Afghanistan | World Bank

Afghanistan - Afghanistan ICT Sector Development Project : P121755 - Implementation Status Results Report : Sequence 04

2013-05-24T04:00:00.000Z

Official Documents- Amendment No. 42 to the Grant Agreement for ARTF TF050577

2013-05-23T04:00:00.000Z

Official Documents- Ninth Amendment to the Letter Agreement for Ireland to TF050576

2013-05-23T04:00:00.000Z

Official Documents- Sixteenth Amendment to the Letter Agreement for Germany to TF050576

2013-05-23T04:00:00.000Z

Official Documents- Sixth Amendment to the Letter Agreement for Korea to TF050576

2013-05-23T04:00:00.000Z

Afghanistan - Afghanistan: System Enhancement for Health Action in Transition Project : P129663 - Implementation Status Results Report : Sequence 01

2013-05-16T04:00:00.000Z

Afghanistan - Second Customs Reform and Trade Facilitation Project : P112872 - Implementation Status Results Report : Sequence 06

2013-05-16T04:00:00.000Z

Project Information Document (Concept Stage) - DABS Planning And Capacity Support - P131228

2013-05-16T04:00:00.000Z

The project DABS Planning And Capacity Support is now in the pipeline.

2013-05-16T04:00:00.000Z

The project DABS Planning And Capacity Support is now in the pipeline. To see more information, see the project information in the World Bank project database

The project Naghlu Hydropower Rehabilitation Project is now in the pipeline.

2013-05-16T04:00:00.000Z

The project Naghlu Hydropower Rehabilitation Project is now in the pipeline. To see more information, see the project information in the World Bank project database

Integrated Safeguards Data Sheet (Concept Stage) - DABS Planning And Capacity Support - P131228

2013-05-15T04:00:00.000Z

Project Information Document (Concept Stage) - Naghlu Hydropower Rehabilitation Project - P132944

2013-05-15T04:00:00.000Z

Afghanistan - Nutrition at a glance

2013-05-10T04:00:00.000Z

Annually, Afghanistan loses over US dollar 235 million in GDP to vitamin and mineral deficiencies. Scaling up core micronutrient interventions would cost less than US dollar 17 million per year. Overall prevalence of stunting and underweight have decreased over the past two decades and the country is currently on track towards meeting (halving 1990 rates of child underweight by 2015). Nevertheless, much remains to be done to accelerate reductions in underweight and reduce low birth weight to improve outcomes for future generations of children.

Official Documents- Fourteenth Amendment to the ARTF Grant Agreement with Denmark for TF050576

2013-05-07T04:00:00.000Z

Official Documents- Third Amendment to the ARTF Grant Agreement for TF098459

2013-05-07T04:00:00.000Z

Common threads : steel case and ARZU's market-led approach to create employment opportunities for women weavers in Afghanistan

2013-05-06T04:00:00.000Z

ARZU, a Chicago-based Non-governmental Organization (NGO), was founded on the goal to apply a market-led approach for sustainable poverty alleviation achieved through artisan-based employment that empowers women. Focusing on Afghan women, the organization identified rug weaving as an employment opportunity that fit within the cultural framework and limitations for women that exist in the country. To begin the initiative in 2004, ARZU hired local staff based in Kabul, and they began to meet with village elders and explain what they wanted to do and ask for permission, taking into account the cultural norms of Afghan society. ARZU uses a combination of donations and the proceeds from sales to fund its social programs and pay the weavers fair market wages. It also covers the cost of local staff to ensure quality control, train weavers to improve techniques, and manage the distribution channels. Currently, ARZU's sales fund 50 percent of its social programs, and the organization hopes to be fully financially sustainable in the next several years. Steelcase and ARZU's partnership illustrates the realized potential of what can happen when an NGO and a corporation overlap in their strategic vision and goals and work together to create job opportunities for the poor. In this partnership, Steelcase accepted a product development cycle that was nearly six months longer to support employment in Afghanistan. As ARZU continues to forge new corporate clients and steelcase continues to seek new partnerships that employ workers in developing countries, a key lesson learned from this private sector-NGO partnership is that it is feasible for a corporation to contract out to social enterprises without lowering quality standard or significantly affecting profitability.

Afghanistan economic update

2013-05-02T04:00:00.000Z

One year into the transition process, Afghanistan sustains robust economic growth. An exceptional harvest, supported by the launch of first large-scale mining activities, increased real gross domestic product (GDP) growth from 7.3 percent to an estimated 11.8 percent in 2012. Inflation dropped to 6.4 percent and continuing high levels of aid helped to build up further international reserves. The medium-term outlook is tainted by uncertainty. Political and security uncertainties are expected to limit private-sector growth in the coming years. Increased public spending, however, will continue to fuel demand for services and construction through 2013. The transition process exposes Afghanistan to a number of serious risks, such as rising financing for public service provision. Security considerations aside, promoting sources of inclusive economic growth, especially agriculture, and strengthening domestic revenue mobilization will be important to mitigate some of these risks. In particular, a stronger reform effort in areas such as tax policy and customs is required to safeguard past gains in development. Finally, improvements in the legal and regulatory environment of mining could help to secure planned investment.

Afghanistan - National Solidarity Program III : P117103 - Implementation Status Results Report : Sequence 06

2013-04-29T04:00:00.000Z

The project Afghanistan Resource Corridor Project is now in the pipeline.

2013-04-24T04:00:00.000Z

The project Afghanistan Resource Corridor Project is now in the pipeline. To see more information, see the project information in the World Bank project database

Official Documents- Agreement for Grant TF014211

2013-04-23T04:00:00.000Z

Official Documents- Disbursement Letter for Grant TF014211

2013-04-23T04:00:00.000Z

Project Information Document (Concept Stage) - Afghanistan Resource Corridor Project - P145443

2013-04-23T04:00:00.000Z

Regaining momentum

2013-04-23T04:00:00.000Z

To regain the strong growth it had before the global crisis, South Asia will have to manage a combination of persistent external economic headwinds and increasing regional macroeconomic and structural vulnerabilities. Macroeconomic policies to tackle the adverse effects of the global downturn have left the South Asian countries with weaker fiscal and monetary options to stimulate growth today. With the exception of Afghanistan, economic growth across other South Asian countries- Bangladesh, Bhutan, Maldives, Nepal, and Sri Lanka-has been moderating or stagnating. In Bangladesh, with export and investment growth slowing, Gross Domestic product (GDP) growth is likely to fall to around 6 percent in FY2013/14, down from 6.3 percent in FY2012/13. Over the same period, Bhutan saw its growth rate decline from almost 9 percent to 7.6 percent. India's economy slowed significantly. As a result, growth of a subdued 3 percent is expected in FY2012/13, down from 4.6 percent in FY2011/12. A significant drop in the region's exports and fixed investment are primarily responsible for South Asia's growth moderation. Private consumption remained stable, helped by resilient remittance flows, and is expected to only pick up slowly due to effects of persistent inflation, fiscal consolidation and slow recovery in disposable income. The overall real effective exchange rate depreciation across South Asia reflects weak economic fundamentals. International reserves fell below critical levels of two months of import coverage in Pakistan and one month in Maldives, reflecting the two countries' difficult external situations. During the first eight months of FY2012/13, Pakistan's net international reserves fell to 1.8 months, down from 2.6 months in the previous fiscal year.

The project Afghanistan Access to Finance is now in the pipeline.

2013-04-04T04:00:00.000Z

The project Afghanistan Access to Finance is now in the pipeline. To see more information, see the project information in the World Bank project database

The project ARTF - Kabul-Aybak/Mazar-e-Sharif Power Project has changed to Closed

2013-04-02T04:00:00.000Z

The project ARTF - Kabul-Aybak/Mazar-e-Sharif Power Project has changed to Closed. To see more information, see the project information in the World Bank project database

The development objective of the Kabul, Aybak, and Mazar-e-Sharif Power Project for Afghanistan is to help provide reliable and quality power to the consumers in the target areas of the cities of Kabul, Aybak, and Mazar-e-Sharif. This second extension, bringing the cumulative extension period to 30 months, is required to provide adequate time to complete the remaining project activities and thus allow full completion of the Project Development Objective (PDO). The activities have been delayed due to several factors, some of which have been outside the control of the project implementing entity.

The project Technical Assistance for Water-sector Capacity Building has changed to Closed

2013-04-02T04:00:00.000Z

The project Technical Assistance for Water-sector Capacity Building has changed to Closed. To see more information, see the project information in the World Bank project database

The development objective of the Water Resources Development Technical Assistance Project is to build the recipient's capacity to progressively undertake strategic basin planning and to improve project preparation for water resources development. This restructuring paper seeks Regional Vice President (RVP) approval to extend the closing date of the Afghanistan Reconstruction Trust Fund (ARTF) grant for the project from March 31, 2011 to March 31, 2013. This first extension is required to provide adequate time to complete the project activities which have been considerably delayed due to factors outside the control of the Government and the project implementing agency. The total project cost was estimated at US$ 15.25 million. The project implementation was divided in two phases with each phase covering a two-year period. The ARTF grant agreement for phase one of the project (US$ 5.5 million) was signed on March 23, 2009 with a grant closing date of March 31, 2011.

The project Emergency Power Rehabilitation Project has changed to Closed

2013-04-02T04:00:00.000Z

The project Emergency Power Rehabilitation Project has changed to Closed. To see more information, see the project information in the World Bank project database

The objective of the Emergency Power Rehabilitation Project for Afghanistan is to provide an improved and more reliable power supply to the people in Kabul. Initially, project implementation had been very slow. In December 2006, the project was restructured to: (i) reduce the scope of part A of the project to rehabilitate and expand the core medium voltage network in Kabul and reallocate credit proceeds to finance critical parts of the northern transmission system to allow the import of lower cost power from neighboring countries to supply Kabul (an added part G of the project); (ii) outsource project management to a consulting firm to mitigate project implementation delays; (iii) revise the project's outcome indicator to increased grid supplied power consumption by customers in Kabul by 70 percent at the end of the project; and (iv) extend the credit closing date by 20 months from January 31, 2009 to September 30, 2010.

The project Afghanistan - Second Skills Development Project is now in the pipeline.

2013-03-21T04:00:00.000Z

The project Afghanistan - Second Skills Development Project is now in the pipeline. To see more information, see the project information in the World Bank project database

The objective of the Second Skills Development Project for Afghanistan is to increase the potential for employment and higher earnings of graduates from Technical and Vocational Education and Training (TVET) schools and institutes through improvements in the skills delivery system. The grant will help finance the costs associated with reforms in, and improvement of, the Technical and Vocational Education and Training sector in Afghanistan, with particular attention to deepening of the institutional systems. The level of skills in Afghanistan is low and formal training for mid-level skills competence, though it exists, is not standardized and/or benchmarked to acceptable sub-regional or regional standards. The support will respond to the situation through: a) strengthening and improving the overall institutional system, b) providing incentives for development of TVET schools and institutes in that provide formal technical training; c) training of technical teachers; and d) developing labor market information systems and Management Information System (MIS) to monitor the whole sector. All these interventions will be underpinned, and informed by robust linkages between the training providers and the labor market. The strength and relevance of the project lies in it being market-oriented, with a pivotal role for the private sector in management and decision-making in the skills delivery system.

The project Kabul Municipal Development Program is now in the pipeline.

2013-03-21T04:00:00.000Z

The project Kabul Municipal Development Program is now in the pipeline. To see more information, see the project information in the World Bank project database

The project Afghanistan - Support to Basic Package of Health Services (Strengthening Health Activity for Rural Poor has changed to Closed

2013-03-17T04:00:00.000Z

The project Afghanistan - Support to Basic Package of Health Services (Strengthening Health Activity for Rural Poor has changed to Closed. To see more information, see the project information in the World Bank project database

The project Afghanistan: System Enhancement for Health Action in Transition Project has changed to Active

2013-03-12T04:00:00.000Z

The project Afghanistan: System Enhancement for Health Action in Transition Project has changed to Active. To see more information, see the project information in the World Bank project database

The development objectives of the System Enhancement for Health Action in Transition Project for Afghanistan are to expand the scope, quality and coverage of health services provided to the population, particularly to the poor, in the project areas, and to enhance the stewardship functions of the ministry of public health (MOPH). Financing is needed for implementation of the basic package of health services (BPHS) and essential package of hospital services (EPHS) through contracting out and contracting in arrangements both in rural and urban areas in provinces supported by the European union (EU), the Afghanistan Reconstruction Trust Fund (ARTF) and the World Bank, covering a total of twenty one provinces in the country (out of thirty four provinces). System enhancement for health action in transition (SEHAT) will be a platform nation-wide project, which will allow for financing health services in more provinces if additional resources become available. The project will also strengthen the national health system and ministry of public health's capacity at central and provincial levels, so it can effectively perform its stewardship functions in the sector.

The project Afghanistan: National Horticulture and Livestock Productivity Project is now in the pipeline.

2013-01-10T05:00:00.000Z

The project Afghanistan: National Horticulture and Livestock Productivity Project is now in the pipeline. To see more information, see the project information in the World Bank project database

The project Afghanistan: System Enhancement for Health Action in Transition Project is now in the pipeline.

2013-01-04T05:00:00.000Z

The project Afghanistan: System Enhancement for Health Action in Transition Project is now in the pipeline. To see more information, see the project information in the World Bank project database

The project Afghanistan HIV/AIDS Prevention Project has changed to Closed

2013-01-04T05:00:00.000Z

The project Afghanistan HIV/AIDS Prevention Project has changed to Closed. To see more information, see the project information in the World Bank project database

The HIV/AIDS Prevention Project will contribute to Afghanistan's national development goals of maintaining HIV prevalence below 0.5 percent in the general population and below 5 percent among vulnerable groups at high risk of infection. The project's development objectives are to slow down the spread of HIV and build up the national capacity to respond to the epidemic. This will be accomplished by: (a) behavior change among vulnerable groups at high risk; and (b) improving knowledge of HIV prevention and reducing stigma related to HIV and AIDS in the general population. The project has four components: communications and advocacy activities will aim to increase knowledge of HIV prevention among opinion leaders and the general population, and reduce stigma and discrimination against vulnerable groups at high risk of HIV and AIDS; strengthening HIV surveillance through biological and behavioral surveys and knowledge attitudes and practice studies; targeted interventions for people engaged in high risk behaviors, including injecting drug use and unsafe sex; and program management, capacity building, monitoring and evaluation, and an Innovation Initiative to promote multi sector activities in support of project objectives.

The project Afghanistan: Extractive Industries Transparency Initiative Implementation has changed to Closed

2012-10-24T04:00:00.000Z

The project Afghanistan: Extractive Industries Transparency Initiative Implementation has changed to Closed. To see more information, see the project information in the World Bank project database

Crossing Boundaries

2012-09-06T23:45:00.000Z

As prepared for delivery

Friday, September 7, 2012

World Conservation Congress

Jeju, Korea

Rachel Kyte, Vice President, Sustainable Development

Distinguished guests, ladies and gentlemen - I am honored to have been asked to make the keynote address at this vital gathering of conservation thinking, leadership and action. I am particularly delighted to be here as I had the privilege and honor to work at IUCN a number of years ago. It feels good to be back again!

This Congress brings together some of the world’s smartest thinkers on the policy and practice of conservation and environmental protection. If anyone is going to guide the world in new ways of thinking and acting, it is this group of 7,000 or more which traverses all spheres - private, public, civil society, multilateral, large, small, left, right.

You, as a group, are not at the fringes of decision-making - you are at the very heart of it. Your scientific research, dedication, pursuit of better policies and connections to community all go towards much better, more informed decision-making.

Over the last few years I have had the opportunity to cross some of the boundaries that very often define our perceptions and determine the work in our institutions. My perspectives changed as I moved from IUCN to working with private companies during my time at the World Bank’s private sector arm - the IFC - and they’re changing again now as Vice President for Sustainable Development at the World Bank.

Today, I am convinced that we will have to make a bigger effort to cross boundaries – between our organizations, across public and private sectors and within civil society - so that we reach a better future for our planet.

Let’s take a look at just some of the evidence of environmental decline before us. Evidence is one of the many things that the World Bank and IUCN share.

· The number and size of populations of the world’s species have decreased by almost a third over the last 100 years and this is projected to continue decreasing

· Over 60 percent of ecosystems are in worse shape now than 50 years ago

· 85 percent of ocean fisheries are fully exploited or over-exploited or depleted

· The condition of coral reefs has deteriorated by 38 percent since 1980

· 80 percent of people live in areas where the quality of rivers is threatened

· Climate change is worsening everything. Flood disasters increased by 230 percent and drought disasters by 38 per cent in the 20 years to the early 2000s.

