Document of The World Bank...AND AN ADDITIONAL FINANCING . IN THE AMOUNT OF SDR 6.4 MILLION (US$10...

Document of The World Bank

Report No: ICR2890

IMPLEMENTATION COMPLETION AND RESULTS REPORT

(IDA-41240 IDA-41241 TF90745 TF94774)

ON A CREDIT

IN THE AMOUNT OF SDR 17.3 MILLION (US$25 MILLION EQUIVALENT)

AND AN ADDITIONAL FINANCING

IN THE AMOUNT OF SDR 6.4 MILLION (US$10 MILLION EQUIVALENT)

AND A DFID CO-FINANCING GRANT

IN THE AMOUNT OF GBP 2.6 MILLION (US$5.2 MILLION EQUIVALENT)

AND A SECO CO-FINANCING GRANT

IN THE AMOUNT OF US$2.4 MILLION

TO THE REPUBLIC OF GHANA

FOR AN

ECONOMIC MANAGEMENT CAPACITY BUILDING PROJECT

November 1, 2013

Finance and Private Sector Development Country Department AFCS2 Africa Region

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CURRENCY EQUIVALENTS

(Exchange Rate Effective November 1, 2012)

Currency Unit = GHS GHS1.00 = US$0.45 US$1.00 = GHS2.21

FISCAL YEAR

January 1 – December 31

ABBREVIATIONS AND ACRONYMS

ADMU Aid and Debt Management Unit AfDB African Development Bank AML Anti-money laundering APL Adaptable Program Loans ARB Agriculture and Rural Banks BCPs Basel Core Principles BOG Bank of Ghana CAGD Controller and Accountant General Department CAS Country Assistance Strategy CIP Chartered Insurance Professional CMAs Control Management Agencies CPS Country Partnership Strategy CSD Central Securities Depository CSTC Civil Service Training College CSU Customer Service Unit CUA Credit Union Association DFID UK Development Fund for International Development EMCB Economic Management and Capacity Building Project FATF Financial Action Task Force FIC Financial Intelligence Center FINSSP Financial Sector Strategic Plan FSAP Financial Sector Assessment Program FSCBP Financial Sector Capacity Building Project FWPC Fair Wages and Pension Commission GCCUA Ghana Cooperatives Credit Unions Association GHAMFIN Ghana Microfinance Networks GIC Ghana Insurance Commission GNPA Ghana National Procurement Agency GNPRA Ghana National Pension Regulatory Agency GOG Government of Ghana GPRS Ghana Poverty Reduction Strategy GRATIS Ghana Regional Appropriate Technology Industrial Service

GSB Ghana Standard Board GSE Ghana Stock Exchange GSEC Ghana Securities and Exchange Commission GSGDA Ghana Shared Growth and Development Agenda GTZ/GIZ German Technical Assistance Cooperation HIPC Highly Indebted Poor Country HOCS Office for Head of Civil Service IA Implementing Agency IAIS International Association of Insurance Supervisors ICR Implementation Completion and Results Report IDEA Interactive Data Extraction and Analysis IOSCO International Organization of Securities Commissions LTSA Long-Term Savings Act MDAs Ministries, Departments and Agencies MDBS Multi-donor Budget Support framework MOFEP Ministry of Finance and Economic Planning MOPRS Ministry of Public Sector Reform NIC National Insurance Commission NPRA National Pensions Regulatory Agency PCPR Presidential Commission on Pension Reform PROST World Bank’s Pension Reform Option Simulation PRSC Poverty Reduction Support Credit RCBs Rural and Community Banks RTGS Real Time Gross Settlement SECO Secretariat for Economic Affairs SIFIs State-Influenced Financial Institutions SMAs Strategic Management Agencies SSNIT Social Security and National Insurance Trust SSPS Single Spine Pay Structure SWAp Sector-Wide Approach Program UNCTAD United Nations Conference for Trade and Development VCTF Venture Capital Trust Fund VRP Voluntary Retirement Programs WEF World Economic Forum

Vice President: Makhtar Diop Country Director: Yusupha B. Crookes Sector Manager: Paul Noumba Um

Project Team Leader: Alan Andrew Moody ICR Team Leader: Xiaofeng Hua

REPUBLIC OF GHANA

Economic Management Capacity Building Project (P092986)

CONTENTS

A. Basic Information............................................................................................................ i B. Key Dates ....................................................................................................................... ii C. Ratings Summary ........................................................................................................... ii D. Sector and Theme Codes ............................................................................................... ii E. Bank Staff ...................................................................................................................... iii F. Results Framework Analysis ......................................................................................... iii G. Ratings of Project Performance in ISRs ...................................................................... xv H. Restructuring (if any) .................................................................................................. xvi I. Disbursement Profile .................................................................................................. xvii 1. Project Context, Development Objectives, and Design ............................................ 1 2. Key Factors Affecting Implementation and Outcomes ........................................... 11 3. Assessment of Outcomes......................................................................................... 21 4. Assessment of Risk to Development Outcome ....................................................... 32 5. Assessment of Bank and Borrower Performance .................................................... 33 6. Lessons Learned ...................................................................................................... 36 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners ......... 37 Annex 1 Project Costs and Financing ............................................................................... 40 Annex 2 Outputs by Component ...................................................................................... 42 Annex 3 Economic and Financial Analysis ...................................................................... 47 Annex 4 Bank Lending and Implementation Support/Supervision Processes ................. 48 Annex 5 Beneficiary Survey Results ................................................................................ 50 Annex 6 Stakeholder Workshop Report and Results........................................................ 51 Annex 7 Summary of Borrower's ICR and/or Comments on Draft ICR .......................... 52 Annex 8 Comments of Cofinanciers and Other Partners/Stakeholders ............................ 55 Annex 9 List of Supporting Documents ........................................................................... 58 MAP

i

A. Basic Information

Country: Ghana Project Name: GH-Economic Management Cap. Bldg. Proj.

Project ID: P092986 L/C/TF Number(s): IDA-41240,IDA-41241,TF-90745,TF-94774

ICR Date: 11/19/2013 ICR Type: Core ICR

Lending Instrument: SIL Borrower: MINISTRY OF FINANCE

Original Total Commitment:

XDR 17.30M Disbursed Amount: XDR 23.42M

Revised Amount: XDR 23.70M Environmental Category: C Implementing Agencies: Bank of Ghana Public Sector Reform Secretariat (Office of the President) Ministry of Public Sector Reform Ministry of Tourism and Diaspora Relations Ministry of Environment, Science and Technology Ministry of Finance and Economic Planning Fair Wages and Salary Commission Office of the Head of the Civil Service Public Service Commission Ghana Securities and Exchange Commission Social Security and National Insurance Trust Ghana Stock Exchange National Insurance Commission National Pensions Regulatory Authority Comptroller and Accountant General's Department State Enterprises Commission Ghana National Venture Capital Trust Fund Ghana Microfinance Institutions Network ARB Apex Bank Ltd. Financial Intelligence Center Cofinanciers and Other External Partners: SECO DFID

ii

B. Key Dates

Process Date Process Original Date Revised / Actual Date(s)

Concept Review: 01/19/2005 Effectiveness: 03/27/2006 03/27/2006

Appraisal: 07/25/2005 Restructuring(s): 12/18/2007 06/16/2011 01/02/2013

Approval: 11/15/2005 Mid-term Review: 06/02/2008 08/17/2009 Closing: 06/30/2011 05/31/2013 C. Ratings Summary C.1 Performance Rating by ICR Outcomes: Moderately Unsatisfactory Risk to Development Outcome: Moderate Bank Performance: Unsatisfactory Borrower Performance: Moderately Satisfactory C.2 Detailed Ratings of Bank and Borrower Performance (by ICR)

Bank Ratings Borrower Ratings Quality at Entry: Unsatisfactory Government: Moderately Satisfactory

Quality of Supervision: Moderately Unsatisfactory

Implementing Agency/Agencies: Moderately Satisfactory

Overall Bank Performance: Unsatisfactory Overall Borrower

Performance: Moderately Satisfactory

C.3 Quality at Entry and Implementation Performance Indicators

Implementation Performance Indicators QAG Assessments

(if any) Rating

Potential Problem Project at any time (Yes/No):

Yes Quality at Entry

(QEA): None

Problem Project at any time (Yes/No):

Yes Quality of

Supervision (QSA): None

DO rating before Closing/Inactive status:

Moderately Satisfactory

D. Sector and Theme Codes Original Actual

Sector Code (as % of total Bank financing) General finance sector 75 62 General public administration sector 25 38

iii

Theme Code (as % of total Bank financing) Administrative and civil service reform 33 38 Other Financial Sector Development 67 62 E. Bank Staff

Positions At ICR At Approval Vice President: Makhtar Diop Gobind T. Nankani Country Director: Yusupha B. Crookes Mats Karlsson Sector Manager: Paul Noumba Um Antony Thompson Project Team Leader: Alan Andrew Moody Christopher Juan Costain ICR Team Leader: Xiaofeng Hua ICR Primary Author: Xiaofeng Hua

F. Results Framework Analysis Project Development Objectives (from Project Appraisal Document) The proposed project aims at supporting the government to define and perform its role as a facilitator for economic development. The project seeks to establish a level playing field in the finance sector focusing upon outcomes rather than establishing new institutions, together with a clear policy to improve the efficiency of public sector management for an enhanced service delivery. The project, through support to FINSSP, will seek to catalyze the allocation of capital to Ghanaians and improve competitiveness and governance of long term savings institutions and markets. The project also aims to strengthen the Public Sector Reform Strategy through providing a framework for prioritization, consensus building and budgeting and to translate the strategy into detailed action plans supported by a thorough monitoring and evaluation mechanism. The objective of the Public Sector Reform component would be to facilitate a reform initiative in the public sector which would be comparable to that achieved through FINSSP in the financial sector in recent years. While this project component might support future implementation of selected activities under some of these action plans through collaboration with Development Partners, any more substantive engagement by the World Bank would be covered through a supplemental financing under this project. It is proposed to design this project component with an open architecture to maximize the involvement of interested Development Partners (DPs). Revised Project Development Objectives (as approved by original approving authority) To support the Borrower to perform its role as a facilitator for economic development through: (i) implementation by Ministries, Departments and Agencies (MDAs) of a reform initiative for improved public sector management and service delivery; and (ii) strengthening the governance and competitiveness of the financial sector.

iv

(a) PDO Indicator(s)

Indicator Baseline Value

Original Target Values (from

approval documents)

Formally Revised Target Values

Actual Value Achieved at

Completion or Target Years

Indicator 1 : Enhanced structure, strategy and responsibility within government for public sector reform

Value quantitative or Qualitative)

MPSR established but not funded by Govt. budget; A MPSR PSR strategy adopted; and Responsibility for PSR among Govt. agencies not clearly defined

Enhanced structure, strategy and responsibility achieved

n.a.

Ballpark cost of PSR strategy available Status not clear on broad-based endorsement, and responsibility for PSR among Govt. agencies

Date achieved 10/19/2005 12/29/2006 12/29/2006 12/18/2007 Comments (incl. % achievement)

Target largely not achieved Indicator might be outdated as targets taken place before project approval Source (Dec07 data): 2006 GOG/DPs MOU and Nov07 Project Paper

Indicator 2 : Establishment of a new pay range structure Value quantitative or Qualitative)

Nil New pay range structure established

New pay range structure established

Single Spine Pay Structure established


Target date extended by Jun11 restructuring, and target achieved Source (Jun11 data): June 2012 ISR and MOFEP 2011 Annual Progress Report

Indicator 3 : Portion of civil service recruitment and promotion based on new merit based system


Nil 60% n.a. Status not clear


Target dropped as related activity was suspended after 2009 MTR Status (% of staff under new system) unknown as of closure of PSR part, although a new merit system was prepared

Indicator 4 : Government subvention for selected subvented agencies reduced Value quantitative or Qualitative)

Nil 35% n.a. Status not clear


Target dropped by Jun11 restructuring Status (% reduction) unknown as of closure of PSR part, although payments for retrenchments made to four targeted subvented agencies

Indicator 5 : 20% increase in private sector credit (including bonds)/GDP Value quantitative or Qualitative)

15% (Gross banking credits to private corporations/GDP

16% 27% 83.8% (an average annual increase in 2006 – 2012 – old

v



approval documents)

Formally Revised Target Values



(excluding bonds) series) Date achieved 12/31/2005 12/31/2010 12/30/2012 12/31/2012

Comments (incl. % achievement)

Revised target exceeded Indicator not appropriate for FSR part of PDO (governance and competitiveness), and attribution to project interventions problematic Source (Dec12 data): BOG

Indicator 6 : 20% increase in private sector savings/GDP


10.6% (Gross private enterprise deposits/GDP) 18% 22%

250% (an average annual increase in 2006 – 2012 – old series)

Date achieved 12/31/2005 12/31/2010 12/30/2012 05/10/2013


Revised target exceeded Indicator not appropriate for FSR part of PDO (governance and competitiveness), and attribution to project interventions problematic Source (Dec12 data): BOG

Indicator 7 : Increase in access to finance Value quantitative or Qualitative)

n.a. n.a. n.a. Status not clear


Indicator without numerical, monetary or descriptive target, and status unknown as of Nov07 when indicator was dropped

Indicator 8 : Percentage growth in No. of deposit accounts at CBs and RCBs


(a) 15% growth - Commercial Banks (b) 23% growth - Rural Community Banks

n.a.

