Documentof TheWorldBank FOROFFICIAL USEONLY ReportNo: 27857-RW PROJECTAPPRAISAL DOCUMENT ONA PROPOSEDCREDIT INTHEAMOUNT OFSDR 13.7MILLION (US$20.0 MILLIONEQUIVALENT) TO THE REPUBLIC OF RWANDA FORA PUBLIC SECTORCAPACITY BUILDINGPROJECT June 7,2004 PublicSector Reformand CapacityBuilding(AFTPR) CountryDepartment9 AfricaRegion This document has arestricteddistributionandmaybe usedbyrecipientsonly inthe performance oftheir official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCYEQUIVALENTS (Exchange Rate EffectiveApril 8,2004) Currency Unit = Rwanda Francs RWF583 = US$1 FISCALYEAR January 1 - December31 ABBREVIATIONSAND ACRONYMS ACBF Africa Capacity BuildingFoundation MINECOFIN Ministryof Financeand EconomicPlanning AfDB African DevelopmentBank MINEDUC Ministryof Education, Science,Technology and ScientificResearch APL Adaptable ProgramLoan MlNlNFRA Ministryof Infrastructure APF Agency PerformanceFund MINITERE Ministryof Lands, Environment, Forestry, Waterand NaturalResources CAS CountryAssistanceStrategy MINISANTE Ministryof Health CDF Common DevelopmentFund MSCBP MultiSector CaDacitvBuildingPrwram * - - - CEPEX CentralPublic Investmentand External Finance Bureau MTEF Medium-TermExpenditure Framework ClDA Canadian InternationalDevelopmentAssociation NUR NationalUniversityof Rwanda CPAR Country ProcurementAssessmentReview OPCPR ProcurementPolicyand Service Group csos CivilSocietyOrganizations PIC Public InformationCenter DG Director General PID ProjectInformation Document DflD Departmentfor InternationalDevelopment PMU ProcurementUnit DCDP Decentralizationand CommunityDevelopment Project(WorldBank) POM ProgramOperationalManual FARAP FinancialAccountability Reviewand Action Plan PRSC Poverty ReductionStrategy Credit FMU FinancialManagementUnit PRSP Poverty ReductionStrategyPaper FMRs FinancialMonitoring Reports PSCBP PublicSector Capacity BuildingProject FMlS FinancialManagementInformationSystem PSR ProjectStatus Report FMS FinancialManagementSpecialist PSRS PublicSector Reform Strategy GNI Gross National Income QCBS Qualityand Cost Based Selection GoR Govemmentof Rwanda RES RwandanExpertiseScheme GPN General ProcurementNotice RlAM RwandaInstituteof Administration and Management HRCBA HumanResourceand Capacity BuildingAgency RlPA RwandaInvestmentPromotionAgency HRDA HumanResourceDevelopmentAgency RITA Rwanda InformationTechnologyAgency IAS InternationalAccounting Standards RVP RegionalVice President IBRD InternationalBankfor Reconstructionand Development SBF School of Bankingand Finance ICT Information & CommunicationTechnology SG Secretary General IEC Information,Educationand Communication SOE Statementof Expenditures ISDS IntegratedSafeguard Datasheet SPN SpecialProcurementNotice t500 ICB All >3 0 NCB All contract >200 and the first contract<200 <30 Three quotations None 2. Goods >150 ICB IAll I >30 NCB The first contract4 5 0 <3 0 Shopping None (Post Review) 3. Consultants Firms >loo QCBS, QBS All < 100 QCBS, QBS, LCS, CQ ReviewofTOR only Individuals >50 See SectionV of Guidelines All (TOR, contract, C V I <5 0 See Section V of Guidelines ReviewofTOR only Total value of contracts subject to prior review: {US$11.4 million) 73 Overall ProcurementRisk Assessment: {High) Frequencyo fprocurement supervision missionsproposed: One every four months duringthe first year o f project effectiveness, one every six months thereafter (includes special procurement supervision for post-review/audits) 74 Annex 9: EconomicandFinancialAnalysis RWANDA: PUBLICSECTOR CAPACITY BUILDINGPROJECT Interventions under the PSCBP support public sector reforms and capacity building to improve the performance o f key public institutions in implementing the PRSP. Thus, much o f the return on investment under the PSCBP will be inthe form o f better-performing public institutions that employ financial andhumanresources in a transparent and accountable manner to implement the PRSP and improve service delivery to the population. Benefits will be measured in the form o f performance indicators, and will be monitored and evaluated on a regular basis. Results will also informprogress towards achieving PRSP goals. Economic. The project is expected to contribute significantly to improved economic management, and thus to more effective PRSP implementation, by promoting transparency and accountability in management o f public resources, including donor assistance. Specifically, the project will have a positive economic impact by supporting: (i) improvements inpublic financial management through the adoption o f a new, comprehensive accounting system; (ii) reforms to the public procurement system; (iii) better performing ministries through support to strategic planningand implementation of annual work plans; (iv) development and establishment o f an M&E system that measures progress in implementing the PRSP, agencies' strategic plans, and the impact o f capacity building; and (v) restructuring o f public sector institutions in light o f decentralization, and increased participation by the private sector and civil society in service delivery. Financial. Improvements in budget execution and public procurement will contribute to a reduction o f the fiscal deficit, improve predictability and flow o f allocated budget resources to PRSP priority sectors and activities, improve the quality o f public expenditure, and increase accountability for public resources. Strengthening institutional arrangements and capacities to manage public expenditures will be critical for sustaining expected results. 