At the same time that this assault on nature has been occurring, we have enjoyed an unrivalled period of economic growth which has seen 660 million people lifted out of poverty in the past 20 years. Don’t get me wrong - we are not saying we need to stop growth to protect nature. Rather, we are calling for a different kind of growth - a greener and more inclusive growth.

An indispensable part of this will be realizing the potential of ecosystems within our economies and to put nature at the foundation of economic strategies. Nature needs to be firmly on the agendas of finance ministers and discussed in board rooms with the focus on building the public-private partnerships to invest in our natural wealth.

Are we ready to do this? Increasingly the World Bank Group is. Now let me share with you three reasons for my cautious optimism that others are ready too.

Firstly, governments are increasingly stepping up - whether by increasing the number and extent of areas under protection or by better recognizing the value of nature and ecosystem services.

Governments, however, are facing daily trade-offs - for example - building a road through a park so that farmers can have better access to markets and/or conserving a road-less national park. Or, they’re weighing up a marina in a mangrove area to boost tourism versus protecting it for its fish breeding, storm protection and carbon storage values.

Effective conservation cannot and will not be driven just by conservation for conservation’s sake. Fortunately, governments increasingly recognize that maintaining and, eventually, accounting for their natural capital comes down to a question of social and economic development. There may not be simple win-wins all the time; but there may be approaches that can come close enough.

We are seeing more and more good examples. In the State of Acre in the northwestern corner of Brazil, the State Government has been making a concerted effort to bring services to its dispersed rural population and to move away from a growth model based on extraction of forest products and expansive agriculture. Where previously 90 percent of Acre’s timber extraction was illegal, now the majority comes from approved forest management plans. Real GDP has increased by over 44 percent and deforestation rates have declined by 70 percent. Acre is showing that safeguarding a state’s natural wealth will also help lift its people out of poverty.

In Liberia, the government has installed a chain of custody system for exporting logs that is helping reduce illegal logging and bringing in much-needed funding for conservation. The Government is also enforcing fishing regulations and arresting vessels found to be fishing illegally.

To manage trade-offs, governments need better information on the economic and social effects of their decisions. More and more governments are embracing the need to use natural capital accounts alongside GDP. At the World Bank Group, we are working with countries from Botswana to the Philippines to put the value of natural capital into the center of their economic decision making. After the 50:50 Campaign at Rio, 62 countries have signed on to support natural capital accounting along with the heads of close to 90 companies. These companies are doing this for competitive reasons - they need to be able to value their assets over the long term.

That brings me to the second reason for my optimism -- the growing leadership coming from parts of the private sector, be they small businesses and local entrepreneurs or Fortune 500 companies.

I see real traction emerging from the advent of rigorous performance standards and principles for corporate behavior. For example, we are beginning to see evidence that the revised IFC Performance Standard on Biodiversity is driving major change both at corporate headquarters and, more importantly, on the ground.

Companies working in developing countries are increasingly investing in biodiversity expertise, in community development, environmental restoration and long-term conservation capacity building. The big shift is that companies are beginning to see this as more than reputational risk management and rather as a way to improve their operations and manage business risk, a key part of creating value. Mainstreaming nature conservation across their operations makes good business sense. Why? Because many companies depend on freshwater, genetic resources, climate regulation, and natural hazard protection to run their businesses successfully and to see their profits grow.

As well as making good business sense, conserving nature and maintaining the resilience of ecosystems upon which people and business depend, allows companies to build trust in the communities in which they operate and among stakeholders abroad. This creates something many call a “social license to operate”.

We are beginning to see more and more companies engage with conservation organizations and external experts to better understand the environment in which they are working. This has inspired some companies to go beyond the minimization of project impacts but also to consider how they might contribute to conservation more broadly.

One example is Rio Tinto which launched its biodiversity strategy at this Congress in 2004. That strategy committed the company to making a Net Positive Impact on biodiversity through its operations. For the past seven years, the company has been piloting the strategy - working alongside government, conservation groups and civil society in Madagascar to build public sector capacity, develop livelihood alternatives, and establish offsets to conserve high biodiversity value areas.

Other examples include Shell in Gabon and Peru LNG which have been working together with the Smithsonian Institution to develop science-based assessment and monitoring of project impacts.

I also see the first few encouraging examples from the finance sector in integrating nature and ecosystem services protection into their investments.

That takes me to my third reason for optimism - that the need for action is overcoming global political sclerosis.

Rio+20 confirmed for me that while at the global level we lack political leadership today to gain consensus, global inaction is being overwhelmed by the ideas, the innovation and the real commitment to action from smart policymakers, city mayors, community leaders and CEOs.

Like-minded coalitions across sectors emerged on almost all issues. People gravitated to ideas and approaches that promised action - whether that was about ocean health, natural capital accounting, access to sustainable energy or reducing short-term climate pollutants.

For the more than 1000 business executives who attended Rio, the message was that action on sustainability is all about future markets, future products, future employees, future investors, and competitiveness linked to sustainability as shared value.

There was an almost overwhelming sense that while we need global governance for ultimate speed and scale, we cannot afford to wait for international agreements to do what everyone knows needs to be done. For every square bracket negotiated, a species is lost and that window of opportunity gets smaller and smaller.

…………………

So, while I have these reasons for cautious optimism --- I am also speaking from a place of urgency. To address the challenges ahead, each and every one of us will have to cross boundaries and we in the conservation community will need to move collectively outside our comfort zones. To this end, I have three appeals.

First to governments: Governments have responsibilities to their citizens that are measured in units of finance – jobs, tax receipts, GDP. We are not naïve: There can be and will be tensions between conservation and development; that’s why public servants need to be armed with the tools and information they need to make fully informed decisions. And that’s why those of you here who work in government should unpack the economic benefits of conservation and translate them into real numbers through natural capital accounting to transform conservation from a discrete sector to an engine of inclusive green growth.

Second to the Private Sector: To be part of the solution, companies need to raise the profile of nature conservation in their boardrooms and recognize the value of nature to their bottom lines. On the ground, companies need to commit to best management practices which will sometimes mean working beyond their immediate project areas to offset impacts and to secure supply chains. This raises technical, political and governance challenges which is why companies need to reach out and offer a hand in partnership to governments, to conservation organizations and even to each other. We hear from the private sector the need for a level playing field when it comes to best practice in biodiversity management. A coordinated and loud voice from industry groups towards government regulators might be part of the solution.

We also need to find ways to bring to scale financial instruments like green bonds, conservation banking, subsidy reform, license to operate agreements for generating new potential sources of support so that good practice can be rewarded with access to capital.

Third to Civil Society: Very often, civil society, conservation organizations and academic institutions are the backbone of any commitment to conserving nature.

But it is important to remember that it’s governments that have the main responsibility for the stewardship of natural assets. These are their citizen’s natural assets; governments must manage them. The rest of us – civil society, donors and philanthropists – must work together, provide them support while demanding transparency and holding them to account, so that they can do more and do it better.

We in the conservation community need to see the private sector as full partners for solutions and not just a threat or a fundraising opportunity. For example, in public private partnerships - if we were able to develop aggregated offsets, is the conservation community collectively ready to provide the means for verification?

Across all these areas of engagement, the World Bank Group stands ready to do its part and to do more:

We entered the debate on green growth in May 2012 through our report ‘Inclusive Green Growth: The Pathway to Sustainable Development’. We want to contribute, in particular by focusing on the inclusiveness of green growth, on the importance of sound fiscal policies - like the removal of inefficient fuel subsidies - and on ensuring that nature considerations are taken into account in economic decision-making. Our work on green growth is, importantly, supported by the Korean Government.

With new energy and emphasis around Natural Capital Accounting stemming from Rio, it is crucial to keep up the political support and momentum, attract key new country partners, and visibly demonstrate action - including through our global partnership called WAVES.

We also want to do more to streamline nature considerations into our own operations by coordinating the implementation of the IFC’s Performance Standards and the World Bank’s operational policies. And I expect that the Bank Group will work more on aggregated offsets as a means of bringing public and private interests together to conserve at scale within a transparent framework.

We are also working on enhancing environmental law enforcement to ensure that the benefits of nature accrue to national economies and local communities - not thugs and organized crime.

Conclusion

Ladies and Gentlemen, as we begin this Congress:

· Let’s agree that we need to do more, better and with more far-reaching consequences

· Let’s together move away from our ardent attachment to old ideologies, old attitudes that stop us from finding solutions together. What we need today is innovation, communication and partnerships between governments, communities, financial institutions, companies and conservation organizations.

· The type and range of solutions will be as diverse as species and ecosystems. Just as nature is not just a set of charismatic species, we will need more than a set of boutique projects and anecdotes to show large-scale impact. We will need to prioritize without devaluing any one community’s chance of life. We will need brave thinkers at the table, all types of partnerships, people with the humility and patience to make them work. Who better than those of us already humbled by the glory of nature and the complexity of its life support?

· Let’s cross our boundaries together.

· I look forward to being with you every step of the way.

The project Afghanistan - Second Education Quality Improvement Program has changed to Closed

2012-09-04T04:00:00.000Z

The project Afghanistan - Second Education Quality Improvement Program has changed to Closed. To see more information, see the project information in the World Bank project database

Afghanistan is a country that has been besieged by civil strife for almost three decades. The Second Education Quality Improvement Project development objective is to increase equitable access to quality basic education especially for girls through school grants, teacher training and strengthened institutional capacity with support from communities and private providers. The objective will be achieved through the following components: (1) School Grants: There are complementary objectives of the school grants component: a) to support the improvement of teaching and learning by facilitating the creation of enabling school environments; and b) support the improvement of basic school facilities at existing government registered primary, middle, and secondary schools with teachers on the payroll. (2) Teacher and principal training and education: The objective of this component is to create sustainable systems which will increase the level of professional knowledge and skills of educators throughout Afghanistan. This component will provide much needed training to teachers and principals. (3) Monitoring and Evaluation: The objective of this component is to (a) build on and support the existing structure for Education Quality Improvement Project (EQUIP) in Ministry of Education (MoE) and (b) establish and implement a practical monitoring and evaluation system for the project so that lessons can be drawn in a timely fashion to facilitate project improvement as well as policy making.

Government of Afghanistan Signs $125 million Grant with the World Bank to Improve Rural Roads

2012-07-22T07:23:16.000Z

Dari l Pashto

KABUL, July 22, 2012 ─ Afghanistan’s Ministry of Finance and the World Bank today signed a $125 million grant from the World Bank’s International Development Association (IDA) to finance the improvement and maintenance of secondary and tertiary rural roads as well as the construction of bridges, together with support for implementation and capacity building activities.

The Afghanistan Rural Access Project (ARAP) aims to enable rural communities across Afghanistan to benefit from improved access to basic services and facilities through all-weather roads. The project is expected to increase the number of people living within 2 km of all-season roads, reduce travel time to essential services, and enable rural people to access essential services more frequently. The total cost of the project is estimated to be around $332 million of which the World Bank financed $125 million. The World Bank administered multi-donor trust fund – ARTF – will finance the remaining $207 million.

“Given that nearly eighty percent of Afghans live in rural areas, building rural infrastructure is crucial for the people’s well-being and prosperity, as well as for economic growth,” said HE Dr. Mustafa Mastoor, Deputy Finance Minister, Islamic Republic of Afghanistan. “Connecting villages with each other and with towns and cities will not only improve villagers’ welfare, but also help bring peace, stability and prosperity. If one village is connected with another, new employment opportunities will open up, access to basic services such as health and education will improve, and businesses will prosper.”

The Afghanistan Rural Access Project (ARAP) follows on from the series of World Bank projects that have supported the Government's National Rural Access Program (NRAP) over the past ten years, together with financing from the Afghanistan Reconstruction Trust Fund (ARTF). NRAP has been one of the Government's national priority programs that share a broader vision of enhancing human security, equitable growth and integrating the rural economy with the regional market, through the provision of sustainable rural access to basic services. To date, with support from the World Bank and the ARTF, the Government of Afghanistan has been able to rehabilitate or built more than 10,500 km of secondary and tertiary road networks across the country. Moreover, these interventions have created over 16 million labor days opportunities for Afghans throughout the country.

Two decades of civil war inflicted severe damage to Afghanistan’s road network, both to main highways as well as rural roads. As the nation started to emerge from the conflict in 2001, only a tenth of the estimated 130,000 km of roads was in good condition.

Today, Afghanistan’s tertiary road network is estimated at 80,000 km, of which only about 7,000 km are accessible to motor vehicles in all seasons; the rest are tracks mostly inaccessible to motor vehicles. Among the roads that remain accessible to motor vehicles all year, an estimated 5,000 km are believed to be in maintainable state, while the rest are in poor condition and need rehabilitation.

“Alleviating poverty through interventions that help create jobs, provide access to basic services and create an enabling environment to private sector investments remains the World Bank’s paramount focus in its support of government efforts,” said Bob Saum, World Bank Country Director for Afghanistan. “The rehabilitation of rural infrastructure so far has led to encouraging improvements in rural livelihoods. Many villages are, for the first time, connected to markets. People have easy access to health facilities and more children are able to go to school. We will continue to support government efforts in sustaining this progress and help it to expand into villages where Afghans still wait to benefit from rural development activities.”

The Ministries of Public Works and Rural Rehabilitation and Development will continue to implement The Afghanistan Rural Access Project (ARAP) over a period of five years.

The Afghanistan Rural Access Project (ARAP) consists of three main components:

The Ministry of Public Works will continue to improve and maintain secondary road networks. Specifically, MPW will rehabilitate some 1,000 km of secondary roads; upgrade 250 km of existing pavement to bituminous standard; conduct routine and periodic maintenance of 1,000 km of paved and unpaved secondary roads, and construct about 1,000 linear meters of bridges.
The Ministry of Rural Rehabilitation and Development (MRRD) will rehabilitate 1300 km of tertiary roads, conduct routine and periodic maintenance of 2,000 km of tertiary roads, and construct 1,600 linear meters of bridges.
To achieve institutional sustainability for managing the road network, the project will support both MRRD and MPW efforts in:
- Strengthening network planning, development and management system
- Developing a comprehensive system for rural road design standards and cost estimation, and research and development
- Developing a road inventory and condition inventory

Contacts:
Wahidullah Tawhidi
Ministry of Finance
Phone: 0700266363
Email:wahid_tawhidi@yahoo.com
www.mof.gov.af

Eng.Sher Mohd Kamin
Ministry of Public Works
Phone:0700295395
Email:skamin@unop.org
www.mopw.gov.af

Sarwar Norzai
Ministry of Rural Rehabilitation and Development
Phone: 0799403862
Email: norzai@gmail.com
http://www.mrrd.gov.af

Abdul Raouf Zia
World Bank
0700280800
azia@worldbank.org
www.worldbank.org.af
www.worldbank.org/artf

The project AF: Development Policy Prog. Series is now in the pipeline.

2012-07-17T04:00:00.000Z

The project AF: Development Policy Prog. Series is now in the pipeline. To see more information, see the project information in the World Bank project database

Zoellick to Join Harvard’s Belfer Center, Peterson Institute

2012-06-27T13:00:00.000Z

WASHINGTON, June 27, 2012—Robert B. Zoellick today said he would join the Belfer Center for Science and International Affairs at Harvard University and the Peterson Institute for International Economics in Washington DC after he steps down as World Bank Group President on June 30.

Zoellick will become the Peterson Institute’s first Distinguished Visiting Fellow as well as also becoming a Senior Fellow at the Belfer Center at the Kennedy School of Government at Harvard.

“I appreciate the opportunity to engage with the scholars and practitioners at Harvard’s Belfer Center and the Peterson Institute for International Economics,” said Zoellick. “I hope to work on the intersection of economics and security, applying history to policy questions of today. Both institutions have been at the cutting edge of research and policy development, and I have benefited greatly from both in the past.”

As the 11th president of the World Bank, Mr. Zoellick turned around an institution in trouble in 2007, recapitalized the Bank, and expanded financing for the poorest countries following the food, fuel and financial crises of recent years. He modernized the Bank by making it more accountable, flexible, fast-moving, transparent, and focused on good governance and anti-corruption. He has increased representation of developing countries in governance and staffing and encouraged developing countries to set their own priorities rather than have them dictated from the Bank. His record has also been marked by an increased role for the private sector through the bank’s International Finance Corporation (IFC), which under his leadership has recruited sovereign wealth funds and pension funds to invest in poor countries, especially in Africa.

Before his term at the Bank, Mr. Zoellick served as Vice Chairman, International, of the Goldman Sachs Group as well as Managing Director and Chairman of Goldman Sachs’ Board of International Advisors from 2006-2007. Previously, he was Deputy Secretary of State in 2005-2006 and a member of the Cabinet as U.S. Trade Representative from 2001 to 2005.

