSlrial Expansion · UNDP Power • Denmark Quality - UNICEF Ser\'i«" USAID Alternative C Cooporalion Ecological -UNDP and ADA • UNICEF andEU andOTZ Developm 0 Tourism and Informllion Indigenou s Heallh. NUb'ition Municipalily enl 5 ;;! Bindiver.ily Capacity l and Sinila. ion Strengthening - NDF Land · UNDPand Administration lJSAID Health · Denmark .­ .'.'. · Teloconl< . B.nks ~ , ·WalC'J' - Insuranc,c ~~ - Power Co. · Local NOO. ·TI -­ Z • l.ocal NGO.< · Lne:ll NOO. S I ~ -.J ~ VI ~ ;::,. ""­ Questions and Answers Update June 1,2000 Questions and Answers This document responds to questions which have been The CDF is meant to provide a compass- not a blue­ raised inside and outside the World Bank on President print. How the principles are put into practice wiB vary Wolfensohn's Comprehensive Development Framework from country to country, depending on economic and (CDF) proposal I The implementation ofthe CDF has social needs and the priorities of the stakeholders in­ been trackedfor over one year in twelve pilots, and during volved. Some development agencies, including the Bank, this period new questWns have been posed, and original are already organizing themselves to support the holistic answers have been either confirmed or revised in the light approach in promoting development. ofexperience. It is also important to point out that the CDFprinciples have been widely endorsed, as reflectedfor What Is The Origin of The CDF? example in the Development 1999: Development Co­ operation Report prepared by the Development Assistance The CDF principles were foreshadowed in President Committee ofthe Organization for Economic Coopera­ Wolfensohn's 1997 and 1998 Annual Meetings Speeches, tion. 2 As implementation experience accumulates new and in the Bank's Partnership Strategy3, together with questions are likely to arise. ~ intend to continue to external consultations. build on the original CDFproposal in consultation with all interested parties. Go to http://www.worldbank.org/ The ideas in the CDF reflect direct observations of cdflcdf-faq.htmfor online version. development experience, well documented in evaluations from across the World Bank and the broader development Background and Origins community. They stem from evidence that the pursuit of economic growth may too often have been at the expense What Is The CDF? of social development, and that open, transparent, participatory processes are important for sustainable The CDF puts forward a holistic approach to develop­ development. These are ideas around which there has ment. It seeks a better balance in policymaking and been a convergence among developing country govern­ implementation by highlighting the interdependence of ments, NGOs, the UN, members of the Development all elements of development-social, structural, human, Assistance Committee (DAC) of the OECD, and others governance, environmental, macroeconomic, and finan­ in the development community - as reflected for example cial. This approach requires a transition from donor-led in On Common Ground, a paper circulated by the DAC in development assistance strategies to the development of a Fall 1999. The CD F aims to bring many of these ideas country strategy led by a country itself, with vigorous together in a single place. participation of civil society and the private sector and with the support of multilateral and bilateral organiza­ The CDF also involves a commitment to expanded tions. partnership, transparency, and accountability under the leadership of the government. The CDF recognizes that Fundamentally, the CDF is a means of achieving greater there is no substitute for national leadership or national effectiveness in reducing poverty, through among other consensus for development. aspects, serving as a management tool to guide the actions of all actors. It is based on the principles of: Why Is This Approach Needed? -A long-term comprehensive vision ofneeds and solutions Development is about much more than the balance of -Ownership by the country payments, or reserves or trade figures or GOP growth. -Partnership with internal and external actors Development is about transforming whole societies. -A focus on development results Experience shows that unless we look at both sides of a country's balance sheet-macroeconomic and financial These principles themselves are interdependent and must aspects on the one side and structural, social, and human be approached holistically. They are discussed in the considerations on the other-we run a grave risk of section on CDF principles. misjudging a country's performance, as well as inad­ equately supporting its future development. 79 Comprehemive Development Framework Experience also shows the need to identify and plan The Principles development projects and programs within a comprehen­ sive or holistic approach. Otherwise, the projects and Long-term, Holistic Vision programs may not match the greatest needs, they may lead to duplication of efforts, and their prospects for Addressing a country's development priorities requires a success will be weakened considerably by a lack of parallel strong anchor in an appropriate, consistent, long-term development of other supportive programs. Also, in a vision of its needs and ways to address them. That vision world of inevitably constrained overseas assistance and also needs to be holistic-that is it needs to: limited human resources to meet the global development challenge, we must be ready to contribute to constructive -Be balanced, by addressing simultaneously the key partnerships that bring together government, macroeconomic issues, structural requirements and social multilaterals and bilaterals, civil society, and the private issues faced by the country; and, sector, in a transparent and interactive process-with -Cover the inter-linkages between sectors, since success in agreed long-term goals and the right cooperative spirit to one sector is often linked integrally to progress in others. achieve them. Country Ownership The purpose of Mr. Wolfensohn's CDF proposal was to provoke discussion, experimentation, and action toward The country needs to be in the driver's seat, owning and these objectives. In the last twelve months the develop­ directing the development agenda with the support of all ment community has paid close attention to progress in other actors. The Government, therefore, needs to build the CD F pilot countries, and as a result there is today consensus internally, and also consult widely-drawing much greater convergence of views on the merits of on democratic structures as appropriate-with other parts implementing the CDF principles. of society, including civil society, the private sector and the country's external partners. The purpose of such What Is The Value-Added Of The CDF? consultation is to draw out ideas, knowledge and opinions and to promote consensus on the strategy expressed in the While the term CDF can be viewed as "new", the long-term, holistic vision. principles which make it up can