75 Annex 10: SafeguardPolicyIssues RWANDA: PUBLIC SECTOR CAPACITY BUILDING PROJECT Not applicable 76 Annex 11: ProjectPreparationandSupervision RWANDA: PUBLIC SECTORCAPACITY BUILDINGPROJECT Planned Actual PCNreview September 27,2001 InitialPID to PIC October 25,2001 ISDS to PIC February25,2004 Appraisal March 10,2004 March 10, 2004 Negotiations April 13,2004 April 14,2004 Board/RVP approval July 8, 2004 Planneddate o f effectiveness October 8, 2004 Planneddate o f mid-term review March 31,2007 Plannedclosing date December 31,2009 Key institutions responsible for preparationofthe project: Ministry o f Public Service Skills Development, Vocational Training and Labor (MIFOTRA) Bankstaffandconsultants who worked onthe project include: Name Title Unit Gradimir Radisic Task TeamLeader AFTPR StefanieTeggemann Co-TaskTeamLeader AFTPR EdwardBrown Country Manager ECCMD Oladipupo Adamolekun LeadPublic SectorManagement Specialist AFTPR DenyseMorin Sr. Public Sector Specialist AFTPR Arleen Cannata Seed Sr. Information Officer ISGCR NatashaHayward Young Professional YPP Jups Kluyskens Consultant SameenaDost Counsel LEGAF PierreMorin Sr. ProcurementSpecialist AFTPC ProsperNindorera ProcurementSpecialist AFTPC ChantalKajangwe ProcurementAnalyst AFTPC JosephKizito Mubiru Sr. Financial ManagementSpecialist AFTFM EmmanuelTchoukou Financial ManagementSpecialist AFTFM Marie-Chantal Uwanyiligira OperationsAnalyst AFco9 Michael Fowler SeniorDisbursement Officer LOAG2 JuvenalNzambimana FinanceAnalyst LOAG2 Mary Kamari Jr. ProfessionalAssociate AFTP3 Gary Reid LeadPublic SectorManagement Specialist ECSPSE Poul Engberg-Pedersen Sr. Public Sector Specialist PRMPS MadeleineChungkong LanguageProgram-Assistant AFTPR Mavo Ranaivoarivelo ProgramAssistant AFTPR 77 Annex 12: A ConsolidatedNationalM&E System RWANDA : PUBLICSECTORCAPACITY BUILDINGPROJECT SituationAnalysis Currently, there are several initiatives within the Government o f Rwanda that have focused on monitoring functions for projects. Inaddition to the government's own initiatives, systems have been developed by donors, including the World Bank, for their specific needs. Furthermore, individual ministries have also developed their own systems for monitoring, among which MINEDUC and MINSAN are the most highly developed. A comprehensive M&E system, however, is lacking, leaving initiatives scattered and insufficiently coordinated. A summary o fthe most relevantinitiatives follows: CEPEX, as part o f MINECOFIN, has initiated a financial monitoring system that contains information from the Rwanda Revenue Authority and the former SIBET system for budget preparation and execution, pre-payment and payment, which forms the basis o f a govemment accountingsystem. This system, which is still under development, will be called Public Books. Information to be collected by the system will be classified in terms o f economic (such as expenditures by goods and services categories), hierarchical (such as Ministry, department, program, subprogram, output/activity), and sectoral (such as health, education, etc.) `data dictionaries.' As the system contains primarily financial information, its lowest aggregate o f data (called the physical) i s the `output' or `activity'. These last levels are described by one-line attributes. Poverty Observatoire, also part o f MINEEOFIN, conducts monitoring activities related to output and impact monitoring o f the Poverty Reduction Strategy priority projects. The Poverty Observatoire conducts annual joint reviews at MINECOFIN and Ministry levels, which include data from district and provinces. They prepare a PRSP Annual Report, which lays the foundation for priorities inthe coming year. This year they intendto also include project data by sector. The Poverty Observatoire currently uses a manual tool for collecting and analyzing data, and while they have identified indicators for measuring progress against objectives, they acknowledge that the system is weak at the lowest levels o f data collection and that more and better indicators are needed. They currently do not have a plan for computerization but are willing to consider one ifit meets their needs. The PRSP Trust Fund i s earmarking considerable funds to assist the Poverty Observatoire to build capacity to monitor and report on the implementation of the Poverty Reduction Strategy, as well as build analytical capacity at the central and decentralized levels. Specifically, it will help districts identify indicators and develop an M I S system to facilitate their own planning, which will also feed into national monitoring. The World Bank Decentralization and Community Development Project has developed a monitoring framework that lists very comprehensive indicators. Although not an actual M&E system, these indicators provide an excellent starting point for an enhanced M&E system at local levels. 78 The HRCBA will be equipped with an integrated Financial Management System/M&E System that will track financial data, inputs, and performance indicators o f capacity building interventions both, o f the PSCBP and increasingly, those other donors. Performance indicators for the PSCBP are defined inannex 3. Data collection is also done on the individualministry level, with the ministries o f Health and Education considered to be best practice. Their monitoring interventions consist o f collecting specific sectoral data to meet the requirements o f ministries to report to the central government, as well as to bilateral andmultilateral donors. ProblemsIdentified Between the government's own systems and those under development for various projects, there are many isolated actions all falling under the general category o f monitoring and evaluation. These different systems have been developed independently o f one another for discrete purposes, and none o f them link with one another or build upon the work already completed or planned. Each of them is limited in scope and comprehensiveness, and focuses solely on the particular need for which it was designed. The danger lies in the proliferation o f many systems, none o f which provides a holistic and all-encompassing picture o f the government's development interventions. This complicates reporting for the MDAs, which have limited staff and would, o f necessity, prefer to use their scarce resources for project implementation rather than the completion o fmultiple reports. For example, the Public Books system being designed by CEPEX focuses exclusively on financial data, yet there are other staff within CEPEX who require output monitoring based on the same core financial data. These staff andthose o fthe Poverty Observatoire, who need impact monitoring data, are part o f the same ministry, yet they were not consulted when the specifications for Public Books were given to the developer, eTools. As a consequence, data collected for the Public Books project, namely financial, does not link to the data relating to objectives, output or impact monitoring. SolutionProposed The best solution for the government would be a comprehensive national M&E system that would allow for data collection at the source, namely the MDAs, on a variety o f indicators, including financial, physical, output, and impact monitoring. It would build upon existing initiatives such as Public Books, the manual system o f Poverty Observatoire, M&E systems at ministry levels, and various initiatives o f the PSCBP, the DCDP, and the PRSP projects and provide linkages to them, as well as to additional data required by various stakeholders. Such a system would allow M D A s to collect, verify, andtransfer information o f use at various levels. It would also allow MDAs to generate, collect, and report on aggregated and disaggregated data related to all these indicators using one reporting mechanism, and would enhance overall efficiency and effectiveness. The need for numerous requests for data from the same MDA would thus be eliminated, saving resources for project implementation. 