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Iraq--Economic Context

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									Government of Iraq Reconstruction + Rehabilitation Program: Progress and Strategies
Supported by: United Nations/IMF/World Bank Abu Dhabi, February 28th, 2004

Macroeconomic Context
• • • • • • • • • • GDP fell by about 30% in 2003, expected to recover 50% in 2004, raising per capita GDP to about US$700 (WB/IMF estimates). Oil production is 2.5 mbd (2/3 of GDP), export/budget revenues are $12 billion plus, mostly for recurrent spending. Capex (about US$15 bn) financed largely by grants and US supplemental budget. Standstill on debt. Private non-oil activity up thru trade, fiscal spending and rising public wage-bill, but insecurity looms large. New Iraqi Dinar (NID) exchange completed on Jan 15, 2004, exchange rates broadly stable (1400/dollar). CBI data on Baghdad shows consumer price increase at 80% in September, and 30-40% in Oct-Nov. Iraqi debt discussions on-going. Most public schools/universities, hospitals open, many are being rehabilitated. electricity generation at 75% of pre-war levels. Unemployment remains the pressing social issue- CSO survey shows 30% unemployment rate but could be much higher. Early economic reforms: liberalization of prices except energy and rationed foods; simplification of taxes; abolition of licensing and tariffs. Recent reforms stalled. Planned 5% reconstruction levy postponed till April. Announced delayed reforms in pricing and SOEs, social safety nets & trade policy. An early accession to WTO negotiations is envisaged.

The Wider Context
• The nature of the involvement of the United Nations and the World Bank in providing assistance to Iraq, is changing. • The prevailing environment and development challenge

• The UN-World Bank Needs Assessment (presented at Madrid – 23-24 October)
• The ongoing work of ministries and other actors in Iraq

UN/WB Needs Assessment
Sectors
Education Health Employment Creation Water and Sanitation Electricity Transport & Telecom Housing & Land Management Urban Management Agriculture, Water Resources & Food Financial Sector State-owned Enterprises (SOEs) Investment Climate Mine Action Government Institutions and Civil Society

Cross-Cutting Issues
Human Rights Gender Environment Cultural Heritage (*) Drugs and Crime (*)

(*) = separate assessments

Remaining Needs Are Great…
A few cases
Water Supply and Sanitation UN/WB NA=$6,842 mn US Supplemental
US Supplemental

Electricity UN/WB NA=$12,122 mn

World Bank Program in Interim Strategy (04) UN Strategy (04) Remaining Needs (UN W/B Needs Assessment)

World Bank Program in Interim Strategy (04) UN Strategy (04) Remaining Needs (UN W/B Needs Assessment)

Transportation and Telecommunication UN/WB NA=$3,409 mn

Housing and Urban Management UN/WB NA=$1,831 mn

US Supplemental
US Supplemental

World Bank Program in Interim Strategy (04) UN Strategy (04) Remaining Needs (UN W/B Needs Assessment)

World Bank Program in Interim Strategy (04) UN Strategy (04) Remaining Needs (UN W/B Needs Assessment)

* Based on UN/WB Needs Assessment, US Supplemental figures, the WB Interim Strategy and UN plans for CY04.

Remaining Needs Are Great…
(continued…)
Agriculture and Water Resources UN/WN NA=$3,027 mn
Education UN/WB NA=$4,805 mn

US Supplement al World Bank Program in Int erim St rat egy (04) UN St rat egy (04) Remaining Needs (UN W/ B Needs Assessment )

US Supplemental World Bank Program in Interim Strategy (04) UN Strategy (04) Remaining Needs (UN W/B Needs Assessment)

Governance and Civil Society(*) UN/WB NA=$387 mn

Health WB/UN NA=$1,600 mn

US Supplemental World Bank Program in Interim Strategy (04) UN Strategy (04) Remaining Needs (UN W/B Needs Assessment)

US Supplemental World Bank Program in Interim Strategy (04) UN Strategy (04) Remaining Needs (UN W/B Needs Assessment)

*US Supplemental allocation for Justice, Public Safety, Infrastructure and Civil Society is $1,401mn for FY04, which is a broader definition than the one used in the Needs Assessment. The US figure used ($75 mn) is a best estimate of the allocation for Judicial Affairs.