be seen as a natural evolution of the development community's role and Enabling such ownership will often require strengthening broader development thinking. For example, as the Bank of capacity in government and elsewhere in society (see has moved beyond simply financing projects-and even section on capacity building). beyond supporting only discrete policy reforms, such as trade liberalization-to addressing broader issues such as Partnership human and social development, governance, and institu­ tions-the need for a CD F framework has become Enabling the country to be in the driver's seat requires apparent. strong partnership among Government, civil society, the private sector, donors, international agencies and other In terms of value-added, the broader framework of the development actors. Such partnership should: CDF can allow the participants of a country's develop­ ment to think more strategically about the sequencing of -Bring together, within a single framework, under policies, programs, and projects and about the better Government leadership, analytical and djagnostic work; pacing of reforms and the choice of appropriate technol­ -Align donor actions to the national strategy and promote ogy. It can encourage a better balance between sectors and selectivity to avoid duplication; greater transparency in complementarities and tradeoffs -Reduce wasteful competition; between, macroeconomic and social needs. Further, the -Encourage common procedures amongst all develop­ better alignment of strategies and greater selectivity for ment partners; and, each player in the development effort-which the CDF -Support the government's lead in managing aid coordi­ can promote-will mean that there is greater policy nation. consistency and that more can be done with available resources. 80 Questions and Answers Development Results in recent Bank analytical work, such as the pilot Social and Structural Reviews, increasingly focus on these kinds A country's national vision needs to link its overall aims to of long-run issues. concrete development results, in a way in which progress towards the aims of that vision can be assessed. These The World Bank works closely with national governments development results are those sought through a broad­ and other development partners, such as the IMF, to help based national dialogue process. Since a key aim of the countries better integrate macroeconomic, structural and CDF is more effective and sustainable poverty reduction, social policies in country programs to achieve sustainable the specific development results sought should be guided growth and development. and informed by the International Development Goals which have emerged, mostly from agreements in UN Structural and Institutional Issues conferences, during the 1990s. It is well established that insticutions are at the core of Issues to Which CDF Relates sustainable development. Institutions which provide predictability and work reliably provide the foundation to Macroeconomics make effective long-term decisions. At the country level, institutional structures which promote such reassurance The CDF proposal noted that: include those which promote: '~n appropriate macroeconomic framework is essentialfor -Good and Clean Government; our work, but... we cannot adopt a system in which the -An Effective Legal and Justice System; macroeconomic and financial is considered apart from the -A Well-Organized and Supervised Financial System; and structural, social and human aspects, and vice versa. -A Social Safety Net and Social Programs. Integration ofeach ofthese subjects is imperative at the national level and among global players': The CDF principles place a particular emphasis both on the need to develop or strengthen these insticutions and The CDF facilitates the integration of macroeconomic support their development. and financial issues with structural and social policies through its emphasis on country ownership, broad Capacity Building sectoral coverage, and a medium- to long-term horizon. The CDF will strengthen the Bank's focus on questions Governments need relatively well-developed organiza­ such as: What are the sources of growth and what are its tional capacity to be able to "own" the development prospects? What are the linkages between growth pro­ process. That is, they need organizations which are cesses and poverty reduction? How do policies, institu­ adequately managed and staffed to define development tions, social, structural, sectoral and environmental problems, consult with multiple stakeholders, identify conditions interact to affect growth? How are the benefits appropriate strategic responses and orchestrate the actions of growth distributed? How can the quality of growth be needed for their implementation. This kind of capacity enhanced to maximize benefits for the poor? The holistic, takes time to develop and in many countries there are long-run approach of the CDF nacurally highlights these difficult structural and insticutional issues needing to be complex but critical questions. addressed simultaneously. Governments must be ready to manage the potential tension between capacity constraints The CDF also draws attention to other important and the need for structural reforms, and between the macroeconomic and sector policy issues, such as ensuring formulation of domestic policy choices and external the long-run fiscal sustainability of the country's develop­ policy advice. ment strategy; evaluating the medium-term external financing needs generated by the country's development Implementing the CDF approach is a promising way of strategy; and addressing the tough economic management addressing insticutional and struccural reforms, on one issues faced by countries that are subject to repeated hand, and organizational capacity, on the other. Both shocks such as droughts or large commodity price swings. these sets of issues must be integral to the country Reflecting the approach of the CDF, discussions of policy strategy process. 