From 1985 to 1993, he served at the Treasury and State Departments in various posts, as well as White House Deputy Chief of Staff. He was the lead U.S. official in the "Two-plus-Four" process of German unification in 1989-90 and served as "sherpa" for the preparation of the G-7/8 Economic Summits in 1991-92.

Mr. Zoellick graduated Phi Beta Kappa from Swarthmore College in 1975 and earned a J.D. magna cum laude from the Harvard Law School and a Master of Public Policy (MPP) from the Kennedy School of Government in 1981.

Contacts:

In Washington: Frederick Jones, (202) 473-9336, fjones@worldbank.org

For Broadcast Requests: Mehreen Sheikh, (202) 458-7336, msheikh1@worldbank.org

The project AF: ARTF-2nd Judicial Reform Project has changed to Active

2012-06-27T04:00:00.000Z

The project AF: ARTF-2nd Judicial Reform Project has changed to Active. To see more information, see the project information in the World Bank project database

The objective of the Justice Service Delivery Project for Afghanistan is to increase the access to and use of legal services. The project seeks to: to implement the Government's National Priority Program, mitigate the impact of the transition; put the system on a sustainable path for long term results; and improve service delivery. The project will finance the costs associated with: (a) building capacity of front line legal service providers to deliver key legal services; (b) increasing scope and quality of legal aid; (c) improving access of the people to legal information and civil legal education; (d) improving management and provision of legal services by central justice institutions; and (e) building project management capacity. The key outcome indicators for this project include: (i) scope and quality of legal services increased; (ii) productivity of legal service providers improved; and (iii) accountability of legal service providers enhanced. The implementing agencies are the Supreme Court (SC), the Ministry of Justice (MoJ) and the Attorney General's Office (AGO).

The project Afghanistan Rural Access Project has changed to Active

2012-06-27T04:00:00.000Z

The project Afghanistan Rural Access Project has changed to Active. To see more information, see the project information in the World Bank project database

The development objective of the Rural Access Project is to enable rural communities to benefit from all-season road access to basic services and facilities. This project paper seeks the approval of the Executive Directors to provide a grant in an amount of US$125 million to Afghanistan for an Afghanistan Rural Access Project (ARAP). The project is being processed under the rapid response to crises and emergencies. The project will focus mainly on the rehabilitation and upgrading of existing access roads along their current alignments with a minimum standard, thereby posing low to medium environmental and social impact. The grant will help finance the improvement and maintenance of secondary and tertiary rural roads, construction of bridges, implementation support and capacity building activities. The project will also finance eligible expenditures under the project.

Innovative Fund to Boost Food Security and Farmer Livelihoods is Launched

2012-06-18T19:04:43.000Z

New Approach to Financing Innovations in Food Security and Agricultural Development Unveiled at G20 Summit in Mexico

AgResults: Innovation in Research and Delivery

LOS CABOS, Mexico (June 18, 2012) – An innovative initiative that will enhance global food security and improve the livelihoods of developing country farmers through prizes and other market-based incentives was announced today by G20 Leaders. With a results-driven funding model that rewards innovators for tackling some of the biggest problems in food security and agricultural development, AgResults addresses global challenges in food security and agriculture by generating market-oriented solutions. The initiative aims to achieve significant improvements in the wellbeing of the poor and vulnerable in developing countries with a fund of up to $100 million, to be administered by the World Bank. The governments of Australia, Canada, Italy, the United Kingdom, the United States, as well as the Bill & Melinda Gates Foundation, are supporting this effort.

AgResults uses pull mechanisms to encourage innovation through results-based payments such as prizes that are typically paid out when certain objectives or milestones have been met. Such financing mechanisms have seen success in generating innovation and market-oriented solutions in other domains such as healthcare, and AgResults aims to deliver similar gains in global food security and agricultural development.

AgResults was born out of the realization that there is a great need for increased investment in global food security and agriculture, in particular from the private sector. The FAO estimates that world food production must double by 2050 to feed a growing world population, while nearly a billion people suffer from a lack of crucial micronutrients in their diet—a hidden hunger that inhibits the development of children and reduces adult productivity. Recognizing these gaps, leaders at the June 2010 G20 Summit in Toronto committed to exploring innovative, results-focused ways of harnessing private sector innovations in food security and agricultural development in developing countries. This commitment involved a two-year effort by committed partners to develop AgResults, culminating in today’s launch of the initiative in support of the Summit priority of enhancing global food security. AgResults addresses this priority directly through new funding and a focus on bringing new, innovative approaches to bear on global food security issues.

In the coming years, AgResults will launch a series of pilots that address some of the biggest problems in global food security and agricultural development. The initiative’s portfolio of pilots will represent a diverse mix of agriculture and food security issues, testing different types of pull mechanisms in different regions globally. The initial set of pilots, focusing on maize production in Sub-Saharan Africa, include:

· Incentivizing the adoption of on-farm storage technology for smallholder farmers;

· Encouraging innovative distribution of a breakthrough technology to reduce aflatoxin contamination; and

· Building a market for new vitamin A-enhanced varieties of maize.

Additional pilots will be explored in the coming years, potentially including livestock vaccines and fertilizer innovation as well as new ideas related to increasing crop yields, decreasing post-harvest losses, increasing livestock productivity and improving nutrition.

For further information, please visit www.worldbank.org/cfp/agpm

Contacts:

In Washington: Amy Stilwell, (202) 458-4906, astilwell@worldbank.org

In Mexico: Fernanda Zavaleta, 52-55-5480-4252, fzavaleta@worldbank.org

For Broadcast Requests: Natalia Cieslik, (202) 458-9369, ncieslik@worldbank.org

Global Mobility Unaffected by Financial Crisis, as Remittances Remained Resilient

2012-06-13T13:00:00.000Z

WASHINGTON, June 14, 2012 – The global financial crisis of 2008/09 has not sent migrant workers streaming back home, despite worsening employment prospects and anti-immigration rhetoric in some destination countries, says a new book on migration and remittances, published by the World Bank.

In fact, migrants may have mitigated some of the pain of the crisis as they tend to work for lower wages, receive fewer benefits and rely relatively little on the state, says the ‘Migration and Remittances during the Global Financial Crisis and Beyond’ book.

“During the crisis, remittances continued to provide a steady source of foreign currency to developing country economies at a time when foreign aid remained flat and foreign direct investment declined sharply,” said Otaviano Canuto, Vice President, Poverty Reduction and Economic Management, at the World Bank.

Removing restrictions on human mobility may help enhance financial flows among nations and alleviate some of the adverse effect of the crisis, says the book. With migrant workers projected to remit about $399 billion to their home countries during 2012, compared to $372 billion in 2011, remittances are the most tangible link between migration and development.

Although many of the 215 million international migrants are facing worsening employment prospects in some destination countries, particularly high-income Europe, their cash support to families in their home countries has remained resilient, posting, in 2009, the only decline in recent memory. Even then, remittances decreased by a modest 5.2 percent, in sharp contrast with the precipitous declines seen in global private capital flows.

“The resilience of remittances is good news for developing countries as they remain one of the less volatile sources of foreign exchange earnings, particularly for the less developed countries. At the household level, these cash transfers are, in many cases, the only lifeline for families in the home countries,” said Hans Timmer, Director of Development Prospects at the World Bank.

However, despite many years of recording ever-increasing volumes of remittances, leveraging this rather large and growing source of funds for socio-economic development remains a key challenge, with the vast majority of remittances used for maintaining families and for the purchase of consumer goods.

The book, which is the first comprehensive study of remittances during the global financial crisis, is a compilation of 45 separate studies that identify and discuss remittance practices across the world and possibilities for the future. Each study is authored by a different expert who analyzes certain countries and certain aspects of remittances, ranging from patterns of remittance flows to usage of remittances received by communities and households.

The book is co-edited by Dilip Ratha, Manager of the Bank’s Migration and Remittances Unit; Ibrahim Sirkeci, Professor of Transnational Studies and Marketing at Regent’s College, London; and Jeffrey Cohen, Associate Professor of Anthropology at the Ohio State University, USA, who also co-author the book’s first chapter on remittance flows and practices during the crisis.

“Contrary to expectations, we found no evidence of return of migrants, even as the financial crisis reduced employment opportunities in the United States and Europe, with many countries, such as Spain, offering financial incentives to encourage migrants to return,” said Sirkeci.

Migration, in fact, was a strategic response to the financial crisis. Like any political or environmental catastrophe, the financial crisis caused human insecurity and people in developing countries responded by crossing borders or moving domestically to survive the impact of the crisis.

“Remittances have remained resilient and, barring the decline in 2009, have maintained a healthy growth momentum. However, since the book went to press, the global economy continues to experience serious bouts of volatility, which could affect migrant earnings and, hence, remittances,” said Ratha.

For receiving countries, a key factor behind the resilience in remittances is the diversification of migrant destinations.

Countries in South Asia and East Asia with many migrants in the United States, Europe and the Gulf Cooperation Council (GCC) countries continued to register increased remittance inflows. One study in the book concludes that only a prolonged global slowdown would cause a decline in remittance flows to India, the largest recipient of remittances in 2011, with $64 billion.

In contrast, Latin America and the Caribbean region, whose migrants are concentrated in the United States, suffered a dramatic decline in remittances throughout the financial crisis. Mexico, the world’s third largest recipient of remittances ($24 billion in 2011), saw a significant decline in remittance inflows from the United States during the crisis. A similar strong impact was found in El Salvador. Both cases underline the fact that many Latin American countries were vulnerable to the effects of crisis, with a special impact on the urban youth in these countries, who face more difficult labor market prospects and declining opportunities to migrate.

Studies related to the effect of the crisis in the European Union on remittance-receiving countries found that Spain has been the fastest-growing immigration destination for the past decade and is now the fifth largest remittance-sending country, after the United States, Saudi Arabia, Russia and Switzerland.

In the East Asia and Pacific region, remittances account for as much as 12 percent of GDP, as in the case of New Zealand and Pacific island economies, while remittances have been keeping the national economy afloat in the Philippines for the past three decades.

Also, due to the depreciation of local currencies of many remittance-recipient countries, such as India, Mexico, and the Philippines, migrants from those countries turned to investment-oriented remittances in South Asia and East Asia where goods, services, and assets suddenly became significantly inexpensive and affordable.

The book recommends that countries develop policies that reduce restrictions on human mobility and develop programs to facilitate the use of remittances for long-term investments and promoting entrepreneurship. Such changes, tailored to both host and recipient country needs, can strengthen the contribution of remittances to development.

Eliminating the complexity of transactions and reducing transaction costs would also help increase the volume of remittances utilizing official channels, to enable many small nations, in particular, to reap the socio-economic benefits of migrant earnings.

The book is available for purchase at http://publications.worldbank.org/18826

The latest migration and remittances data are available at www.worldbank.org/migration

Interact with migration experts at http://blogs.worldbank.org/peoplemove/

Contacts:

In Washington: Indira Chand +1 (202) 458-0434, +1 (703) 376-7491, ichand@worldbank.org

For TV/Broadcast: Natalia Cieslik +1 (202) 458-9369, ncieslik@worldbank.org

WB Urges Developing Countries to Strengthen Domestic Fundamentals, to Weather Global Economic Turmoil

2012-06-12T17:00:00.000Z

WASHINGTON, June 12, 2012 – Developing countries should prepare for a long period of volatility in the global economy by re-emphasizing medium-term development strategies, while preparing for tougher times, says the World Bank in the newly-released Global Economic Prospects (GEP), June 2012.

A resurgence of tensions in high-income Europe has eroded the gains made during the first four months of this year, which saw a rebound in economic activity in both developing and advanced countries and an easing of risk aversion among investors. Since May 1^st, increased market jitters have spread. Developing and high-income country stock markets have lost some 7 percent, giving up two-thirds of the gains generated over the preceding four months. Most industrial commodity prices are down, with crude and copper prices down by 19 and 14 percent, respectively, while developing country currencies have lost value against the US dollar, as international capital fled to safe-haven assets, such as German and U.S. government bonds.

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So far, conditions in most developing countries have not deteriorated as much as in the fourth quarter of 2011. Outside of Europe and Central Asia and the Middle-East and North Africa, developing country credit default swap (CDS) rates, a key indicator of market sentiment, remain well below their maximums from the fall of 2011.

“Global capital market and investor sentiment are likely to remain volatile over the medium term – making economic policy setting difficult. In this environment, developing countries should focus on productivity-enhancing reforms and infrastructure investment instead of reacting to day-to-day changes in the international environment,” said Hans Timmer, Director of Development Prospects at the World Bank.

Increased uncertainty will add to pre-existing headwinds from budget cutting, banking-sector deleveraging and developing country capacity constraints. As a result, the World Bank projects that developing country growth will slow to a relatively weak 5.3 percent in 2012, before strengthening somewhat to 5.9 percent in 2013 and 6.0 percent in 2014. Growth in high-income countries will also be weak, 1.4, 1.9 and 2.3 percent for 2012, 2013 and 2014 respectively – with GDP in the Euro Area declining 0.3 percent in 2012. Overall, global GDP is projected to rise 2.5, 3.0 and 3.3 ⁽¹⁾ percent for the same period.

This baseline scenario remains the most likely outcome. However, should the situation in Europe deteriorate sharply no developing region would be spared. Developing Europe and Central Asia is especially vulnerable because of its close trade and financial ties with high-income Europe, but the world's poorest countries will also feel the fall out – especially countries that are heavily reliant on remittances, tourism or commodity exports or that have high-levels of short-term debt.

“Where possible, developing countries need to move to reduce vulnerabilities by lowering short-term debt levels, cutting budget deficits and returning to a more neutral monetary policy stance. Doing so will provide them with more leeway to loosen policy, should global conditions take a sharp turn for the worse,” said Andrew Burns, Manager of Global Macroeconomics and lead author of the report.

The full report and accompanying datasets are available at www.worldbank.org/globaloutlook

Regional Highlights

Growth outlooks for each country are available in the full report at:

www.worldbank.org/globaloutlook

Growth for the East Asia and Pacific region is on a moderately easing trend, with GDP gains for the region dropping to 8.3 percent in 2011 from 9.7 percent in 2010. The recent deterioration in global financial conditions is expected to add to pre-existing headwinds, including relatively weak demand from the high-income world, and a slowing phase in China to moderate regional growth to 7.6 percent in 2012, before broader global recovery lifts exports and growth for the region in 2013 to 8.1 percent, easing to 7.9 percent in 2014. China’s GDP is expected to accelerate from 8.2 percent in 2012 to 8.4 percent by 2014.

Notwithstanding the economic downturn in the Euro Area in the fourth quarter of 2011, developing Europe and Central Asia posted strong (5.6 percent) growth in 2011, driven by robust domestic demand and good harvests in countries such as Russia, Romania and Turkey. However, severe weather conditions in early 2012, capacity constraints in some countries, deleveraging by European banks, and the renewed turmoil in high-income Europe are projected to slow regional GDP growth to 3.3 percent this year, before a modest recovery begins with growth firming to 4.1 and 4.4 percent in each of 2013 and 2014.

Growth in the Latin America and the Caribbean region eased to 4.3 percent in 2011, from 6.1 percent in 2010, due to the pronounced slowdown in the region’s larger economies. In Brazil, GDP slowed sharply to 2.7 percent in 2011 (7.5 percent in 2010), as investment growth and private consumption eased. The region’s short-term outlook is clouded by a weak external environment, and capacity constraints in select economies. Regional GDP is expected to decelerate to 3.5 percent in 2012, firming to 4.1 percent and 4 percent in 2013 and 2014, respectively, while growth in Brazil is projected to remain below potential at 2.9 percent in 2012, before accelerating to 4.2 percent in 2013 and 3.9 percent in 2014.

Uncertainty, volatility, and political change continue to characterize conditions in the Middle East and North Africa region. Aggregate GDP grew by 1 percent in 2011, down from 3.8 percent in 2010. Regional growth is projected to remain weak at 0.6 percent for 2012, mainly reflecting the influence of sanctions on growth in Iran, and continued GDP declines in Syria and Yemen. As these elements fade in importance, growth for the region should step up to 2.2 percent in 2013 and 3.4 percent in 2014. Egypt’s economy is projected to move out of negative territory to 1.4 percent growth in 2012, rising to 4.6 percent in 2014. Growth is also expected to pick up strongly in Jordan and Lebanon, while oil prices, which are projected to average near $107/bbl in 2012, will benefit the region’s oil exporters.