Key Themes in UN/WB/IMF Framework
The 14 sectors in the Needs Assessment are organized to Three Broad Themes: 1. Macroeconomic Stabilization (IMF) and Reconstruction and Transition/Transformation to a Market Economy 2. Governance and Public Sector Reform 3. Poverty and Safety Nets
 Significant progress since October 2003. Many activities on the ground, and workshops held in each of the 3 thematic areas with Iraqi authorities. More are planned. Diagnostic assessments are starting and initial work to be completed by mid-2004, others later for delivery in 2004-07.

Theme One: Reconstruction & Transition/ Transformation to a Market Economy
 Reconstruction/Rehabilitation- provision of key infrastructure & social services, employment creation (UN/WB) - refer to Infrastructure slides  Policy/TA work on building blocks of transition (UN/WB):
 Macroeconomic stabilization (fiscal, monetary, exchange rates, see IMF role)  Measured price liberalization & restructuring of subsidies Trade policy reforms, WTO membership, developing regional trading ties; customs reforms  Macro implications of energy pricing reforms and management of oil revenues  SME development for employment, SOE reforms, and financial markets, including investment climate and regulatory reforms, policy support to ministries  Agricultural and rural development strategy  External debt management and debt sustainability

Key Partners: Ministry of Trade; Industry & Minerals; Planning; Finance; Central Bank; Agriculture; other ministries; IFC; IMF; DFID; EC; USAID; Donor Agencies

Theme Two: Governance & Public Sector Reform (1/2)
 Civil Service/Governance (WB/UN):
Support to local administration; support to planning, coordination and statistics capacity; analysis of government payroll; institutional mapping; civil service management & skills; laws, regulations/procedures for public administration; modernization, information networks, skills updating and training.

 Rule of Law, Civil Society, Media (UN):
Establishment of media centers; strengthening of coordination mechanisms; integration of international human rights standards; creation and maintenance of databases; strengthening community participation methodologies; support to children deprived of family primary caregivers and children in need of special protection; establishing GIS mapping system; support to drug and crime control efforts; mainstreaming the concept of human development, human rights and gender equality in national policies.

Key Partners: Ministries of Finance, Planning, Human Rights, Justice, Interior, Defense, Labor and Social Affairs; legislative bodies; civil service agencies; IMF; DFID;US; Donor Agencies;

Theme Two: Governance & Public Sector Reform (2/2)
 Financial Management & Procurement (WB/UN): assessments,
workshops, training of staff in ministries

 Priorities in Public Spending and Public Exp. Management (WB/IMF): budget planning & management; mechanisms for coordinating
government decision-making; mechanisms for legislature, citizens' groups and external audit body; public expenditure management; tax policy and administration; training

 Fiscal Decentralization (WB/IMF/UN): budget management;
organizational structures at federal, local level; laws & regulations for funding sub-national level, enhancing local revenue base/borrowing; strengthening capacity and training

Key Partners: Ministry of Finance, Planning, Sector Ministries; legislative bodies; civil service agencies; IMF; DFID;US; Donor Agencies

Theme Three: Poverty and Social Safety Nets
 Reaching the most vulnerable groups:
– – – – Enhancing national capacity to deliver assistance to refugees, IDPs & returnees. Providing basic humanitarian assistance to vulnerable groups. Seeking to maximise local employment generation through appropriate technology HH poverty, unemployment, food economy HH Poverty causes & vulnerability; social development analysis Health Policy, Health Finance and Public Health Education and Water sector strategy

 Building knowledge base on:

 Policy options drawing from analyses on:
– – –
– – – –

food markets (central and regional, public and private) social protection, pensions, options for cash transfers, monetization
manage the implementation of the current PDS and its phased replacement by the targeted safety net interventions such as School Feeding and Vulnerable Group Feeding for malnourished and vulnerable people identify and design safety nets provide equipment undertake database management

 Capacity Building to:

Key partners: Ministries of Planning, Health, Agriculture, Displacement and Migration, labor and Social Affairs, Education, Justice, Human Rights, Trade, other national agencies and NGOs.