81 Comprehensive Development Framework The Bank is ready to support capacity building under the speech to UNCTAD X in Bangkok, and in the CDF, and indeed sees it as a necessary ingredient, and it communique from the Development Committee meeting will look to individual governments to take the lead in on April 17, 2000. The partnership dimension of the defining the scope and pace of their development. CDF can also facilitate a dialogue on mutuality in trade relations. Where the country does not have adequate capacity, the international community should support and help the Labor Market authorities to establish, own, and implement programs that fill the gaps. At the same time, capacity building Labor markets are critical to development, and have wide­ activities themselves provide increasing opportunities for ranging effects on economies and the lives of people. As more effective donor coordination and for scaling up their the CDF provides a holistic approach to development, impact. The positive news is that in all CDF pilot and labor accounts for the bulk of personal incomes, countries efforts are under way to strengthen capacity. labor issues are vital in the CDF. The Bank is working in However, in most cases, these efforts still are inadequate partnership with other institutions such as the Interna­ and special attention to capacity-building and knowledge tional Labour Organization (ILO), the World Congress of transfer should continue. Labor and the International Confederation of Free Trade Unions, on these labor issues. Trade Well functioning labor markets can contribute to eco­ An appreciation of the impact of trade policies is an nomic growth and poverty reduction. This is especially important element in the holistic, cross-sectoral and long important to the poor in developing countries, as many term approach to development fostered by the CDF. have labor as their only asset. Productive employment Trade policies can have a significant effect on the level can bring about social development not only through and distribution of income, how resources (labor, capital, income generation and poverty reduction, but by creating etc.) are allocated among different sectors of the economy, a sense of dignity and self-worth to the individual and, at what techniques of production are used, access to foreign the aggregate level, contributing to social haFmony. technology, capital equipment and investment, and rate These benefits also depend on the quality of employment of economic growth in the long run. provided. The World Bank recognizes and supports the ILO's emphasis on Decent Work as an important compo­ Over the past two decades, many developing and transi­ nent of social development. In the absence of a smooth tion countries have dramatically liberalized their trade functioning labor market, economic deprivation and policies by removing or reducing trade barriers such as social exclusion may result, which tends adversely to affect quantitative restrictions on trade, tariffs and foreign minorities, women and children in particular. Further, exchange controls. There is increasing recognition that, there is widespread recognition that labor-intensive for countries to draw the fullest benefit from integration growth is key to reducing poverty. Creating the condi­ with the world economy, they also need to move beyond tions for achieving labor-intensive growth remains a reducing "traditional" trade barriers to more difficult challenge especially in low-income countries. The broad institutional reforms. These issues include, for example, approach of the CDF is likely to be of assistance in the efficiency of customs, ports and other logistical addressing the complex, multi-dimensional issues raised facilities, the quality of domestic competition policies,. by this challenge, and the participatory nature of CDF performance and competition in services industries increases opportunities for labor to be consulted and (especially in vital intermediate services such as telecom­ heard. munications and financial services), government procure­ ment practices and the role of product standards and Gender regulations. A comprehensive framework for develop­ ment facilitates this integrated view of trade policy and Gender disparities exist in every country of the world. In development strategy, as set out in Mr. Wolfensohn's most countries, the evidence suggests, decreasing these 82 Questions and Answers disparities would reduce poverty and enhance economic Global and Regional Issues growth. Gender issues therefore need to be part of the consultation process with all partners on the CDF, and Global and Regional issues are of increasing importance for all topics. in dealing with the challenges of development. From the environment (climate change, deforestation, water use When discussing the various prerequisites for develop­ and flood control) to health (vaccines, aids) to trade ment, it is therefore important to identify gender issues (market access, labor standards), issues that transcend the that are inhibiting development in that area-and ask nation-state are now near the top of the development how problematic gender disparities can be reduced. For agenda. example, when discussing governance issues, it is impor­ tant to ask whether women have an effective voice in The holistic nature of CDF, and the active dialogue government policy making, given the evidence that the between domestic and international partners, should assist inclusion of women in governance reduces corruption. developing country governments and donors formulate Similarly, with regard to the legal and judicial systems, it coherent responses to regional and global challenges-in is important to ask whether existing laws and their particular, addressing how to anchor these responses in a enforcement treat women and men equitably, since local reality. inequitable treatment often underlies the inability of women to make a full contribution to economic produc­ Opening avenues for partnership by developing countries tivity. With regard to safety nets and social programs, a in regional or global initiatives (such as the Special critical question is whether such programs adequately Program of Action for Mrica (SPA) and the Global recognize the vulnerability of women to demographic and Alliance for Vaccines and Immunization (GAVI)) remains economic shocks, caused by their dependency on male a challenge for the international community. An impor­ family members for income transfers. In areas such as tant element is information access and knowledge sharing. agriculture and water and sanitation, the important The Global Development Gateway, being promoted by questions include whether women's distinctive roles in the the World Bank and a network of partners, is an impor­ sector have been adequately addressed in the design of tant initiative, that supportS CDF at the country level sectoral programs. and has the potential to strengthen regional and global collaboration. The CDF process provides an opportunity to ensure that all interests are fully reflected in determining government priorities. Thus most of the pilots explicitly highlight Roles under the CD F gender issues in their strategies, both specifically, and as a cross cutting theme. Examples include Bolivia, where Government they have established indicators of progress which, especially for the Equity Pillar focus on improving the The means of arriving at consensus on a national develop­ welfare of women and children. The Dominican Repub­ ment strategy or vision will vary from country to country, lic now aims to promote equitable access to justice for partly depending on the maturity of the country's women and men. Eritrea's strategy recognizes that much governance processes and institutions. It is very impor­ needs to be done if women are to be fully empowered­ tant that the consensus building process in the country and sets out specific measures to address this aim. In build as far as possible on the