(a) 10% growth - Commercial Banks (b) 6% growth - Rural Community Banks

See data on IO


Target added by Dec07 restructuring as a PDO indicator, but moved to IR level by Jun11 restructuring with reduced sub-targets ICR assessment provided under relevant IO

(b) Intermediate Outcome Indicator(s)



approval documents)

Formally Revised

Target Values



Indicator 1 : Initiation of a substantive reform program at a MDA Value Nil Substantive reform n.a. Pay reforms

vi



approval documents)

Formally Revised

Target Values



(quantitative or Qualitative)

program at an MDA initiated

initiated at several MDAs


Target achieved Source (Dec07 data): Nov07 Project Paper

Indicator 2 : Percentage of public servants remunerated on the basis of a unified national pay spine

Value (quantitative or Qualitative)

0% n.a.

70% of public servants remunerated on the basis of a unified national pay spine

98% public sector employees migrated to SSPS


Target added by Dec07 restructuring but dropped by Jun11 restructuring Dropped target nevertheless exceeded 6 months after closure of PSR part Source (Dec12 data): MOFEP 2011 Annual Progress Report

Indicator 3 : Percentage of positions for which satisfactory job descriptions exist Value (quantitative or Qualitative)

0% n.a. 60% Status not clear

Date achieved 12/18/2007 12/18/2007 06/30/2011 06/30/2011


Target added by Dec07 restructuring but dropped by Jun11 restructuring Related subcomponent suspended after 2009 MTR Status of achievement unknown by closure of PSR part, although a performance management system was drafted and piloted

Indicator 4 : Percentage of civil servants receiving fully completed annual performance appraisals based on revised performance management system



Date achieved 12/18/2007 06/30/2011 06/30/2011 06/30/2011


Target added by Dec07 restructuring but dropped by Jun11 restructuring Related subcomponent suspended after 2009 MTR Status of achievement unknown by closure of PSR part, although a performance management system drafted

Indicator 5 : Percentage of public servant HR data available through secure HR website Value (quantitative or Qualitative)


Date achieved 12/18/2007 12/18/2007 06/30/2011 06/30/2011 Comments (incl. %

Target added by Dec07 restructuring but dropped by Jun11 restructuring Related subcomponent suspended after 2009 MTR

vii



approval documents)

Formally Revised

Target Values



achievement) Status of achievement unknown by closure of PSR part

Indicator 6 : No. of civil servants receiving satisfactory evaluations on training 3 months after completion


40 n.a. 420 Status not clear

Date achieved 12/31/2006 12/31/2006 06/30/2011 06/30/2011


Target added by Dec07 restructuring but dropped by Jun11 restructuring Status of achievement unknown as of closure of PSR part, although the dropped target was reported as achieved without specific value by closure of whole project

Indicator 7 : Percentage of customers who are satisfied with services provided by CSU Value (quantitative or Qualitative)

Baseline not available n.a. 80% Status not clear

Date achieved 12/18/2007 06/30/2011 06/30/2011


Target added by Dec07 restructuring but dropped by Jun11 restructuring Status of achievement unknown as of closure of PSR part, although the dropped target was reported as achieved without specific value by closure of whole project

Indicator 8 : Percent of complaints registered at CSU resolved in less than one month Value (quantitative or Qualitative)

Baseline not available n.a. 80% Status not clear

Date achieved 12/18/2007 06/30/2011 06/30/2011


Target added by Dec07 restructuring but dropped by Jun11 restructuring Related subcomponent suspended after 2009 MTR; and status of achievement unknown, although the dropped target was reported as achieved without specific value

Indicator 9 : No. of MDAs Publishing Service Standards (45 by 2011) Value (quantitative or Qualitative)

23 n.a. 45 Status not clear

Date achieved 12/18/2007 06/30/2011 06/13/2011 Comments (incl. % achievement)

Target added by Dec07 restructuring but dropped by Jun11 restructuring Status of achievement unknown by closure of PSR part, although it was reported that 122 MDAs published service standards by closure of whole project

Indicator 10 : No of agencies publishing data on progress on achieving service standards Value (quantitative or Qualitative)

Nil n.a. 25 Status not clear


Target added by Dec07 restructuring but dropped by Jun11 restructuring Status of achievement unknown as of closure of PSR part

viii



approval documents)

Formally Revised

Target Values



Indicator 11 : Percentage of outputs in their MOUs completed by CMAs under reform (PSC, OHCS, SEC, CAGD, MOFEP)



Date achieved 12/18/2007 12/18/2007 06/30/2011 06/30/2011


Target added by Dec07 restructuring but dropped by Jun11 restructuring Status of achievement unknown by closure of PSR part, although reportedly PSC achieved 100% completion, OHCS 100%, SEC 60% and CAGD 70% plus FWSC 100% by closure of whole project

Indicator 12 : MOU on the pooled account for PSR signed among DPs and GOG is complied with


Nil n.a. MOU complied with

No pooled fund for PSR


Target added by Dec07 restructuring but dropped by Jun11 restructuring Target not achieved Source (Jun11 data): Bank team feedback and Bank TF records

Indicator 13 : Civil Service Law (1993) is reviewed, finalized and resubmitted to Cabinet


Existing law outmoded n.a. CS law reviewed and presented

CS law revised and submitted to Civil Service Council and PSRS Secretariat


Target added by Nov07 restructuring but revised by Jun11 restructuring Revised target achieved Source (Jun11 data): June 2012 ISR

Indicator 14 : Fair Wages and Salary Commission is strengthened and resourced to implement the New Pay Policy


Nil n.a.

FWSC received support for technical consultancies and equipment

FWSC received 9 consultancy reports; and 3 vehicles and office equipment acquired

Date achieved 12/31/2006 12/31/2006 06/30/2011 06/30/2011


Target added by Jun11 restructuring Target achieved based on significant progress in implementing the SSPS by FWSC Source (Jun11 data): June 2012 ISR and MOFEP's 2011 Progress Report

Indicator 15 : Institutional and staff census by Ghana Education Service to identify ghost workers and delete them from payroll is completed

Value (quantitative Nil n.a. Census

completed Status not clear

ix



approval documents)

Formally Revised

Target Values



or Qualitative) Date achieved 12/31/2008 12/31/2008 06/30/2011 06/30/2011


Target added by Dec07 restructuring but relevant subcomponent suspended after 2009 MTR Status of achievement (deletion of ghost workers) unknown as of closure of PSR part, although target reported as achieved by closure of whole project

Indicator 16 : Long-Term Savings Act amended to address tax and regulatory issues


Nil LT Savings Act amended as necessary

n.a.

LT Savings Act was repealed by 2008 National Pensions Act


Target no longer relevant after 2008 new pensions law Source (Dec08 data): Bank team ISRs and FSD/MOFEP

Indicator 17 : Percentage of regulated institutions inspected by GSEC using agreed template Value (quantitative or Qualitative)

20% 100% 50% 58%


Target achieved but attribution to project interventions problematic Source (Dec12 data): FSD/MOFEP

Indicator 18 : Average time for GSEC to review finalized IPO proposals as per SEC guidelines Value (quantitative or Qualitative)

6 weeks 4 weeks 4 weeks 4 weeks


Target achieved Source (Dec12 data): FSD/MOFEP

Indicator 19 : BOG compliance with relevant BCPs


50% 80% 100%

100% (1999 methodology) 88% (2006 methodology)


Target achieved Source (Dec12 data): FSD/MOFEP

Indicator 20 : Percentage of checks cleared through ACH and online check clearing within the same day (95% by 2008)


95% checks cleared within 3 days

95% checks cleared within 2 days

n.a. Over 95% of checks cleared through automated

x



approval documents)

Formally Revised

Target Values



codeline system within a day


Target dropped by Dec07 restructuring Dropped target achieved Source: BOG

Indicator 21 : Percentage of banks and NBFIs supervised based on an agreed template


90% onsite inspections of banks Ad hoc onsite inspections of NBFIs

100% banks and NBFIs within last 12 months

100% banks and NBFIs within last 12 months

100%


Target date revised by Jun11 restructuring Target achieved, but attribution to project interventions problematic Source (Dec12 data): FSD/MOFEP

Indicator 22 : Responsibility for supervision of RCBs and CUs clarified through legislation


Responsibilities not clarified

Appropriate legislation enacted

Appropriate legislation enacted (ARB Apex Bank by 2007 and CUA by 2008)

Draft Credit Union Bill submitted to Cabinet which clarifies supervision responsibility for CUA No draft legislation on RCB supervision was developed


Target partially achieved Source (Dec12 data): FSD/MOFEP

Indicator 23 : NIC Compliance with IAIS CPs as determined by ROSC review Value (quantitative or Qualitative)

31% 60% 100% 68%


Target revised by Jun11 restructuring Target partially achieved, but attribution to project interventions problematic Source (Dec12 data): FSD/MOFEP

Indicator 24 : Percentage of insurance companies inspected within the year by NIC based on agreed template


30% 100% 100% 56%

Date achieved 12/31/2005 12/31/2008 06/30/2011 12/31/2012 Comments (incl. %

Target date revised by Dec07 restructuring Target partially achieved, but NIC moving to risk-based supervision

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approval documents)

Formally Revised

Target Values



achievement) Source (Dec12 data): FSD/MOFEP Indicator 25 : Secondary market turnover as % of market capitalization


0.59% of GDP (3.6% of market capitalization)

1.5% of GDP 5% of market capitalization

2.05% (excluding AGA and TLW – Average annual turnover of capitalization)


Target revised by Jun11 restructuring Target not achieved, and had a weak pathway with planned project interventions Source (Dec12 data): FSD/MOFEP

Indicator 26 : No. of new equity issues in the Ghanaian market is four each year


Average 2 new listings (2001-2003)

Number of equity new issues in Ghanaian market is 4 each year (total of 24 new issues in 2006 - 2011)

Number of equity new issues in Ghanaian market is 4 each year (total of 28 new issues in 2006 - 2012)

11 additional listings and 9 new right issues (2006 – 2012 total)


Target date revised by Jun11 restructuring Target was not achieved and less relevant with project interventions Source (Dec12 data): FSD/MOFEP

Indicator 27 : Dematerialized trading takes place through a demutualized exchange with automated clearing and settlement on T+3 basis


GSE not demutualized and RTGS not fully operational

Dematerialized trading takes place through a demutualized exchange on an automated clearing and settlement platform on a T+3 basis with RTGS

Dematerialized trading takes place through a demutualized exchange with automated clearing and settlement on T+3 basis

Dematerialized trading with automated clearing and settlement on T+3 basis; but demutualization was not completed


Target revised by Jun11 restructuring, and target partially achieved Source (Dec12 data): FSD/MOFEP

Indicator 28 : No. of private funds established and operating Value (quantitative or Qualitative)

4 private investment funds



217 private investment funds (2006 – 2012 total)

xii



approval documents)

Formally Revised

Target Values




Target date revised by Jun11 restructuring, and target exceeded Source (Dec12 data): FSD/MOFEP

Indicator 29 : Percentage of contribution to private pension schemes/total mandatory contributions in pension sector


Nil

10% (Voluntary contributions by individuals/Total mandatory contributions to SSNIT)

15% of contribution to private pension schemes/total mandatory contributions in pension sector

28% of pension contributions after 2008 new law


Target revised by Dec07 restructuring, and target exceeded Source (Jun12 data): ICR author estimate based on 2008 law

Indicator 30 : Percentage of SSNIT assets under management by private investment funds Value (quantitative or Qualitative)

20% held in special term deposit accounts at banks and NBFIs

65% of portfolio assets

65% of portfolio assets

Status not clear


Target date revised by Jun11 restructuring, and target should have been dropped after the 2008 law adopted a new approach towards diversification

Indicator 31 : Evidence of improved governance of 4 state-influenced FIs resulting from the adoption of governance plans


Nil Governance plan adopted for 3 out of 4 SIFIs

n.a. Status not clear


Target dropped by Dec07 restructuring, but no report on status of achievement at the time

Indicator 32 : No. of Credit Bureaus licensed and operating Value (quantitative or Qualitative)

No. of Credit Bureaus licensed and operating

CB Law promulgated

4 CBs licensed and operating

2 credit bureaus established and operational


Target revised by Dec07 and Jun11 restructurings Target partially achieved, but attribution to project interventions problematic Source (Dec12 data): FSD/MOFEP

Indicator 33 : Increase in volume of formal remittance transactions

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approval documents)

Formally Revised

Target Values




13% of GDP 15% of GDP n.a. Status not clear


Target dropped by Dec07 restructuring, and no report on status of achievement as of Dec07

Indicator 34 : Cost of remitting GBP100 from UK reduced Value (quantitative or Qualitative)

3% - 5% n.a. 1.5% - 2% Status not clear


Target added by Dec07 restructuring but dropped by Jun11 restructuring No report on status of achievement as of Jun11

Indicator 35 : No. of remittance products developed and approved


Nil n.a.