UN and WB Strategies
Linking to the Needs and Priorities of Iraq UN Strategic Plan 2004

World Bank Interim Strategy

THE UN STRATEGY 2004
 Based on the Needs Assessment  An integrated team approach from 23 agencies  1,000 national staff continuing to work throughout  Ten clusters and five cross-cutting themes  Three-year perspective, outputs for 2004  Consultations and Partnerships –
Ministries, WB, NGOs, other Actors, Donors

 The Task Manager - role and responsibility  UNAMI – program coordination and support  Linkage to IRFFI

Needs Assessment  The Clusters
NA Sectors
Education Health Employment Creation Water and Sanitation Electricity Transport & Telecom Housing & Land Management Urban Management Agriculture, Water Resources & Food Financial Sector State-owned Enterprises (SOEs) Investment Climate Mine Action Government Institutions and Civil Society • Cross-cutting: Human Rights, Gender, Environment, Culture, Drugs + Crime

Clusters + Cross-Cutting Issues
1. Education and Culture 2. Health 3. Water and Sanitation 4. Infrastructure and Housing 5. Agriculture, Water Res. + Environ 6. Food Security 7. Mine Action 8. IDPs and Refugees 9. Governance and Civil Society 10. Poverty Reduction + Human Dev. Cross-Cutting
– Security – Human Rights – Gender – Environment – Employment Generation

Current UN Activities (representative sample)
 Reconstruction and rehabilitation of key infrastructure – water, sanitation, electricity, ports, housing, agriculture, water resources, schools, health centers, laboratories  Support for the provision of basic services including education, health, nutrition, shelter, water, sanitation  Working with vulnerable groups, particularly IDPs, refugees, and returnees, and children in need of special protection  Addressing important issues in human rights, gender equity, environment and cultural protection  Seeking opportunities for launching employment generating programs  Promoting social capital through civil society organizations, media, and consultative processes.

WB Interim Strategy
 Key focus on Iraqi implementation, with WB support and capacity building.  Prepared in consultation with Iraq Economic and Sector Ministries, as well as UN, DFID, PMO, USAID, other partners.  Covering 6-9 months, to be followed by Transition Support Strategy.  Linked to IRFFI.  Follows 3-Pronged Strategy: Emergency Operations; Capacity Building; and Laying Groundwork for Medium Term Development.  4 Emergency Programs: Multi-Sector Capacity Building ($5-10 mn), Education ($100 mn), Rural Infrastructure ($100 mn), Multi-Sector Infrastructure ($200-$400 mn). Immediate Training in Procurement/FM/Safeguards in February, Policy Training.

IFC Role
 IFC received Board in December approval for:  $200 million Small Business Financing Facility, to provide financing to micro and small businesses and TA. Donors approached for:  $30 million for TA  $25 million for subordinated tranche of financing component  The Private Enterprise Partnership for the Middle East (PEP-ME) for Iraq, Afghanistan, West Bank Gaza and Yemen  A 4 year, $40 mn TA initiative for private sector development  Seeking $30 million from donors

Iraq-IMF Role in Iraq’s Reconstruction
• As part of the Joint Needs Assessment work, Fund staff prepared a macroeconomic assessment for the Madrid Donors’ Conference. Since then, Fund staff has been carrying out economic surveillance and technical assistance activities. Staff is currently projecting a strong economic recovery in 2004, based on a recovery in oil production capacity, donor-financed investment outlays which will provide the impetus for growth in the non-oil sector, and on the expectation of an improving security situation. Fund staff has been engaged in a dialogue on macroeconomic policy issues with Iraqi officials and the Coalition Provisional Authority (CPA). In early February, staff met with a high-level Iraqi delegation in Washington to discuss policies that could lay the basis of a program that could be supported by the Fund. These discussions are expected to continue in mid-March. Staff has prepared a preliminary a medium-term macroeconomic framework and is preparing an external debt sustainability analysis (DSA).

•

•

Iraq-IMF Role in Iraq’s Reconstruction
• A technical assistance (TA) program for the period through June 2004 has been prepared by Fund staff. The work plan includes training in the areas of public expenditure management, tax policy and administration; central bank organization, accounting procedures and financial reporting, banking supervision, and payments system reform; a series of statistics missions; and a macroeconomic management course to be organized by the IMF Institute. At the request of key donors, Fund staff is playing a coordinating role in TA efforts in macroeconomic policy areas, in particular, with the World Bank, US Treasury, USAID, DFID (U.K.), and the Bank of England. Fund staff has been assessing the technical and administrative aspects of establishing a technical assistance center in the Middle East (METAC) that will provide technical assistance to Iraq and other countries in the region. The Fund has appointed a representative to the International Advisory and Monitoring Board (IAMB). The IAMB held two meetings in December 2003 and one in midFebruary. During the meetings organizational matters were discussed and finalized, and a review was conducted of the CPA's proposed scope of work for the external audits of oil export sales and the Development Fund for Iraq (DFI). In mid-February the CPA issued a request for bids by external auditors and their appointment is expected to take place later this month.