Growth in South Asia slowed to 7.1 percent in 2011, from 8.6 percent in 2010, as headwinds from the Euro Area crisis caused a steep deceleration in exports and a reversal of portfolio inflows. Growth in India was particularly weak due to monetary policy, stalled reforms, and electricity shortages, which, along with fiscal and inflation concerns, cut into investment activity. Policy uncertainties, fiscal deficits, entrenched inflation, and infrastructure gaps will continue to weigh negatively on investment activity and are expected to limit regional growth to a relatively modest 6.4 percent in 2012, 6.5 percent in 2013, and 6.7 percent in 2014. India will see growth (measured at factor cost) increasing to 6.9, 7.2 and 7.4 percent in fiscal years 2012-13, 2013-14 and 2014-15, respectively.

Economic growth in Sub-Saharan Africa remained robust in 2011 at 4.7 percent. Excluding South Africa, growth in the rest of the region was stronger, at 5.6 percent, making it one of the fastest growing developing regions. Higher commodity prices and improved macroeconomic and political stability in recent years has supported increased private investment flows to the region, with promising prospects in the medium term. As global demand firms and domestic demand remains robust, regional growth is expected to strengthen to 5 percent in 2012, 5.3 percent in 2013 and 5.2 percent in 2014.

Contacts

In Washington: Merrell Tuck-Primdahl +1 (202) 473-9516, +1 (202) 476-9897, mtuckprimdahl@worldbank.org;

Indira Chand +1 (202) 458-0434, +1 (703) 376-7491, ichand@worldbank.org

In London: Derek Warren + 44 (20) 7592-8402 , dwarren1@worldbank.org

For TV/Broadcast: Natalia Cieslik +1 (202) 458-9369, ncieslik@worldbank.org

(1) Using purchasing power parity weights, global growth would be 3.3, 3.9 and 4.2 percent for 2012, 2013 and 2014, respectively.

Globalization: Made in the Americas

2012-06-08T00:30:00.000Z

AS PREPARED FOR DELIVERY

Inter-American Dialogue 30^th Anniversary Dinner

Remarks of Robert B. Zoellick, President, World Bank Group

June 7, 2012

Introduction

Thank you for the honor of your invitation to commemorate the 30^th Anniversary of the Inter-American Dialogue.

The origins of this Dialogue stretch back to a discussion between Peter Bell and Abe Lowenthal on a park bench.

Peter and Abe were disturbed by the breakdown in inter-American exchanges during the Falklands/Malvinas war, and by the lack of ties with the rising democrats of Latin America. So they discussed bringing together leaders from across the hemisphere to set a new inter-American agenda. The Dialogue held its first ad hoc conference in late 1982.

Today, 30 years later, Latin America’s very success offers the opportunity to remake that Hemispheric partnership around new pillars:

· A revived free trade policy that will aid structural reforms for growth in all our countries;

· An energy transformation, ending the Hemisphere’s energy dependency;

· A new diplomacy infused with private sector pragmatism to solve public problems;

· Shared security; and

· The first Democratic Hemisphere.

For the United States, this new agenda could enable us to rely on a great, home-grown asset – Hispanic-Americans – as the vanguard of U.S. connectivity in a new Western Hemispheric economy.

This Dialogue can – and I believe will – help drive this change: to create a “Globalization: Made in the Americas.”

Under Peter Hakim’s and now Michael Shifter’s energetic leadership, the Inter-American Dialogue has become the leading U.S. center for policy analysis, exchange, and communication in the Western Hemisphere.

The idea at the heart of the Dialogue remains very much the same as that which emerged from the conversation on the park bench: that through dialogue and shared vision, interested citizens across the hemisphere together can plant the seeds of new policy ideas and practical proposals for progress in the Americas.

So tonight, let’s put that idea to work.

A Different Vantage Point

Just two months ago, the leaders of the Western Hemisphere met in Cartagena for the Summit of the Americas. Colombia was an excellent host, and the Summit showcased the country’s many hard-won achievements.

But the news reports were, frankly, disappointing. Aside from the behavior of some Secret Service agents, the coverage focused on disagreements about Cuba and drugs. Some even suggested this would be the last Summit of the Americas. The agenda seemed stuck in a time warp.

So when Carla Hills asked if I could join you this evening, I thought the best way to celebrate the Dialogue’s Anniversary was to offer new possibilities for the Americas in a fast-changing global economy.

My vantage point on our hemisphere is different from many U.S. contributors to the Dialogue. I am not a specialist in Latin America.

Like many of my U.S. foreign and security policy colleagues, much of my energy has been concentrated on the issues of Europe and the Asia-Pacific, the Middle East and Southwest Asia.

Yet because of my economic background, Latin America and Canada have loomed larger on my global map.

In the 1980s and early 90s, working with Secretary of Treasury and State James Baker, we were immersed in issues of Latin American debt and reforms for growth, the Canadian and North American FTAs, and Central American security and democracy.

In 2001, as U.S. Trade Representative, we were fortunate to build on that experience, negotiating FTAs with Chile, Colombia, Peru, Panama, the five countries of Central America and the Dominican Republic. Together with NAFTA, these FTAs cover 54 percent of the economy of our hemisphere, not including the United States, offering an underutilized web of free traders that could support deeper integration in the Americas – even hemispheric free trade and democracy.

Five years as President of the World Bank Group has added to this perspective.

Why am I stressing this global outlook on Latin America? Because, while working on the issues of our region, I have urged my Latin counterparts to look globally, too.

Instead, for too many years, the dialogue within our hemisphere seemed constrained by a North-South framework. The United States loomed large – whether as a hegemon, source of support, market, model, danger, or even frustrating land of inattention.

On development, debt, investment, competition, and trade, Latin Americans need to see the wider horizon – especially to benchmark with East Asia. And beyond East Asia, Latin America has a new role to play in building multiple engines of growth with other emerging markets. It is time to break out of that North-South construct.

Consider Canada’s experience in combining regional integration with global reach: of course, Canada’s FTA with the United States in 1988 deepened the two countries’ economic integration – but in addition, the competitive adjustment driven by that accord made Canadian business more competitive globally.

A new hemispheric partnership requires leaving old habits, old mindsets, and old models of dependency behind.

That partnership will necessitate a new mix of partners, public and private.

That partnership should be the next challenge for the Summit of the Americas and this Dialogue.

Latin America’s Record of Gains

Latin America’s recent record of gains now puts it in a position to remake the Hemispheric partnership.

The numbers tell the story.

Between 2003 and 2010, the income of the average Latin American increased by more than 30 percent. A silent revolution in macro-financial policy has strengthened the economic immune system of many countries. We saw the payoff after the fall of Lehman Brothers: Sound policies in Latin America enabled expansions to offset the downturn without the aftershocks that now threaten Europe.

About 73 million Latin Americans have been lifted out of poverty since 2003. Today, almost a third of the region’s population is considered middle class.

Latin America is breaking a pattern of persistent inequality, including through an increase in women’s involvement in the economy, particularly from poor families. Colombia and Peru have buttressed this trend by boosting opportunities for people of African and indigenous origin, seeking to overcome divisions that populists have exploited.

Mexico and Brazil have led in developing well-targeted conditional cash transfer programs that have revolutionized public assistance. These programs couple income grants for poor families with incentives for health check-ups and keeping children in school. Mexico’s Oportunidades program has probably done more for women’s health than anything in the country’s history.

These are safety net programs that appeal to a fiscal conservative: They cost only about half a percent of GDP. The World Bank has helped export this model to 40 other countries, ranging from Pakistan to the Philippines.

Latin America is “going global.” As the global trade negotiations have stalled, leading Latin American free traders have tried to keep up the momentum. Mexico has FTAs with 59 countries; Chile with 43.

Colombia offers a leading example of how a democracy can combine security, development, and good governance to overcome narco-traffickers, kidnappers, and terrorists. Peru demonstrates how sound economic policy and political commitment across administrations can reverse years of stagnation.

Brazil’s influence is expanding – through its companies, agricultural and mining experience, development work, peacekeeping in Haiti, and interest in Africa. Brazil’s leaders of the left have also turned a page in history by sticking with democracy. Rising leaders of the left in other Latin American countries have seen the benefits for the poor of Brazil’s example, compared to authoritarians who tear down institutions to consolidate personal or party power.

Looking Ahead

So what’s ahead for Latin America?

Latin America’s per capita income is still only at 30 percent of the U.S. level.

To climb higher, Latin American economies will need to leap beyond the so-called middle income trap. Many developing economies make early rapid gains. But then productivity and growth tend to slow.

This is a global challenge. In 1960, the World Bank ranked 101 economies as middle income; by 2008, almost half a century later, only 13 had made it to high income levels – and one was Greece.

Many Latin American countries will need to translate the commodity boom into broader, more diversified economies. This region has lived through roller-coaster booms and busts before.

Higher productivity is the antidote to the middle income trap.

Since the 1980s, Latin America has underinvested in infrastructure – electricity, roads, bridges, ports, transport – and maintaining and operating these services. Currently, Latin America spends 2 to 3 percent of GDP on infrastructure, less than half the rate of investment in East Asia.

Public-private infrastructure partnerships not only offer a source of financing, but also better design, maintenance, and operations to deliver high-quality services on time.

Colombia has experimented with PPPs in urban water supply and sanitation. Mexico’s new Highway Concession Program has mobilized PPP projects of around $11 billion, expanding the country’s major toll roads network by some 25 percent.

Latin America has to anticipate its human capital needs. The region is aging rapidly: today, about 11 percent of Brazil’s working age-population are seniors; by 2050, it will be nearly half.

Latin America also needs to improve the results of its investments in education. By age 15, the learning achievement of the average Latin American student lags two years behind his or her developed country counterparts.

Latin America is recognizing that gender equality is smart economics. Today, women in Latin America outnumber men in schools and universities. Working age women represent roughly 40 percent of the entire labor force in the region.

To continue to grow, the region will need more competition and innovation in the service sector. Competitive services increase productivity. They supply the ‘software’ of integration: transport, where delays and losses can impose significant costs; information technology, because accurate data and effective communication is vital; financial services, to create a supportive business environment; and logistics systems, which are a driver of business competitiveness.

A New Agenda

What do these challenges mean for a new hemispheric partnership? What should have been the news coming out of Cartagena?

Let me offer five ideas.

First, the Western Hemisphere needs to revive an activist free trade and economic reform policy, globally and regionally. We need fresh approaches.

The United States will be cutting agricultural subsidies, especially given high prices, and eliminating protection for ethanol. Why not deploy these to prod others?

Service sector liberalization can boost productivity, open new businesses, create new jobs, and cut the “Latin cost” that many countries impose on their own businesses. Why not deploy this economic need to revive a mutual interest in negotiation?

A strong self-interest can drive this renewed call for liberalization. Latin American economies still need much investment and more robust capital markets – especially in local currencies – that can help Latin American entrepreneurs and family-owned businesses to expand.

Infrastructure investments require capital goods and services, as Panama’s 21st Century Canal project is demonstrating. Why not dismantle barriers to lower the cost of infrastructure expansion?

Better logistics make economies more competitive. The World Bank’s 2012 Logistics Performance Index estimated that Latin American logistics costs are between 16 and 26 percent of GDP – that’s two to four times the average in Europe or East Asia.

The World Bank has helped Colombia and Peru to implement a “single window” approach to customs clearance and border management. In Brazil and Peru, the Bank has worked with international freight forwarders to connect rural, remote villages and small businesses to export through national postal services; in the first six months, more than 300 small firms in Peru became exporters, most for the first time.

Even as the WTO works toward a Trade Facilitation agreement, the Americas could develop an accord that points the way.

Brazilian officials are focused on exchange rates. Yet to really boost growth the target should be productivity. Better infrastructure can help, and so can more efficient and effective public services. The World Bank Group has launched a deeper partnership with the Governors of the Northeastern states of Brazil to overcome these impediments. Over time, however, the United States and its free trade partners should be working with Brazil to rebuild the case for a hemispheric initiative to realize the benefits of trade liberalization and economic reforms.

It takes two to tango, and this agenda requires changes on the part of the United States, too. The United States is no longer leading the open trade agenda, as it relies increasingly on defensive measures. The United States has its own high costs of trade – antiquated ports and laws to protect special interests.

The United States should work with its current free trade partners in the Americas to deepen ties of development, reform, and investment.

The current architecture of US FTAs in the hemisphere offers a solid legal framework, but it needs to evolve into a home for an ongoing dialogue – across countries and with business, academic, civil society, and environmental communities – to see what else can be done to lower costs and barriers and create opportunities.

The United States and its partners could explore progressive integration across the FTAs, for example by expanding provisions to cumulate inputs among partners while qualifying for free trade.

The United States needs to make its hemispheric FTA network dynamic, linked to business and investment policies, and improved governance.

A new concept of an FTA network in the Americas could also support inclusive and sustainable development as the foundation for open societies and borders.

Second, innovation in the energy sector, led by the United States, could transform energy security for North America, the Hemisphere, and the world.

In 2008, imports supplied 70 percent of US oil demand. By 2020, PFC Energy estimates that imports could be down to 40 percent of US oil demand – or even 20 percent if Canadian oil is counted as part of the home market. If natural gas for Canada and the United States is added, U.S. net energy imports from the rest of the world could drop to five percent of U.S. demand. That’s an amazing game-changer in energy.

If Mexico opens PEMEX to real outside investment, the outlook is even brighter. With the discovery of the giant deep offshore PRESAL oil and gas fields, Brazil can play a major role in supplying oil and gas in the region.

Yet there is a need to connect these energy supplies – through infrastructure – with countries in Central America and the Caribbean that have suffered from high prices and limited access. Increased efficiency and alternative sources could help the energy poor, too. It’s long past time for a hemispheric energy policy – blending consideration of inclusive growth, the environment, and indigenous communities’ interests.

Third, this new Hemispheric partnership needs to break old patterns of diplomacy. There are now vibrant private sectors all across the hemisphere. The challenges of overcoming the middle income trap and structural reforms to boost productivity need private sector advice and solutions. All across the developing world, the World Bank is encountering a new pragmatism about involving the private sector in areas that used to be public monopolies: infrastructure; education; healthcare; skills training; delivery of public social services. Advanced economies such as the United States should be taking note, too.

Yet government-business dialogues can be stilted showcases. The Summit of the Americas – and perhaps the Dialogue – should review which approaches work better and why. With some guidance, businesses can better connect possibilities with policies. Governments can commit to responses, commitments, openness, and results.

Fourth, the new Hemispheric agenda should help all 35 countries overcome security threats to growth and opportunity.

The fragile governments of Central America are at risk of being overwhelmed by crime and violence linked to drug trafficking, organized crime, gangs, and firepower. Spain, which has roughly the same population as Central America, has about 400 murders per year; in 2010, Central America had over 18,000.

The region pays a heavy economic price for this insecurity – as much as 8 percent of GDP. The basic legitimacy of governments and institutions is fraying: About half of Central Americans say a military coup could be justified when crime levels are high.

Experiences from Medellin and Rio de Janeiro have shown that the best way to attack criminal insecurity is through an integrated approach: combining stepped-up policing, prevention, and community investments. Quick turnarounds are possible. Strong regional cooperation is indispensable.

The United States has an unfortunate pattern of ignoring dangers in Central America until they explode. This time U.S. diplomacy should work with Mexico, Colombia, and Panama to develop a coherent strategy – not band-aids. As in Colombia, the Central American private sector must also be part of the solution. And the United States should also take responsibility for the drug habits of its public that fuel demand for narcotics from the south.

Fragility in the Caribbean is another soft spot. But small economies can be competitive in many sectors. Accelerating integration in the Caribbean can share services, add to resilience, and boost economic prospects.

Latin America should also be looking toward a greater role in global security – through practical steps, not the old G-77 policies of the past. My friend and former colleague, Bernie Aronson has proposed, for example, that Brazil could lead by voluntarily ending its uranium enrichment program and then calling on other nations – including Iran – to follow its example. If Brazil wants to help shape the 21^st Century, leadership in preventing the spread of nuclear weapons – with an idea and action – would send a powerful signal.

Fifth, the debate over Cuba at Cartagena sounded like hollow echoes from another era. Look ahead, not back.

Chavez’s days are numbered. If his subsidies to Cuba and Nicaragua are cut, those regimes will be in trouble. The democrats of Latin America – left, center, and right – should be preparing. The calls for democracy – for an end to intimidating thugs, human rights, fair elections, and rule of law – should come from all its capitals.

There will soon be an opportunity to make the Western Hemisphere the first Democratic Hemisphere. Not a place of coups, caudillos, and cocaine -- but of democracy, development, and dignity.

This transformation will not be achieved by the Calvo doctrine. By divisive populists. By corruption. By acquiescence. By silence.

You know well that if Latins leave the work to Washington and Ottawa, the opponents of liberty and human rights will play the cards of gringoism and neo-imperialism. Trump them.