2 bankable remittance-related products by Bank of Ghana

Status not clear


Target listed as dropped by Jun11 restructuring, and no report on status of achievement as of Jun11

Indicator 36 : Financial services surveys undertaken Value (quantitative or Qualitative)

Nil At least 2 surveys n.a. One FinScope demand-side survey


Target achieved with delay Source (Jan10 data): FinScope

Indicator 37 : Domestic debt auctions carried out under direction of MOFEP strategy (integrated approach to Treasury management)


MOFEP did not direct and define Govt debt strategy

Integrated approach to treasury management by MOFEP established

n.a.

Debt strategy published with national budget, which is a guidance on strategy over medium-term


Target achieved although dropped by Dec07 restructuring Source (Nov08 data): DMD/MOFEP

xiv



approval documents)

Formally Revised

Target Values



Indicator 38 : A new framework for public and private pension design and regulation is implemented


Newly established PCPR published interim report

White paper and legislation drafted on a reformed pensions system, including establishment of data, funds and oversight implementation parameters

Implementation of rules and regulations by NPRA

New pensions law promulgated in 2008 and is under implementation


Target achieved with EMCB contributions on law drafting and NPRA operation Source: Bank team ISRs

Indicator 39 : Policy on PPP approved by Cabinet Value (quantitative or Qualitative)

Nil n.a. PPP policy approved by Cabinet

National PPP policy adopted by Cabinet


Target added by Jun11 restructuring, but by then it appeared to have been achieved Related activity removed to the PPP Project

Indicator 40 : Percentage growth in No. of deposit accounts at (a) commercial banks and (b) RCBs


(a) CBs - 15% growth (b) RCBs- 23% growth n.a.

(a) CBs - 10% growth (b) RCBs - 6% growth

(a) CBs - 16.2% (average annual increase in 2006 – 2012) (b)RCBs - 10.2% (average annual increase in 2006 – 2012

Date achieved 12/31/2005 12/31/2005 12/30/2012 12/31/2012


Target first added by Dec07 restructuring as a PDO indicator, and then moved to IR level by Jun11 restructuring Target exceeded, but attribution to project interventions problematic Source (Dec12 data): FSD/MOFEP

Indicator 41 : Strategic partner(s) participate in Venture Capital Fund


Strategic partner(s) participate in Venture Capital Fund

Competent advisor providing technical assistance

n.a.

VCTF sponsored 5 indigenous VC funds ($57.2 million in total, and 46 SME investees)

xv



approval documents)

Formally Revised

Target Values



Date achieved 12/31/2005 12/31/2006 12/31/2006 12/31/2012


Target achieved (albeit dropped by Dec07 restructuring), with EMCB contributions on capacity building and portfolio review (ongoing as of closure of whole project) Source (Dec12 data): VCTF

G. Ratings of Project Performance in ISRs

No. Date ISR Archived DO IP

Actual Disbursements (USD millions)

1 03/03/2006 Satisfactory Satisfactory 0.00 2 10/05/2006 Satisfactory Moderately Satisfactory 1.67 3 06/20/2007 Satisfactory Moderately Satisfactory 3.06 4 12/20/2007 Satisfactory Moderately Satisfactory 4.39 5 06/30/2008 Satisfactory Moderately Satisfactory 7.39 6 12/25/2008 Satisfactory Moderately Satisfactory 12.05

7 06/29/2009 Moderately Unsatisfactory

Moderately Unsatisfactory 19.01

8 12/22/2009 Moderately Unsatisfactory

Moderately Unsatisfactory 20.40

9 06/30/2010 Moderately Satisfactory Moderately Satisfactory 22.19 10 03/25/2011 Moderately Satisfactory Moderately Satisfactory 25.76 11 08/10/2011 Moderately Satisfactory Moderately Satisfactory 27.40 12 07/11/2012 Moderately Satisfactory Moderately Satisfactory 32.01 13 01/31/2013 Moderately Satisfactory Moderately Satisfactory 33.98 14 05/29/2013 Moderately Satisfactory Moderately Satisfactory 35.06

xvi

H. Restructuring (if any)

Restructuring Date(s)

Board Approved

PDO Change

ISR Ratings at Restructuring

Amount Disbursed at

Restructuring in USD millions

Reason for Restructuring & Key Changes Made DO IP

12/18/2007 Y S MS 4.39

(a) Revision of PDO to mainly reflect the expanded scope of PSR part, from the original "(i) facilitating a reform initiative for improved public sector management and service delivery" (DCA version) to "(i) implementation by MDAs of a reform initiative for improved public sector management and service delivery"; (b) Provision of additional IDA financing (USD10 million equivalent) for ongoing and new PSR activities (including severance payments), as well as for financing taxes of eligible expenses; (c) Revision of Results Framework, mainly to add more than a dozen PSR indicators (refer to Section F of this Datasheet for details)

06/16/2011 MS MS 27.30

(a) Extension of closing date of FSR part from 06/30/2011 to 12/30/2012 to allow completion of planned project activities; (b) Wrap-up of PSR part by original closing date; (c) Reallocation of IDA financing among FSR components (reduction of funding for Component B – C to increase funding for Component D – G); and (d) Revision of Results Framework, to retroactivel recognize de facto suspension of a number of PSR activities after 2009 MTR, and to add new IR level indicators to FSR part (refer to Section F of this Datasheet for details)

01/02/2013 MS MS 33.29 Extension of closing date of FSR part from 12/30/2012 to 05/31/2013 to allow completion of remaining FSR activities

If PDO and/or Key Outcome Targets were formally revised (approved by the original approving body) enter ratings below: Outcome Ratings Against Original PDO/Targets Moderately Unsatisfactory Against Formally Revised PDO/Targets Moderately Satisfactory Overall (weighted) rating Moderately Unsatisfactory

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I. Disbursement Profile

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1. Project Context, Development Objectives, and Design 1.1 Context at Appraisal 1. Country background: Ghana’s economy was poised to accelerate in 2004 after years of efforts in restoring macroeconomic stability and executing fiscal policy reforms. Real GDP grew by 5.8 percent, the highest since 1992. The stronger economic growth was driven mainly by the favorable terms of trade for cocoa and gold exports, and increases in private remittances. Foreign exchange reserves reached closer to four months of imports. Progress made in public expenditure management enabled Ghana to achieve seven out of sixteen HIPC PEM benchmarks. The authorities started to use more market-based instruments (e.g. Monetary Policy Committee and prime rate). Improved macroeconomic management led to a sharp drop in inflation, from 40 percent in 2000 to 11.8 percent in 2004. The peaceful presidential election in December 2004 enhanced a positive economic outlook in the short to medium term. The World Economic Forum rated Ghana as an “ascending competitive” country in Africa. 2. Economic structural change, however, did not progress well and the country remained vulnerable to external shocks (e.g. worsening of terms of trade). The economy relied heavily on the exports of a few primary commodities: cocoa, gold and timber accounted for more than 70 percent of total export earnings. The size of the government was large, with the State involved extensively in utilities, enterprises and banking. Government’s wages and debt interest payments accounted for 69 percent of total budgetary revenues (including grants), leaving little room for increased allocation for basic education, public health and infrastructure investment. Business environment was far from conducive to private sector development, due to high regulatory and administrative cost, inadequate infrastructure, shortage of skilled labor, and difficulties in access to affordable or longer-term financing. Foreign direct investment (inflows) went down from an annual average of US$140 million in 1994 - 1999 to that of US$124 million in 2000 – 2005.1 3. Public sector: Ghana underwent rounds of public sector reforms (in particular civil service reforms) supported by several development partner projects since mid-1990s. The results achieved were regarded as insignificant. At appraisal the main issues identified for the purpose of the EMCB Project included: (i) weak policy and implementation coordination among different agencies and between central and local governments; (ii) lack of proper training and compensation; and (iii) inadequate governance. Other problems identified related to equipment and resources allocation, record keeping and information management, and the public service pension system (modest coverage but costly). 4. Financial sector: Ghana’s financial sector at the time of project appraisal was characterized by limited financial intermediation, predominance of four commercial banks, high exposure to the public sector, weak performance of state-influenced institutions, and dominance of the Social Security and National Insurance Trust (SSNIT) in the insurance and pension

1 unctad.org

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industries. Stock market was small and inactive. Those features are summarized in the following table. Table 1: Financial Sector Overview Indicator 2003 (%) Total assets to GDP 39.0 Credit to private sector to GDP 12.5 Population having access to bank accounts <10.0 Banking industry exposure to public sector (share of loans and government debt holdings in total assets) >35.0

Share of Ghana Commercial Bank in total assets 19.7 Share of three largest foreign banks 38.7 Interest margin 10.6 Stock market capitalization to GDP 18.7 Stock market turnover ratio (value traded to market capitalization) 4.1 Insurance premiums to GDP 0.85 Share of SSNIT in total premiums written (2001) 84.3 Sources: the World Bank, IMF 5. Banks were profitable thanks to the comfortable interest margin, but the banking system was vulnerable because of loan concentration and high level of past-due loans. SSNIT was a large owner of a number of banks but its financial position was undermined by weak governance and extensive government interference in funding management and investment decisions. The compliance of Bank of Ghana (BOG) with the Basel Core Principles for Effective Banking Supervision (BCPs) was considered as of relatively high level at the appraisal time. Main shortcomings were found in supervisor autonomy, enforcement, consolidated supervision and information sharing. BOG was a leader in implementing many financial sector reforms, but in needs of institutional capacity building and upgrading of payments and operational systems. All regulators of Ghana’s financial markets including the BOG and those mentioned in the following paragraphs were said to have suffered from scarce resources and inadequate training. 6. The insurance industry was small (9.2 percent of GDP) and was regulated by the National Insurance Commission (NIC). Observance of the International Association of Insurance Supervisors (IAIS) Core Principles was assessed as low, despite improvements of NIC’s regulatory capacity. At appraisal, a new Insurance Law was drafted, and was expected to strength NIC’s mandate and remove the monopoly by the State Insurance Company and the Ghana Re.2 This would entail further challenges to NIC’s capacity in maintaining stability of the sector while fostering competition and growth of the industry. 7. Ghana’s securities market was regulated by the Ghana Securities and Exchange Commission (GSEC). The GSEC updated a number of regulations but was not yet fully compliant with the International Organization of Securities Commissions (IOSCO) Objectives

2 The draft eventually became the 2006 Insurance Act.

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and Principles. Main weaknesses were found in Quality and adequacy of disclosure, Management of conflict of interest, Rulemaking, and Shareholder redress. 8. Ghana’s microfinance landscape was populated by hundreds of small institutions. The formal institutions included Rural and Community Banks (RCBs), Savings & Loans and Credit Unions. Those institutions were regulated by the BOG. The supervision of RCBs took up nearly 70 percent of BOG’s supervision resources due to those institutions’ large number (123) and their geographical spread (countrywide). The capital markets were small and shallow, although Ghana Stock Exchange (GSE) saw a spectacular rise in new listings/issues and secondary market transactions in 2004. 9. Government strategy: The Government of Ghana recognized those development challenges and adopted a Ghana Poverty Reduction Strategy (GPRS 2004 - 2007) in February 2003. The GPRS targeted at accelerated economic growth over the medium to long term by maintaining macroeconomic stability, tackling impediments to private sector led growth, and fostering new sources of growth. Improvement of public sector management was another strategic priority. 10. Public sector reform strategy: In May 2005, the Government established the Ministry of Public Sector Reform (MOPRS) as the leader for the preparation and implementation of public sector reforms. A Public Sector Reform (PSR) strategy in the form of a Comprehensive Work Program was adopted three months later. The PSR strategy aimed to improve effectiveness, efficiency and accountability of the public sector. Particular attentions were given to the appointment and remuneration of the civil service leadership; the mandate and structure of the civil service; human resource management and compensation policies; financial management; as well as operational procedures and uses of information technology. 11. Financial sector reform strategy: The Government also adopted a Financial Sector Strategic Plan (FINSSP) in 2003 to address the constraints to access to finance over a period of eight to ten years. FINSSP contained 98 core tasks to be implemented through 500 detailed activities and incorporated various recommendations from the 2001 Financial Sector Assessment Program (FSAP) and the FSAP Update of 2003. By 2004 – 2005, 90 detailed activities were completed, such as the passing by the Parliament of four important laws.3 The strategy was strongly owned by both the market participants and the Government. It was envisioned that the planned reforms under FINSSP would enable Ghana’s financial sector to become “efficient in the mobilization and allocation of funds, fully integrated with the global financial system and supported by a regulatory system that promotes a high degree of confidence.”4 12. Bank strategy: To support the GPRS objectives, the Bank’s 2004 – 2007 Country Assistance Strategy aimed to achieve accelerated economic growth and employment generation through managing macroeconomic stability, removing constraints to private sector investment, and harnessing the sources of growth. The Bank strategy also highlighted the importance of

3 Banking Bill, Payment System Bill, Venture Capital Fund Bill, and Long Term Savings Bill 4 2003 National Budget Statement