•

•

Iraq-IMF Role in Iraq’s Reconstruction
• Fund staff has developed a timeline for the use of Fund resources by Iraq, once an internationally recognized government is in place and other conditions for such Fund assistance are met. The work plan envisages a series of policy discussions with Iraqi officials from now through late June, culminating with the clearance of arrears to the Fund and a possible disbursement under the Emergency Post-Conflict Assistance (EPCA) policy in the second half of 2004.

•

The economic program to be supported by the EPCA will need to focus on promoting macroeconomic stability through appropriate fiscal, monetary, exchange rate, and external debt policies. The supporting macroeconomic framework would identify quantitative indicators/targets to assess performance and guide policy implementation. Finally, the program will have to address the need to rebuild the country’s administrative and institutional capacity in the macroeconomic policy areas.

THE SECTORS
(following the Needs Assessment structure)

Education
   WB and UN have collaborated with MOE to support (i) the MOE-initiated Amman meeting, October 2003 (ii) The Education Sector Coordination Forum (chaired by MOE), (iii) Education Coordination Forum (convened by UN), (iv) UN/WB collaboration via teleconference and meetings. Additional Coordination Meetings are planned in March 2004, chaired by MOE and MHESR, during which WB and UN will agree on optimal collaboration in the area of technical capacity building of the MOE/DOEs/ MOHE. Baseline study on existing Early Childhood Stimulation and learning practices would be completed and pilot project initiated by UN.



The following key areas have been identified for UN/WB collaboration under primary, intermediate, secondary , vocational & higher levels of education:
– – – – – – – Teaching /learning materials provided; while WB will provide textbooks, UN will provide Education Kits, Laboratory equipment, etc. (WB Emergency Education Project $100m) EMIS/school mapping will be strengthened Curriculum reform facilitated Pre/In-service training for teachers, principals & supervisors provided Schools , educational institutions & facilities rehabilitated; WB/UN efforts are underway Parents, communities, civil society and children & youth mobilised, organised and participating in educational activities Sector wide coordination and networking of international & national partners enhanced



Partners:
MOE/ MOHE & DOEs, International and National NGOs, UN agencies, World Bank, CPA, School functionaries - teachers, principals, supervisors, students and parents

Culture
 Objective (1) - to protect, conserve and promote tangible and intangible cultural heritage  Objective (2) - to fight against illicit traffic of Iraqi cultural property  UN has collaborated with the Ministry of Culture on:
 Organizing 3 international experts’ meetings on Iraqi cultural heritage and participating in other workshops and meetings to fight against illicit traffic  Carrying out 2 multi-disciplinary assessment missions to Iraq  Establishing an International Coordination Committee for the Safeguarding of the Cultural Heritage of Iraq to coordinate activities in favour of Cultural Heritage

 UN will focus on:
     Conserve, protect and interpret major archaeological sites and monuments Strengthen capacity-building at all levels Rehabilitate and reequip major cultural institutions and museums Document and inventorize cultural heritage Promote information sharing, raise awareness and organize promotional activities

 WB is to be contributor to Iraq Cultural Heritage Congress (approved allocation)

Health
 Overall WB/UN objectives to provide funding and TA to the Ministry of Health to restore the public health and primary care system by rebuilding critical infrastructure and public training capabilities  In January, Senior Policy Seminar held in Amman, Jordan by WB/UN senior MOH officials, USAID, CPA  Agreed agenda with MOH includes:
 Data gathering and Master planning (WB)  Support for urgent structural and legislative changes (UN)  Urgent training and capacity building within the health sector in: Nursing (UN); Reproductive health and MCH (UN); Management (UN); Procurement (WB); National Health Accounts (WB/UN); Health Care Financing (UN/WB); Decentralization (WB/UN) – Rehabilitation of Emergency Medical Services and procurement of emergency medical service equipment (WB/UN)

Employment Creation
 UN is addressing immediate Income Generation through:
 labor-intensive rehabilitation across sectors  Working with key partners to develop and plan implementation of programs, especially MOLSA, Public Works, Displacement and Migration. Training with MOLSA staff; provision of advisors.  Training Iraqi counterparts in the conducting of surveys.  Developing programs to support capacity of MOLSA (and local authorities) to monitor and disseminate information on employment. National Employment Database and IT infrastructure provided to MOLSA.  Development work on vocational training centers , employment centers, livelihoods for vulnerable groups, social fund established. Start-up packages to six employment centers.