Conclusion

For the United States, a new partnership in the Western Hemisphere offers opportunities for renewal at home, too.

All the debates about macroeconomic issues – fiscal and monetary policies – as important as they are, risk inattention to microeconomic incentives, structural reforms in the United States.

Energy. Infrastructure. Education. Human capital. Competition. Environment. Innovation. The United States also needs to clear away old rigidities on these new fundamentals.

The United States also needs to draw on the energies, intelligence, and drive of all its citizens.

As my friend Luis Alberto Moreno of the Inter-American Development Bank has pointed out, the 50 million strong Hispanic community in the United States is a growing market, source of entrepreneurship, and resource for a Hemispheric economic strategy. At over $1 trillion, the purchasing power of Latinos in the United States is larger than the economies of every Latin American country except Brazil.

According to the U.S. Census Bureau, there are between two and three million Hispanic-owned businesses in the United States. Many are small. But they create jobs, earn revenues, and pay taxes.

As Latin America grows, the Hispanic businesses in the United States offer an incredible asset. Hispanics in the United States could be in the vanguard of a new Western Hemispheric economy.

Small and medium-sized Hispanic-American businesses will need help to expand their entrepreneurialism – information about markets, financing, and risk management services. To be most effective, this assistance should be decentralized – perhaps drawing on local chambers of commerce in cities and states where most Hispanic businesses can be found. The Small Business Administration, OPIC, Ex-Im Bank, the Inter-American Development Bank, and the World Bank could then deploy their resources to help.

The world economy is still struggling to recover from the worst blows since the 1930s. Europe is a danger zone. U.S. leadership remains vital to get through the storm, to reach a new world economy of multiple poles of growth.

This is why the news coming out of the Cartagena Summit was disappointing.

This is not a time for drift, for old North-South debates, for retreat behind borders, old mindsets, or out-dated dependencies.

This is a time for the New World to again inspire novel thinking – about development, growth, structural reforms, rule of law and human rights, democracy, and security.

This Dialogue should aim high: To have the Western Hemisphere shape this next era of globalization – so that future historians will title the next chapter, not “The Passing of the New World,” but “Globalization: Made in the Americas.”

Cities to Face Sharply Rising Costs for Garbage Treatment

2012-06-06T15:30:00.000Z

New report points to 70% global increase in urban solid waste

WASHINGTON, June 6, 2012 – A new, far-reaching report on the state of municipal solid waste around the world predicts a sharp rise in the amount of garbage generated by urban residents between now and 2025. The report estimates the amount of municipal solid waste (MSW) will rise from the current 1.3 billion tonnes/year to 2.2 billion tonnes/year, with much of the increase coming in rapidly growing cities in developing countries. The annual cost of solid waste management is projected to rise from the current $205 billion to $375 billion, with cost increasing most severely in low income countries.

The report, What a Waste: A Global Review of Solid Waste Management, for the first time offers consolidated data on MSW generation, collection, composition, and disposal by country and by region. In itself, this is an accomplishment because, as the report states, reliable global MSW information is either not available or incomplete, inconsistent, and incomparable. Nevertheless, the authors of the report point to a looming crisis in MSW treatment as living standards rise and urban populations grow.

“Improving solid waste management, especially in the rapidly growing cities of low income countries, is becoming a more and more urgent issue,” said Rachel Kyte, Vice President, Sustainable Development at the World Bank. “The findings of this report are sobering, but they also offer hope that once the extent of this issue is recognized, local and national leaders, as well as the international community, will mobilize to put in place programs to reduce, reuse, recycle, or recover as much waste as possible before burning it (and recovering the energy) or otherwise disposing of it. Measuring the extent of the problem is a critical first step to resolving it.”

The report notes that municipal solid waste management is the most important service a city provides. In low-income countries, MSW is often the largest single budget item for cities, and one of the largest employers. A city that cannot effectively manage its waste is rarely able to manage more complex services such as health, education, or transportation. Improving MSW is one of the most effective ways of strengthening overall municipal management.

The report shows that the amount of municipal solid waste is growing fastest in China (which surpassed the US as the world’s largest waste generator in 2004), other parts of East Asia, and part of Eastern Europe and the Middle East. Growth rates for MSW in these areas are similar to their rates for urbanization and increases in GDP. There is a direct correlation between the per capita level of income in cities and the amount of waste per capita that is generated. In general, as a country urbanizes and populations become wealthier, the consumption of inorganic materials (e.g. plastics, paper, glass, aluminum) increases, while the relative organic fraction decreases.

“What we’re finding in these figures is not that surprising,” said Dan Hoornweg, Lead Urban Specialist in the Finance, Economics, and Urban Development Department of the World Bank and eco-author of the report, “What is surprising, however, is that when you add the figures up we’re looking at a relatively silent problem that is growing daily. The challenges surrounding municipal solid waste are going to be enormous, on a scale of, if not greater than, the challenges we are currently experiencing with climate change. This report should be seen as a giant wake-up call to policy makers everywhere.”

The authors of the report say an integrated solid waste management plan is needed in cities to approach solid waste in a comprehensive manner. Key to such a plan is consultation and input from all stakeholders, including citizen groups and those working on behalf of the poor and the disadvantaged. Public health and environmental protection aspects of any such plan are also critical.

The report also spells out policy recommendations for reducing greenhouse gas emissions, many of which emanate from inefficient solid waste management practices. Post-consumer waste is estimated to account for almost 5% of total global GHG, while methane from landfills represents 12% of total global methane emissions. The report says that a number of practical approaches could be applied in most cities, including:

· Public education to inform people about their options to reduce waste generation and increase recycling and composting;

· Pricing mechanisms (such as product charges) to stimulate consumer behaviour to reduce waste generation and increase recycling;

· User charges tied to the quantity of waste disposed of, with (for example) consumers separating recyclables paying a lower fee for waste disposal; and/or

· Preferential procurement policies and pricing to stimulate demand for products made with recycled post-consumer waste.

For a link to the report, click here: http://go.worldbank.org/BCQEP0TMO0

Contacts:

In Washington: Roger Morier, +1 202 473 5675, rmorier@worldbank.org

For Broadcast Requests: Natalia Cieslik, +1 202 458 9369, ncieslik@worldbank.org

World Bank Group Unveils New Focus on ‘Green, Clean, Resilient’ Development

2012-06-05T04:00:00.000Z

WASHINGTON, June 5, 2012 -- The World Bank Group today released its ambitious, new Environment Strategy for 2012-2022 aimed at supporting countries to pursue sustainable development pathways that are green, inclusive, efficient, and affordable. The new Strategy responds to calls from governments and the private sector for new approaches to development in light of unprecedented environmental challenges and lays out a vision for “a green, clean and resilient world for all”.

“We’re seeing that working through the nexus of food crises, water insecurity, and energy needs is being made all the more complicated by environmental degradation and climate change,” said World Bank Vice President for Sustainable Development Rachel Kyte. “Countries and communities and the ecosystems they depend on need to build resilience while moving to more efficient growth paths. This Strategy lays out the areas where we will put emphasis as we work to respond to countries’ needs.”

As countries seek to reduce poverty in the face of climate change and other major environmental challenges, the Bank Group is providing knowledge, solutions and financing to foster an environment that is:

· Green where natural resources are sustainably managed and conserved to improve livelihoods and ensure food security;

· Clean in which cleaner air, water and oceans enable people to lead healthy, productive lives and where development strategies emphasize low-emission, climate-smart transport, energy, agriculture and urban development;

· Resilient in which countries are better prepared for shocks and less vulnerable to natural disasters, volatile weather patterns and other impacts of climate change.

World Bank commitments addressing environment and natural resource management have grown from $1.5 billion or 8.4 percent of World Bank lending in FY01 to $6.3 billion or 14.3 percent in FY11.

“The Strategy acknowledges the vital role of the private sector in achieving sustainable and inclusive economic growth and development,” said International Finance Corporation (IFC) Vice President for Business Advisory Services Nena Stoiljkovic. “IFC works with the private sector as an advisor, financier, and standard setter to help unlock this potential.”

The IFC invested $1.7 billion in climate-friendly projects in FY11, up 6 percent from $1.6 billion in FY10.

Under the “green” agenda, a key priority is the Wealth Accounting and Valuation of Ecosystem Services (WAVES) global partnership which supports countries’ efforts to factor natural capital into national accounting systems and through the Global Partnership for Oceans, the focus is on restoring the world’s oceans to health and optimizing their contribution to economic growth and food security. The “clean” agenda prioritizes pollution management through river clean-up and legacy pollution projects while also encouraging low-emission development strategies and financing for renewable energy, climate-smart agriculture, and lower-carbon cities.

The “resilience” agenda, targets support to countries to adapt to climate change, improve disaster risk management, with a focus on vulnerable Small Island Developing States to reduce dependence on oil imports, build sound infrastructure, and restore protective coastal ecosystems such as mangroves.

The Strategy includes action plans for the specific environmental challenges in each developing region of the world.

· In Africa, work will focus on strengthening governance for natural resource management given growing pressure on the region’s agriculture, mining, forests, and water basins. In partnership with other agencies, the private sector, and civil society, the Bank Group is seeking to expand access to clean energy across the region.

· In East Asia and the Pacific the Bank Group is supporting renewable energy and energy efficiency, sustainable urban development and transport, as well as prioritizing the phase-out of numerous industrial pollutants; advising on carbon markets and adaptation in agriculture and coastal infrastructure; scaling up forest management; and strengthening regional partnerships to preserve biodiversity.

· In Europe and Central Asia where many countries are faced with energy shortages and a legacy of industrial pollution, the Bank Group is promoting clean energy and production while supporting programs to dispose of pollutant stockpiles, rehabilitate watersheds and improve disaster preparedness.

· In Latin America and the Caribbean where pressure continues on coastlines, wetlands, and the world’s largest forest cover, the Bank Group is supporting the management of protected areas, the integration of biodiversity conservation into productive landscapes and in some countries, the use of payments for environmental services. It is also providing the world’s most urbanized region with policy advice on cleaner development paths, supporting industrial pollution abatement, and promoting “green cities”.

· In Middle East and North Africa where high population density, water scarcity, and overfishing tend primarily to affect the poor, the Bank Group is supporting programs to strengthen the capacity of countries with shared seas—the Mediterranean, the Red Sea, the Gulf of Aden and the Arabian Gulf—to reduce marine pollution and manage fisheries. Other focus areas include desert ecosystems and livelihoods; improved urban and industrial planning; scaled-up solar power generation; and efforts to reduce vulnerability to drought.

· In South Asia where the poorest live in areas of high soil erosion, variable rainfall, and degraded forests, the Bank Group is helping to strengthen the role of natural resource management in the development agenda, strengthen environmental management in industry and reduce the costs to countries of environmental degradation.

Meeting the challenges of a green, clean, and resilient world requires leveraging the comparative advantage of all development partners. The new Strategy recognizes the growing role of the private sector in addressing sustainability concerns, developing sustainability standards, and ensuring that global markets can and do promote sustainable development.

The Strategy also encompasses the Multilateral Investment Guarantee Agency (MIGA) - the arm of the World Bank Group that promotes responsible foreign direct investment into developing countries by offering political risk insurance to the private sector.

"MIGA is pleased to have contributed to this strategy and to advance the notion that the private sector is absolutely crucial to affect change with respect to environmental issues," said Michel Wormser, MIGA's Vice President and COO.

To measure and monitor progress the Environment Strategy includes a results framework to track progress over time. The new Strategy also advances work to assess greenhouse gas emissions from the Bank Group’s portfolio of development projects with pilots being undertaken in a number of World Bank energy, transport and forestry sector projects.

Contacts:
In Washington: Elisabeth Mealey, +1 202-458-4475, emealey@worldbank.org

Vanessa Bauza, +1 202-458-1603, vbauza@ifc.org
Mallory Saleson +1 202-473-0844 msaleson@worldbank.org

For Broadcast Requests: Natalia Cieslik, +1 202-458-9369, ncieslik@worldbank.org

To read the World Bank Group Environment Strategy 2012-2022, click here.

For more information on Sustainable Development at the World Bank click here.

For more information on the IFC Sustainability: www.ifc.org/sustainability

For more information on MIGA: www.miga.org

World Bank Increases Transparency through Inaugural Publication of Sanctions Board Decisions

2012-05-30T13:30:00.000Z

Milestone in anti-corruption agenda unmatched by any other IFI

WASHINGTON, May 30, 2012 - Marking another advance in openness and accountability in its anti-corruption work, the World Bank Group today published for the first time a set of decisions issued by the World Bank Group’s Sanctions Board in cases of alleged fraud and corruption.

"The World Bank Group takes a hard line against corruption, and we believe that greater transparency must be part of that effort,” said World Bank Managing Director Sri Mulyani Indrawati. “By publishing Sanctions Board decisions, we are making all parties involved in the sanctions process more accountable. This move should deepen the deterrent effect of debarments and enhance the educational value of the Sanctions Board’s findings."

The first published decisions were announced at a panel discussion hosted by the World Bank Group Sanctions Board Secretariat to take stock of recent developments and consider ongoing challenges for the Bank Group’s sanctions system. At the discussion, the Bank Group also announced the appointment of two new Sanctions Board members: Mr. Yves Fortier, an international arbitrator and former Canadian Ambassador to the United Nations, who will serve as Chair of the Sanctions Board; and Ms. Catherine O’Regan, President of the International Monetary Fund Administrative Tribunal and former Judge of the South African Constitutional Court.

The Sanctions Board, an independent administrative tribunal with a majority of external members, serves as final decision-maker in all contested sanctions cases. Decisions are taken based on an adversarial process that includes written arguments and evidence and, where requested, an administrative hearing. More than 530 firms and individuals have been sanctioned by the World Bank Group for fraud, corruption and collusion since the sanctions system was established in 1999. Most of these sanctions have been in the form of debarments, where firms or individuals are rendered ineligible to participate in Bank Group-financed operations.

From December 2011, the Sanctions Board Law Digest has made publicly available summaries of past cases and the legal principles applied over time. The publication of full Sanctions Board decisions goes a step further and creates an unprecedented level of transparency by presenting the Sanctions Board’s detailed review of each new appeal to determine whether misconduct occurred and if so, what sanctions should apply.

"Publication of our decisions furthers the Sanctions Board's goal to fight fraud and corruption through the rule of law," said Fathi Kemicha, the first external Chair of the Sanctions Board. "Parties that come before the Sanctions Board, as well as our partners in the international community, will now have a more robust understanding of our process, case law, and careful examination of each case."

The decisions published today can be accessed on the World Bank’s external website, and explain the rationale for sanctions imposed in eight cases recently considered by the Sanctions Board:

· Sanctions Board Decision No. 46 (Sanctions Case No. 151): Income Electrix Limited debarred for six months for fraud.

· Sanctions Board Decision No. 47 (Sanctions Case No. 121): M/s. Concept Pharmaceuticals Limited debarred for fraud, with conditional release after three years.

· Sanctions Board Decision No. 48 (Sanctions Case No. 118): Zhonghao Overseas Construction Eng. Co., Ltd. debarred for two years for fraud, with conditional early release after one year.

· Sanctions Board Decision No. 49 (Sanctions Case No. 130): De Lorenzo of America, Corp., S.A. de C.V., and its affiliate Marketing Enterprises Latin America, LLC., each debarred for fraud, with conditional release after two years.

· Sanctions Board Decision No. 50 (Sanctions Case No. 117): ASDECON Corporation Company Limited debarred for corrupt practices, with conditional release after five years.

· Sanctions Board Decision No. 51 (Sanctions Case No. 145 and Sanctions Case No. 146):

- Sanctions Case No. 145: General Consulting Training (GCT) and Mr. Ali Safi each debarred for one year for fraud.

- Sanctions Case No. 146: TEAM Engineering & Management Consultants (TEAM) debarred for fraud, with conditional release after two years.

· Sanctions Board Decision No. 52 (Sanctions Case No. 134): Contransimex Nigeria Limited debarred for fraud, with conditional release after two years.

All sanctions are reflected on the World Bank Listing of Ineligible Firms & Individuals (www.worldbank.org/debarr).

For more information, please visit: www.worldbank.org/sanctions

Contacts:

In Washington: David Theis, (202) 458-8626, dtheis@worldbank.org;

For Broadcast Requests: Natalia Cieslik, (202) 458-9369, ncieslik@worldbank.org

New Initiatives Give Hope to a Carbon Market Facing Challenges

2012-05-30T12:30:00.000Z

World Bank releases State and Trends of the Carbon Market report 2012

COLOGNE, GERMANY, May 30, 2012 – The total value of the carbon market grew by 11 percent in 2011, to $176 billion, and transaction volumes reached a new high of 10.3 billion tons of carbon dioxide equivalent (CO₂e) according to a new report from the World Bank.