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improved and decentralized public sector management for better service delivery. While a main instrument for achieving those and other CAS objectives was the budget supporting Poverty Reduction Support Credit (PRSC) series, non-lending activities were planned to support the implementation of the recommendations of the 2003 IMF-World Bank FSAP Update. Topics to be covered in particular included development of an efficient financial intermediation system, creation of a market for financial assets transfer, and anti-money laundering assessment. Support to the public sector management reforms included analytical work on decentralization and capacity building. The Bank strategy also recognized the need for targeted capacity building operations to support the implementation of the Government poverty reduction and sectoral reform strategies. 13. Development partnership: Donor coordination was strengthened when the Government implemented the Multi-donor Budget Support framework (MDBS) in 2003. The CAS was developed within the MDBS, with the PRSC series as the main instrument for joint development partner programs. Nine development partners (DPs, including the Bank) also agreed to re-orient their support at the sector level towards programmatic lending and multi-donor funding. 14. EMCB Project: Against the above background, the Bank at the request of the MOPSR and the MOFEP approved the Ghana Economic Management and Capacity Building Project (EMCB or the Project) in November 2005 to support the development and implementation of government strategies on public sector reform (PSR) and financial sector reform (FSR). The Project was originally financed by an IDA credit of USD25 million equivalent and GOG counterpart funding of USD8.7 million. During project implementation, the Bank provided an Additional Financing of USD10 million equivalent to mainly finance the up-scaled PSR component. In addition, the UK Government’s Department for International Development (DFID) provided a grant of USD5.2 million equivalent5 and the Switzerland Government’ State Secretariat for Economic Affairs (SECO) USD2.4 million to co-finance the FSR components. 1.2 Original Project Development Objectives (PDO) and Key Indicators (as approved) 15. The original PDO as stated in the Project Appraisal Document (PAD) was: “The proposed project aims at supporting the government to define and perform its role as a facilitator for economic development. The project seeks to establish a level playing field in the finance sector focusing upon outcomes rather than establishing new institutions, together with a clear policy to improve the efficiency of public sector management for an enhanced service delivery. The project, through support to FINSSP, will seek to catalyze the allocation of capital to Ghanaians and improve competitiveness and governance of long term savings institutions and markets. The project also aims to strengthen the Public Sector Reform Strategy through providing a framework for prioritization, consensus building and budgeting and to translate the strategy into detailed action plans supported by a thorough monitoring and evaluation mechanism. The objective of the Public Sector Reform component would be to facilitate a reform initiative in the public sector which would be comparable to that achieved through FINSSP in the financial sector in recent years. While this project component might support

5 At the windup of the DFID grant in June 2011, USD2.7 million had been utilized by the Project and the rest of the DFID funding was cancelled.

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future implementation of selected activities under some of these action plans through collaboration with Development Partners, any more substantive engagement by the World Bank would be covered through a supplemental financing under this project. It is proposed to design this project component with an open architecture to maximize the involvement of interested Development Partners (DPs).” 16. The Development Credit Agreement (DCA) of the Project streamlined the PDO as follows: “The objective of the Project is to support the Borrower to perform its role as a facilitator for economic development through: (i) facilitating a reform initiative for improved public sector management and service delivery; and (ii) strengthening the governance and competitiveness of the financial sector.” 17. The original outcome indicators (i.e. the key indicators) as stated in the PAD were:

(i) Enhanced structure, strategy and responsibility within government for public sector reform by end 2006

(ii) 20 percent increase in private sector credit (including bonds)/GDP by closing date

(iii) 20 percent increase in private sector savings/GDP

(iv) Increase in access to finance since project implementation.

18. The DCA contained the same indicators with minor wording variations, except for the fourth indicator which was not included. 1.3 Revised PDO (as approved by original approving authority) and Key Indicators, and reasons/justification 19. The original PDO was revised in the December 2007 project restructuring, mainly to reflect the extended scope of the Public Sector Reform (PSR) part of the Project. The revised PDO was: “To support the Borrower to perform its role as a facilitator for economic development through: (i) implementation by Ministries, Departments and Agencies (MDAs) of a reform initiative for improved public sector management and service delivery; and (ii) strengthening the governance and competitiveness of the financial sector.” 20. The outcome indicators in particular those of the PSR part of the project were revised, added or cancelled by the December 2007 and the June 2011 project restructurings. The key indicators as of the project closing date (May 2013) were:

(i) Establishment of new pay range structure to guide pay awards by 2011 (PSR objective);

(ii) Private sector credit (including bonds)/GDP ratio increases by 27 percent by end-2012 (FSR objective, which is the gross banking credits to private corporations as a percentage of GDP per BOG definition); and

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(iii) Private sector savings/GDP ratio increases by 22 percent by end-2012 (FSR objective, which is the gross deposits by private sector enterprises at banks as a percentage of GDP per BOG definition).

1.4 Main Beneficiaries 21. No specific direct beneficiaries or primary target groups were identified at appraisal. Based on the project design it appears that the EMCB was intended to directly target the public administration and the financial service regulators. The ICR review of the lists of implementing agency (cum beneficiaries) by the closing dates of the PSR part (June 2011) and the FSR part (May 2013) indicates that the PSR part had ten beneficiaries (e.g. Public Service Commission and Office of Head of Civil Service). Under the FSR part, there were also ten direct beneficiaries (e.g. Bank of Ghana, Ghana Securities and Exchange Commission, Ghana Insurance Commission, Ghana Pension Regulatory Authority, and Ministry of Finance and Economic Planning).6 1.5 Original Components (as approved) 22. Seven components were designed to achieve the project objectives. Each component in turn consisted of several subcomponents and some of them were further split up. Altogether there were 12 areas for PSR support and 31 subcomponents/main activities for FSR support. Those components and subcomponents as approved are summarized below. 23. Component One – Public Sector Reform (Part A): This component was to support the development of a framework for prioritization, consensus building and budgeting of public sector reform objectives. It would also support the development of action plans with monitoring and evaluation strategies for the planned reforms, and implementation of reform initiatives in Ministries/Departments/Agencies (MDAs). The component was originally managed and implemented by the MOPSR.7 No specific or main activities were designed for the development of the said framework at appraisal, although the legal documents indicated that specific activities of this part of the Project would be agreed upon between the Government and the participating Development Partners through a Memorandum of Understanding (eventually signed off in March 2006). The Project Appraisal Document (PAD) indicated the following 12 broad areas as candidates for project support.8

(i) Civil Service training program

(ii) Service delivery improvement (customer service standard programs)

(iii) Public Sector Pay Policy and Pension Reform

6 FOR the list of the project beneficiaries, please refer to Section A of the Datasheet. 7 The MOPSR was said to have been established for the sole purpose of developing and implementing a PSR strategy. The ministry was dissolved in early 2009 after the 2008 Presidential election, and the Public Sector Reform Secretariat (PSR Secretariat) became the successor for project implementation. 8 EMCB Project Appraisal Document (Report No: 33791-GH), October 19, 2005,

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(iv) Establishment of Human Resource Management policies

(v) Restructuring MDAs, Central Management Agencies (CMAs) and Strategic Management

Agencies (SMAs)

(vi) Decentralization

(vii) Development communication enhancement program

(viii) Information and Communications Technology

(ix) Support to judicial training program

(x) Support to Parliament

(xi) Establishment of a procurement cadre in the Civil Service

(xii) Subvented Agencies

24. Component 2 – Regulation of Financial Markets (Part B): The Component was mainly to strengthen the Ghana Securities Exchange Commission (GSEC, the implementing agency – IA). At appraisal, the following five main activities were envisaged for achieving this goal:9

(i) Technology upgrading

(ii) Technical assistance including capacity building in the areas of supervision, surveillance and enforcement

(iii) Amendment of the 2004 Long-Term Savings Act

(iv) Development, regulation and supervision of the Long-Term Savings (LTS) Agency

(v) GSEC’s public education campaign

25. Component 3 – Banking and NBFI Regulation (Part C): This was a BOG (IA) strengthening component. The component consisted of the following main activities:

(i) Reviews of the structure of the Banking Supervision Department, the fit of various departments in the overall organizational structure and the HR salary structure

(ii) Preparation and drafting of several laws (e.g. Credit Bureaus law)

9 This is based on the main text of the PAD and the DCA. Annex 4 of the PAD indicated that the component would also support Commodity Exchange Market and Over-the-Counter Market.

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(iii) Improvements of the technological base

(iv) Clarification of regulatory and supervisory responsibilities between BOG and the Credit

Union Association (CUA) for credit unions, as well as between BOG and ARB Apex Bank for the rural community banks (RCBs)

(v) Strengthening of supervisory and regulatory capacity of BOG, CUA and ARB Apex Bank

26. Component Four – Insurance Regulation and Supervision (Part D): This Component aimed to support capacity building of the National Insurance Commission (NIC, the IA). The designed main activities included:

(i) Design of curriculum and strategic training plan for the insurance industry at the Insurance Industry Training Center (including support to the operation of the center)

(ii) Development of regulations

(iii) Insurance supervision capacity building

(iv) Capacity building of NIC’s research and actuarial units

27. Component Five – Strengthening of Capital Markets (Part E): This Component was to support the capacity building of Ghana Stock Exchange (GSE, the IA) which was the implementing agency. Specifically, the following main activities were to be carried out:

(i) Review of GSE rules and regulations

(ii) Improvement of capacity for management of business and regulatory risks of demutualization

(iii) GSE automation (linking the Central Securities Depository with an automated trading and settlement system)

(iv) Staff training for the GSE and market operators 28. Component Six – Pension Sector Development (Part F): This Component aimed to achieve what its title suggested, and the implementing responsibility was assigned to SSNIT at appraisal (but was transferred to the National Pensions Regulatory Agency in 2009). The main activities as designed were as follows:

(i) Strengthening of legislation for the governance of the pension sector by establishing a framework to transfer investment management to external, independent and regulated private investment fund managers

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(ii) Designing of a process for the outsourcing of SSNIT’s investment functions

(iii) Capacity strengthening of SSNIT staff in actuarial simulations against different medium-term reform scenarios

(iv) Strengthening of the timeliness and accuracy of data management at SSNIT 29. Component Seven – Access to Finance and financial Sector Governance (Part G): This Component sought to establish a strengthened banking and NBFI system that would provide a wide range of competitive products. There were multiple implementing agencies including, the Financial Sector Development Department (FSD), the Aid and Debt Management Unit (ADMU), and the Microfinance Unit of the Ministry of Finance and Economic Development (MOFEP), the Venture Capital Trust Fund (VCTF), the Presidential Commission on Pension Reform (PCPR), as well as the BOG. The objective of the Component was to be achieved through the following main activities:

(i) Development of a strategic vision and a governance framework for four State-Influenced Financial Institutions (SIFIs, Ghana Commercial Bank, Agricultural Development Bank, National Investment Bank and State Insurance Corporation)

(ii) Preparation and implementation by the FSD of GOG’s financial sector policies and

oversight of relevant agencies

(iii) Research by the BOG on cross-border capital flows

(iv) A FinScope approach survey of demand on access to finance

(v) Support to increased flow of remittances through improved payment systems (under Component Two), a grant facility targeting low income households, and research on remittance patterns

(vi) Establishment of a sound base for the governance and regulation of the VCTF

(vii) Support of the PCPR’s work program through several major activities10 (viii) Amendment of the Long-Term Savings Scheme Act and support of an appropriate tax

regime for the LTSA initiative

10 They included: Technical studies on the design of a comprehensive reform program; Provision of qualified actuaries; Training in a pension reform toolkit and an international core course on pension policy reform; A focused examination of incentives for voluntary savings by the informal sector; Evaluation of data management requirements, policy design options and regulation/supervision/oversight of different tiers of pension institutions consistent with the designed new public pension scheme; and Formulation of legal requirements for the new pension regime.

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(ix) Debt management strengthening through Segregation of MOFEP borrowing activity from the BOG Domestic Debt Desk; Restructuring of the government borrowing patterns towards longer term maturities; and Support of long-term debt market development and pricing

1.6 Revised Components

30. There were no formal revisions of components; although there were a number of readjustments of subcomponents/main activities (see Section 2 below for details).

1.7 Other Significant Changes

31. The Project was restructured three times which (respectively) expanded the project scope and scale, modified the Results Framework, reallocated IDA funding between components, and twice extended the closing date of the financial sector reform components.

32. First restructuring and Additional Financing (December 2007):11 An additional IDA credit of US$10 million equivalent was provided to Component One (Part A), Public Sector Reform to finance a number of reform initiatives (e.g. the pay reform) and staff severance payments of four subvented agencies, as well as taxes incurred in eligible expenditures under both parts of the Project. The restructuring for the first time since project appraisal clearly identified eight PSR subcomponents. The original Project Development Objective (see Section 1.3) was revised, and a number of PSR Intermediate Results (IR) indicators added. Several FSR IR indicators were also revised (see Section 2.3 for details).

33. Second restructuring (June 2011): The closing date of the FSR part (Component Two – Seven or Part B – G) was extended from June 30, 2011 to December 31, 2012, to support an evolving financial sector development agenda as reflected in FINSSP II (June 2011). The restructuring readjusted the focus of those components in order to better address issues identified by the 2011 FSAP update. IDA funding was reallocated between the FSR components, mainly to increase financing for Component Four – Seven (by reducing the funding for Component Two and Three, and the allocation of the unutilized Project Preparation Advances). The restructuring also revised the outcome indicators (see Section 1.3) and the intermediate results indicators.