79 The PSCBP proposes a comprehensive M&E system for government which would serve multiple purposes, obviating the need for discrete systems and duplication inthe collection and reporting o f data. Existing systems could be enhanced to combine financial, physical, and output monitoring of public expenditures by including several other components, and these enhancements could be realized by the use o f associated databases and linked systems. One o f the proposed enhancements would contain financial information about the source o f funds; that is, whether from the GoR for the recurrent budget, or from GoR anddonors for the development budget. Another enhancement would address the objectives, output, and impact monitoring o f the use o f public finds, as they relate to the `output' level o f Public Books. In particular, MDAs, the Poverty Observatoire and the HRCBA for the MSCBP need a more comprehensive M&E system, which will require interfaces to the basic Public Books system to facilitate collection o f qualitative data at the MDA level, link it to financial data, and provide reports that can be aggregated anddisaggregated on all levels. To ensure that monitoring can take place independent o f the potentially lengthy database development process or possible breakdowns in the physical infrastructure, manual systems allowing the M D A s to collect, verify, and monitor data must be established and maintained. M D A s and the HRCBA will also require training and equipment, both to collect and eventually retrieve information from the system. Most important in the development o f such a system would be extensive consultations with stakeholders at all levels to ensure that all needs are taken into consideration inthe development o f the comprehensive system. Furthermore, the capacity o f individual MDAs to generate and analyze data is an essential first step, followed by extensive training. This would best be done in a phased approach to M&E for the GoR, comprising the following steps: Phase1:Institutingan "M&E culture" at MDAs - Build the capacity of MDAs to collect and monitor data, and assist them in identifying the types and nature o f information required and how it will help them to implement their programs and improve strategic planning. - AssistMDAsintheirownmonitoringeffortsandinthedevelopment ofdatabasesof objectives, outputs, and impact indicators that can later be linked into the national system. - ProvideMDAswithguidelines fortheprocessofparticipatorycollectionofdata; that is, a clear identification o f indicators, how often they should be aggregated, when they should be aggregated, andby whom. Phase2: Consultationstowards a NationalM&E System - ConsultwiththoseresponsibleforthePRSPTrustFund,thePSCBP, andtheDCDP to ensure that all players agree on a comprehensive system for M&E, and on the funding elements. 80 - Develop scenarios for a high-level M&E framework that would incorporate suggestions andideas from each o fthese projects. - Consult government entities onthehigh-levelM&Efiameworkto solicit theirideas on the utility o f such a system and to discuss possible approaches to building a comprehensive solution. Phase3: Builda ComprehensiveM&ESystem - Design a comprehensive M&E system with logical andphysical links to existing financial management systems. - Buildoradaptasystemthatmeetstheneedsofthegovernment, donors, andMDAsat a variety o f levels. Phase4: BuildCapacityfor Implementation - Conduct training for MINECOFIN's Poverty Observatoire and CEPEX, MDAs, HRCBA, and other staff in the use o f the system; provide assistance in the infrastructure so that the system is accessible on all levels. 81 Annex 13: Documentsinthe ProjectFile RWANDA: PUBLIC SECTOR CAPACITY BUILDINGPROJECT Documentsfor ProjectPreparation: Operational Manual for the Multi Sector Capacity Building Programme, Draft, PriceWaterhouseCoopers, March2004. Mapping of on-going and planned capacity building activities o f all Government Ministries, Departments and Agencies (MDAs) and Local Governments, Final Report, March 2004. The Vision and Strategic Framework for the Multi Sector Capacity Building Programme inRwanda, May2003. Medium Term Strategy, Action Plan and Budget for Multi Sector Capacity Building Programme, Draft Report, June 2003. MultiSector Capacity BuildingProgramme: RetreatheldinGisenyi, FinalReport, June 2002. Multi Sector Capacity Building Program: Workshop to define the way forward, Final Report, May 2002 Summary of the Main Report- Multisector Capacity Building Programme: Assessment of Capacity BuildingActivities, May 2002. Inception Report -Multisectoral Capacity BuildingProgram, January 2002. GeneralBackgroundDocuments: 0 Valentine, Theodore R.: Towards the Development o f a Medium Term Remuneration Policy for the Rwanda Public Service: Draft Report, January 2004. 0 Public Sector Reconfiguration and Transformation. Strategic Paper - Republic of Rwanda. Kigali, December 23,2003. 0 Rwanda Financial Accountability Review and Action Plan. Final Report o f Diagnostic Mission, February2003. 0 Obidegwu, Chukwuma: Rwanda: The Search for Post-Conflict Socio-Economic Change, 1995 - 2001, Africa Region Working Paper Series, No. 59, October 2003.Appraisal of the Decentralisation inRwanda, Final Report - Republic o f Rwanda. Ministry o f Local Government, Information and Social Affairs, September 2003. 