According to State and Trends of the Carbon Market 2012 this growth took place in the face of economic turbulence, growing long-term oversupply in the EU Emissions Trading Scheme (EU ETS) and plummeting carbon prices.

The report, released here at the Carbon Expo in Cologne, describes how even as prices declined, the value of the global carbon market increased in 2011, driven predominantly by a robust growth in financially motivated transactions. By far, the largest segment of the carbon market was that of EU Allowances (EUAs), valued at $148 billion. There was also a substantial increase in the volume of secondary Kyoto offsets (which grew by 43 percent, to 1.8 billion tons of CO₂e, valued at US$23 billion) fueled by increased liquidity in the Certified Emission Reduction (CER) market and in the nascent secondary Emission Reduction Unit (ERU) market. Following the same pattern observed in previous years, the global carbon market in 2011 was primarily driven by the EU ETS.

With the end of the first commitment period of the Kyoto Protocol in 2012, the value of the pre-2013 primary CER, ERU and AAU markets declined once again in 2011. Not surprisingly, however, the market is starting to look beyond 2012 and consequently the post-2012 primary CDM market increased by a robust 63 percent, to US$2 billion, despite depressed prices and limited long-term-visibility. Although China remained the largest source of contracted CERs, African countries – largely bypassed in the pre-2013 market – emerged stronger in 2011 and accounted for 21 percent of post-2012 CERs contracted during the year.

Against this backdrop, several new domestic and regional carbon market initiatives gained traction in both developed and developing economies in 2011. Five new jurisdictions passed legislation adopting cap-and-trade schemes.

“It is heartening to see that, while leading economies continue to experience difficulties and the carbon market faces major challenges, we see increasing interest in, and support for, new market-based mechanisms to mitigate climate change in the long term,” said Joëlle Chassard, Manager of the Carbon Finance Unit of the World Bank.

The Australian Parliament passed the Clean Energy Act, the California Air Resources Board adopted a cap-and-trade regulation, and Québec adopted its own cap-and-trade program. The province is now working toward linking it with California’s starting in 2013. Last month, both Mexico and the Republic of Korea passed comprehensive climate bills, laying the foundation for future market-based mechanisms.

“Together, these initiatives will drive substantial resources towards low-carbon investments and they have the potential to unleash a truly transformational carbon market, in support of a global solution to the climate challenge,” said Alexandre Kossoy, Senior Financial Specialist, World Bank Carbon Finance Unit.

Contacts:

In Cologne: Isabel Hagbrink, +1 202 458 0422, ihagbrink@worldbank.org

In Washington DC: Elisabeth Mealey, +1 202 458 4475, emealey@worldbank.org

For an electronic version of the report and more information on the Carbon Finance Unit and its carbon funds, please see: www.carbonfinance.org

World Bank Welcomes African Leadership on Natural Capital Accounting

2012-05-25T14:17:29.000Z

Announces $3m in support from Japan to help countries around the world put it into action

GABORONE, BOTSWANA, May 25, 2012 – The World Bank’s Vice President for Sustainable Development, Rachel Kyte, today welcomed the strong endorsement from ten African countries for natural capital accounting - a tool for factoring countries’ natural assets into their systems of national accounting.

Speaking at the conclusion of the African Sustainability Summit in Botswana, Kyte said African leaders had shown the way forward through a joint communiqué on natural capital accounting which recognized GDP’s limitations as a measure of well-being and sustainable growth and underscored the importance of a tool for taking natural capital into account for improved economic decision-making.

“Africa is where sustained and sustainable economic growth and the stewardship of natural wealth become one and the same thing,” Kyte said. “Making progress means more than just a strong GDP - it means giving equal attention to the economic, environmental and social pillars of sustainable development. By endorsing natural capital accounting as a tool for delivering on more inclusive green growth, Africa is showing the way for the rest of the world.”

Kyte said that 24 countries around the world were already compiling natural capital accounts. With so much on-the-ground experience to draw upon, she said the World Bank was hoping to see at least 50 countries and 50 private corporations follow Africa’s lead by endorsing natural capital accounting at the upcoming Rio+20 Conference.

The World Bank is supporting countries to factor their natural capital into systems of national accounts through a global partnership called WAVES (Wealth Accounting and the Valuation of Ecosystem Services). Ms Kyte took the opportunity of the Botswana Summit to announce the Government of Japan’s financial commitment of $US3 million to support the WAVES Partnership.

“Japan’s generous commitment helps us step up to meet the increasing demand from countries to make natural capital accounting a reality,” Kyte said.

Japan’s Deputy Vice Minister of Finance for International Affairs and Executive Assistant to the Prime Minister for Global Environmental Finance, Naoko Ishii said “Japan has long been a supporter to enhancing biodiversity and preserving ecosystems, and is excited to strengthen this initiative.”

WAVES is working to build capacity in countries to implement Natural Capital Accounting based on the UN’s recently endorsed System for Environmental and Economic Accounts (SEEA). The SEEA provides an internationally agreed method, on par with the current System of National Accounts, to account for material natural resources like minerals, timber, and fisheries.

WAVES is also working to develop an agreed methodology for accounting for ecosystem services, including for example, the `regulating’ services of forests for pollination and wetlands for reducing the impacts of floods.

The WAVES partnership includes the United Nations Environment Program, the UN Development Program, and the UN Statistical Commission; the countries of Botswana, Colombia, Costa Rica, Madagascar, and the Philippines, which are implementing programs; as well as financial or technical support from Australia, Canada, France, Japan, Norway, the United Kingdom, and several NGOS.

For a copy of the latest WAVES report “Moving Beyond GDP” go to:

http://www.wavespartnership.org/waves/

Contacts:

In Washington: Robert Bisset, +1 202 458 5191, rbisset@worldbank.org

For Broadcast Requests: Natalia Cieslik, +1 202 458 9369, ncieslik@worldbank.org

For more information about WAVES and the World Bank’s work on sustainable development visit:

http://www.worldbank.org/sustainabledevelopment

For more information about the Summit For Sustainability in Africa, please visit here.

World Bank Database Shows Export Markets Are Dominated by Big Firms

2012-05-24T13:46:46.000Z

Difficult for Newcomers to Survive

WASHINGTON, May 24, 2012 – A few large companies dominate export markets in developing and developed countries, with the top one percent often accounting for more than half – sometimes nearly 80 percent – of total exports, according to a new World Bank database with a wealth of details on exporting firms.

The new Exporter Dynamics Database offers the most comprehensive picture yet of exporter characteristics and dynamics – a firm’s entry, exit and survival in the export market – in 45 developed and developing countries. The database mainly covers 2003-2009, though data from the 1990s are also available for some countries.

A key finding is that the export market is difficult to tackle for newcomers, with 57 percent of companies on average – and two-thirds in Africa – quitting within a year of entering the export market.

“Governments traditionally have focused on helping exporters expand to new products and new markets, but they may need to do more to help firms survive,” says Ana Margarida Fernandes, the task leader of the database, which was developed by the Trade and International Integration team of the World Bank’s Development Research Group.

The global database allows for cross-country comparisons of exporters based on factors such as size, survival, growth, and concentration. More countries will be added as the database expands. Until now, most databases focus not on exporting firms, but on the aggregate flow of goods across borders based on countries or products.

Based on data sets covering the universe of export transactions obtained directly from customs agencies, the data are comparable across countries. Measures cover the size distribution of exporting firms, their diversification in terms of products and markets, the dynamics of exporting firms’ entry, exit and survival, and the average unit prices of the goods traded.

The Exporter Dynamics Database could help policy makers identify opportunities in particular sectors and address challenges faced by their exporters, especially in their entry and survival in export markets. For example, it can be used to analyze the performance of export sectors in a country, comparing them with their counterparts in the region or richer countries. The database can also make it easier to analyze the impact of tariffs and other trade barriers. For example, it can be used to assess the impact of stringent non-tariff measures on the numbers and average size of exporters.

The database reveals several interesting trends. For example, the rate of firms entering the export market is high, with more than half of the exporters in Laos, Malawi, Tanzania, and Yemen being newcomers in any given year. But their survival rate isn’t that good, generally with more than a third of companies on average leaving the export market every year.

“Our database shows how large the degree of churning in export markets is, particularly in less developed and smaller economies,” says Martha Denisse Pierola, an economist at the Development Research Group who started the project with Caroline Freund, now the chief economist at the Middle East and North Africa Region of the World Bank. “We need further research to better assist governments in minimizing the costs associated with these high exit rates.”

Contacts:

In Washington: Jane Zhang, (202) 473-1376, janezhang@worldbank.org

For Broadcast Requests: Mehreen Sheikh, (202) 458-7336, msheikh1@worldbank.org

For more information, please visit: http://econ.worldbank.org/exporter-dynamics-database

For more information click here.

The project Afghanistan Rural Access Project is now in the pipeline.

2012-05-23T04:00:00.000Z

The project Afghanistan Rural Access Project is now in the pipeline. To see more information, see the project information in the World Bank project database

World Bank Group Finds over 80 percent of Investment Promotion Agencies’ Efforts Falling Short

2012-05-20T23:00:00.000Z

WASHINGTON, May 20, 2012 - Even as countries compete to attract investments, 80 percent of national investment promotion agencies are failing to respond to investor inquiries in the key sectors of agribusiness and tourism, according to the World Bank Group’s Global Investment Promotion Best Practices 2012 report.

The report assessing 189 economies’ responsiveness to investors finds that investment promotion agencies are less responsive to direct investor inquiries than they were three years ago. In the areas of inquiry-handling and website performance over the past two years, two regions showed improvement—the Middle East and North Africa, and Latin America and the Caribbean.

"In difficult times, governments may be tempted to cut funding for investment promotion. However, this can cost them opportunities to secure investments and jobs,” said Pierre Guislain, Director of the Bank Group's Investment Climate Department. “Skilled investment promotion agencies can give economies a competitive advantage by helping investors choose a suitable location and set up operations that create jobs and promote growth.”

The report shows that limited resources need not be an obstacle to effectiveness. For example, Cyprus Investment Promotion Agency, one of the world’s top-performing agencies, has only 10 staff members spread across a range of functions. It also finds investment promotion websites to be a bright spot, with 62 percent of agencies implementing best practices.

Nicaragua’s investment promotion agency PRONicaragua emerged as the world’s top investment facilitator, becoming the first developing country to do so. PRONicaragua achieved best-practice standards in website performance and response to investor inquiries.

"We believe that the level of service an Investment Promotion Agency offers influences an investor’s first impression of a country’s investment climate, as it demonstrates that Government’s attitude and commitment towards investors. It is with that vision, through commitment to offering high quality service and insuring that each and every investor get the information they need, we try to build a strong sense of comfort about doing business in our country and promote economic development." said Javier Chamorro, CEO of PRONicaragua.

The report was produced by the Investment Climate Department of the World Bank Group (which includes IFC, MIGA, and the World Bank) and sponsored by ProInvest, a European Commission partnership program for the countries of Africa, the Caribbean, and the Pacific, and by the government of Spain.

For more information about the report, please visit www.globalinvestmentpromotion.org

Contact:

In Washington, D.C.: Shaela Rahman, +1-202-458-0283, Srahman@ifc.org

As Prepared for Delivery, IFC’s 14th Annual Global Private Equity Conference

2012-05-15T14:00:00.000Z

As Prepared for Delivery

IFC’s 14^th Annual Global Private Equity Conference:

Prevailing in a New Financial Landscape

Robert B. Zoellick

President, World Bank Group

Tuesday, May 15,2012

Introduction

It’s a great pleasure to join you today for IFC’s 14^th Annual Global Private Equity Conference in association with the Emerging Markets Private Equity Association, or EMPEA.

The story of this conference is emblematic of how the world economy has changed: Fourteen years ago, a small group met in the basement of IFC to discuss the prospect of private equity in developing countries.

Today, there are more than 800 people here, from nearly 60 countries: institutional investors; public and pension funds; private investors; endowments and family offices; senior investment professionals; chief investment officers, and directors from leading fund managers around the world, as well as representatives from development institutions and government agencies.

Plenary sessions and roundtable discussions cover a range of issues over three days – the global economic outlook and regulatory trends, of course – but also non-financial risks, infrastructure, SMEs, mezzanine…and intriguing markets beyond the BRICs to Turkey, Palestine, Africa, and frontier markets.

The success of this conference is in large part because of the enormous potential of emerging markets: over the past five years, developing countries have provided two-thirds of global growth.

This conference also reflects the terrific partnership between Lars Thunell and the Private Equity Funds group at IFC, and Sarah Alexander and her team at EMPEA. Together, they’ve made this conference one of the leading global forums for private equity. So I want to thank them for their hard work and their leadership.

I also want to thank an impressive set of participants: sponsors; panelists; speakers –and all of you.

Yet I want to add a special word of thanks for Lars.

When I came to the Bank in July 2007, it was a time of trouble.

Frankly, meeting Lars was like having a breath of fresh air: He was steady, sensible, constructive – clearly an excellent executive, committed to the private sector’s role in development, and doing interesting things.

Together, we came up with some innovative ventures both to help developing countries during tough times, and to move IFC even closer to the cutting edge of private sector development in these exciting markets.

He always offered good counsel, fine judgment, common sense, and friendship – for which I’m grateful.

Keeping the Focus on Growth and Structural Reform

Last month, at the Spring Meetings of the World Bank Group and IMF shareholders, much of the focus was – understandably – on macroeconomic stability.

This attention to the macroeconomic picture is necessary – but it’s not sufficient. Extraordinary monetary policies buy time – but they don’t solve the fundamental problems.

As my friend, Deputy Prime Minister and Finance Minister Tharman of Singapore said at our Spring Meetings, investors will accept short-term costs if they perceive good returns over time. All countries – developed and developing – need to focus on the structural reforms – the microeconomic policies – that will drive future growth.

Structural changes are essential to enhance productivity, competition, and innovation for developed and developing countries – whether it’s so that Europe can restore its economic performance, or China can avoid the so-called “middle income trap” and meet its challenges in the coming decades. Structural reforms are important for the United States, too.

In practical terms – and for investors like you – what does structural reform mean?

It means strengthening the fundamentals of productive supply-side growth in all sectors – agriculture, manufacturing, services.

It means investing in infrastructure – especially through public private partnerships.

It means private sector development – the engine of innovation and job growth: markets; investment; small and medium-sized businesses; as well as focusing on jobs training and skills.

It means expanding markets – through both the hardware and software of trade: regional integration; ports and infrastructure; lowering the costs of formal, informal, or logistics barriers.

At the same time, structural reform means investing in green growth and energy efficiency – because “growing dirty, cleaning up later” is not a viable option. Environmental degradation cannot be the price for short-term growth.

Structural reform also means investing in human capital:

- Efficient and affordable safety nets – because only 1 out of every 5 people in the poorest countries has any form of social protection;

- Basic financial services – because more than half the world’s poor, almost 2.4 billion people, are “unbanked”;

- Basic nutrition and health – because without these essentials, people cannot begin to achieve their potential; and

- Quality education, connected to training, which leads to better jobs, more innovation, and greater gains for all.

Investing in people means tapping the energies and genius of all: young people, the elderly, and not least girls and women – an under-realized source of growth everywhere.

Importance of Partnerships

You can play an important role in making all this happen.

Countries need private equity more than ever to push forward the structural agenda. But to be most effective, the right partnerships are critical – to seize opportunities, open up new markets, share market knowledge and learning.

We’ve seen this at the World Bank Group with IFC’s Asset Management Company, or AMC, which Lars and I created in 2010 to supplement IFC’s traditional model of raising money in bond markets and then investing it. The idea was for the AMC to tap sovereign wealth funds, pension funds, and other institutional investors that are looking to increase their exposure to emerging markets, and that are interested in accessing IFC’s transaction pipeline, investment approach, and track record of superior returns.

Now ably led by Gavin Wilson and a fine team, the AMC considers investments in spaces where IFC-supported private equity fund managers are not active, either because of the size of the investment or the riskiness of the sector. As the AMC makes profitable returns for its institutional investors, these investors are likely to feel more comfortable investing in smaller private equity funds and frontier markets.

The AMC now totals over $4 billion – almost $3 billion of which had little previous exposure to Africa and other less recognized emerging markets. Building on the success of its $1 billion African, Latin American, and Caribbean Fund, last year, the AMC established an African Capitalization Fund that invests in commercial banking institutions in northern and Sub-Saharan Africa. This Fund has already made investments in Ghana and Malawi.

AMC offers a great model for a win-win partnership between capital, experience, and expertise.