34. Third restructuring (December 2012): This restructuring extended the closing date of the FSR components to May 31, 2013 to allow the completion of a few remaining activities of the FSR components.

11 The additional financing became effective in April 2008.

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2. Key Factors Affecting Implementation and Outcomes 2.1 Project Preparation, Design, and Quality at Entry 35. Project design: In general, project design benefitted from the availability of government reform programs and improved donor coordination at the sector level. In addition, the regular FSAP updates and the coordinated consultative process which led to the development and adoption of the FINSSP provided a favorable micro-environment for the FSR part of the Project: main hurdles to financial sector development had been identified and the financial sector reform strategy became owned by the main regulatory stakeholders which were also the project implementing agencies. However, the Project as designed was overly complex as it housed two very broad and challenging reform programs. A clear sign of project complexity is the sheer number of the implementing agencies (20). Commonsense tells us that the span of control of an institution or task management team is limited. Overstretching that span is a recipe for trouble. 36. PSR part: Public sector reforms (e.g. streamlining agencies and retrenchment schemes) are often politically charged with direct consequences for people’s career and/or livelihood. Affordability of the cost for the government budget is another common challenge.12 Research and practices before and around the time of project design show the following success factors are critical: Strong political will, Broadly-based consensus, and Careful sequencing. The Bank’s earlier experience in supporting public sector reforms in Ghana was not successful and two projects in this regard had been rated unsatisfactory. In addition to the absence of the success factors, a main constraint in Ghana was the lack of government capacity to implement a wide-scope reform program those projects supported. The design of the PSR part attempted to incorporate those lessons learnt. Government commitment to public sector reforms was considered as strong at appraisal, based on the meetings with the Minister of MOPSR, and the fact that a PSR strategy was adopted. But there was no documentation indicating consultations with other main stakeholders (e.g. other MDAs). On the other hand, the newly established Ministry of Public Sector Reform had not been funded by the budget. Various MDAs were taking the lead in a number of reforms which might not have been fully incorporated into the MOPSR’s strategy. It appears that inadequate attention was paid to signs of uncertainties in the ownership of the PSR component, leading to the challenges to ensure buy-ins by the main stakeholders during project implementation. 37. To address doubts about the appropriateness of the scope of the PSR component expressed at the Bank’s internal reviews including a Quality Enhancement Review (QER), the Project was said to only support the development of a framework for prioritization, consensus building and budgeting in the initial phase. Implementation of the reforms would be supported by additional IDA financing. The actual design of the PSR component as recorded in the PAD did not identify any main activities for the development of the framework with specific costing of the activities (e.g. diagnostics, research of international experience and sensitization workshops). Instead, the Appraisal left the Bank support open-ended by listing all the 12 broad

12 For example the estimated cost of the Ghana Public Sector Reform program was US$409 million at the time.

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areas of public sector reform in the MOPSR’s PSR strategy, making it difficult to monitor and assess implementation progress and project efficiency. 38. The PSR part was considered as quite risky at the Bank’s internal reviews before project appraisal. There were also questions on whether the Bank should involve in the public sector reforms through the EMCB ProjectOn the other hand, DFID strongly advocated Bank involvement in public sector reforms. At the time the development partner had involved in supporting the public sector reform agenda in Ghana for two decades. The management decision for project design was to (a) let DFID take the lead;13 (b) develop a strategy to either exit or scale up Bank involvement later during project implementation; and (c) support the strategy with a series of benchmarks. The decision was made with the knowledge of the previous failure of Bank operations in the sector. It appears an urge to quickly respond to a government request for continuous support of public sector reform overruled other equally important concerns (e.g. development impact and reputational risk). Furthermore, the recommended risk mitigation measures were not adopted in the eventual project design. 14 If the quality enhancement recommendations were adopted in project design, complexity (a major hurdle to implementation and outcomes) might have been reduced. 39. As early as the QER time questions were raised about synergies between this part of the Project and the FSR components. The decision to keep the PSR component under the Project was said to have been based more on internal budget and staffing considerations. At the time there might not be many options, but it turned out to be a costly decision in terms of project efficiency and achievement of objectives. 40. FSR part: The detailed analysis of the 2001 and 2003 FSAP provided feed to the design of the FSR components. The starting point of the design was clear from the conception phase, which was to support the implementation of FINSSP. There had been dialogues with the counterparts and a stakeholder workshop for the conceptualization of the components. Out of FINSSP’s 119 core tasks (later reduced to 98), the project design attempted to focus on establishing a common standard for financial sector regulation and institutional efficiency. Specific main activities were identified and cost of components estimated at appraisal. The design of this part of the Project enabled the Bank to support, with specific technical assistance activities, the implementation of its own recommendations in sector assessments and Government strategy, which is needed to enhance developmental impact. 41. Lessons learnt from the Bank financed NBFI Assistance Project and the Second Economic Reform Support Operation Credit were reportedly considered for the design of the FSR components. The difficulties those projects encountered in implementation were due to the complicated design and numerous small and unrelated components, which had limited the

13 DFID was later found to have only achieved mixed results from its support in the PSR area: “Assessing DFIC Support to Public Sector Reform in Ghana” by Gordon Evans, DFAIT, March 2008. In 2011, DFID Ghana decided to shift the focus of the country program away from the public sector as well as financial sector reforms to be better in line with the broader UK government priorities. 14 No exit option was explored at appraisal. While a scale up (additional financing) was indicated in the PAD, no benchmarks to anchor a decision on this option were provided. There was no indication of the respective role of DFID and the Bank under the EMCB Project. No pooled funding was secured.

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projects’ capacity to provide in-depth support in those areas critical to the achievement of project objectives. At the Bank’s internal reviews a more selective approach was recommended for the design of the FSR parts. In addition, several important technical issues were raised, such as the need for a gradual approach towards the proposed outsourcing of management of SSNIT investments, and the merit of giving priority to GSE demutualization given the development stage of Ghana’s stock market. However, the wide scope of the components was maintained at appraisal, which included those two and many other stand-alone activities in addition to the interventions specifically aimed to establish a common standard regulatory framework and improve institutional efficiency. Synergies (if any) between the components and the subcomponents were considered only as byproducts of a holistic approach, although this approach does not necessarily mean one has to deal with all the industries of the whole financial sector at once. Because of the wide span of control, more attention had to be paid to the conduct and processing during project implementation, rather than the effectiveness and efficiency of the activities. 42. Institutional arrangements: The project design treated the Project as two parallel projects in terms of institutional arrangement for implementation. The MOPSR and the FSD/MOFEP were to manage their respective parts of the Project separately as two stand-alone project management units (PMUs). Steering committees were envisaged for separate sector and donor coordination. However, there was no single owner to be held accountable for the whole project; no mechanism for collaboration and coordination between the two parts of the Project; and no arrangement for the monitoring and evaluation of the whole project. The separated institutional arrangement for project implementation was a main hurdle to timely responses to implementation problems based on the monitoring and reporting of the whole Project, as well as to efficient utilization of the project funding. 43. PSR part: The design of the institutional arrangement for the public sector reform part of the Project was at a highly generic level. Principles based on the experience of public sector reform funds in various countries were cited as the institutional arrangement for this part of the Project. The only detail available at appraisal was the coordination and technical meeting schedules, in addition to assigning the responsibility for PSR implementation to the MOPSR. There was no design on the specific responsibilities and accountabilities for the procurement, financial management and M&E functions, or analysis of the MOPSR staff capacity in managing Bank financed investment and technical assistance projects. There was a general mentioning of MDAs as implementing agencies without specifying which MDAs would be or were likely to be the implementing agencies. The lack of institutional arrangement was a sign that the design of the PSR part was inadequate for implementation. 44. FSR part: The design of the institutional arrangement for the implementation of the financial sector reform components was much advanced at appraisal. The newly-established FSD/MOFEP was assigned the overall responsibility for project implementation (including procurement planning and project financial management), as well as for coordination with the implementing agencies and the participating development partners. Internal and external coordination was to be conducted through two steering committees (one for coordination between the FSD/MOFEP and the IAs, and the other between the FSD/MOFEP and the participating DPs). The responsibilities and accountabilities of the six main implementing

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agencies were clearly defined. The institutional arrangement as designed was critical in holding together the six different components (with at least 31 planned activities at appraisal) for implementation monitoring. 45. SWAp approach: The Project was designed to take the SWAp (sector-wide approach program) approach. The Bank’s 2004 – 2007 Country Assistance Strategy highlighted the use of the approach and donors had agreed to coordinate sector interventions through similar approaches (e.g. program-based approach or PBA). At appraisal, this approach was new with a relatively short history in the World Bank’s portfolio, and in-depth knowledge was not available on the factors affecting the effectiveness of the approach. According to OPCS guidance (updated in 2011), a SWAp does not have to be whole sector wide. It could be thematic or sub-sector wide. OPCS also made it clear early on that the SWA concept could be applied to a variety of Bank financing instruments (e.g. Adaptable Program Loans and Sector Specific Loans). An IEG review of health sector SWAps in six countries (including Ghana) in 2009 found the results of the sector-wide approach were mixed in terms of achieving national program objectives and realization of the benefits of the approach.15 Some of the relevant lessons learnt include the need for rigorous appraisal of work programs to ensure minimum quality standards and better sequencing of efforts to mitigate the risks of implementation delays and weak results focus. Should there be adequate time for project appraisal to thoroughly digest the lessons learnt from the earlier Bank operations, the project design could have adopted a more phased-in approach for achieving the ambitious economy-wide objectives in a more realistic time horizon. 46. Risk identification and mitigation: The appraisal rated the policy-level risks of the PSR part as substantial – there were a lack of clarity on the roles and responsibilities between MDAs for the public sector reform agenda; and a high-level public skepticism towards the PSR agenda. If implemented, the proposed risk management approach (to focus the Bank intervention first on prioritizing the reforms and a few achievable quick wins) could have had mitigated the risks early on in project implementation. With the benefit of hindsight, the PSR part was a high (rather than substantial) risk intervention and much more should have been done to ensure that the two main risks mentioned above were adequately addressed before submitting the Project or the following Additional Financing for Board approval. 47. Policy-level risks were also identified in the design of the FSR part, and were rated from low, modest to substantial. The higher risk areas were: (a) demutualization of GSE, (b) outsourcing of SSNIT investments management, and (c) governance of state-influenced financial institutions. Proposed mitigations were generic discussions of preemptive or corrective actions, close monitoring, and/or the good momentum of financial sector reform. No specific plan was prepared to actually mitigate the risks (e.g. triggers for preemptive actions). Those risks materialized early in project implementation, and only the third one was addressed by dropping the relevant subcomponent through the 2007 project restructuring.

15 IEG Working Paper Series: Do Health Sector-Wide Approaches Achieve Results? Denise Vaillancourt, IEG WP 2009/4

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48. No operational level risks (e.g. weak institutional capacity for project management and the challenges brought by the wide span of control) were identified at appraisal, which turned out to be major factors affecting timely project implementation and monitoring. 2.2 Implementation 49. Project implementation took more than seven years but eventually resulted in significant progress towards achieving the project objectives (see Section 3 for details). In addition to the issues discussed in Section 2.1 above, the following factors either contributed to the completion of project implementation, or were responsible for the incompletion of activities and a lack of results. 50. PSR part: The 2007 restructuring clearly grouped many project activities into nine subcomponents, which at least facilitated the monitoring and reporting of project status. The decision to finance the cost of the retrenchment programs in four subvented agencies enabled the progress made towards the achievement of the relevant result indicator. 51. The 2009 Mid-Term Review (MTR) conducted detailed assessment of each PSR subcomponent. Based on the MTR recommendations, four subcomponents were suspended (de facto termination) and the financing of the activities under the other subcomponents were refocused towards those which were already well under way. The cancelled activities suffered un-clarified objective, unsatisfactory implementation, and/or lack of effective results. The MTR readjustments significantly re-oriented the PSR component towards achievable results. 52. The additional financing of US$10 million (see Section 1.7 for details) scaled up Bank involvement in Ghana’s public sector reform. The decision was made after strong MOPSR request and based on a general description of good progress made. However, given the 2009 MTR findings, it appears that the goal of the first phase (prioritization and budgeting of, and consensus building for the PSR strategy) might not have been achieved as of end-2007. This should not be difficult to foresee since the design of the first phase was said to have followed the model for developing FINSSP, which was a product of years of joint efforts of the Government, the main stakeholders and the DPs16 If the first phase goal were reached, part of the scarce IDA funding committed under the Additional Financing might have been better utilized for more achievable results. 53. The 2007 restructuring expanded the scope of the PSR part. About 18 months later the MTR report found that some of the planned activities (e.g. reorganization of the Civil Service) had little chance to be completed due to various political and socio-economic factors. Others (e.g. decentralization) were led by other government agencies and had already received donor support outside the EMCB Project. The MTR also recommended an immediate project restructuring to address the problems encountered under the PSR part including a possible PDO revision. However, the second restructuring was not conducted until a few weeks before the original closing date (June 30, 2011) and there was no change in the PDO. It appears that an

16 For example, just the adoption of the FINSSP took more than two years.

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opportunity was lost to make the scope and objective of the PSR part more realistic sooner (e.g. in early 2010). 54. FSR part: During project implementation most of the implementing agencies maintained a strong ownership of the reform program, and the FSD/MOFEP leadership was committed to the Project throughout the implementation period. Continuous ownership of implementing agencies and strong leadership in project management were critical to project implementation and the achievement of the results. 55. On the other hand, the following problems show that the implementation difficulties rising from the ambitious scope of the FSR part was not adequately addressed during project implementation: • Component Six – SSNIT investment portfolio: Limited activities (mainly training) were

carried out in SSNIT before the implementing agency withdrew from the Project in early 2009 after the new pension law became effective. The withdrawal of the SSNIT indicates that the planned outsourcing of a large part (65 percent) of the stock of the pension contributions managed by SSNIT to the private sector for investments management was indeed lack of broad-based political support. In contrast, the gradual approach adopted by the 2008 law is being implemented.17

• Component Seven – Added new activities: The 2011 project restructuring added several new

activities under this component, such as strengthening of institutional capacity for anti-money laundering (AML) purpose and support to the development of rural finance. The additions of the activities were quick responses to government requests. Some addition, in particular the support to AML achieved good results because the GOG made a high-level political commitment with Financial Action Task Force (FATF) in late 2010 to address strategic AML/CFT deficiencies; and there were adequate resources to support both legal and regulatory improvements and institutional development. 18 Other added activities did not enjoy those conditions and increased number of activities made the component more unwieldy. The component by itself could be a stand-alone and reasonably-sized financial sector technical assistance program (USD10.8 million).