 WB is addressing Employment through the Emergency Projects, identification/ funding of bottleneck skill gaps in key sectors, and IFC’s SME initiatives.

Emergency Infrastructure Reconstruction (1/2)
 Objective: Restore needed basic infrastructure to pre-2003 levels thru: (i) Supply of equipment & material; (ii) Rehabilitation of existing facilities; (iii) Provision of TA for project design & implementation; (iv) Capacity building in systems/utilities management  WB’s focus on investments for water/electricity utilities & transport/urban mgmt agencies, to restore basic services & build sound practices. Investments in major/medium size cities needing urgent reconstruction.  WB Project summary sheets were given to Sector Ministries to identify sub-projects not funded by other donors. Upon clearance by Iraq Strategic Review Board- sheets expected by the end of February 2004.

Emergency Infrastructure Reconstruction (2/2)
The UN is assisting in delivering the following, amongst others:
 Preparatory works for formulating a Master plan for the Electricity Sector  Rehabilitation of Transmission Lines & Electrical Facilities of key essential services.  Procurement and installation of back up generators in key hospitals, sewerage and water pumping stations  Full rehabilitation of damaged electrical facilities of major hospitals through local contracting  Supervision of Wreck Removal in Shat Al-Arab (17 to date)  Rehabilitation of houses in Central and South  Resettlement and reintegration of returning refugees  Finalization of priority programs in Housing and Urban Management in consultation with Iraqi High Level Advisory Panel  Strengthening access to and quality of education, preventative, reproductive+ community healthcare services, mine risk education.  Physical rehabilitation and construction of essential health, water and sanitation, electricity, and housing infrastructures in vulnerable communities and areas of poor access.  Modernizing and strengthening key local administrations to better respond to community needs.  Provision of agriculture inputs to enable work and improve rural livelihoods  Extensive support to employment centers, training centers and SMEs.
Key Partners: Ministries of Electricity; Construction & Housing; Public Works & Municipalities; Education; Health; Water; Agriculture; Industry & Minerals; Planning; Finance; others agencies; Donor Agencies; NGOs

Water Supply and Sanitation
UN/WB will both address critical needs in the sector, ensuring harmonization with Iraqi priorities and PMO-funded projects.
 UN will focus on, amongst others: (i) rehabilitation of water and sanitation facilities, (ii) water quality surveillance system, (iii) develop + implement master plans for major cities, (iv) capacity for decentralised planning, (v) develop alternative sewage systems, (vi) develop alternative solid waste disposal systems, (vii) participation of private sector in water & sanitation, (viii) treating industrial & medical waste effectively, (ix) alternative rural water & sanitation options. (approx. $341 mn for 04)  WB will target: (i) water pollution in Tigris from untreated sewage in Baghdad, and (ii) restoring water & sewerage services in Baghdad & other urban/rural areas (approx. $150 mn for 04). Immediately covered under Emergency Infrastructure and Rural Rehabilitation projects. Followed up by environmental projects in medium-term.

Transport
 In Transport, WB will undertake rehabilitation of roads and railways. Covered in Emergency Infrastructure Project  On ports, UN will work on dredging and urgent rehabilitation works in ports. (approx. $75 mn for 04 for transport and telecom)  WB will work on master planning, inter-modal facilities, piloting and navigation aid equipment, and restructuring  The WB would assist in reestablishing public transport services in Baghdad through renewal of lost buses and equipment for maintenance workshops (approx. $120 mn for 04 for transport and telecom)

Telecommunications
 WB has agreed an agenda with Ministry of Communications to develop a regulatory capacity in the sector. The WB, with assistance from UN, will support: – Commercializing ITPC to bring it to modern standards of competitiveness – Building a regulatory capability that encourages private participation in the sector, including policy and capacity building – Sector Vision outline & preparations for capacity-building underway  UN will focus on:  Frequency spectrum management  E-applications and processing