0 Harvard Business Review, "On Point: Why Good Projects Fail Anyway," September 2003. Constitution o fthe Republic o fRwanda, June 2003. 0 Memorandum o f the President on a Country Assistance Strategy for the Republic of Rwanda, November 2002. 82 Poverty Reduction Strategy Paper and Joint IDA-IMFAssessment for the Republic o f Rwanda, July 2002. 0National Investment Strategy (N1S)-Republic of Rwanda. Ministry of Finance and Economic Planning CEPEX, May 2002. 83 Annex 14: Statementof LoansandCredits RWANDA: PUBLIC SECTOR CAPACITY BUILDINGPROJECT Differencebetween expected and actual Original Amount inUS$Millions disbursements Project ID FY Purpose IBRD IDA SF GEF Cancel. Undisb. Orig. Frm.Rev'd PO66385 2003 InstitutionalReformCredit 0.00 85.00 0.00 0.00 0.00 42.62 18.92 0.00 PO71374 2003 HIVIAIDS 0.00 0.00 0.00 0.00 0.00 30.44 0.58 0.00 PO75129 2002 Emergency Demobilization& 0.00 25.00 0.00 0.00 0.00 32.61 1.95 0.00 Reintegration PO65788 2001 RegionalTrade FacilitationProject 0.00 7.50 0.00 0.00 0.00 5.95 2.30 0.00 PO57295 2001 Competitiveness&Enterprise Development 0.00 40.80 0.00 0.00 0.00 34.59 14.10 0.00 PO64965 2001 RuralSector SupportProject 0.00 48.00 0.00 0.00 0.00 46.02 21.98 0.00 PO58038 2000 Agric. & RuralMarket Development 0.00 5.00 0.00 0.00 0.00 1.32 1.24 0.00 PO45091 2000 HumanResourceDev. 0.00 35.00 0.00 0.00 0.00 25.94 20.08 0.00 PO45182 2000 RuralWater Supply & SanitationProject 0.00 20.00 0.00 0.00 0.00 19.05 2.20 0.00 Total: 0.00 266.30 0.00 0.00 0.00 238.54 83.35 0.00 RWANDA STATEMENT OF IFC's HeldandDisbursedPortfolio InMillionsofUSDollars Committed Disbursed IFC IFC FY Approval Company Loan Equity Quasi Partic. Loan Equity Quasi Partic. Total portfolio: 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 ApprovalsPendingCommitment FY Approval Company Loan Equity Quasi Partic. Totalpendingcommitment: 0.00 0.00 0.00 0.00 84 Annex 15: Countryat a Glance RWANDA: PUBLICSECTOR CAPACITYBUILDINGPROJECT Sub- POVERTY and SOCIAL Saharan Low- Rwanda Africa income levelopment diamond' 2002 Population, mid-year(millions) 8.2 668 2,495 Lifeexpectancy GNIpercapita (Atlas method, US$) 230 450 430 T GNI(Atlas method, US$billions) 19 308 1012 Average annual growth, 1986-02 Population(s'd 6.0 2.4 19 Laborforce (%) 5.0 2.5 2.3 ;NI Gross mr primary M o s t recent estimate (latest year available, 1996-02) :apita nrollment Poverty(%of populationbelownationalpoverlyline) Urbanpopulation (%of totalpopulation) 8 33 30 Lifeexpectancyat birth (years) 40 46 59 Infant mortaiity(per 1000live birlhs) 99 D5 81 Childmalnutrition (Omofchildfen under51 24 Access to improvedwater source Access to an improvedwater source (%ofpopulation) 41 58 16 Illiteracy(%ofpopulation age 159 31 37 3 1 Gross primaryenrollment (%of school-agepopulation) 19 86 95 -Rwanda Male 1% 92 a 3 Low-income group Female 18 80 81 KEY ECONOMIC RATIOS and LONG-TERM TRENDS 1982 1992 2001 2002 Economic ratios' GDP (US$ billions) 14 2.0 11 11 Gross domestic investmentlGDP 8.8 15.6 18.4 8.8 Exports of goods and services/GDP 116 5.6 9.3 6.1 Trade Gross domestic savings/GDP 5 2 2.9 19 19 Gross national savingslGDP 13.8 1.9 118 1.9 T Currentaccount baiancelGDP -5.7 -1.7 -6.5 -115 InterestpaymentslGDP 0.1 0.3 0.5 0.6 Total debt/GDP 15.5 42.1 15.4 Total debtservicelexports 5 2 n.3 24.6 Presentvalueof debffGDP 39.3 Presentvalue of debffexports 386.6 Indebtedness 1982-92 1992-02 2001 2002 2002-06 (averageannualgrowfh) GDP 14 4 2 6.1 9.4 -Rwanda GDP oer capita . . -15 18 3.1 6.3 I Lowincomea r o u ~ - . STRUCTURE o f the ECONOMY 1982 1992 2001 2002 1 Growth o f investment and GDP (%) (%ofGDP) I Agriculture 39.8 33.2 40.5 416 40 industry 211 18.1 216 218 Manufacturing 13.5 P.1 9.8 DA 20 Services 38.5 48.1 31.9 36.6 0 Private consumption 819 82.6 86.4 86.1 Generalgovernment consumption P.9 14.5 117 P.l -20 Imports of goods andservices 242 18.3 25.8 25.0 1982-92 1992.02 zoo1 2002 (averageannualgrowfh) Growth o f exports and imports (%) Agriculture 0.4 6.4 8.3 D A Industry -0.4 2.6 T 7.6 1.9 6o Manufacturing 0.0 -0.2 1.8 9.o Services 3.7 2.9 4.4 8.8 Private consumption 2.2 3.3 2.3 95 Generalgovernmentconsumption 7.2 2.4 8.2 112 Gross domestic investment -2.1 5.8 3.0 5.1 Imports of goods and services 3 2 13 4.0 -0.3 -Exports - o - I p o r t s 85 Rwanda PRICES and GOVERNMENT FINANCE 1982 1992 2001 2002 inflation (%) Domestic prices I (%change) Consumer prices .6 9.6 3.4 2.0 implicit GDP deflator 4.9 7.3 0.2 0.0 Government finance (%of GDP,includes currentgrants) Currentrevenue 16.3 19.8 210 Current budget balance -0.5 5.6 5.8 I I Overallsurplus/deficit -8.1 -11 -11 -GDPdeflator -CPI TRADE 1982 1992 2001 2002 (US$ millions) Export and Import levels (US$ mill.) Total exports (fob) 88 89 93 78 400 T Coffee 35 23 23 Tea 21 23 24 300 Manufactures 2 48 27 Total imports (cif) 3 s 340 342 200 Food 29 52 55 Fueland energy 37 73 74 100 I I Capitalgoods 69 51 53 0 Exportpriceindex(1995-00) 57 70 67 96 97 98 99 00 01 Import priceindex(1995-00) 98 96 97 maports Inports Terms of trade (995-00) 58 73 69 O2 BALANCE o f PAYMENTS 1982 1982 2001 2002 (US$ millions) Current account balance to GDP (%) Exports of goods and services a 2 I14 159 143 Imports of goods and services 324 372 440 443 Resource balance -202 -259 -281 -300 Net income 11 -1) -20 -25 Net currenttransfers 11) 1P B1 a 4 Currentaccount balance -81 -157 -133 -200 Financingitems (net) 14 116 a 1 205 Changesinnet reserves 67 41 -11 -5 Memo: Reserves includinggold (US$ millions) Conversionrate (DEC, locaVUS$) 92.8 03.4 443.0 475.4 EXTERNAL DEBT and RESOURCE FLC)WS 1982 1992 2001 2002 (US$ millions) :ompositlon o f 2001 debt (US$ mill.) Total debtoutstanding anddisbursed 2 8 857 1,283 IBRD 0 0 0 ,G:36 IDA 77 408 7 0 Total debt service 7 21 43 IBRD 0 0 0 IDA 1 5 B Compositionof net resource flows Official grants 70 eo 160 Official creditors 26 72 43 Privatecreditors 3 -1 0 Foreign direct investment 21 2 5 Portfolio equity 0 0 0 World Bank program Commitments 56 S 1s Disbursements a 32 53 4 IBRD E- Bilateral B IDA -- D Other mltilateral - F Rivate - Principal repayments 0 2 11 C-IMF G- Short-tet 86 Annex 16: Letter ofDevelopmentPolicy REPUBLICOFRWANDA Re: Letter ufDevslopmenlI'ulicy on htuJU-Seclox CapacityBuilding Program(,kISCBP)inRwanda IamwritingtnrequestyouappmveapmposedTDAsupporttothe Government of Rwanda's Multi-Sector Capacity Building Program VSCEP). The support requested is intended to finance ar;tivitics aimedat addressing persisrent and critical hitman and insliluliunalrdpdciLy gaps at the centralgovemeni l ~wilh h e aimurcroaliny an ol'licicnxl, dhAive d i ~ awuunrablr: l')ublic Sector, ca.pablc.of spcmhcading tlic dcvclaymcnt d processand a.chicvi.nggods and nl?jcctivc,cloudincd iiitlic c.miitty's vision 2020.andthe PovertyReductionStmtegy Paper (PRSP). BackgroundandHeceutDeveloplucuts 1. Tlie Govemient o f Rwanda jGoR) ha$, in the last ten (10) years undeita1:tn diallenging progrmmies to address socio-economic da7elopmentyaps ~realodby a cumbinativrr of policy aid ui$liluliorraI inadequaciesbcibre Lho wiir aridgalocide mid the resuitiiig destniction. The post war and gtmooide activities c c m d nminly - 011 cmc~gcnq progp.;mes tu restore public. administradon stiuct.urcs and Wehritt : .