56. Other factors: From the very beginning, DFID was a partner of the FSR part of the Project, and committed US$5.2 million equivalent to the pooled fund to finance the FSR components (available after August 2007). 19 SECO became a co-financier of the FSR components in August 2009 and contributed US$2.44 million equivalent to the FSR pooled fund. The pooled fund arrangement facilitated the flow of funds from different participating DPs to

17 The 2008 law establishes a three-tier pension system, and allows private sector funds to manage the investment of new pension contributions to the second (occupational) and third (individual) tier schemes. 18 AFTF and SECO provided technical advice and the EMCB project supported setting up of a FIC. 19 US$2.45 million equivalent of the DFID contribution was cancelled in June 2011. The pooled fund for the PSR part as planned in the PAD, the DCA and the 2007 Project Paper did not materialize, although there was no documentation on the main reasons. But this is not a major factor affecting the achievement of the objectives of the PSR part, as the issue was not a shortfall of funding but a lack of better selectivity and sequencing.

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finance the FSR part of the Project. In addition, SECO and GIZ coordinated with the Bank by providing support to a number of financial sector reform in parallel to the EMCB. Those were good examples of donor/development partner coordination at the sector level. 57. The MOUs between the Government and the participating Development Partners (signed off in March 2006 as an IDA credit effectiveness condition) laid down the coordination and co-financing mechanisms. The preparation and status review of the annual work plans provided a good forum for coordination, in particular regarding procurement and financial planning. Early delays in project implementation could be attributed to the need to acquaint project management staff of MOPSR and MOFEP with the World Bank procurement guidelines and review procedures. Over-reliance of consultants at the MOPSR affected implementation of the planned activities under the PSR component, in particular after the consultants’ contracts were terminated in early 2009. The Project was once rated as Project at Risk. 2.3 Monitoring and Evaluation (M&E) Design, Implementation, and Utilization 58. PDO: The statement of the original Project Development Objectives was very broad (see Section 1.2). The original PDO statement in the PAD was also long and ambiguous about the Project’s main objectives. The revised PDO statement (See Section 1.3) re-oriented the PSR part of the objective, but retained the goal of changing the overall government role in economic management. It would require much more support than the EMCB Project to enable the GOG to clearly define and effectively perform its role as a facilitator for economic development. The PDO was improved for the PSR part during project implementation, but still suffered a common problem of the time: aiming to achieve economy-wide goal for a relatively small development intervention. 59. Inferred PDO: Neither the original nor the revised PDO accurately reflected what the Project was intended to achieve with regard to the FSR components. There was a disconnect between the intended project objectives and the stated PDO as recorded in the official project documents. Based on the ICR review of the original project design including the original allocation of the IDA funding among the project components, and the various statements of project objectives in the PAD, the main intended objective (inferred PDO) of the FSR part appears to be to strengthen the regulatory regimes and improve the regulators’ operational efficiency.20.

60. Results framework: The results framework (RF) set up high level targets and not all of them were pertinent to the planned project interventions. There were many indicators (a total of 41 throughout the implementation period) which in a way mirrored the dispersed nature of project activities. The RF underwent several rounds of modifications. In general, the modifications of the targets and indicators for the PSR part improved the attribution between targets and main activities. Changes for the FSR part were mainly at the component level, but the attribution problem in the design of the PDO and outcome indicators of the FSR part was not

20 Allocations for the activities related to regulatory frameworks and institutional efficiency accounted for at least 74% of the IDA funding for the FSR components. Except for Component Seven all the other FSR components focused on those two themes.

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addressed. Project monitoring and evaluation (M&E) for both parts of the Project was more on processes and outputs, rather than results and indicators.

61. PSR part: The Bank’s internal reviews before appraisal recommended further development of the results framework for this part of the Project. Those recommendations were not adequately incorporated into the project design. The original outcome indicator (related to the development of a strategy and organizational structure for the PSR component) appears to be more of an intermediate-results-level measurement for specific actions. It was probably also outdated. The MOPSR was established in May 2005 and the PSR strategy was adopted in August 2005, while the Project was approved in November 2005. The activities financed by the Project before credit effectiveness (through retroactive financing and the PSR PPF) might be limited to the staffing cost and the preparation of the PSR MOU between the Government and the participating Development Partners. There was no intermediate results (IR) indicator to measure the results of prioritization and consensus building for the PRS strategy, although those were said to be the main activities of the Bank interventions in the first phase of project implementation. 21 The original results framework for the PSR part was not ready for implementation at appraisal. 62. The shortfalls in design were partially addressed through the 2007 restructuring when the original outcome indicator was dropped and three new indicators added. Thirteen IR indicators were adopted for the corresponding subcomponents, which was a reflection of a lack of prioritization and over-promising of what limited IDA resource could do. The June 2011 restructuring dropped two outcome indicators (related to the recruitment and promotion schemes of the Civil Service and the reduction in government subvention). The restructuring also re-developed the subcomponent-level targets. The number of indicators was reduced from 13 to 5 at the intermediate results level. The final results framework was specific and more realistic, but the changes should have been made immediately after the 2009 MTR, so as to set achievable targets to guide the implementation of the remaining PSR activities, rather than to retroactively reflect the 2009 cut-down just before the closure of the PSR part. 63. During project implementation, the PSR targets were reported as achieved without the support of specific qualitative and/or quantitative assessment (except for the MTR which reviewed the status of the PSR part by subcomponent). Despite management advice to promptly assess the results of the PSR part after it was closed in June 2011, there was only a summary of the outputs one year later. As the MOPSR was dissolved and the implementation consultants left the PSR Secretariat, institutional memories were lost and documentation on project implementation was lacking. The uses of the results framework to monitor and evaluate project progress under the PSR part were quite weak. 64. FSR part: There was a more detailed results framework for the financial sector reform components at appraisal. The outcome indicators were financial deepening metrics (gross banking credit to private sector and gross deposits which included demand deposits by private

21 If the Bank interventions were more than the further development of the strategy in the first phase, the design of the IRs and IR indicators were inadequate. There was only one IR Indicator related to the initiation of a substantive reform program at a MDA for the indicated 12 areas of Bank support.

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sector enterprises at Ghanaian banks as percentages of GDP); rather than measurements of governance and competitiveness. Some intermediate results indicators were for major reforms where the EMCB only had limited or no interventions (e.g. the indicators on supervision coverage and effectiveness; or that on the increases in the number of deposit accounts). Several other intermediate results-level targets were also set at a high level. For instance, one result aimed to increase the turnover of the secondary equity market. This market liquidity measurement is determined by a number of macroeconomic and institutional factors (e.g. monetary policy and investment decisions by investors) which were beyond the reach of the Project. During project implementation, two rounds of revisions were made. Target revisions were mainly upward adjustments (e.g. the target for increase in the gross banking credit to private sector/GDP was raised from the original 20 percent to 27 percent). There were also additions, revisions and cancellations of the component level results and the indicators but the attribution weaknesses remained, reflecting the challenges in fixing congenital defects in the design of the results framework. Appropriate outcome indicators should have been adopted either for the stated PDO or the intended objectives. 22 While the FSR RF was specific, measurable and time-bound, it suffered from weak attribution. 65. Data for the FSR results framework for the purpose of Bank reporting were provided but not regularly updated. At least one workshop was held in the last year of project implementation to highlight the need to enhance the connection between activities and the outcome and result indicators. However, it appears the results framework did not become an integral part of project M&E. In other words, it was not used regularly to monitor progress and identify bottlenecks. There were no in-depth assessments of project status against the RF indicators at the major milestone dates (e.g. the first two restructurings and the MTR). For instance, when a main activity was dropped (e.g. strengthening of SIFIs governance), no assessment of the implementation status was provided.23 There were also omissions in readjustment. When the new pension law adopted the gradual approach to enhance the management of additional pension contributions, the indicator regarding the stock of pension contributions was not removed. Annual work plans focused more on procurement and financing plans and the status of those plans. Discussion and finalization of annual plans could have been a good opportunity to conduct realistic assessment of progress against the RF indicators. Documentation of results were uneven, with some implementing agencies/beneficiaries (e.g. GSEC, BOG, NIC, VCTF and DMD/MOFEP) having given much more thoughts to the pathway from activities to the final results. An internalization of the FSR results framework would have made the project M&E more results oriented.

22 For example, if the FSR part were truly about governance strengthening, more relevant governance indicators should have been adopted, such as “enhanced accountability of the owner and management of financial institutions”, or “improved regulatory quality”. See the World Bank: Worldwide Governance Indicators. info.worldbank.org/governance/wgi/ 23 The first restructuring kind of cancelled the subcomponent aimed to strengthen the governance of the four SIFIs by formally dropping the relevant indicator. The cancellation of this subcomponent does not appear to be a main factor affecting the project outcomes as it was not the main focus.

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66. For a more complete picture of the project results framework and the final status of the formally set targets, please refer to Section F of this ICR’s Datasheet. 2.4 Safeguard and Fiduciary Compliance 67. Safeguard: No safeguard policies were triggered by the design and implementation of the Project. 68. Procurement: Procurement faced challenges and most of the time during project implementation was rated from moderately unsatisfactory to moderately satisfactory. At the beginning the problems came from the lack of familiarity with Bank guidelines and review procedures. Later on, when the Bank prior review procedure shifted to the annual work plan based approach through the second project restructuring, procurement performance gradually became satisfactory in 2012. No fiduciary breaches were identified during project implementation.

69. Financial management: Project financial management started well in particular with regard to the PSR part, but gradually deteriorated in 2006 – 2008 partly due to various capacity related issues such as delays in installing a Bank requirement compatible project accounting software in the PMU. The dissolve of the MOPSR in early 2009 resulted in staffing and other continuity difficulties at the project management unit of the PSR part. These challenges were subsequently addressed. For the FSR component the financial management performance was satisfactory. Overall, the project FM performance at the closing date was considered as satisfactory. All the project auditor’s reports were unqualified and no fiduciary breaches were identified. 2.5 Post-completion Operation/Next Phase 70. PSR part: The most important result of this part of the Project was the Single Spine Pay Structure (SSPS). The SSPS has been fully integrated into the civil service pay scheme, and is expected to be continued. The Fair Wages and Pension Commission (FWPC) is functioning well. While DFID withdrew from this sector in 2010 – 2011, the Bank’s current Country Partnership Strategy (FY13 – FY16) continues to attach importance to the public sector reform in Ghana, although the specific operations to support this reform agenda are currently under discussion with the GoG. 71. FSR part: The efficiency gain under this part of the Project appears to start to take roots in the beneficiary organizations (the regulatory institutions), although a couple of important operational systems (e.g. NIC’s supervision returns system) were not yet to be launched as of project closure. One issue that should be paid more attention to is the financial planning for system maintenance and upgrading. No systems can live up to their full capacity and utility without regular maintenance. Given the advancement of ICT in today’s world and the evolutionary nature of the regulators’ operations in Ghana’s financial market, regular system upgrading in the longer term would lead to further efficiency gains. The same can be said about compliance with the international standards of financial sector regulation and supervision, as