existing democratic institu­ Morocco, a National Action Plan for the integration of tions at local and national level. A central aspect of women in development wi1l be part of the National implementing the CDF in a country, however, will be Development Plan for 2000-2005. Romania's new support for government efforts to draw out the views of strategy specifically covers, among other things, increasing different stakeholders, for example, through: the number of women in key positions in the public and private sectors, strengthening the legal framework on -Supporting the identification and ownership of a violence against women, and the provision of workplace balanced national development strategy, and an enhanced child care. central role of government in the coordination of develop­ ment assistance; 83 Comprehensille Del1elopment Framework -Supporting the role of legislatures in public policy (e.g. ownership be expanded as broadly as possible, so that the through adopting laws and parliamentary inquiries), in poor and minority groups are fully involved, and are not building a national consensus on development and in disenfranchised. This emphasis, on giving a voice to the providing oversight of governmental programs and poor, will make it more likely that resources go where policies; they are most needed-and that the benefits can be -Supporting in-country consultative group meetings to sustained. This presents a major challenge and may enhance the participation of key national stakeholders, require special efforts, including, where necessary, including civil society and the private sector; strengthening the capacity of civil society groups, to -Promoting efforts to develop and implement assistance ensure that the consultative processes with the poor and strategies that emerge from a country's own national minority groups are meaningful exercises. development agenda and priorities; - Promoting joint analytical work with partners to Civil Society (including NGOs) enhance country capacity, consensus building, and ownership; Civil society involvement is central to the partnerships -Supporting national fora to promote civil society and approach and consensus building essential for the success private sector inclusion; of the CDF. Civil society includes NGOs, Academia, - Promoting the harmonization of development assistance Faiths and Labor organizations. The involvement of civil agencies' operational policies and procedures-to increase society in defining the national strategy and its priorities, efficiency in the delivery of assistance and reduce the represents a major shift in promoting development. It is burden on the country of dealing with multiple proce­ also a key aspect of country ownership of the policy dures amongst donors and international agencies; and agenda, as distinct from government alone defining the -Supporting the development of country-based knowl­ strategy. Increasingly, civil society (including NGOs) edge systems that would enhance government coordina­ plays a crucial role in promoting development at the grass tion efforts. roots level and is an important vehicle for giving voice to the poor and marginalized. Nevertheless, civil society is The emphasis on promoting broad ownership that not a homogeneous group and engaging its representa­ includes civil society, agencies and the private sector, and tives in the policy debate must be defined by country­ the focus on key, long-term development priorities, means specific circumstances and not be a substitute for, or the CD F should transcend government changes and undermine, local democratic institutions. strengthen the sustainability of development efforts. Even the choice of who should speak on behalf of civil Parliament and other democratic institutions society can pose certain challenges. In Ghana, Bolivia, Uganda and several other countries, conscious efforts to The process of building a national consensus and owner­ include civil society in policy discussions, as well as in ship of a country's development strategy is vital to the policy implementation, have revealed the need to build CDF. It is essential that Parliaments and other demo­ both capacity and organizational structures that would cratic institutions in the country are fully involved in this allow for constructive engagement in the policy debate. process. In Bolivia, members of Parliament discussed and approved the National Action Plan. In Ghana, its In principle, civil society can also be an important player national strategy, Vision 2020, originated as a report to in carrying out analytical work jointly with the country's Parliament, who provides a focus for policy debate. In government and other partners, where the capacity is Uganda, the Parliament is becoming increasingly involved available. Although this remains largely a potential at in discussing development issues. present, it does hold promise for the future. Poor and Minority Groups Private Sector One of the most important principles in the CDF is that A significant change in the approach to promoting of country ownership of the development agenda. In this development is the increasingly important role of the process of national consensus building, it is vital that private sector. The CDF recognizes this role and advo­ 84 Questions and Answers cates the full participation of the private sector in the partnerships, essential for the success of the CDF ap­ policy debate, consistent with the need for inclusiveness. proach, require active nurturing of mutual trust and There is growing evidence both from the CDF pilots and confidence among the players. Equally, the CDF will also other sources, that the private sector is now increasingly mean changes in the culture and attitudes of all partners. included in the policy debate: For instance, Consultative Group (CG) meetings now involve private sector partici­ Bilateral Donors pation either directly by way of a seat at the table, or indirectly through separate meetings. Prior experience, and early experience from some of the CDF countries, shows that bilateral donors are prepared, In Vietnam, the private sector was involved for the first and in many cases very keen, to move toward greater time in a CG in 1999, and a private sector forum has cooperation to avoid the duplication of analytical work, been established with the aim of identifying constraints to and to harmonize their processes for appraisal, monitor­ the more rapid expansion of its role. Romania is another ing, and evaluation-thus increasing their efficiency and case where efforts are underway to fully involve the reducing the workload for countries. private sector in the policy debate: Intensive consulta­ tions-recently organized in the form of workshops to Uganda's experience shows how various donor initiatives identify Romania's national vision and priorities-fully can be brought together. The Consultative Group involved private sector participation. With more CGs meetings held in Kampala, in December 1998 and March held