Technical Assistance Reports
2024
May 24, 2024
Guinea: Technical Assistance Report-Climate Change and Gender Budgeting
Description: [This report is only available in French] This technical report discusses ways to introduce climate and gender budgeting (CGB) in Guinea’s budget cycle. To this end, it develops an integrated approach to incorporate into the budget cycle both climate and gender (CG) aspects, as part of priorities-based budgeting, which could serve in similar contexts. Moreover, there was no program-based budget, as tagging climate and gender expenditures at the level of a program is more comprehensive and commonly suggested. The report supports that the introduction of CGB would facilitate and inform program budgeting initiatives. In Guinea, integrating climate aspects in the budget cycle face several challenges, including a proliferation of institutions involved. On gender, despite the adoption of key legislation and a national strategy on gender equality, there were limited sectoral diagnostics and sex-disaggregated statistics to cover gender transversality. The implementation of CG related national strategies is not completely translated into measures, actions, and associated costs. In addition to proposing a method for CGB tagging, this report proposes six high-priority recommendations that could significantly help integrate CG in the budget cycle in the short to medium term. The report also includes a couple of tools, which would help to successfully introduce and present CG aspects in the budget cycle. Guinea; Climate change; gender inequality; Budget cycle; budget planning and preparation; program-based budgeting; public investment spending; fiscal reporting; expending tagging; public financial management.
May 17, 2024
Costa Rica: Technical Assistance Report-Universal Basic Pension: Objectives and Constraints
Description: At the request of the Ministry of Finance, a mission from the International Monetary Fund visited San Jose. The purpose of the mission was to assess the proposal to a universal basic pension and to estimate its fiscal and welfare impact on the budget, on pension schemes, and on old age income poverty. Costa Rica is entering a demographic transition which will see the old age dependency ratios significantly worsen in the coming 20 years. The long-term financial sustainability of the general social security pension scheme (IVM) is a concern, despite various reforms introduced over the past three decades and the scheme’s reserves are expected to be exhausted by the mid-2030s. The government’s proposal intends to address financial sustainability, the adequacy of coverage and of benefit levels, as well as distributional equity through the introduction of a universal basic pension. The IMF team’s assessment is that the proposal is unlikely to fully meet its stated objectives. The proposal will worsen social security pension scheme’s financial sustainability and create additional financing needs. This will translate into an accelerated exhaustion of IVM reserves and, after the reserves are depleted, require significant adjustments to IVM parameters or higher government transfers. Old age income security may be more effectively addressed, with less pronounced fiscal side-effects, through improving coverage and compliance in IVM and expanding the reach of the social pension scheme. The primary instruments of achieving these goals are: (a) amending the rules undermining compliance with registration and wage reporting regulations in the contributory schemes, (b) improving coordination between tax and contribution collection agencies, (c) amending the regulations governing eligibility for noncontributory social pensions and (d) ensuring the noncontributory social pension is adequately financed.
May 17, 2024
Cabo Verde: Technical Assistance Report-Climate Policy Diagnostic
Description: Cabo Verde faces development challenges from multiple structural factors, including insularity, territorial discontinuity, fragility of ecosystems, and scarcity of natural resources, namely water and arable land. Climate change implications are amplifying these challenges. As an island extension of the arid Sahel zone, Cabo Verde faces severe water shortage, which the country addresses more and more through energy intensive desalination, using electricity produced largely by thermal power plants, which depend entirely on imported fossil fuels. The resulting high energy prices directly impact the cost of water production. In conjunction with climate change induced aridity, the energy-water-climate nexus presents the core development challenge for the country.
May 17, 2024
Guinea: Technical Assistance Report-Public-Private Partnership (PPP) Institutional and Fiscal Risks Management
Description: [This report is only available in French] This technical report discusses the main bottlenecks that have hampered the effectiveness of Guinea’s PPP governance framework and the management of PPP-related fiscal risks. The legal and institutional framework for PPP in Guinea appears to be strong, but its implementation is not yet effective. The institutions involved in PPP management are gradually stepping-up their staff and capacity. The PPP unit (UPPP) has developed several standard documents (forms an templates) by to assist contracting authorities in complying with legal and regulatory procedures for PPP projects. The report elaborates on the factors that prevent line ministries from completing feasibility studies, which is essential to ensure project efficiency and value for money. While the Guinean authorities appear to have fallen into the fiscal illusion of free infrastructure through PPPs, the report underlines the need to consider the fiscal costs and contingent liabilities generated by PPPs, as part of the fiscal risk management framework and the budget cycle more generally. It highlights the massive recourse to unsolicited proposals for PPPs which are often poorly aligned with government priorities and suggested, in line with good practices, to limit the use of such proposals and favor government-led calls tenders. On these grounds, this report makes nine high-priority recommendations that could improve PPP management and the associated fiscal risk in Guinea.