~ :.. I- 04.sw 87 reconstructthe basic social and physicil infiaslrwtrires i h t hadbeen destroyed. 2. Sincc 1!$)4, security nnd political stability have been restored, piiblic adnliuisiwa.tion stritctures re-established and, politicdl a# well ;is adnliujsIj.a.t.ive powers decentrdlised ta local governmenu lt~enhance total plrt'cipatim of tho populace inthe management o f their public affairs. At the beginning of 1997. it major pwgamc oC ccunumir: retbrms was initiated. Econumic;gmwt'Ltiwas registered and co~iti~iued to rise ,through:hoitithe y a m of ecuncmic cccovcry (1997-2003). Broad national palicics to cuhnncc ccomnic and social transfnnnation have bee11 dcvclopcd to 3ny 8 finn foundtxioli for the transition towards m~taiiialic develop"it as outlined in national policy strategy dociiments; Wskin 2020, Poveri,yReduclicinStraLeyy Paper (PRSP), andthe Nhinal InvtvrLmerrlStrategy(NIS). 3. 1)rugrannnes to cnlinticc gmd govcxiianoc md proinotc R.ci~lturcof political tolcra.ncc hmc hccn initiated aid ~e bearing good reaulh. Tbc oilgoing pingrainmeof iiatimial uiii'yand reconc.iliation, initiated iti 1995,continues to be an effectise tool inthe nationalreconciliation pmwss, A national refcrmdwn ww hdd in May 2003 tu g:onatk cnnstnsus on the cunsliluliund arriinmgemctjnts bclilable l"dmu"ic governamc in Rwanda. A IICW ucttional cousfitution was thcrcaftcr adoptcd followcd by prcsidcntinl and parlianmtary clcc.tions: in August 2UO3 aiid September 2003 rc3specJively. 'The troiisitional jioveriLclrice nrraagemeuits that httdheqi put:in place iiixnediarslyaffer thc w a i and genocide were smnothly ended usbming in a new de~nocraticallp dect~d govmient. 4. The mjor task &he now GUVGIXXT"~s Lo c;crrisdiJale aGhiswmenb i realiscd during the trmsilion pwiocl, revie.w the bottlariecks aud challc.Gcs r;ricuuntcrd a d rcdcsigu stratcgics to rcdrcass thcsc challc~qcsin order to m e t deselopment aspilatiom of the Rwnndnii people as outljiied in. the nmianal policies (referred to in paragraph 2 nbwej ~ i i din T.he framework of the hfillenniuin Develqniient fioalg. Related strategic actions to be undertaken dial1 include inter alia: enhancing public sector ref'orms ini(iaie:d d1irjn.g the transition pari04 creating u ~riliual.miss uT mined Rwagdms lo spiprarhaad the dcveivpment pruoass; and strmglhanitig public sector institutions 10 Greate an enablingcnviroiitnontfor dclivcring basic social scrvicca a d regulating dic ,pt.ivatc sator. 'I'hcsc actions will usher in a well pcrfuciiing public sector, whic.h will. hilitate the develop" of a veiy ~ihisiit pivat. sactor, and an active and respansivecivil society, 88 EnbaxlcingPoblicSectorReforms 'l'ticGovcriinmit fully racoglljsesthe critical role playedby ,thepublic sector in miMing nrhcr sectors to grow and cunlribuie lu sustainabla develnpmenL. Tn this cuntaxl, alre.adyiiritiatcd public scivic\; rcfornls qhall be conso1idate.dand fiirtha ~nhucudwilh a v i w to improving thc cilicioncy tirid ~Ifec~iveness pvblic sector jngtitiitions. of YIJ clntc, all thee brmcliei of Governmenthave undergone significant rcfnl-ina. The legislature has been rzstructuTed fo impmvz its perfomiwc.e and to enswe t.hat the Governmenti s wwuntable tu the pqulation. It now comprises it chd."e:r uf d-quliev an3 tho sonale, The judiciary is urtdergoing ccrrxipchcnsix rcfornls to I'CII~OVC dysi'ruiciional structmcs a d to CDSLIL'C that \ion-qunlificdpc~sounclacc removcd and rqlaaoci by ouaipctcnt and qutililicd OZICS. As for Lhc uxwcutive Ira":some ministries lim-e heeti. merged atid others abolished toavoid overlapssadto enhmce costeffectivciiessin s a k e d.cl.ivc.~.The Gfivemmenr will caitintiously cai-ry out hictioixd reviews of all public sector institutions and c.orrecti\;e actions will bz undertalcenwith B view to iinprocingtheir performance. The slraiagic objd i v e pursued 'by tlic Ciovcrnaicnt is to orient die f~~nctioizing thc public administration in accordaiicc with thc of principles mid vahies enshrined in the n.ewlyRdopted constinitionand 10 put in place iiiore efficient n.nd effectise fiilnini.str;lr ive stslrc.ttires that we capable of fiitcilif.atii1giinplernentarimof*~ctititiesailned at oaricliinl dad-qmienr Tt is also meant to ensure high qualityservices accessible to the population;it the lowest cost possible. The attainment of diis strategic. objective will enable lhe cormuy Eo wpe with ghbalisalion chiilleiigcs: cspccially 'by crcatutg a conducive crivironnicntfobr thc pdi'atc scctor and civil smictyto fully participtc intlic dcsclopnmt process. Public ServiceReforms 8. To eiisure focused and successful implmenta.tion of public sector r e f o m , the Govemmenl will build un (he ac;wrnplishmentsoCih h t phdSG or civil sewicc rcfoain. 1nit.ia~tctcdin 1998: this fitst phasc cnhariccd cstahl.inlmicnt,cniiwol: iiiipmwd pay, rario~inlimIfunctifins, orgatizations and staffing of ministries and sa.wnil owrnllreductionof 89 ghost. workers and mostly unqualified public seimrits. . The second phage ofpihlic service ~efotm,initiated in blay 2002, seeks m improve tlie ef'ficiency, effectiveness, acmuntabiliv and transparency of Rwinda's public service. It foc;use?;on tnmsforminp structures and m;inagGmen:nl rpkms: changing attiludcs and menlnlily r.d G i d savanu, enhancing przrolessiorial aptitudes arid human T~SOUTCGknuw how, hcrcashg USC of applicd tcchaologics, improving workins ii~ethodsand practices, and puttingin place clear policies, lam, norms and procediires to guide actions in the civil senice. Tlie civil snvice reform also dms at improving the qualityof senices to its citizens and increasing cost-effectiveness by promotingparticipation of the piivate sector and civil society inscn;ic.e delivery and by decentralizing nai- core Iinictions. ' l h Gav~r~nrnent will c.orrtiiiue to consolidale iniLia1. rcsultsand sliall cxtcnd rcfom acriviticsto tlic cntirc public service. 