in the field, the scope for private sector participation 2000, drew broad representation from the private sector, is becoming much larger. It is expected also that good civil society, the donor community, and the government, governance and judicial reform, both important aspects of with full participation of the President, parliament, and the CDF, will provide a suitable environment for private the cabinet. These meetings are also part of a broader sector activity. process of discussion on macro and sectoral issues, which has improved government interaction with donors, and The Development Community helped better to define the sorts of programs that are needed. "The key point about the CDP is that it's a basis for bringing people together-not necessarily under World Bank leader­ The Regional Development Banks ship. In some cases the Bank will lead, in some cases it will follow, and in some cases it will not be there at alL" The regional development banks are key actors in all the CDF countries, bringing a regional perspective that -J. D. Wolfensohn complements we1l the World Bank's global perspective. From the outset there have been regular consultations The principles underlying the CDF reflect the principles with the main regional development banks (African, espoused by the Development Assistance Committee of Asian, Inter-american, European) on how to collaborate OECD, the EU, the UN, and bilateral donors. This in support of countries piloting CDF. There are regular convergence is reflected in a recent paper by the 0 ECD's meetings between World Bank and regional bank opera­ Development Assistance Committee (DAC) entitled On tional managers in several of the pilot countries ( Cote Common Ground. d'Ivoire, Ghana, Ethiopia, Uganda, Vietnam, Kyrgyz Republic, Bolivia). They also seek to identify synergies The CDF aims to give all the actors involved in a and resolve issues of potential duplication of interests at country's development the information that provides a the country level. Joint team-building seminars, basis for each to contribute according to their compara­ involving World Bank and regional bank staff, have taken tive advantage. The actual arrangements for inter-agency place in some of the pilot countries. coordination and division of labor will be unique to each country adopting the CDF. It will be important to Recently the World Bank has entered into specific ensure that these arrangements do not undermine the agreements with the African and Asian Development country's ownership and decision-making power and that Banks to foster closer collaboration at the country level, they facilitate the participation of all major stakeholders. reflecting the principles of CDF. The World Bank and Each agency will remain individually accountable for some of the regional banks have a different level of carrying out its agreed contributions. However, effective country presence in the CDF pilot countries, which 85 Comprehensive Development Framework requires closer collaboration then ever before. The Work is under way to better integrate frameworks such as regional banks are in turn expanding and strengthening the UN Development Assistance Pramework (UNOAF), their field presence. the UN Common Country Assessment (CCA) with the COP, in the common interest of creating a coherent, At the institutional level, the MOBs (World Bank and integrated approach that supports a country-led national regional banks) have established working groups to development strategy. UN Resident Coordinators have harmonize various operational policies and procedures, been encouraged to engage with the COF based on the that have an impact on the effectiveness of implementa­ comparative advantages of the various UN agencies tion of programs and projects at the country level working locally. (procurement, evaluations, environmental assessments). Through harmonization it is anticipated that scarce UN agencies have also designated COF Focal Points to resources in client countries can be freed up for more provide useful feedback on pilot activities and as a way of productive work, and a'Iso reduce the transaction costs of identifYing how to strengthen partnership with other aid delivery. The MDBs also are actively engaged in players involved at the country level. These focal efforts to build coherence in analytical work and advice points-including from the World Bank-meet regularly given to governments, addressing for example issues such to review progress. as financial sector reform, governance and private provision of infrastructure. Processes to Which CDF Relates The International Monetary Fund (IMF) The Relationship Between The Processes The Bank and the IMF have a long-standing partnership There are a variery of processes intended to support the in assisting member governments achieve sustainable efforts of developing countries to reduce poverry, which growth and development. This partnership recognizes the include, but are not limited to, those set out in subse­ primary responsibiliry of the Fund for macroeconomic quent answers. The COF aims to be holistic by providing stabilization and surveillance, and the primary responsi­ a framework through which all these processes can be biliry of the Bank for structural and social issues. The related together in a coherent way which avoids wasteful COP approach does not presume any changes in the competition. The COF principles set out elements for mandates and responsibilities of the two institutions. the long-term and an overall approach to make progress However, the COP could enhance the development sustainable in reducing poverry. Within that overall impact of this partnership because it further emphasizes approach, Governments still need to set out their concrete country ownership; proadens and deepens sectoral plans for making progress in the short or medium term: coverage; places strategies and policies in a longer-term such plans might rypically be captured in a three to five horiwn; stresses that to be effective, economic programs year country strategy and in the medium-term expendi­ need to be comprehensive and holistic; and require the ture framework. In turn, there needs to be a clear link support of a broad-based international partnership between the country strategy and the specific activities extending beyond the Bank and the IMF (see section pursued by each internal and external partner pursuing below on Poverry Reduction Strategy Papers (PRSP)). poverry reduction in that country. That link is rypically captured in a country business plan for that partner. The The United Nations System aggregation of such business plans should in turn contrib­ ute to that partners overall aims for poverry reduction, Today, there is consensus between the UN, the Bank and and the achievement of other relevant agreed interna­ its major development partners regarding the links tional development goals. between social development and a sound macroeconomic and structural policy environment and, an agreement on These relationships can also be set out graphically as in the need for close cooperation and partnership. This the COF process diagram (see chart on page 32 In approach has been endorsed by the heads of all the UN Country Experience section of this book) . Funds and Programs. The UN Development Group leads on this work, at the request of the UN Oepury Secretary General. 