May 17, 2024
Bangladesh: Technical Assistance Report-Report on Climate Risk Analysis
Description: A Technical Assistance (TA) mission was conducted in Dhaka, Bangladesh, from March 5 to 9, 2023, to assist authorities in setting up a framework to assess physical climate risk in the financial system. The TA mission focused on (i) proposing a risk assessment framework tailored to available data, with a focus on the impact of floods on the banking sector, (ii) taking stock of financial and climate data availability and identifying data gaps, (iii) setting up collaboration and data sharing mechanisms, taking into account legal obligations and confidentiality constraints, between multiple agencies. The mission identified the main climate and financial data sources and existing data gaps, proposing a preferred micro approach for climate risk assessment based on high-granularity data and two alternative options relying on more aggregate data. The micro approach is a borrower-level assessment based on geo-located bank exposure data; the alternatives rely on lower granularity or country-level exposures, possibly resulting in estimates that might be of lower precision and output of lower quality. The choice of framework should aim to strike the right balance between timeliness and quality of the analysis.
May 10, 2024
Georgia: Technical Assistance Report-Report on Stress Testing the Central Bank Balance Sheet and Developing Hedging Markets
Description: This CD engagement covered two distinct areas to help the National Bank of Georgia (NBG) deliver on its price stability mandate, it: 1) provided a forward-looking analysis of the NBG’s balance sheet to assess its policy solvency and to help institutionalize such a process, and 2) outlined a strategy to develop hedging instruments in interest rate and foreign exchange (FX) markets to support monetary policy transmission. With virtually no interest-bearing liabilities, the NBG balance sheet is robust. Under the adverse shock, it improves on account of FX revaluation gains. Higher inflation also helps, since the need for a higher policy rate generates larger domestic interest income. Institutionalizing this analysis allows for early warning of the need to reduce dividend payments (or for re-capitalization) thereby supporting operational independence. Georgia has made good progress on many of the enabling conditions for developing hedging markets, but several structural factors provide challenges. A supportive regulatory environment is in place, market infrastructure is robust, and there is a range of instruments available to serve as the underlying instrument for derivatives. However, there is a lack of heterogeneity of financial risk profile and appetite amongst participants. Recommendations include setting up a standardized FX forward trading platform, pushing for upgrades of banks’ treasury management systems, supporting the targeted education and training efforts of the Georgian Financial Markets Treasuries Association, revising the current FX forward index to be more informative by publishing outright transacted rates; and publishing Overnight Indexed Swap benchmarks.
May 6, 2024
Saint Lucia
Description: A technical assistance (TA) mission on external sector statistics (ESS) was conducted to the Central Statistics Office (CSO) of Saint Lucia as part of the Caribbean Regional Technical Assistance Centre (CARTAC) work program on ESS. The mission focused on addressing data compilation issues on trade in goods—especially on the import and re-export of fuel—and travel credits and assessed the revised 2022 balance of payments that was disseminated in December 2023.
May 3, 2024
Cambodia: Technical Assistance Report-Report on Residential Property Price Index (RPPI) Mission
Description: A technical assistance (TA) mission was conducted from January 15–19, 2024, to assist the National Bank of Cambodia (NBC) with the further improvement of their Residential Property Price Index (RPPI). The mission was conducted under the auspices of the Data for Decisions (D4D) Trust Fund. The mission completed the following tasks: (i) undertook a review of the methods used for the RPPI (ii) identified areas for improvement consistent with international best practice, (iii) provided practical training to staff in the NBC, (iv) assessed the suitability of the template used for data collection from the commercial banks, and (v) analyzed the potential for accessing and using more comprehensive data sources.
April 29, 2024
Barbados: Technical Assistance Report-Financial Stability Report
Description: The technical assistance encompassed a comprehensive review of all pertinent aspects aimed at enhancing the joint financial stability report (FSR) of the Central Bank of Barbados (CBB) and the Barbados Financial Services Commission (FSC). The mission determined that the development of a detailed FSR production plan is critical and has the potential to facilitate improvements and synergies among various experts involved in the report’s production. The preparation of a communication plan for the report is another essential step that needs to be taken by the CBB and FSC. The broader macroeconomic context and a more forward-looking perspective should be reflected in the FSR, which needs to be streamlined to follow the central risk story with key messages that are clear and easy to understand to readers with limited knowledge of the financial system in Barbados. The report should reflect all important elements of financial stability assessment, such as the regulatory framework and the analysis of the real sector. The quality of the FSR could be further enhanced through advancements in the financial stability analytical toolkit. Finally, the mission reviewed and provided recommendations on the use of existing as well as potential new data sources that should be fully utilized for financial stability purposes.
April 26, 2024
Bosnia and Herzegovina-Republika Srpska: Technical Assistance Report –Public Investment Management Assessment (PIMA)
Description: There have been significant improvements in public investment management (PIM) in Bosnia and Herzegovina - Republika Srpska (RS) over the last decade and the legal and institutional design is now ahead of many regional comparators. The effectiveness of the PIM framework is lagging behind its design, and continued strong and consistent reform efforts will be important to eliminate remaining obstacles to efficient public investment. Many of these reforms are already underway or planned.