3. Tlie entire public senice shallberight.sized TO deliver effective sei-vicc and the pay strnctuire s l d l be mfoiined to streamline rhe snhiy and iiicentiva p,iclmges for public sewice personnel. The Gavemnmit.is committed to developing policy and legal instruments to creak organisaLiuna1lmkslgw md in& tutiunal riilcs as well as procedures necessary for a skble public service with jub security for well pelforming auld coiripctait pc~.o~mcl. The Goverrmierit is COrUVlScd that thcse mcasi!rcs will crcate favonrablc.conclitiorls to athaact.remuit, motiwac w1.d.rcta.iIIn.fair show of tlicbcst tdcnts. 10. In cf'furts tu cnhancc parlicipation, rclinc &IC tuc.~aof' government spending, xcinrww acwimlability mmdimpruvus~miccdclb~ryof the public. ndn~nimatim: the Guvemmcnr tidoplcd EI rluc"mira1iun policy a.ud dcsigmd a. thrcc-phasc implctncnlationstrategy in May 3,000. Tlic first phasc of its i?nplcmcntat4ion itist.ituitioudisd decentrnlised governance through articulating the iiecessniy policies and legal framework, Local adrtiinistmtivc snuctures were put inplace and grass roots ai ~ ~ as1local gwernmanl;alaclions were heldin 1999 1 arid 2001 respectisety Surne ndiiieniary inanagenami syslrms have h a m p'utinp1ac.eto facilitate thG fiuictiotririg o f local gwemmenb. 11. In Lhc ncxl phase, lhe Goverfimentwill focus OD builcliiigirisliuitioual capacities of Local Crovcmncnts to consolidatc thc dcccnralisatioii procc:s. Tlic Giavanimtnt will olsn put in place inecliaiiisms to facilitate greaterparticipationo f citizens in decision-making,planning and iniplemantatiou o f their development program& and projects. 90 'Ilre Govermeritwill in additifin facilitate a greater alloc.dtion ofpublic msources tn the .local governments and councils at grass roots level, Tlie stratqy i s to inmiw dti~ma'productive capa.c-iiics and to enhanceBCGCSS Lo basic social scrviccssuch BRAcnlth arideducation, as well as infonnadon 011govc,mmcntsci-vicea. 12. Tfic wh~lccssence of decaih-aljsa.tiion i s to devol~tsewice delivery rcsponsibiliiies to levels where bmrficiarirs can besl ~ G C W S i3.im-n. Significant partions a f secroral budgets for service delivery ministries have been de-mncentratedto thc:pruvicia'l Icvcl. DovoluLionoi' thouc: services to the locd govement k ~ id&at y t fully accomplished s because o f c;lpar:ily constraints at bod1the sectoral nluiistiya d local guvenmmt lcvcls. Govcr~~,mciit will cailrinue to rraiisfer fiiinncial reaoiirccs to imp1.m" 1oca1 gnveminmt progxinmes aiid projects through thc c&hlishtd Csmmon Developmait Fund. l i e pimcess of sec.tora1 dece;lltm.lismion shall be matched with fiscal and finm+il deceiitralisihon and the devehpm~ntof 1r)cdl guvm"nt capxiiy to manage the dxentraliaed funcrions and resources. ID4, in close cnordination with seseral partners in ricvklupmmt, is supponing this process. 13. Ciovcrnmmnt is cnriiniitted.tnputlingin place .a tratispuent aiid results orienred public qenrliture management system: which is ciiisy to use by stakeholders at all levels of lhe rmsemmonl. ' h e Medium-Tem Expenditure Framework (b1TE.F) was iutrudwcd and adoptcd to enhancc linkagus bulwconpuhios, bidgc1Jt;u:ib;iunuand UU~CVKXICS and iu prumulr: slakeholder parcicipcltion imi budget decisiotls aucl niorxitorimip,. Staffs at the Miaistry of Finance and Fmnomic Planning (MTNECOPJR~hnvc 1xcn trnincd and technical aqsistnticc wan snught ta assist in thi,c capcity Inildiiig iiiitintive. However, further training i s needed in other smtm instimiom to eiitrenchthe practice of MTEF in all govmneiitiustitutions, 14. Ruilding cIn L ~ GMTEF itlihdves, the GovmLniwt will undertake auliom io; (;i)iategratc recumit and dcvclupmciit bud@.; (ii) rdine sector stratcgics and p r o g a m c s in thi: li~imcwurkUTYKSP; and (jii) dcvclup SUI e l k i a l t irioiiitoL'idgand evdiintiou system that cript.ures all financial data for iisc in piq"tion of rcpoxrs and. dissminatioa o f biidgct pcrfomiancc and nut comes. Periodic public espwiditui~ reviews shall be cmied out to DSS~SSinylenientation progress aid provideoptions for way forward. Sector expenditure reviewsshall also 91 15. Significant strides have been r r d e it1 iiilyroving public financial reporting!acc;ounldbililymd Iransparcncp Key'achim-cmtitts inchdc Iht?wlabLidunent of dic Officc of Auditor General and the Ndioml TE&I Board, Mcauiwhile die inszikitional t-estn~c.tnrii~,g process is still. ongoing at MIKECOFIN. The Rrblic. Accniints Office has heen clevated to the level of B clepmrtnenr and was assigneda Director,The office of Inspector General of Finance and Audit was also elevated to that of Chief Tntemal Auditor. The legal kamework govemhg the budgeting ~ T O G ~ S S and finm~ialawoimling has' been rGSieWed accordingly. 1.6. T ~ Gciovc"tciit completed m fi11ancial nccouiitability review and action piail (Yiil3.W) to improve public expendit.ureiiiannagement and financial accouiitnbility nnd repor-tiiig; supported by nFln,the World Bank, and T.JNfiP.To operatinnalise FARAP recommendations, the Clnwrnment ifi finalizing a Public Financ.id Management Capaciq Buildingand Technical Input Plan. Nilh'support lkom lhe EC. The donor commimily is coNmitkd lo supparting its implementation and monituring and ,tvaiualion results in the c.ontext of thc riational PRSP review process, 1'1, More specificnlly and in the context of the action plan agreed and supparted by the donors, Lhe pv~rnmenlwill: {,i) ahengnrihm Lha capacity of public acmunts direc.tordteby training and equipping its staff and those responsible for yublic acccoimts in.other ministries, to ensure uniform recording and tryurlitg uf financial inik"lion: (ii) SLrrngheu the 11ewLy established office of Chief Internal Audiior by minirig arul equipping its staff and tliosc rcspomiMc for tiic Lliternal aidit function in ndier tniriistries tn eiisure maiiageriient coinplinnce with iiir.miin1control ayteins andprocedum; (iii)rwiew the financial. imtructions a i d enstire tlm all public sector instiwions adop fi uniform set of instrnctjon; {iv) & s i p a comphunive training pr>rog"me for piahtic officials responsible for rtcordingand mwaging publicfinances. 