86 Questions and Answers Poverty Reduction Strategy Paper (PRSP) their overall development programs. As set out in the Bank's 1999 CAS II Retrospective, the CDF provides an The PRSP is to be prepared in accordance with the CDF umbrella under which each agency can prepare its own principles. It integrates poverty reduction policies into a CAS or business plan. In this context, the CDF provides coherent, growth-oriented macroeconomic framework. a basis for continued CAS reform, by enabling some As with the CDF, national governments are responsible unpacking of the CAS assistance services from loans, to for the preparation of PRSPs, with the participation of be refocused more sharply on the World Bank Group's domestic and external partners. External partners are program, within the broader context of the CDF, to­ encouraged to assist governments in preparing PRSPs, gether with any medium term plan for taking CDF and to link their development effortS to them. A PRSP principles forward. An example of this approach is the must be broadly endorsed by the Bank and the Fund latest Ghana CAS which is in two partS: the first part is a Boards to provide a basis for both institutions' medium-term strategy for Ghana, written by the Ghana­ concessional programs in low-income countries, and for ian Government, and presented by them (via a video-link) countries to obtain debt relief under the HIPC initiative. to the World Bank's Board. The second part focuses Thus, the PRSP is an operational vehicle-which can be a specifically on the Bank's plans for supporting that specific output of a CDF or of processes based on CDF­ Government strategy. As lessons are learned in the CDF principles-that is intended to translate a country's pilots, they are being reflected in Bank CASs, programs, poverty reduction strategy into a focused and time­ and operations. bounded action plan. Indeed, countries using the CDF (such as Ghana, Uganda, and Bolivia) have been at the With the central importance it attaches to country forefront of those successfully preparing PRSPs. ownership of national development strategies, CDF can help marshal wider support for addressing a well-recog­ The CDF and the PRSP should be mutually reinforcing. nized problem-the proliferation of CAS-type documents The PRSP process will focus the attention of a larger among bilateral and multilateral donors-which is number of governments on CDF principles. It will also increasingly burdening clients. A country-owned CDF­ ensure more effective collaboration between the Bank and based vision provides the basis for a medium-term the Fund in supporting countries, as specifically requested development strategy which all the country's external by their major shareholders. partners should be ready to support, and on which they can focus their individual business plans. The preparation of a PRSP inevitably brings with it some challenges: International Development Association (IDA) -First, time is needed to allow for the development of a The CDF is fully consistent with IDA goals and objec­ fully country owned and participatory process, while not tives: unduly delaying the delivery of debt relief or development assistance. -First, in keeping with IDA's overarching goal of poverty -Second, there is a need to ensure that all development reduction, CDF promotes broad-based growth, supports partners are given an opportunity to be included fully and good governance, focuses on development outcomes early in the process. favoring sustainable development and poverty reduction. -Second, both IDA and the CDF recognize the impor­ The Bank's Country Assistance Strategy tance of flexibility and customized country programs, (CAS) and other Development Agencies' fully grounded in country ownership and partnership Plans between the recipient country and donors. -Third, IDA and the CDF both focus on performance The CDF and the Bank's CAS are fully complementary. and aid effectiveness. Recognizing that poverty reduction The CDF covers the totality of a country's long-term is more successful in a good policy environment, IDA development strategy. The CDF is especially useful in country allocations are based on performance, which is helping countries to design, sequence, and coordinate assessed on an annual basis. 87 Comprehensiz1e Development Framework United Nations Common Country What does it mean to be a CDF Pilot? Assessment and Development Assistance Framework The pilots are putting into practice a critical mass of the CDF principles. But in each one, the approach taken and The UN Common Country Assessment (CCA) and UN the timing of progress will depend on country circum­ Development Assistance Framework (UNDAF) are both stances, including the interaction between the govern­ instruments intended to improve coordination at country ment and internal and external stakeholders. The Bank is level among the UN agencies, and the effectiveness of not advocating a standard approach. In some pilot their support to Government. As such they are entirely countries steps towards implementing the CDF principles consistent with the CDF, albeit within a more specific have actually preceded the CDF proposal. As progress in context. In developing a national vision, a government implementation of the CDF is being tracked, the empha­ wiU be expected to draw on the widest possible sources of sis has not been in isolating the influence of the CDF analysis and advice. It is therefore to be expected that the proposal, but in capturing the implementation of the UN's assessment of their economic problems and pros­ CDF principles. pects, as captured in the CCA, will make an important contribution in the formulation of country strategies. Since Spring 1999, the Bank has followed the efforts of Equally, in assembling a better picture of the range of pilots with interest, and elicited inputs and guidance from interventions contributing to the country's development, all our partners on the CDF concept and its operational the UNDAF will helpfully articulate the UN's role. See feasibility-with participation and shared learning that also section above on the UN System. are as broad as possible (for details see section on UN Country Assessment and Development Assistance Implementation Framework below). How is the CD F Being Implemented? A first progress report was published in September 1999, and a second in May 2000. Another CDF report is being Mr. Wolfensohn's proposal for a 'Comprehensive Devel­ submitted to the World Bank Governors for the Annual opment Framework' was launched on January 21, 1999. Meetings 2000. It was endorsed by the Development Committee