Electricity
 WB & UN will work closely on institutional capacity building and training in all aspects of electricity sector.  WB’s Emergency Infrastructure Program for FY04-05 will provide selected critical investments not taken up by other donors to help restore electricity throughout the country (approx. $90 mn for 04)  UN is focusing on: (i) the rehabilitation of the National Dispatch Center – stage II; (ii) rehabilitation of Al-Mussaiab, Al-Taji, and Mosul power stations; and (iii) training for Ministry staff. (approx. $134 mn for 04)  WB will provide TA/Policy Advice on: (i) energy pricing; (ii) least cost supply options; and (iii) regulatory and structural reforms

Housing, Land Management & Urban Management
 WB/UN will work closely on developing institutional capacity building and training/workshops on Housing and Urban Management, and upgrading of slums  UN will: (i) focus on resettlement & reintegration, rehabilitation of housing for vulnerable groups, upgrading of depressed areas in selected cities and towns; (ii) work on developing housing policy including housing finance mechanisms with WB; and (iii) focus on wide institutional capacity building and on organizing regional training & workshops on Housing, Land Management and Urban Management. (approx. $81 m in 04)  WB work in Urban Management (approx. $90 mn for 04) in:
 Policy/regulatory reforms to improve local-level accountability & financial sustainability  long-term policy measures for sustainable urban development  Expanding municipal infrastructure through its Rural Development Project

Rural Development – Agriculture, Water Resources and Environment
 UN and WB continue regular consultations on immediate investments and rural agricultural policy work.  UN will focus on: (i) supply of critical production inputs to target vulnerable rural
communities and households, (ii) institutional reorganization, capacity-building and HR development of relevant Ministries (Agriculture, Water Resources and Environment), (iii) assistance to formulation of policies & key regulatory frameworks, (iv) urgent rehabilitation of critical agricultural & water resource infrastructure, supply of equipment and of inputs. (approx. $124 mn in 04)

 WB includes in its interim Strategy:
 Emergency Community Rural Infrastructure Rehabilitation Project ($100 mn). First phase ($20 mn) will focus on irrigation rehabilitation, water supply and sanitation in rural areas. Strong focus on pilot-projects.  Agriculture and Rural Development Policy Framework to assess medium/longterm needs for institutional development. Followed by Agriculture Rehabilitation and Institutional Development Project (tentatively $70 mn).

 WB to work on a Country Water Assistance Strategy, with input from the UN, covering Policy and Institutional Reform needs and trans-boundary issues.

FOOD SECURITY
 UN/WB ongoing activities include:
– (i) Joint assessment meetings, (ii) preparation and agreement of joint work
plan/TOR, (iii) Joint Study examining the function of food markets and the implication of change of PDS levels on market prices, (iv) defining central and regional food markets infrastructure and capacity, (v) household data collection, (vi) market prices data collections, (vii) focus group data analysis, (viii) supporting PDS, vulnerability analysis and safety net activities, (ix) policy paper and food market study.

 Proposed Activities (UN/WB): • Building a better knowledge of:
– (i) food economy situation, (ii) causes and extents of vulnerability

• Undertake synthesis policy options paper drawing from three separate analyses on:
– (i) food markets, (ii) social protection, (iii) options for cash transfers,

• Transitioning from the current universal public distribution system to a targeted food assistance programme. • Developing counterpart capacity to:
– (i) manage the PDS transition, (ii) analyse vulnerabilities, (iii) identify and design safety nets, (iv) establish the necessary functional structures, (v) provide equipment, and (vi) undertake database management
Key partners: Ministry of Planning, Ministry of Health, Ministry of Trade, Ministry of Education, Ministry of Agriculture

The Financial Sector
 Financial Sector, the short-term program includes:
– – – – – State Banks Capacity Building (US, WB) Banking Supervision Capacity Building (IMF, US, WB) Developing a Payments System (IMF, US, WB) Strengthening the Private Financial Sector (US, IFC) Support/Strengthen Commercial Banking (WB, IFC)

 In the Medium Term, Develop Housing Finance, Leasing and Insurance (WB, IFC)  Est. WB program of $20 mn in 04