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well as institutional capacity building. They are a dynamic process and it is important to budget well in advance for their continuous strengthening. 72. The Government has realized the importance of continuous financial sector reform and is now implementing the FINSSP II (2011 – 2015). The strategy aims to further pursue the six key objectives of the first phase strategy and contained 26 initiatives and 90 recommendations. Those recommendations cover the six sub-sectors of the EMCB Project plus specific guidance on monitoring and evaluation. The Bank is preparing a new technical assistance project (FY14) to support the implementation of selected FINSSP II recommendations. DFID is no longer involved in supporting the financial sector reform program, but other donors (e.g. SECO and GIZ) have ongoing programs to support the financial sector reform and development in Ghana. 3. Assessment of Outcomes 3.1 Relevance of Objectives, Design, and Implementation 73. For the purpose of this ICR, Relevance of the Project was assessed in view of Consistency with the current government and Bank strategies and Complexity as compared to prioritization needs and existing institutional capacity. 74. PSR part: The Relevance of this part of the Project is considered as Moderately Unsatisfactory for the following reasons. 75. Strategy consistency: Successive governments of Ghana have attached importance to the role of public sector reform in economic development, and the government strategies have always assigned priority to the strengthening of public sector capacity, streamlining of government processes and reduction of the burden of the national budget. Although the new PSR strategy of the current government (returned to power in December 2012) is not ready for ICR review, the general direction of the program is not expected to be very different from the previous reforms. Meanwhile, the 2012 - 2013 Ghana Shared Growth and Development Agenda (GSGDA) has anchored on, among other things, the enhancement of transparent and accountable governance. Public sector reforms are grouped with this strategy pillar. The design and implementation of the PSR component was in line with the Bank’s country assistance/partner strategy of 2004 and 2009. Based on the ICR review of the final draft Bank CPS for 2014 – 2018, improving public institutions is an important pillar. The PSR component as designed and implemented can be considered as consistent with the current government and Bank strategies. 76. Complexity: The main design and implementation factors discussed in Section 2 also severely affected the relevance of the PSR part. Analysis on the causes of the past failures in Ghana’s public sector reform conducted for the preparation of the 2009 government PSR strategy further support a low rating of the PSR part of EMCB in this regard. Bottom-up reforms from the line ministry level are found to have a better chance of success. The past experience also proves that it is critical to build into a PSR program selectivity, focus and clarity. The design of the PSR part of the Project was off track when evaluated against those benchmarks. The 2007 project restructuring even further expanded the scope of Bank intervention. The readjustments of the scope of the PSR part by the MTR made the component more focused in the

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last 18 months of project implementation, although the changes were only formalized before the closure of the PSR component (June 2011). The scope of the PSR part of the Project as designed and implemented in the larger part of the implementation period (first 4 years) was too ambitious. The range spread out over a wide spectrum of public sector institutions without securing ownership of the reforms by those institutions. 77. FSR part: The Relevance of this part of the Project is Moderately Satisfactory. 78. Strategy consistency: The FINSSP II currently under implementation has similar objectives as FINSSP I, which include, among other things: (i) strengthening of a more facilitative regulatory regime; (ii) development of pension and insurance industries and the capital market; and (iii) diversification of the financial sector for improved access to finance. Implementation of this strategy is an important policy goal of the current GSGDA. Bank support to financial sector reforms was an important part of the country assistance/partner strategies of 2004 and 2009. The new CPS plans to continue this support. The FSR part of the Project is consistent with the current government and Bank strategies. 79. Complexity: International experience (e.g. Bank of Thailand’s Financial Sector Master Plan) demonstrates that even in a more developed market with stronger institutional capacity, sector-wide reforms should be carefully sequenced to be effective.24 At the design phase of EMCB the need for synergies between components and subcomponents was overlooked for the sake of a holistic approach, while synergy in fact is a critical element of holistic approaches. In addition, the design of the FSR part could have benefited from better sequencing. For instance, demutualization of stock exchanges and/or other mutual institutions was mainly to expand the capital base of a mutual. Given the small and inactive equity market, it appears that the demutualization of GSE was not a priority to support in 2005 or in the later phases of project implementation. If the reforms were better prioritized and sequenced the complexity of the FSR part could have been reduced. 80. Project relevance: Based on the above analysis of each part of the Project and given the fact that the Project contained two broad sector reform programs; the Relevance of the whole EMCB is Moderately Unsatisfactory. This rating has also taken into consideration that, (i) consistencies with government and Bank strategies in most of Bank financed projects is a non-issue but complexity varies greatly between projects; and (ii) putting two completely separated broad programs under one project was a major factor affecting the EMCB’s efficiency.

24 The broad reform measures of Bank of Thailand’s FSMP (excluding the capital market reforms which were addressed separately) were sequenced into three phases: Phase I, took six years (2004 – 2009), Phase II five years (2010 – 2014) and Phase III will commence after 2014. See R. Ashley Baxter, FED/San Fransesco, Asia Focus, July 2010

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3.2 Achievement of Project Development Objectives 3.2 Achievement of Project Development Objectives 81. The ICR assessment of the achievement of PDOs is based on a review of the progress (or a lack of it) towards the intermediate (i.e. component level) targets and those results’ contributions to the achievement of the stated PDOs, as well as the inferred objectives for the FSR part. The assessment is divided by the main milestones: 2007 restructuring which revised the PDO, closing date of PSR part (June 2011) and closing date of FSR part (May 2013). Annex 2 provides a detailed list of the outputs delivered under the Project. 82. Component-level results – PSR part: The progress under this part of the Project towards achieving the intermediate results is Moderately Satisfactory. This rating takes into account (i) the fulfillment of the original intermediate result indicator, and (ii) the significant achievement of the revised IR targets. The retroactive nature of the revised IR indicators has been factored into the rating. 83. Up to end 2007: The intermediate target as recorded in the PAD and the DCA was “initiation of a substantive reform program at a MDA (by 2006)”, although different indicators were used in different project documents (e.g. the supervision mission aide memoirs and the Implementation Status Reports).25 Evaluated against the approved IR indicator, the expected result was achieved, as the pay reform was introduced in several MDAs by December 2007. 84. Up to mid-2011: The ICR review of this period is split into the years before the September 2009 MTR recommendations, and those after the MTR. Evaluated against the status of the 13 intermediate targets set by the 2007 restructuring, the progress towards achieving the component level results in 2008 – 2009 was limited (see Section F of the Datasheet for details). This is based on the 2009 MTR findings: even by then many planned activities were not initiated and the PSR component as a whole was rated moderately unsatisfactory. 85. Project implementation improved after the readjustment of the PSR part at the MTR time. Based on the information collected at the ICR review, 14 out of the 35 main activities (retained/revised/added after the 2007 restructuring) were completed by June 2011, and all this was achieved after November 2010 (one activity was completed after June 2011). 26 The completed activities that bear a clear pathway leading to the achievement of the revised PDO (implementation of reform initiatives by MDAs to improve public sector management and service delivery for enhanced government role as an economic facilitator) were: Development of a new pay and pension administration framework; Strengthening of the Fair Wages and Pension

25 For example, the indicator in the ISR was “detailed action plans for individual operations are in place and & rigorous M & E is instituted”. 26 Five activities were suspended in late 2009, and the rest either incomplete or never initiated as of June 2011.

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Commission; and Restructuring of a subvented agency (GRATIS).27 The first two activities are directly related to the revised outcome indicator (establishment of a new pay range structure). The last activity and possibly the retrenchments in the other three subvented agencies (GSB, GFTA and GNPA) reduced government payroll subventions to the four agencies. 86. Before the closure of this part of the Project, the 13 IR indicators were consolidated into four component-level targets, which was a retroactive recognition of the 2009 readjustments. Evaluated against those indicators, the targets were largely achieved:

• The 1993 Civil Service Bill was revised and submitted to the Civil Service Council and the PSR Secretariat (target was Civil Service Law (1993) is reviewed, finalized and resubmitted to Cabinet)

• Voluntary Retirement Programs implemented in 4 subvented agencies (target was the

same) • FWSC implemented the Single Spine Pay Scheme (target was Fair Wages and Salaries

Commission is strengthened and resourced to implement the New Pay Policy) • GRATS underwent a restructuring exercise (target was a limited subvented agencies

reforms program is completed) 87. Component-level results – FSR part: The progress under this part of the Project towards achieving the component level as well as the stated intermediate results is Moderately Satisfactory. This rating mainly takes into account (i) the limited progress in project implementation before the PDO revision in 2007; and (ii) the achievements in 2008 – 2013. 88. Up to end-2007: Project implementation suffered delays (mainly due to procurement related problems and only a fraction of the available IDA financing was utilized. Progress towards component results was limited. 89. Up to May 2013: Project implementation overcame the earlier delays and achieved significant results, which were not necessarily measured by the stated intermediate indicators. 90. Component Two (Regulation and supervision of financial markets): The main results of this component contributed to the strengthening of the regulatory regime for the securities markets. The law review led to a new Securities Industry Act (pending cabinet and parliament approvals) which will enhance GSEC powers in enforcement. The adoption of a web-based market surveillance system (once launched) is expected to facilitate early detection of market manipulation and documentation gaps, timely disclosure of public information, and filing of investor complaints. The GSEC’s offsite surveillance now covers all the financial institutions regulated by the capital market regulator.

27 The establishment of the customer service units and call centers should have contributed to the achievement of the project objective, but the information collected at ICR review suggested that many of the units became dysfunctional after the MOPSR was dissolved.

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91. Component Three (Banking and NBFI regulation and supervision): The project interventions resulted in the enhanced operational efficiency of the BOG. The number of days to clear checks was reduced from three days (within the two main urban centers) or two weeks (mainly rural areas) to within 24 hours. A permanent monitoring unit now regularly collects data on the cross-border capital flows. A number of automated systems for central bank operations, banking supervision, data management, HR management and BOG staff training further enhanced BOG’s operational efficiency. 92. Component Four (Insurance regulation and supervision): The interventions under the component mainly helped lay down the basis for enhancing NIC’s operational efficiency and the industry training capacity. An automated administrative system (once adapted and launched) will enable NIC to undertake risk-based off-site surveillance, and the web-based reporting portal (once launched) to facilitate timely submission and analysis of supervision returns.28 The support to the two industry training institutions provided a new curriculum and the Chartered Insurance Professional course books. 93. Component Five (Strengthening of capital markets): The component interventions contributed to the development of capital markets. The Rules for the Alternate Market guide the operation of the secondary board for SMEs. A South Africa Gold Fund was listed at the GSE following the issuance of the Rules for the Operation of Exchange Traded Funds. The automation of the trading processes together with GSE’s adoption of an automated clearing and settlement system reduced transaction related risks. A new regulation was developed which (when implemented) would enhance GSE governing council through a reduction of council members (from 13 to 9) and clear requirements for members’ qualifications, tenure and appointment mode. 94. Component Six (Pension sector development): This component contributed to the establishment of the new pension schemes and the pension sector regulator. An actuarial review of the sustainability of the SSNIT fed into the development of the December 2008 new pensions law. The support to the setting up of the National Pensions Regulatory Agency (NPRA) helped the regulator to become operational sooner. At the time of ICR review, the NPRA has issued regulations on the basic national social security (Tier 1 scheme) and the occupational and personal pension schemes (Tier 2 and 3), as well as licensed many private sector fund managers for Tier 2 and Tier 3 schemes. Given the products produced by the NPRA, the NPRA has become operational. 95. Component Seven (Access to finance and financial sector governance): The technical assistance provided under this component focused on institutional capacity building for improved access to finance (e.g. staff training of RCB Apex Bank, GHAMFIN, VCTF and FIC). In addition, this component achieved several results important to the general financial sector development:

28 The system (Vizor MIS) was being tested as of August 2013 using real insurer data submitted in December 2012 and March 2013. Initial test results point to the need of system adaptation to local conditions.

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(i) Sector strategy development – The assessment of the outcomes of FINSSP I (2003), the 2010 Finscope demand side survey findings, and the consultation process and the costing of reforms feed into the preparation of FINSSP II (2011).

(ii) Legal and regulatory framework – 15 bills were enacted or passed with the Project

support and draft guidelines on corporate bond issues and credit rating are now available.

(iii) Institutional development – The FSD/MOFEP was repositioned as a permanent unit in charge of the overall financial sector development. Staffing and equipment support helped improve the coverage and quality of RCB inspections by the ARB Apex Bank. Training on the uses of an international standard data collection tool enabled GHAMFIN to benchmark Ghana’s MFIs and analyze the development trends of the industry.29 Other direct results include the setting up of the Financial Intelligence Center (FIC) and the financing of reviews of VCTF’s investment portfolios).

(iv) Government debt management – The government borrowing operation was separated

from the BOG. The incorporation of the debt strategy in the annual national budget improved debt planning. The automation of the national debt records improved debt reporting and information sharing.