92 program" and projects. Sevwdl initidtivcs haw been developed to xXr0:riilor projects wirfiiri g~'\ie~mi~!t~titlstitutioiiil and donor ini.e,twntions.Ilhc Gm-cmtunmt will strcagtli.cn. rhc cxisting flash rcpaitiiig systcin at MINECOFM to track budget comniiuiients niid payments arid monitor financial flows and pmgress in tlie hnplemeiizationof public'investmentprojects. A. Pova~yOhsenatmy was set ~ i p mmitnr and disseminatetrends in poverty reducth and tn tha outctrmes of the budget. These iniliaGves, huwver, need Lo hi: expmde.d to allow for more focussed monitoring and evaluation of PRSP implcmc?nta~iun, .lhc Govmirri~ulwill improw on thc cirrrcnt public book project to strengthen thz nationa.1mnonitoriiig system. HUW'~R-EI, iniuativcs havc bccn dciclopcd indc,pcndcntof one thcac anotlicr aid iiisufficient Iinkngees exist. Gwemaitntwill build011 d i ~ c initiatives tn develop a coii~prehensivenational hl&E system that will MDAs) and inkgale a variety or inlliutors. This r;umprehen:nsive allow data collectjon at source {ministries! deparhneiits, agencies, M ~ysleniwill tnoiiitor hiancia1 data, physical out puts and impad. The M Uctdtinc &.dlbc invliliilcda1MDAslu Idmiliarkcpublicofficials withthe itnpotmnceof collec.tingdata and iimitoringperformmce. 19. The unfoldingpublir;sator rcfoms and their implementationhave by no doubt G X W ~new ;uxdgreat= da"ndS fur capacitybuiM.inginthe o.omitry. The rixlisatioii o f thc coiuitiy's dwClopinc.nt agenda shall 101gcly depend an the avnilobi1it.yof capacity to nmagc thc rcfoms, implenient policies, and monitor andevalimteomcomes. .%Ifmesseverecapacitycoiistraintsinpul>licandprivate The c.oiii~trysdll sectors as well as in the civil society. Tii particula~,tlie puhlic sector suffers fim on mute sliortage o f slii1le.dpersonnel, pa%icularlyinkey serc.ic.rc delivery ministries. Even the few itvitilitble skilled human resouces we not fdly utiliscd d w to inadequate management md inceiitiws. Ttic institutiod wk"hm lacks appropriata urgaiiisatiotinlstnwtiires, ndcquatcworkiiig facilitics, wwkiiig s p t w ~ and procedures as well as c.ompetiljve ranunmation capable of attracting and retaining qualified staff. Tl1.e GoR fiirtlier lacks a. conuiicmframenwl; ghiing t.he design and iinplantiitatinn of capncitJ. buildinginitiatives within ministries,bm-eenn-inistries, andbetween the Ciovernment and donors. To d ~ t qcapacity buildingwtisities have been largely Linmcuordimted, leading LU ocrwlaps, g a p and In& oi' synergies. 93 21. The biggest challenge for the Governmenr therefore i4 to create a c.iitica1mass of trained ndtionals to fill skill gaps in the economy, effect changes in managmen1 practices, put in place a clear and m.nspa.rcxit staff rccniittrictit aid promodoti system, inipro'vc wurkiug conilizioiis, and mswe effective inplatientation of aplimvcd pol.icics and strategies, natahlythe new paystructure which is B prmquisirc for improvingpublic service performmce, 22. The Government.rwognizescn,yncitybuil~lingas an hegmlpart 01Ole devtlqment procesw. It is Bkeyinput into the tcnrioniic gtowh of thc country. Tt is viewed as a incans to an aidrather than an end in itqelf. Many capacity building inrementions have been carried out iii a discreet mmer wilh V G insignidant impact on the counq's ~ dwelopmenl. In urds lu ousm \mgiblo results inredwing poverty, Lfia &cmTinleIit has prepared a Muhi-Sector capwily Building P r o g a m e {MSCH) that procides the strategic vision and fostcis colic", consistency and cmrdinatiw in the formuliltion and implementntinnof capacirybuildinginterikioiis. 'This pmgramneis based on a larger yisioii of economic and social develqimentm d 011 the capacity needsimpliedbysuch ilvision. 23. 'lha preparation of the MSCHP svolvzd h r r l law Ihuught prwesses. Fimt VIS thc visicin and aspirations of thc political l;cadc&ip to build an ecollorny t1la.t kas a. strcmg senice orientation. Second wm the c.onsulr~.tiueprocess smmg key stakeholders tlmugh workshops, saniaarrw and dincusdon groups plus study tmm in: the regionfa leani from exptriences of countries with a comparable smio-ecmiamic ewiimment as Rwanda. A study to assess capacity building iiiten.entions inRwanda since 1994wds carriedout andthe report was used as R W O ~ ~ Idocutnont itl a. workshop Ihmt took place in blay L ~ 2002, bringing t o g d m stakchaldcrs fiom tlic public scctar, privala scctor and civil soc.icty to disc.uss cfipacity building issucs in die country nnd define D way fonvnrd. GoK attachedg e n t importaimto a participatory process, eumiragixg learning niid ownership of key sfdielioldms. .As B rewlt, the prepratinn pmcemof the MSC:HPtook quite same time but also ensuredownership of the programme. 25. The h.lSCBP envidons building cdpacily 01' cenlrdl and locd goveniments,thepriva~t:sectorand Civil SocietyOrgnrrisatiuns(CSO;). However, given the complelLily oC Lhe lark, the MSCBI' will initially 94 fucirs on bidding capacity in the public sector 8t the caitml gclve'ernmentlzrd, while huilding institutionalarraiigemeilts for better coordiriation of all capncity building efforts. The Goveinment will expaidthe MSCDP to local gwcmmmts, the private sector ;idCSOs as the ~ T W W evvlres. 26. The MSCBPtargcts Ir~inlanTCSOIXCC dwclopiwit, institutionbuilding, policy fondation, and coordiiintion of capacity buildilig interventions. It. embeds capacity bitildiug a.c.tivitiesin priori? sector Frograms LISoutlined in the PRSP and as reflected inthe government pmgrambudgetsandthe MTEF. 2?. Loci1 training insdtutions s M l be reslruc(iwd and s[renglhtr;ntxl tu cxry uul IXaininy in pubfic; fiaancialrrmngernent and hurnanregource mnagmenl a1the lava1O fdsg~ee01.diploma inodor to fillskill gap.,. Tfic Gowrninwt will also initiatc tlic dcvcbpiiicnt of Local instittitcs and "think-tailks'3for policyresenrchm d ana.lysis.The goal is to have inplace intemtionallyratedlocal.institiitjom for professimialtraining, certification and regulation of accountants, auditors, IT systems administ", bankers and public service personnel administrators. The training condtancy shall be deselbped .Lbwgh strengthening exivting ones and facilimtiq, die creatioti of iiew ones. `T'tie trairiing cunsu1lanc.y iurmionwill also bc dcvclapcd throong,Ii nairiitig interested Rx37atidan public sc.wicc manngcrs as private.traincrs This rc-training will enable die111 to establis11 private mnsultmcy busiiiesses in cast they hase to lewe t,hepublic.service?thewby increasing fhe niiinbei:of trainingpmvidmandpromolingsmall businavsdevehpmmi. 