The Investment Climate and SOEs
 Work includes Policy Advice, Regulations, Capacity Building and Direct Assistance  Investment Climate work has twin priorities:
 Job creation (UN, WB (IFC), US)  Commercial Legal Structure and Institution and policy building: Public and private institutions (WB, US)

 In SOEs:

 Training of the Iraq Public and Private Sector is central to this agenda

 Financial and operational strengthening of SOEs in critical sectors (WB, IMF, UN)  Support to labor adjustment programs (severance, job retraining, required for inoperational and overstaffed SOEs (WB)  Preparation for public private partnerships- establishing regulatory frameworks and institutional capacity (WB, US)

 $100 mn for 04-05 WB SOE/Financial Sector/Inv. Climate Project

 High level training of policy makers on key policy questions (WB, IMF)  Medium level training of key implementers in public/private sector (WB)  Vocational level training in modern business practices, management and critical skills (US, UN)

Mine Action
The UN will focus on:
 CAPACITY BUILDING Technical support – 10 to 15 Technical advisors Mine Action to NMAA through TBA Operational capacity (Mine Clearance, MRE and Victim Assistance) – Support NMAA to develop of national Mine Action organizations through TBA – Support to the ongoing Mine Action activities through Minetech International and InterSOS  SURVEY – Land mine impact survey coordinator April 2004 to 2006-7 through VVAF (Vietnam Veteran of America Foundation)  MINE RISK EDUCATION (MRE) – Two mine action organizations complete MRE projects through community networks through TBA – Pilot MRE response network established in four governorates through TBA

Government, Civil Society, Rule of Law, and Media (1/2)
UN will focus on Public Administration & Rule of Law:
 Support to local administration: Capacity Building programs on public management and project cycles, and updated methodologies in auditing, outsourcing, procurement, linked to direct support schemes for improved service delivery at local level.  Support to Planning, Coordination and Statistics Capacity: Comprehensive program on statistics and planning methodologies in place to strengthen the planning and coordination capacity of the Ministry of Planning and Development Cooperation. FAFO household survey conducted.  Rule of law and law enforcement: Support to the judicial training institute and rehabilitation of main courts. Support to establishment of drug and crime control legal frameworks. Capacity building on drug and crime control for public officials

Government, Civil Society, Rule of Law, and Media (2/2)
UN will focus on Civil Society, Human Rights & Gender Equity:
Civil society development: NGOs mapping, Capacity Building program and Trust Fund for NGOs development. Mobilisation around women’s human rights and support to NGOs. Partners: NCCI, local NGOs and Ministry of Planning,  Gender equality (jointly with WB): National action plan for the advancement of Iraqi women adopted and ministerial gender focal points appointed and trained on leadership skills and gender promotion. National strategy to increase women’s participation. Awareness campaigns on gender, women’s human rights and their role in the political reconstruction process. Mobilise support for women’s participation in political reconstruction.  Media development: Capacity building for media development on business management and professional ethics. Support to local broadcasting initiatives, to media/ communities partnerships, and identifying media focal points. Policy advice on legal framework through international conference on Iraqi media. Main partners: journalists association, local NGOs.  Human Rights: International workshop on Human Rights in Iraq paving the way for national action plan. Creation of HR Documentation and Training centers. Support to local HR NGOs. Training of public officials on HR issues. Main partners: Ministries of Human Rights and Justice, local NGOs and line ministries.  Child Rights: Establishment of Child Rights centers in 18 governorates and support for the establishment of the Child Welfare Commission. Policy advice on child rights for adoption and implementation of adequate social and protection policies. Database on child protection issues. Main partners: MOLSA, international and local NGOs.

Cross-Cutting Issues
Environment
 UN to address integration of environmental considerations through:
    Sectoral strategies incorporate environmental “good practices” in development plans Capacity building of the environmental authorities on assessment, policy and law development Technical assistance and facilitation of regional cooperation on Mesopotamian marshlands Assessment of the environmental situation in Iraq and, recommendations to remediate the environmental “hot spots”

 WB to ensure due diligence/compliance with WB safeguard policies through:
– Training on the WB safeguard policies (March 25, 2004), & environmental policy with UN – Sectoral/regional environmental and social assessments on new investments (FY 05-06)

 Other medium-term WB Environmental Management Activities, coordinated with UN, include: Environmental Analysis, Environment Management Project, Gulf Environment Action Program, Pilot Projects on municipal and hazardous waste management

Job Creation (see also Sector: Employment Creation)
 UN and WB reflect Job Creation as a Cross-Cutting issue in all their program areas, particularly emergency reconstruction/ rehabilitation and vulnerable groups.  Other initiatives: WB and UN vocational and enterprise training, SME development including community-based initiatives, vocational training for small start-ups.