When I asked one pension fund manager what attracted him to AMC, he told me: We now know developed markets are risky, too; we see growth potential in developing markets – but we don’t know where to invest. IFC does. And we can learn through this partnership.

Opportunities: Doing Well and Doing Good

We have seen the positive impact private equity can have.

IFC has private equity investments of about $3 billion across 180 funds in emerging markets. We estimate that these investments alone have helped create about 300,000 new jobs over the last 10 years, many of them for women. We see much more potential for the future.

Private equity also increases the wealth – the savings – of pension funds and other institutional investors who assist many millions of savers, small and big.

Increasingly, institutional investors want their investment capital not only to do well, but to do good. Private equity can help companies grow, hire more workers, raise productivity. But at the same time, private equity can also be a powerful driver of change: raising standards; fostering growth; promoting new opportunities for businesses and individuals; helping to overcome poverty; bringing hope.

Let me give you some examples.

China Environment Fund

Tsing Capital’s China Environment Fund: Founded by Don Ye in 2000 to focus on clean tech investments, the Fund adopted a triple bottom line, balancing social, environmental, and financial returns.

At first, portfolio companies were resistant to the Fund’s focus and approach. After all, government regulations were weak. Investors would say, “We give you the money, and you give us a return. Why are you talking to us about welfare, child labor, the environment, and insurance?” Deal flow was slow for the first fund: it only raised $13 million from socially responsible investors.

Now, Tsing Capital’s investors are telling a different story. The company has become a market leader, generating three digit financial returns. The latest China Environmental Fund, in which IFC invested $20 million, had a target size of $350 million.

What’s the secret of Tsing Capital’s success? Certainly persistence on the part of Don and his team. But they also chose the right partners.

From the outset, Tsing Capital performed social and environmental risk screening on companies during due diligence before it invested. The company checked standards against national laws and regulations, but they also made thorough use of IFC’s performance standards which provide guidance on how to identify – and avoid – risks and impacts.

If Tsing Capital identified any excluded activity – potential deals were dropped. If they found risks, they were corrected. Tsing Capital worked hand-in-hand with companies to improve corporate governance and upgrade management capability and strategies.

Their hard work has paid off. Today, Tsing Capital is raising environmental and social standards across the industry, and transmitting those standards into multiple start-up companies. It has twice been honored as a corporate citizen in China, and Don Ye has been recognized by Business Week as one of China’s 40 most powerful people – alongside President Hu Jintao and Yao Ming of the Houston Rockets!

It’s a great success story. It shows how commercial concerns linked to environmental and social standards offer win-win opportunities. It demonstrates how private equity can be a powerful driver of growth and change.

Pragati India Fund

One of IFC’s recent investments, the Pragati India Fund, offers another good example of doing well and doing good.

The fund is a pioneering investment vehicle that will focus on economically under-developed states in India. These are areas where it has traditionally been a challenge to attract private investments – but where the changing political, social, and economic development dynamics offer new opportunities that are largely untapped. Sixty percent of Pragati’s investments target the country’s 8 poorest states.

IFC is investing up to $20 million in the new fund. The idea is to help Pragati provide growth capital to start-ups outside of major urban centers – adapting successful business concepts to small- and medium-sized enterprises in low-income states and rural regions. In India, small- and medium-sized businesses typically receive only 5 percent of all private equity capital, forcing them to rely on high-cost informal borrowing. The Pragati Fund is designed to fill that funding gap and support the development of India’s financial infrastructure.

As a co-investor, IFC can help increase the impact of the project – bringing not only capital but management expertise, which can help strengthen operations as well as environmental and social governance.

Just last month, Pragati India Fund made its first investment – in Jash Engineering Limited, a manufacturer of customized engineering goods for the water and waste water infrastructure sector. Jash is now expanding into manufacturing equipment for water treatment plants, and even generating clean power from residual water of the plants. The company is looking to move into municipalities across India.

With India’s government pushing for world class water treatment facilities, investing in a company like Jash offers real opportunities – to help these enterprises access finance, create jobs, promote inclusive growth, and contribute to cleaner, healthier water and energy for hundreds of thousands.

Supporting the Poorest

I hope more fund managers and investors will look for these types of opportunities – and look for them beyond BRICs and within frontier regions.

IFC is increasingly shifting its focus in this direction. Since 2007, over half the funds supported by IFC have been in the poorest countries supported by the World Bank’s International Development Association, or IDA. IFC's equity returns over the last 10 years in low-income countries, compared with IFC as a whole, provide a compelling case for investment.

Africa has been IFC's top performing region over the last 10 years, with a real rate of return of 25 percent compared to 18 percent for IFC worldwide.

Sub-Saharan Africa is also the region where IFC’s investments in private equity funds have grown the most, and where we have more private equity partners – a total of 38 – than anywhere else. In FY11, IFC committed new investments in 5 funds in Africa, and so far in FY12 we’ve invested $70 million in 3 funds.

We already have plans for 2 or 3 more funds this fiscal year – including 8 Miles Fund, a pan-African private equity fund backed by Bob Geldof.

8 Miles plans to make investments in growth areas across Africa such as agribusiness, consumer and retail health, telecommunications, banking and financial services. The target fund size is $450 million, with $15 to $40 million investments in 10 to 12 African companies with above-average potential for revenue growth and job creation. Investors partnering with IFC include the United Kingdom’s CDC, the African Development Bank, and Vital Capital Fund. J.P. Morgan will provide fund administration services.

Private equity is already changing the face of Africa – and funds such as 8 Miles recognize that there’s huge potential to do more. The fund’s name refers to the fact that, at their nearest points, Africa and Europe are only eight miles apart.

For much of Africa, however, the distance is far greater. Countries dealing with fragility and a history of conflict are home to the world’s poorest – the Bottom Billion, as Paul Collier pointed out in his 2007 book, though today, it’s more on the order of 1.5 billion.

In 2010, the World Bank focused on these countries in our World Development Report on Conflict, Development, and Security. One of the conclusions of that report was that private sector development is a key factor in infrastructure and logistics, local banking, service delivery, and job creation – to show early results as well as longer-term growth. Access to capital and finance is vital for putting these countries on the path to economic stability. But, of course, most fund managers aren’t ready to provide the risk capital and strategic advice that private equity provides.

That’s why IFC conceived of SME Ventures, an initiative to support local private equity fund managers and raise equity and advisory services funds in low income – and particularly post-conflict – countries. Today, we’re putting private equity to work is some of the most underdeveloped areas of the world.

Take Central Africa – a region rich in minerals, but with a history of fragility and instability. Private equity groups have traditionally focused on larger investments in the extractive industries. Yet it’s small- and medium-sized businesses that create the most jobs in any economy.

So two years ago, IFC committed up to $12.5 million to the Central Africa SME Fund. Managed by XSML, a Dutch SME fund manager, and Cenainvest, its partner based in Cameroon, the fund aims to mobilize a total of$25 million from other development finance institutions and the private sector. With offices and a team on the ground in the Democratic Republic of the Congo and the Central African Republic, the fund’s focus is on making investments and providing advisory services to the local business community, to help African entrepreneurs build sustainable businesses that create jobs and income.

The funds’ first investments in the DRC have been in a healthcare clinic, including new medical training for staff; a call center; and a food processing company for baby cereal, where the fund is also helping improve the company’s financial management and developing audited financial statements. In the Central African Republic, the fund is preparing to invest in an internet service provider.

The Central Africa SME Fund is also looking ahead. So, for example, it’s conducting a market study on fresh fruits for a fruit producer in Kinshasa, and helping prepare a business plan and financial projections for a cassava mill run by smallholders.

Through the SME Ventures initiative, IFC has also committed equity to funds for Liberia and Sierra Leone; Bangladesh; Nepal; and we are currently working on a fund for Bhutan.

And just last month, IFC made its first private equity investment in Haiti.

When Haiti was hit by a major earthquake in 2010, we knew that the Bank Group’s support to help the country recover, rebuild, and break its dependence on aid must include bringing in the private sector.

IFC has already committed five investments and significantly scaled up its advisory operations in Haiti. These projects are helping create 5,000 new jobs – as well as safeguard 5,000 existing jobs.

Now, IFC is committing up to $10 million to the Leopard Capital Haiti Fund to support small and medium-sized businesses.

With a team already on the ground in Port-au-Prince, the fund is raising $75 million in equity to invest in four main sectors: renewable energy; low- and medium-income housing; agribusiness; and hospitality. It’s also raising $4 million in donor money to provide technical and managerial assistance to companies that were thriving before the earthquake, but now want to upgrade their operational capacity and grow. At the same time, this Haiti Fund will work with its portfolio companies to enhance corporate governance, and environmental and social standards and practices.

It’s an exciting new partnership for IFC. Our Private Equity Funds team has already catalyzed an additional $10 million from investors – and will continue to support the Leopard Capital team in raising more.

We hope this will encourage more investors to invest in Haiti’s potential.

Importance of Openness

Over the past five years, I’ve seen this private equity conference grow in size, scale, and quality. I’ve also seen, from my discussion with our clients in developing countries around the world, just how important they consider the capital and expertise that private equity brings in helping their countries grow and raise standards.

Yet the role of private equity has come under increasing scrutiny and political focus in the developed world – not least here in the United States. For some, the very term is synonymous with corporate raiders, asset strippers, and secretive back room deals.

The private equity industry needs to respond to the demand for higher standards of openness, transparency, and integrity. Private Equity should be a major part of the new investment climate in emerging markets. It should increase overall investor confidence.

I recognize that some investment professionals aren’t used to being in the public eye. But you are now. And transparency is the best antidote to conspiracy theories.

At the World Bank Group, we can see the transformative power of openness. Our new information and knowledge-sharing initiatives may turn out to be the most important legacy of my tenure at the Bank Group.

Our Access to Information policy releases to the public vast numbers of documents about the Bank’s projects, analytic and advisory activities, and proceedings of the Board. It’s now viewed as the “gold standard” for financial institutions.

Our Open Data initiative has unlocked our world-class knowledge and development data. We now provide free access to more than 7,000 indicators, including GDP data and development statistics, meaning that anyone – from a PhD student, to an NGO, to a farmer, or even a private equity investor – can download our data, analyze it, and come up with solutions.

Our Mapping for Results website shares geo-spatial information on more than 2,500 Bank-funded projects.

Now we are beginning to work with communities to map their own infrastructure – clinics, wells and schools. The next step is to allow people to use hand-held devices to let the Bank know, from wherever there are in the world, what is really going on with our projects and investments.

These initiatives are making the World Bank Group more open, transparent, and accountable; helping us fight corruption and build better governance; and getting us ready for a new era of democratized development.

The investment community can benefit from greater openness as well.

Conclusion

I have always enjoyed taking part in this conference. I have spoken at it every year during my time at the World Bank Group.

I wanted to come here again, for the fifth time, because I am convinced that private equity investments can be one of the most powerful and important agents of change for developing countries: boosting local economies and creating jobs; improving governance and sustainability standards in private industry and capital markets; transforming thinking about growth; reducing poverty and creating hope.

That Change agenda is the core of our mission at the World Bank Group. It’s what we strive to do every day. It’s why private equity – and this conference – is important to me.

The success of this event demonstrates that I’m by no means alone in this conviction.

So I want to thank you again for joining us today. I hope your time at this conference opens new insights and creates new partnerships for all of you – and for the World Bank Group.

But most of all, I hope that it affirms your commitment to doing well and doing good – to using the power of private equity to support people in developing markets who want to create, build, and seize new opportunities.

That can be a lasting legacy for all of us.

Thank you.

Afghanistan: Encouraging Skills Development and Musical Talent

2012-05-09T21:51:05.000Z

Overview

Funded by the International Development Association (IDA) and the multi-donor Afghanistan Reconstruction Trust Fund (ARTF), a project aimed at developing the skills of young Afghans has assisted more than 1,000 young men and women gain managerial, accounting, and information and communications technology (ICT) skills. It has also helped more than 6,750 youth, destitute women, and marginal farmers from numerous provinces, including highly insecure areas, to pursue more productive lives through targeted skills training.

multimedia

Afghanistan Reconstruction Trust Fund

More Results

1,510

students have graduated from the National Institute of Management & Administration

25%

of graudates from all programs are women

more information

Challenge

At the end of the civil war in Afghanistan, there was a huge shortage of skilled personnel in Afghanistan. The overall scene was fragmented, supply-oriented with zero quality control, and no motivation or autonomy, which could have led to improvements. There was practically no person with any accounting or managerial skills at the junior or junior-middle levels either in government or in the private sector. ICT skills were rare. Rural youth and destitute women, as well as marginalized farmers had no means of rising above desperate poverty levels. Most affected were the highly insecure provinces where insurgents continued to oppress any form of education or skills development. For most technical trades, government had schools, but the curricula were long outmoded, there were practically no workshops or equipment and the quality of teaching, was poor. Private service providers mushroomed, with no check on what they were doing, and supplied ill-trained and equipped youth who then had no job opportunities.

Approach

The Afghanistan Skills Development Project (ASDP) project was designed to help create and support meaningful institutions that would work on the demand for skills, and assist in creating a framework for qualifications that would establish standards to which all skills training – whether provided by private service providers or the government – could be mapped. It also sought to provide training, through third party sources, to rural youth, destitute women, and marginalized farmers to impart productive life-skills, including personal business development skills. On the institutional front, the emphasis was on broadening school management to include business, on the creation of a whole new institution for management, accounting, and ICT, and on making the schools autonomous in stages. On the rural training front emphasis was on strict monitoring and evaluation to capture actual gains.

Results

ASDP has contributed to key outcomes between 2008-2011:

-1,510 young men and women graduated from the newly-established National Institute of Management and Administration (NIMA) in its first year of 2011, of which 1,058 have been given Diplomas from the University of Jyvyskala, Finland. Importantly, 29 percent of the graduates were women. Eighty percent of the graduates obtained jobs within six-months of pass-out, and a new cohort has been inducted.

-Women now constitute an average 25 percent of graduates from all programs (including rural programs);

-The government has issued orders providing a degree of administrative and financial autonomy to all the project-aided institutions;

-Schools have broadened their management councils and have included industry representatives;

-A defunct institution, Afghanistan National Institute of Music (ANIM), has been revived and has already earned international repute. ANIM itself has reached several milestones, including creation of wide donor interest (ANIM has now received support in kind from US, Germany, France, Italy, India, Australia, and others) and the rehabilitation and integration of war orphans, who are a large section of the students. It has also implemented a concrete and workable model of decentralization and administrative and financial autonomy that has been ratified by the Ministry of Education and extended to other institutions. ANIM has also successfully integrated cultural pursuits with the goals of primary and secondary education, as it now has a fully-equipped school where classes are held between music sessions and musical practice.

-The ANIM orchestra, consisting of children between the ages of 11-to-20, has also been given a rare privilege – a night to perform at New York’s Carnegie Hall. Other sponsors are also coming forward to support this institution and this group of children.

-More than 6,000 rural youth, destitute women, and marginalized farmers have been trained in various skills including how to run their own businesses. Approximately 25 percent of those trained are women

-Studies show that the income of those trained has gone up between 30-40 percent within six months of course completion.

-A Draft Qualifications Framework and a Draft Law have been made through a consultative process and are now under discussion between various ministries and donors.

Voices

Today, we have 24 street kids with us. Some were selling chewing gum, plastic bags, or boiled eggs in the street. Now, we give their families 30 US dollars to stay in school as a kind of compensation for their loss of income.

—Dr. Ahmad Sarmast, Coordinator of ANIM

Bank and ARTF Contribution

The initial total project cost was estimated at US$38 million, with IDA contributing US$20 million, and US$18 million coming from the ARTF. Of this, US$29 million has been released and the Managing Committee of the Fund is now being approached to release the last tranche of US$9 million. Of the US$29 million, 16 percent was spent for training of rural youth and vulnerable groups, and 70 percent has been spent on development of vocational training institutions, including NIMA and ANIM.

Partners

There is a strong partnership with other donors in the skills sector. The US Agency for International Development and Norway contributed the first US$9 million through the ARTF. There is a regular and ongoing discussion of issues within the Human Resources Development Board, where all donors are represented. The Bank plays a major role in facilitating meetings, and contributing to the deliberations.

Toward the Future

Of the 141 government institutions in the skills sector, the project supports six. Benefits have been clear and visible. It is important to extend project benefits to other institutions and it is proposed that additional vulnerable groups be brought under the rural training component of the project. NIMA itself needs close support by international partners for another three-to-four years to ensure institutionalization of academic norms. Support also has to be provided for further work on the Qualifications Framework and Qualifications Authority. The government is providing all revenue costs for the project. Lastly, given the success of ANIM, a scholarship program for deserving students and a program to further broaden the base of the institution will need to be considered. Funding issues will be addressed through additional funding requests as well as the next planned phase of the Afghanistan Skills Development Project. The expected release of the last tranche of US$9 million from ARTF will considerably assist with these aims.