of World Bank Governors at the 1999 Spring Meetings. Individual Country Circumstances Mr. Wolfensohn promised to report on progress to the World Bank Annual Meeting in September 2000. There is no single model for the CDF. Over a period of experimentation on the ground and structured learning, Implementation of the CDF is currently being tracked in the "pilot" countries are using the CDF to craft their the following twelve pilots: Bolivia, Cote d'Ivoire, programs and experiment with different ways of work­ Dominican Republic, Ethiopia, Eritrea, Ghana, Kyrgyz ing-for example, greater partnership and stronger Republic, Morocco, Romania, Uganda, Vietnam, and ownership. Different areas of initial emphasis clearly West Bank and Gaza. These are the selected pilots reflect different country circumstances, as no two pilot because the country authorities at the highest levels are countries started from the same baseline. Disasters, such aware of what the CDF offers, and have expressed interest as floods in some pilot countries and droughts in others, in taking part. Their diversity emphasizes that the CDF and political events, also have an impact on country approach is relevant to a broad range of countries and ability to focus on a longer term, holistic development that there are no set criteria, other than that the govern­ agenda. ment embrace the concept. Country ownership is at the core of the selection criteria. Significantly, a growing Bank teams wiU work within the provisions of the Bank's number of "non-pilot" countries are implementing policies and legal requirements, while making use of the elements of the CD F approach. Over time, this practice flexibaity these provide to respond to client needs. will embrace even more "non-pilot" countries. 88 Questions and Answers What is the CDF Matrix? What Does it ing them. What is crucial is to set up and nurture a Contain? mechanism and process by which a version of the matrix appropriate to the country can be agreed upon. The CDF matrix is intended as a management tool, to provide all players involved in a country's development, What Progress Has Been Made in the First especially the national governments including parliamen­ Year? tary bodies, a shared framework of information, around which to coordinate efforts. The matrix can also be used CDF principles have been widely accepted, and under­ for examining the roles of different stakeholders and for score the growing convergence of views in the interna­ identifying inter-sectoral linkages and information gaps. tional community, on a sustainable approach to poverty reduction. There has been progress across all thirteen The way the matrix is used will vary from country to pilot countries in implementing the principles, although country depending on individual circumstances and the situation varies. Indeed, in some pilots, unforeseen country-specific priorities. It aims to provide a rational events or external shocks have affected the pace of starting point for defining each nation's development progress. In practically all the pilots, long-term develop­ essentials in relation to issues such as: ment frameworks are already available or being prepared. Explicit efforts are being made to address the balance -Macro and Financial: a sound economic and financial between the macroeconomic aspects and the structural/ framework for sustainable growth. institutional issues. Country ownership of the develop­ -Structural: good governance and clean government, an ment agenda is beginning to emerge as more countries effective legal and judicial system, a well-organized and demonstrate a willingness to lead. Stronger partnerships supervised financial system, and social safety net and are emerging along with greater selectivity. Where the social programs. CDF matrix is already in place, it highlights existing -Human: education and knowledge transfer, health and duplications and gaps, and allows for more effective population issues. coordination. -Physical: water and sewerage, energy, roads, transport and telecommunications, and environmental and cultural Emerging Issues ISSUes. -Managing Dialogue: The CDF advocates inclusion. Each country will have its own unique priorities that However, in the efforts to engage civil society and the should be included and become the focus of the matrix, private sector, care must be taken not to undermine as it evolves over time. Attention to fiscal issues, trade and domestic democratic institutions, such as parliaments, regulatory issues, the labor market and employment which are often fragile in many countries. The involve­ conditions, and the role of the private sector, for example, ment of such institutions, in the consultation processes, will depend on the characteristics of the country and the should help to address this concern. It will also help to results of the national dialogue about priorities and ensure that dialogue is not ad hoc, but becomes a recur­ programs needed to address them. In some cases, the rent characteristic of the CDF process in-country. CDF matrix will also provide a basis for discussing the impact of external global and regional issues in a given -Change Agents: For most of the pilot countries, the country as well as risks and vulnerabilities, such as natural change agents managing the CDF process tend to be few disasters. In sum, the CDF focuses on each country's and over-stretched. This makes the continuity of the development essentials, including economic, social and process relatively fragile. There is need, therefore, to find human development and good governance. ways to expand and deepen the constituency for the changes advocated in the CDF approach. The individual country concerned designs and "owns" the matrix, and several have already developed preliminary -Harmonization: For the Bank's clients, a major benefit web sites. But, it takes time to build a consensus in from closer collaboration among external partners would countries and among the development agencies support- be to reduce the transaction costs and the burden on their 89 Comprehensive Development Framework often already stretched capacity. Experience so far has CDF and the World Bank strongly reconfirmed the urgent need for the Bank and its partners to make progress in harmonizing and rationaliz­ Will the Bank's Policies and Procedures ing the procedures they require of countries. Change under the CDF? -Selectivity: A key indicator of real progress in moving The ways in which Bank country teams support the COF towards a more common approach by partners is evidence pilots complies with the Bank's Board-approved policies that they are focusing increasingly on selected areas of and procedures-including the environmental and social activity. While such divisions of labor are long-standing, safeguards, fiduciary policies (including those for procure­ they have not usually been based on any overall assess­ ment), contractual and legal procedures, and disclosure ment of priorities, or on their relative