Cross-Cutting Issues
Human Rights
 There is a need to promote a culture of protection of human rights by strengthening the capacities of key governmental and non-governmental institutions, and by facilitating the resumption of the regular activities of the judicial system. There is also a requirement to advocate child protection needs, developing child rights-based systems and policies, and expanding protection mechanisms at sub-national levels.

Gender

 In Iraq- women are 60% of population, among the best trained in the region; yet risk losing the most in terms of rights, voice and access to opportunities.  Need for active inclusion of women in all decision making, & leadership capacity training.  Promoting greater participation of women in economic activity & preserving women's economic rights is critical.  The UN is committed to mainstreaming gender equality in national policies, and to promoting a mentality change within Iraqi society in support of gender equity and women’s rights.  WB includes Gender in its Interim Strategy. After a Amman Workshop with prominent Iraqi women, strategies for mainstreaming, and a project component in the Rural Development Project, were agreed.

Moving Forward…
 The Building Blocks are in place for a coordinated effort for Iraqi Reconstruction:
     Iraqi led process- strategy and implementation US Supplemental Appropriation Other donors’ interventions WB Interim Strategy and UN Strategic Plan 2004 UN agencies and new WB Iraq Office in Amman, to facilitate interaction with Iraqi authorities. WB videoconference facility in Baghdad on-line  UN/WB Facility Coordination Committee for the IRFFI  UN/WB/IMF/AFESD in IAMB

 A coordinated, comprehensive approach within an Iraqi-led framework is evolving. The key elements are in place.  An optimal arrangement vis-a-vis all entities involved will emerge over time, through wide-spread consultation and collaboration. The commitment is there.  The key priority is meeting the immediate needs of Iraqis in a coordinated and coherent manner.

The needs are substantial and require all resources available.

Remaining Needs Are Great…
A few cases
Water Supply and Sanitation UN/WB NA=$6,842 mn US Supplemental
US Supplemental

Electricity UN/WB NA=$12,122 mn

World Bank Program in Interim Strategy (04) UN Strategy (04) Remaining Needs (UN W/B Needs Assessment)

World Bank Program in Interim Strategy (04) UN Strategy (04) Remaining Needs (UN W/B Needs Assessment)

Transportation and Telecommunication UN/WB NA=$3,409 mn

Housing and Urban Management UN/WB NA=$1,831 mn

US Supplemental
US Supplemental

World Bank Program in Interim Strategy (04) UN Strategy (04) Remaining Needs (UN W/B Needs Assessment)

World Bank Program in Interim Strategy (04) UN Strategy (04) Remaining Needs (UN W/B Needs Assessment)

* Based on UN/WB Needs Assessment, US Supplemental figures, the WB Interim Strategy and UN plans for CY04.

Remaining Needs Are Great…
(continued…)
Agriculture and Water Resources UN/WN NA=$3,027 mn
Education UN/WB NA=$4,805 mn

US Supplement al World Bank Program in Int erim St rat egy (04) UN St rat egy (04) Remaining Needs (UN W/ B Needs Assessment )

US Supplemental World Bank Program in Interim Strategy (04) UN Strategy (04) Remaining Needs (UN W/B Needs Assessment)

Governance and Civil Society(*) UN/WB NA=$387 mn

Health WB/UN NA=$1,600 mn

US Supplemental World Bank Program in Interim Strategy (04) UN Strategy (04) Remaining Needs (UN W/B Needs Assessment)

US Supplemental World Bank Program in Interim Strategy (04) UN Strategy (04) Remaining Needs (UN W/B Needs Assessment)

*US Supplemental allocation for Justice, Public Safety, Infrastructure and Civil Society is $1,401mn for FY04, which is a broader definition than the one used in the Needs Assessment. The US figure used ($75 mn) is a best estimate of the allocation for Judicial Affairs.

Thank You.


								
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