28. The Government i s ~LI< cornmiitcd `to the. mudernisation and cvon.tiral IxmaIumitiun ul' yuvcrnrnmt upcmliuns lhrough strategic and cost-cffectiw a.pplication of ICTs. Tlic bISCBP will suppai-i Ihe newly eatablishcd Rw-andnInfornmtion Tcc.11nologyAgcnqr (UTA)tu p q m e sectmal policies, standards and guidelilies that will facilitate iiiiplemeiitationof ICT Poiicy couiittyvide. The pmgaiiiiiie will also sapport trainiiig of tnp phlic stmice managers and middle level lachnicims in ihc: appmpriab sualegiw arid morlalilies ror trmsLvmalionto +Go.c~.rrunent. Thc programtnc will fbhx fdciliute ac.quiuitionand inxkllalion u lICY inli-astniciurc inMDGs (u improvc clXcicricy and effectiveuesa inttleir operafialis. 29, Inline wifhtlir pal.icy tn lrromntc public-privatesector psmlmshipa for itnprovd savicc delivery, the Govenlmeiit v4l prwide support to stmrqthix public-private sectot inteiface through the Rwanda 95 hv-ost" PromotionAgency (RIPA) and the Rwanda Private Sector Federation. Specific activities under this suppurl shnll include erkblishing a depivLmmt to promote issues on pub1ic:private parumshipi; ar RlPA and. sup,port.ing thc Rwanda Privatc Swor Fc.dcrationinc.rcat.itignlicttcr busincmawirmmentfar it.snicinhcrs. 2 9 . V ~MSCBP is plamcd wilh a lung-!LmpLwpoctivo. I i v ubjcciivcs and viaion will nul be reaiisai in the short 01`aiediurti kmm. 11 will be implernmled tkrough a series o f tncdium tcrm (5 ycnrs) irnplmwntation etra.tcg.i.cs, Ttic first fivc-ycnr MediumTam saatcgy has heal preparcd rcvfilving nround seven cnnpments cnveriiig the period 2005 tn 2809 with the total estimatedcost of f;SS 1;SS 77,151,300 wer the five-year period. 3O.The Government wiU put inp k c apgrupriatc institutional arrangements 10 fkciliuile irnplementntiori of the pro&ranune `l'he cubincl htiY nppro3Xed establishment of a HuinauResonrceand1natinitio~mI.Cnpscity Dcvcl.opmc,nnt Agcncy (HIDA) to implcincnt thc programc. Tlic Agency shall bz establishedby mi act of padiantencto give it a strong legal backing. It will be a self-accounting public,institution vt-itli legal status and admhlistmtive autonomy. It will be puverned b? a Council r;omprising mmbm hawii Burn. the;public se;c1or, priua~t:sw;lur and civil socicty.A cwnpctcntUirector Gcncralassistcd bysupport staiTarid B team of i~ndtidi~cipliiiq specialists shnll ensui-e its day-ta-day opera.tion. 3I,.The pl-ngrmiinie geekg UI avoid overlapsmid duplicatim lsy adding valtie to nii-goiiig and planned capacity building interventions, in close cooperation with odm donors. Over time, the MSCBP will build the capacity orpmticipatiag MDAs io plan, m i a g e and evaluate their own capacity buildingacti17itic.s. As ministries' capacities increase., so will QieiI rvspousibilify it1 dcsigring; implcmnctitingand waluating c.apachy building iiitei-ventians, to mswe dmand-driveu iuten7entions and ownership. . 32,'l'b ensiire proper ILW of fundn, stringent accountability aiTangelnents shall bc piit in place and nifoxed. Proposals m d applications for funding slinll conform to the procedures and fomuts for validating achifi7emeiltsof'planncdurri-pub as will be sliptrlabd ia h eInmlormda of understanding between NNCBA arid pa.riic.ipalbig h?lDAs.M&E 96 s p i i m s shall be esublishecl at the level of MI>Ajto inonitor the irnplementiltinn nf activities under the \%CRP and others stipulated in thc mategic plans for h4D.k The mmgmneiit of HRICBA will pepare qmrtterly proyress reports on ,the impltsmmlirtion of the prog"e, as WOU as acalemenis 01reventie and e?rpendii.urt:lor submissiun tu Uie Governing Comicil. The Cioveriimeritwill also erisuri: that a conly1rh"c informaticln, cducntion and comruiinicaticn stxatcgy is dcsigiledand iiirplemaikd on n caiitiiiuous basis in order to eimm ou"~le~s11i~1, iiifaimtiou and cousiiltation of the progrmnc amongst all stakeholders. Cmisultatlonsmdth DevelopmentPartners 33.lhe Ljocremncnt dccply appruciatcs tlic untiring cffoifs of die World Bad t c m drougliout pmgraiiunc prcparnrion and.in availinga. Proicct Prcpiwadoii Facility (PPF) to finance preparatory activities. Go.ven.imeiir also apprecintes the Rank's proposed IDA siipporttluoiigl~ the Piib1.i~Smar Capacity Ruilding Project(PSCTP) iii suppmt of rhe Government MSCBP. The PSCBP will fa& on strengtheningcapacity inpublic.sectur institutiunsat the c~ntrizlg y " i 1we.l to facilitate implemmlaiion of he l'lC31'. 34.Thc hvcmtncnt also rcmgi&cs thc positivc rcsyonsc mcl co~itit~~id support of thc Ahica Capnciy RuildingFouiidotiaii (ACRF) to cnpaciqt building in Rwanda. The ACRF was closely associaied inthe biSCBP prqari-it~ process and participatedin the apprnisal ,mission orgmisd by h e World BaxL Tliq Imvr also pledged to sripporl MSCBP. The Gova-nmc.nt will cuntinur: .Lo consult othw dcvclopmcnt partners to support lhc prog-mnmcuvcr iimc. `l'hisp~uwwwill. bc mmulagcrlwithin ihi: donor fii.ar1lrrvor.kof coorchation mil lwmioniznlion apcud upon, betwcm Gov"cnt and dwclopmncnt pa.t-trtlicrs, in support of PUP imp1cnic11tntiCIn. Canc.Iusion 35.blt.Prssidcq for Rwaudato ovcrconic capacity cotistraititsatidrealise [lie davdoprrimt goals and objcctiws sct out iithr:PRSP it will require substanrivcinvcslmcnh invkillv Jcvclupmcrd tind inulilulim builhng as oiitliricd above. We recoguiset1ia.t national ownelship and cotunitmerit are key to succcssful implcmcntatitionof \ffSCRP accrivitio. A I thc same ritnc:tlic mntinuing engagement of the intamational coninmiry through policy dialogiie and mataial assistice is esscntil. Your approval o f 97 this rcqucst thcrcfore2i s crvdnl as it. lays a. strong fooiiclotioii fiom which other MSCRPactisitieawill belaunched. Pleaseaccept, hlr. pTRpideyt,thc assuranczflofour highest asreem. 98