comparative policy. At the same time, those country teams have advantages. The COF has enabled governments, in a flexibility to experiment with internal non-policy-related number of pilots, to initiate steps towards a more system­ procedures, such as those for project documents and atic and analytically-based selectivity. This has already led internal processing. If any recommendations for changes the Bank to identifY a number of areas in which it should in Board-approved policies and procedures emerge from be reducing its role, or withdrawing entirely. Reduced the COF pilots, they will be presented to the Board for Bank leadership does not automatically translate into no consideration. Bank role. Also, in some pilots, mapping out a COF or COF-like matrix has made gaps apparent, leading to What Role is There for Non-pilot Countries? government requests for partner action which can encourage wider involvement. The COF principles emphasize country ownership and leadership. If any country wishes to adopt part or all of How is Progress under the COF Being the COF approach, they are free to do so. In many cases, Assessed? the move towards adopting COF principles in particular countries has started at a sectoral or regional level. Such a The initial time frame for testing the COF is 18 months, step-by-step approach may be particularly helpful for which is clearly too short a time for a definitive assess­ non-pilots. Indeed, some non-pilot countries have 'been ment of the developmental impact of the COF. However, pursuing elements of the approach since before the COF it is long enough to show whether the country, together was launched. And an increasing number of other with major stakeholder groups, can put into practice the countries are now either beginning to do so, or are COF principles and the kind of consultation and consen­ recognizing the value of translating the COF principles sus-building processes needed for the COF to work. into their long-term strategy formulation processes. The Governments and teams from assistance agencies will Bank is also looking for signs that in addition to govern­ track indicators depending on the goals they have agreed ments, other agencies and stakeholders are already starting at the outset. The choice of specific indicators, and of to join in-taking into account its own knowledge of the how they will be monitored, will depend on the govern­ country concerned. It has also been possible for some ment and its development partners. Bank country teams to support a number of non-pilot countries, to pursue elements of the COF approach, In most of the countries undertaking the CO F, the particularly in the context of Bank Country Assistance discussion of indicators is still in its early stages. In Strategies. Bolivia, for example, discussion has focused on long-term, internationally agreed development goals and on what What are the Resource Implications of the needs to be done to achieve them. Within the Bank, the COP? performance scorecard is an instrument that will cover across-the-board experience and results-and help the The CO F is designed to yield better results, and to Bank assess whether the COF is helping to achieve increase overall efficiency by reducing the duplication of improved development effectiveness and, ultimately, efforts-thus it should, over time, help all actors to lower poverty reduction. 90 Questions and Amwers costs. At the same time, it has to be recognized that What is the Role of the Bank's CDP participatory approaches-an integral part of the CDF­ Secretariat? may take more time and resources than do more top­ down approaches to development. Again, however, these The Bank has established a CDF Secretariat, as a central are also expected to produce substantial long-run effi­ focal point for CDF matters, to provide support in the ciency gains and savings. implementation of CDF principles. The Secretariat is an active participant in CDF-related workshops and confer­ World Bank country teams recognize that implementing ences and the informal networks of CDF focal points in the CDF should be budget-neutral, over time. Indeed, bilateral aid agencies, multilateral institutions, and the budget neutrality is a key concept underlying the CDF, UN family. These focal points provide for useful sharing and one which underscores the need for selectivity. This of information, distilling lessons, identifYing synergies and issue is being dealt with through the adoption of multi­ finding solutions to bottlenecks that occur in the imple­ year budget approaches, and making trade-offs, including mentation of the CDF. The Secretariat organizes the in some cases shifting from projects to sectors. Some CDF Learning Group meetings-meetings between the pilots are incurring up-front costs which are being World Bank's President and the country directors working financed through redeployment of resources, or in some on pilot countries, at which they exchange experiences. cases through additional contributions of partners in the Sometimes Executive Directors also attend. It also has implementation effort. responsibility for keeping senior management and the Bank's Executive Board and staff fully briefed on progress. The Bank will therefore fund any additional costs from The Secretariat has a tracking mechanism to monitor supporting CDF implementation by reallocating re­ progress in CDF pilot countries. The mechanism is sources away from other activities-within current updated on a quarterly basis and provides the information operational budget envelopes. The reallocation likely to required for briefing the Board, senior management and be needed is judged to be within the range of the normal staff, as well CDF focal points, and for reporting. reallocations made in Bank programs in the course of a year. What are the Implications of Implementing the CDP for the Culture of the Bank and Other Development Agencies? Endnotes The CDF requires a change in the way the Bank's and other agencies' country teams approach their tasks, so that they take a broad, strategic view of their interven­ I James D. Wolfensohn, Proposalfor a Comprehensive tions, rather than concentrating on individual projects. Development Framework, World Bank, January 21 , 1999 While this is beginning to happen within the Bank, there (see section two of this publication) . is also a need for strengthening work relationships between country and sector staff. 2OECD, The DACJournal, Development Co-operation, 1999. A decision to mainstream the CDF within the Bank will need to be accompanied by the introduction of transpar­ 3 See Partnership for Development: Proposed Actions for the ent and accountable mechanisms to assess progress, draw World Bank (SecM98-421), May 21, 1998; and Partner­ lessons and keep everyone informed about country-level ship for Development: From Vision to Action (SecM98­ action, as has been done in the case of the CDF pilots. 789), September 23, 1998, available on the web at: www.worldbank.org/cdf/papers.htm. 91