Afghanistan: Sustainable Development of Natural Resources

2012-05-09T21:17:10.000Z

Overview

Drawing upon IDA funding and sector expertise, Afghanistan has created a competitive, transparent mining investment climate that has attracted large foreign direct investment commitment of more than $8 billion (2010-2012) across a portfolio of oil & gas, copper, iron ore, and gold

multimedia

Afghanistan Reconstruction Trust Fund

More Results

5,000

jobs created on the Anyak Mine

$250 million

million in revenue collection expected

more information

Challenge

With this development comes increased pressure for inclusive growth around (a) improved award of contracts & licenses; (b) more transparent, non-discretionary regulatory monitoring and compliance; and (c) ensuring benefits at the community level with improved environmental / social performance. Moreover, there is emerging pressure for an integration of public and private investment plans; together with coordination and sequencing of these investments in order to offer private sector solutions towards employment, infrastructure development, economic growth and diversification.

These investments create opportunity for private sector solutions around infrastructure gaps and reinforcing of public sector investments. It is important for the government to (a) continue to adopt and implement global good standards around licensing, monitoring and environmental / social safeguards, (b) continue support of broader efforts around transparency (EITI), competitive award of contracts and leases (tenders), and (c) improve land acquisition, resettlement and consultation while ensuring that communities benefit from resource extraction.

Communication remains a challenge for government, donors and investors alike. A high-profile media focus on the resource curse, proper treatment of Mes Aynak antiquities, and the need for inclusive growth (community engagement / benefits sharing / resettlement) requires a more effective communication strategy. In this regard, the Extractive Industries Transparency Initiative (EITI) is offering a more transparent environment for a multi-stakeholder group to report out on sector issues and serve as a barometer of the ability of the government to work collaboratively on key issues.

Approach

The World Bank team has led in assisting the government on policy dialogue around sector development, working over a sustained nine year period in which core team members have an average of six years of contribution. Through the Bank’s Sustainable Oil, Gas and Mining Policy Division the team has assisted the government on issues along the extractive industries value chain using an incremental funding approach. Adapting to changing political economy and capitalizing on reformers that have emerged in the government, the team has been able to promote sustainable development of the minerals sector. The Country Management Unit (CMU has provided strong support reinforcing the team on complex issues and, most importantly, bringing into the dialogue other teams having complementary activities. This team / CMU partnership has been evident to other donors who have aligned their efforts to improve overall coordination. The CMU’s support of the team’s proposal to create a specialized multi-disciplinary “resource corridor” team is evidence of an innovative approach by the Bank in country, and an action that is being widely watched by other teams working on resource development globally.

Results

Hydrocarbons: three blocks of the Amu Darya basin – have been awarded to CNPC IW, with production from a known well to begin 2012

Copper: Aynak awarded to MJAM (MCC), with three other copper / gold deposits, including Aynak North, being tendered in 2012

Iron ore: Hajigak under final negotiation with two selected bidders and tender of related Sya Dara will commence 2012; and

Gold: Dushi was awarded in 2011 to a consortium of private investors – now in production. The Aynak operation is forecast to provide $250-$300 million per year in direct taxes and royalties, and the creation of 5,000 jobs. The challenge ahead is to integrate and leverage these investments towards the broader development agenda.

On governance the Bank has supported Sector and Sub-sector Policy Frameworks, including environmental / social management and protection of cultural property. Capacity has been built around the monitoring and regulating of mining operations, and consultative frameworks for improved community participation and benefits sharing. Assistance has been given to improved land acquisition processes, a systemic problem for which the mining sector has the profile necessary to facilitate reforms in alignment with Bank safeguards. The Resource Corridor approach has resulted in a dedicated multi-sector team, led by FPD, assisting the government on infrastructure, employment, community consultation and benefits sharing, growth and diversification agendas around natural resource development. On sector development Bank assistance has resulted in the tendering of two world class deposits, with $7 billion investment commitments into Afghanistan. The competitive, transparent tender methodology developed as led to a concurrent tendering of an additional six more assets by DoD and two more properties under SDNRP 2 in 2012. Lastly, the Extractive Industries Transparency Initiative is preparing its first reconciliation report.

Voices

The project has led to more consultative processes and inclusive growth, respect for land rights through improved acquisition and resettlement processes, and preparatory steps towards local procurement and skills development .

—— Michael Stanley, Project Lead

Bank Contribution

IDA has been used to fund incremental assistance USD30 million (2006), USD10 million (2010), and USD52 million (2011).

Partners

Collaborative partnerships has been developed with the U.S. Agency for International Development, the U.S. Department of Defense, The U.K.’s Department for International Development, and Australia’s AusAID within the mining sector, principally around building good governance and transparent and competitive tenders. The Asian Development Bank has been further instrumental in developing.

Toward the Future

The Ministry of Mines, through the Geological Survey of Afghanistan, will continue sector promotion and transparent tenders using the methodologies developed. Frameworks and processes for environmental / social performance are being propagated beyond the project to application across the sector. UNESCO is being engaged to ensure sustainability of attention to cultural property issues. And civil society is engaged through the Extractive Industry Transparency Initiative EITI multi-stakeholder group.

Challenges remain -- it will take more time to ensure strong and sustained capacity to regulate and monitor world class oil, gas and mining operations. Secondly, these developments will require major investments into infrastructure such as roads, water and power and greater investments into railways and pipelines. Third, it will be important to foster and catalyze “resource corridors”, a World Bank approach to leverage private sector investments towards the broader growth and diversification agenda – and thus reinforcing public investments that are drawing down. Resource corridors will ensure inclusive

Afghanistan: Improving Irrigation

2012-05-09T19:32:11.000Z

Overview

As of December 31, 2011, the incremental irrigated area resulting from rehabilitation of more than 750 irrigation schemes exceeded 800,000 hectares, which is more than the end-of-project target of 715,000 hectares. As of Dec. 31, 2011, the number of beneficiaries is over 840,000 people.

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Afghanistan Reconstruction Trust Fund

More Results

800,000

hecatres of land have been irrigated

840,000

beneficiaries have from greater agricultural yields

more information

Challenge

Like many other IDA funded projects in Afghanistan, the task team was faced with two key challenges: a lack of capacity at the ministerial level, (Ministry of Energy and Water is the implementing agency) and the volatile security situation throughout the country.

Approach

To help address capacity issues within the Ministry of Energy and Water, the project was supported by technical assistance support from the Food and Agriculture Organization (FAO). Care was taken by the project to make certain that the FAO team included national staff to ensure a close working relationship with the Ministry and quality control training was provided to all staff in the Ministry’s Project Coordination Unit (PCU). The project also developed creative methods for dealing with risks associated with working in insecure area. The project required that each request for invoice payment by contractors be supported by geo-referenced photos taken before the start of the works, at various stages of construction, and at completion. Requests for payment needed to include evidence of quality control, including an “OK Card” countersigned by project staff, the contractor, and beneficiaries. This methodology is now used in all areas.

Results

Emergency Irrigation and Restoration Project performance is evaluated with key outcome performance indicators, namely (i) Incremental Irrigated area and (ii) Incremental yield, mainly Wheat, but also other major crops. Key results of the Emergency Irrigation and Restoration Project include more than 750 irrigation schemes implemented, which exceeded 800,000 hectares of irrigated area by December 31, 2011. More than 840,000 people benefited by December 31, 2011; iii) increase in yield resulted from 34 percent (1,705 kg/ha to 2,286 kg/ha) for barley to 44 percent (2,254 kg/ha at the beginning of the project in 2004 to 3,245 kg/ha by the end of December 2011) for wheat; and iv) reduction in water related disputes from about 98 at the beginning of the sub-project to 44 per year per sub-project by the end of December 2011.

Voices

Most people in our village depend on agriculture in some way or other. So, to stand on our own feet, it was essential for us to boost our agricultural produce as much as we could .

—— Haji Abdul Qahar, Farmer

Bank Contribution

The project was originally financed by IDA Credit of US$ 40.0 million in November 2003. In addition to this IDA Credit, three (3) additional IDA Grants (US$25.0 in December 2006, US$ 28.0 in April 2008 and US$ 33.5 in April 2009) have been provided to the project to make the total project cost of US$ 126.5 million.

Partners

The Bank worked closely with the Ministry of Energy and Water within the Afghan government. In addition, technical assistance to the project was provided by Food and Agriculture Organization.

Toward the Future

Thanks to the commitment and leadership of the government, the Emergency Irrigation Rehabilitation Project, which closed on December 31, 2011, has delivered impressive results to Afghan rural communities. Achievements of the project are being continued under the Irrigation Restoration and Development Project that has an estimated cost of US$147.5 million over a six-year period. This new initiative was approved by IDA’s Board of Executive Directors in April, 2011 and the project became effective in June, 2011. Rehabilitation of irrigation canals and intakes will be further expanded nationwide as well as hydro-meteorological services will be further strengthened.

Afghanistan: Achieving Education Results in a Difficult Environment

2012-05-09T19:01:02.000Z

Overview

The Afghanistan Reconstruction Trust Fund (ARTF), World Bank, and their partners in Afghanistan worked together on an education project that has increased enrollment, especially for girls, as well as trained teachers and school principals, and built over a thousand new schools.

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Afghanistan Reconstruction Trust Fund

More Results

7.2 million

children are now attending school, up from 1 milliion in 2002

137,681

teachers have been trained

more information

Challenge

The World Bank’s assistance to Afghanistan’s education sector started against a bleak backdrop, as there had been no education for girls before 2001. The Taliban had banned education for girls, school infrastructure had been decimated, and there was a critical shortage in the quantity and quality of teachers. In addition, the sector was hampered by a prevalence of multiple curricula, low literacy rates, high gender inequity, and weak higher education and technical and vocational training programs. Afghanistan in 2002, still in a state of conflict and emerging out of two decades of turmoil, had generations in need of education and skills. The demand for education services was tremendous and far outstripped supply. As demand for education continues to soar, providing equitable access to quality education, especially for girls, remains the biggest challenge.

Approach

The ARTF and Bank sought to encourage community participation and secure long-term sustainability of its work by aligning project development objectives with the government’s development objectives and its education strategies and plans. Improving the quality of outputs as well as enhancing the overall quality of teaching and the learning environment is critical. School infrastructure grants, quality improvement grants, and teacher and principal training have helped bring about notable improvements in quality and participation in education. In addition, the formation of school Shuras (community-led decision-making bodies) has helped enhance community participation and local ownership of education investments. The Shuras help facilitate community contracting for establishing new schools and also help create school improvement plans, as well as providing round the clock support on various issues facing the schools.

Results

Owing to the ARTF and Bank’s contributions of funding and expertise, school enrollment has increased from 1 million in 2002 to 7.2 million children in 2011, of which 2.7 million (37 percent) are girls; in 2001, girls were entirely excluded from education. In addition to boosting enrollment, the ARTF and Bank have supported capacity enhancements across the sector, helping train 137,681 teachers, including 39,003 female teachers. They have also completed or are building 1,659 schools to enhance access to education in remote areas.

Altogether, 11,695 principals have completed School Management Training (among them, 605 female principals) and the ARTF and Bank helped establish 618 Principal Learning Circles to promote a tradition of continued learning and knowledge exchange. Finally, as of 2012, total of 3351 female teachers were receiving scholarships to attend teacher training colleges.

Voices

We now have a school in the village for both boys and girls. All the children attend classes regularly, especially those who couldn’t go to school earlier because of the distance.

—Mohammad Yousuf

Bank and ARTF Contribution

The Second Education Quality Improvement Program has budgeted US$210 million in support between 2008 and 2012. Of this amount, US$158 million is being drawn from the Afghanistan Reconstruction Trust Fund (ARTF), US$30 million is a grant from the Bank’s International Development Association (IDA) and US$22 million is provided by the U.S. Agency for International Development (USAID).

Partners

In addition to the support from ARTF and USAID, bilateral donors have also complemented financing education sector projects. All funds – whether from the ARTF or IDA – are “on budget” and are channeled through the government’s budget. The Bank’s preference for “on budget” financing approach has influenced other donors to also consider using this funding option, which boosts government capacity and ownership of these efforts.

Toward the Future

Remarkable progress has been achieved with the ARTF and Bank’s support, and the focus is now shifting toward improving the quality and the longer-term sustainability of results. In addition, Afghanistan is undergoing a transition process that will see a reduction in international presence, as well as decrease in aid money. To further consolidate project gains and, more importantly, to strengthen systems at Ministry of Education, the Bank will extend the Education Quality Improvement Program. During this time, a learning outcomes assessment – as well as several other preparatory and summative measures – will be taken to prepare for a new program that will reflect the needs and context of the achievements of the past decade.

World Bank Commits to Sustained Engagement in Afghanistan

2012-04-26T22:00:00.000Z

WASHINGTON, DC, April 26, 2012 -- The World Bank’s Board of Directors today discussed its Interim Strategy Note (ISN) for the Islamic Republic of Afghanistan which provides a sustained commitment and vision to the country’s development through the period of transition and beyond.

The ISN builds upon a solid track record of results, despite the high risk environment. “Over the past decade, the World Bank, together with the international community, has helped the government make steady progress in many areas, including provision of basic services,” says Isabel M. Guerrero, World Bank Vice President for South Asia. “These visible gains include the development and roll-out of national programs in health, education and village level governance and service delivery, and a functioning and credible public financial management system.”

Going forward, the Bank’s support to Afghanistan over 2012-14 will be based on supporting the delivery of some of the most important national priorities. It is also grounded in helping the Government to manage the critical transition from security and development dominated by the international community to one led by the Government of Afghanistan by the end of 2014. Bank group support will be provided around three themes:

1. Building the Legitimacy and Capacity of Institutions.

2. Equitable Service Delivery.

3. Inclusive Growth and Jobs.

Specifically the Bank will continue to expand its support to institutions and processes associated with transparent economic and financial management and community level governance especially through the National Solidarity Program (NSP). Equally important will be to sustain and expand, as possible, World Bank support for important national programs in areas such as healthcare, education, rural connectivity and irrigation.

The strategy will also help promote domestic sources of growth and jobs, which will be all the more critical as aid driven growth decreases with the draw-down of the international military. Analysis undertaken by the Bank suggests that Afghanistan’s economy, which has been growing strongly at 9% per annum on the back of extremely high military and donor spending, may slow to some 5-6% as international assistance decreases.

A key to identifying and sustaining sources of growth will be work around the concept of “Resource Corridors” which seeks to catalyze investments in Afghanistan’s huge natural resources in a holistic manner, linking up mineral resources, infrastructure, communities and employment-creating sectors in a way that provides growth and jobs beyond the borders of the mines. In addition, enhancing the connections between Afghanistan and its neighbors in terms of transportation, power and other infrastructure will be essential not only for the export of Afghanistan’s minerals, but will also help foster wider cooperation and trade in region.

“It will be important to give all Afghans, and particularly the local communities, a stake in natural resource development which, in turn, will promote equity and security in an environmentally sustainable manner” says Josephine Bassinette, Acting World Bank Country Director for Afghanistan.

Recognizing that transition and the ongoing conflict present a particular risk for women and girls in Afghanistan, gender issues will continue to be strengthened and mainstreamed. Within each activity the Bank will assess how it can be designed to most effectively help strengthen legitimacy, create jobs and support gender equality.

The Bank will deliver its program through International Development Association (IDA) grants in which Afghanistan will receive about $150 million per year and the Afghanistan Reconstruction Trust Fund (ARTF) which could potentially provide up to $800 million per year in grants during the period of the ISN. The ARTF, supported by over 30 bilateral donors, is the world’s largest single country trust fund and provides on-budget support to major Afghan programs and reform efforts. The Bank’s private sector arm – the International Finance Corporation (IFC) — will also strengthen its support to both private sector companies and improving the business environment.

Consultations with various stakeholders including public representatives, civil society, the wider donor community and the private sector went into the preparation of the ISN. The Bank’s program has helped deliver tangible improvements in the life of Afghans. At the same time, the strategy cautions that development faces daunting challenges, especially in a fragile environment, and so expectations need to be realistic as to what can be achieved in the near term.

Contacts:

In Washington: Alison Reeves, (202) 473-8955, areeves@worldbank.org;

In Kabul: Raouf Zia, 93 (0) 70280800, azia@worldbank.org

To read the ISN, please visit: http://go.worldbank.org/UPYGK12PM0

For more information about ARTF, please visit: www.worldbank.org/artf

For more information about World Bank activities in Afghanistan, please visit: www.worldbank.org/af

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