96. In addition to those noticeable results leading to the progress towards strengthened regulatory regimes and improved regulators’ operational efficiency, most of the FSR components achieved the formal intermediate targets to various degrees. Some of the achievements may be directly attributed largely or partially to the project interventions. For instance: (i) the establishment and implementation of a basic framework for public and private pension design and regulation (an intermediate result of Component 7 with contributions from Component 1); (ii) a boom of private investment funds from five in 2005 to a total number of 217 by the end of 2012; and (iii) the dematerialized transactions of GSE. Both the FSD/MOFEP and the implementing agencies reported good results from a large number of staff/industry training activities and sensitization/dissemination/public education workshops. Unfortunately there were no ex-post/follow-up reports on the effect and/or behavioral changes as a result of the capacity building support. For further details regarding the status of the formal intermediate targets, please refer to Section F of the Datasheet. 97. PDO achievement: The project performance up to the end of 2007 in achieving the original PDO and outcome indicators (as well as the main intended objectives of the FSR part) was Moderately Unsatisfactory. This rating takes into account: (i) a pay reform was initiated in a number of MDAs; (ii) but the PSR program was not further prioritized and sequenced; (iii) responsibility among government agencies for public sector reforms were not clarified; and (iv) implementation suffered serious delays under the FSR part. 98. The project performance from 2008 to May 2013 in achieving the revised PDO and outcome indicators (as well as the inferred objectives of the FSR part) was Moderately Satisfactory. This rating takes into account: (i) the achievement of the revised PSR outcome

29MIX Data Collection Tool and MIX Monitor, developed by the Microfinance Information Exchange Inc

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indicator; (ii) the progress towards achieving the inferred project objectives of the FSR part; and (iii) the likely contribution of the project results to the strengthening of financial sector governance (a formally set PDO) in terms of regulatory quality. Table 2 summarizes the main outcomes achieved. However, there is a lack of data to report and validate the actual improvements in service delivery and strengthened enforcement ability of the financial regulators. Table 2: Main results and outcomes:

PDO Results Outcomes implementation by Ministries, Departments and Agencies (MDAs) of a reform initiative for improved public sector management and service delivery

• A Single Spine Pay Structure (SSPS) replaced over 100 salary structures

• One aspect of public sector management improved (pay structure streamlined)

• Enhanced equal pay for work of equal vale expected to improve service delivery by public sector workers

Strengthening regulatory regimes (inferred PDO)

• Draft amendments submitted to Cabinet to replace 1993 Securities Industry Law (amended in 2000)

• Regulatory overlaps to be removed and GSEC operational independence to be strengthened

• 1989 insurance law replaced by 2006 Insurance Act

• Regulatory powers of NIC enhanced

• New Pensions Act in effect since 2008

• Pensions industry regulated and supervised by NPRA

• long-term savings expected to increase under 3-tier pensions scheme

• No of private fund managers experienced significant growth

Strengthening governance and competitiveness of financial sector (original PDO)

• See above 3 main results • Regulatory quality expected to be improved due to above listed main outcomes

Improving operational efficiency (inferred PDO)

• An electronic surveillance system in operation at GSEC

• GSEC off-site supervision enabled to cover whole industry

• Automated check clearing system in operation (managed by BOG)

• BOG able to provide faster payments services to GOG and financial institutions

• A web-based portal for submission of supervision returns installed and tested at NIC

• NIC expected to ensure timeliness and completeness of reports by industry

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99. PSR part: The PSR part overcame many design and implementation defects and achieved the revised outcome indicator. The original project-level target (enhanced structure, strategy and responsibility within government for public sector reform) might have been more or less outdated since the bulk of work related to the establishment of the MOPSR and the development of the PSR strategy had been completed by the time of project approval. Evidence appeared later shows that the responsibility of the MOPSR was limited and the ministry was unable to take lead in, or coordinate among, various public sector reform programs managed by different MDAs. On the other hand, a pay reform had been initiated in several MDAs by the end of 2007, which could be considered as an important step towards the original PDO of “facilitating a reform initiative for improved public sector management and service delivery”. 100. The revised outcome indicator was “establishment of a new pay range structure to guide pay awards”. The Single Spine Pay Structure (SSPS) became effective in June 2010, and by the end of 2011 the remuneration of 98 percent of the public sector employees was migrated onto the structure. Before the adoption of the SSPS, Ghana’s civil servants were paid under more than 100 salary structures. The SSPS is a 25-grade structure and the pay level is determined by job evaluations based on a common job evaluation plan. The SSPS enhanced “equal pay for work of equal value”, although it is too soon to observe the direct impact of the improved incentives scheme on the public sector management and service delivery, or the enhancement of the Government’s role as an economic facilitator. 101. FSR part: Commendable results were achieved under the FSR components after the project management and implementation agencies overcame the early year delays. Those results were mainly found in two areas: Strengthening of regulatory regimes and Improvement of regulators’ operational efficiency. Examples of the first group of results included: (i) the draft Securities Industry Law (pending cabinet and parliament approvals) which is to remove regulatory overlaps and enhance GSEC’s enforcement powers; and (ii) the 2008 Pension Act which establishes a uniform set of rules, regulations and standards for the administration and payment of pensions in both the public and private sectors. The laws and regulations reviewed or adopted with the Project’s contributions are said to have improved the conformity of Ghana’s financial sector regulatory framework with international standards (e.g. IOSCO principles).

102. A good example of the second group of results was BOG’s automated check clearing system which enables payments to be settled within the day. Faster and safer payments usually help businesses and public sector institutions to better manage contractual relations, default risk and cash flows. Another example was the computerized management information system installed in the NIC. Once launched the submissions of quarterly and annual supervision returns would reach 100 percent. It would also allow the NIC to pick up early warning signals as the supervision returns become timely and complete. 103. In addition, the Project contributed to the setting up of the National Pensions Regulatory Agency, and the Financial Intelligence Center. Those regulatory institutions were in full operation and their establishment filled in the missing building blocks of the regulatory framework for Ghana’s financial sector. The establishment and strengthening of a permanent unit in charge of the financial sector development in the Ministry of Finance and Economic

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Planning enhanced the government’s role in providing strategic guidance for the financial sector reform. 104. The ICR review has also made an effort to assess the progress towards the strengthening of governance and competitiveness (stated PDO targets) by indicators which would better measure those targets. The indicator that measures governance and reflects what the Project intended to achieve originally is Regulatory Quality. This is broadly defined by the World Bank as the ability of the government to formulate and implement sound policies and regulations that permit and promote private sector development. 105. The FSR part contributed to the development and the strengthening of the regulatory regimes for securities, insurance and pensions industries. The FSR components supported the establishment of permanent regulatory/oversight institutions, such as the BOG’s capital flow watchdog, the MOF’s FSD unit and the NPRA. Unfortunately, there was no impact analysis of the project results on regulatory quality, i.e. the regulators’ ability to enforce the laws and regulations. Based on the recent IMF review, significant gaps and inconsistencies remain in the financial sector laws. In addition, the regulation and supervision of foreign banks in Ghana as well as the much needed restructuring of two weak banks will test the regulatory quality.30 The impact of the project interventions on the stated PDO objective of enhanced financial sector competitiveness is more difficult to verify. According to the same IMF report, Ghana’s banking system is competitive when assessed against the competitiveness metrics of barriers to entry and concentration of assets. On the other hand, the playground is tilted towards the State due to the significant state-ownership of the sector (e.g. by BOG). Given these considerations, the best effort conclusion of the ICR review is that the FSR part may have contributed to the strengthened financial sector governance in terms of regulatory quality. 106. Financial deepening in Ghana registered good progress during the lifecycle of the Project. Assessed against the two gross metrics of the Project (formally set outcome indicators), the gross banking credit to the private sector grew by 84 percent per annum (old series, 2005 – 2012) or 40 percent per annum (new series, 2006 – 2012). The gross enterprise deposits at banks showed an even faster growth (2.5 times, old series or 40 percent, new series).31 Assessed against the international standard benchmark of financial deepening, the net domestic credit to private sector as a percentage of GDP also inched up, from 11 percent in 2006 to 16 percent in 2012. Given the size of Ghana’s GDP (US$40.7 billion, 2012), a number of favorable macroeconomic and sector-level factors must be at play and would better explain those increases. 3.3 Efficiency 107. PSR part: There was no quantitative analysis at appraisal. At that time it was determined that a NPV analysis was not appropriate for this Projector. However, a limited cost effectiveness analysis could have been conducted for the pay reform, the removal of ghost workers and the subvented agency retrenchment programs. Neither was any qualitative analysis conducted on project efficiency.

30 IMF Ghana 2013 Article IV Consultation, IMF Country Report No. 13/187, June 2013 31 Data on the two gross metrics are based on the Bank of Ghana statistics.

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108. FSR part: The appraisal only provided two or three examples of the would-be monetary values at the national economy level which was too indirect for the appraisal of the efficiency of the project pe se. While a NPV-type of analysis may not be appropriate for the planned interventions, there should have been qualitative analysis of project benefits and costs by comparing with the efficiency of similar projects or that of a situation without the Project. 109. ICR analysis: The ICR review is unable to conduct an ex-post cost effectiveness analysis. It appears documentation and records keeping of project data were quite weak. Collection of data on results and outcomes for the ICR purpose took months. The project documents of a couple of related projects were reviewed and those reports suffered similar weaknesses in economic analysis of project efficiency. 32 This ICR evaluates the EMCB efficiency in the following aspects. • Outcomes: The expected outcome (revised) of the PSR part was achieved – A new pay range

structure became effective. The intended outcomes (inferred) of the FSR part were also achieved – There was significant progress towards strengthened regulatory regimes of securities, insurance and pensions markets and the operational efficiency of those sectors’ regulators as well as that of the BOG and the FSD/MOFEP was improved.

• Costs: The cost for achieving the PSR outcome was approximately USD13.1 million

(including over US$3.4 million for the retrenchment programs of the four subvented agencies). The cost of achieving the FSR outcomes was around USD27.7 million, including USD22 million IDA financing, USD2.7 million DFID financing, USD2.2 million SECO financing and USD0.9 million GOG financing.33 The costs were substantial and some of the project financed consultant reports which were either not finalized or did not lead to on-the-ground results.

• Capacity building: This category of project activities accounted for over 30 percent of the

actual total cost of the FSR part.34 All most all the IAs of this part of the project reported benefits from capacity building. However, the modus operandi of the project interventions for capacity building was piecemeal training activities, and a large part of which was conducted overseas. Implementation of many activities was consultant driven with uncertain impact on in-house capacity. There was no arrangement for knowledge dissemination; nor was there any assessment of training effectiveness. Those mechanisms should have been built into the Project at appraisal or through the project restructurings. This is another sign that the complexity and the wide span of control affected project effectiveness.

32 PAD and ICR: Ghana Rural Financial Services Project, and Ghana Public Sector Management Reform. 33 Data on the final cost of the PSR part was provided by the PSR Secretariat as of October 2011. Data on the IDA, DFID and SECO financing of the FSR part are from the World Bank Client Connection ( as of Sept 30, 2013), and that on the GOG financing of the FSR part is provided by the MOFEP. 34 Training amounted to over 19 percent of the actual total cost of the PSR part at project closure, and Meetings/Seminars/Workshops close to 12 percent (MOFEP data).

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• Duration: The implementation period was very long for a largely technical assistance project. The PSR outcome took five and half years to achieve, and the FSR outcomes took almost seven and half years to achieve. Given Ghana’s four-year cycle of presidential elections and consequent government changes, project implementation suffered from institutional memory loss (PSR part) and gaps between official replacements (FSR part).

110. Based on the above analysis, the Project is rated Moderately Unsatisfactory in terms of efficiency. 3.4 Justification of Overall Outcome Rating 111. Rating: Moderately Unsatisfactory 112. The Project provided modest but meaningful support to the GOG to eventually become a facilitator of economic development. The pay management aspect of public sector management was improved and there should be better incentive for the public sector employees to improve service delivery, due to the pay reform. The financial sector regulatory role of the government is critical to ensure sustained economic development. This role was improved thanks to the strengthened financial regulatory regimes and improved operational efficiency of the beneficiary regulators. The upward factors considered include: (i) the Project’s consistency with the current Government and Bank strategies; (ii) the achievement of the revised PSR Outcome Indicator; (iii) the achievement of the FSR part’s inferred objectives; and (iv) the common practice in ICR reviews to give more weight to project efficacy among the three main evaluation categories of outcomes. On the other hand, the Project was too complex to be effective and efficient; the original PSR outcome indicator was not achieved; and the data difficulties in validating actual improvements in service delivery by the public sector employees and those in financial sector supervision enforcement. 3.5 Overarching Themes, Other Outcomes and Impacts (a) Poverty Impacts, Gender Aspects, and Social Development 113. There was no direct impact as the Project was not designed to directly address those issues. (b) Institutional Change/Strengthening 114. The most dramatic institutional change took place in the pensions sector. Before the Project, pensions were managed solely by SSNIT, which kindly regulated itself. The Project contributed to the establishment of a three-tier pension system. New pension contributions to the occupational and individual schemes are gradually being managed by private sector fund managers, which are regulated by the NPRA. (c) Other Unintended Outcomes and Impacts (positive or negative) 115. Not Applicable

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3.6 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops 116. A questionnaire was provided to the FSD/MOFEP and the PSR Secretariat and through them the implementing agencies with an attempt to collect feedback on the project design and performance. The FSD/MOFEP and three FSR implementing agencies provided brief comments. A summary of those responses is available upon request. 117. In general, the IAs were satisfied with the project design and implementation, in particular the project’s contributions to the development of a modern legal and regulatory framework, supervision capacity building, establishment of a basic framework for access to finance, and growth of the private equity industry. They also pointed out a number of shortcomings related to the ambitious project scope, a lack of synergies between components, the difficulties with the design and implementation of the M&E framework/indicators, and financing shortfalls for operational system automations. 118. The frequently cited causes of implementation delays included:

• Lack of project management skills and expertise • Unforeseen technical difficulties and lack of technical capacity • Weakened management commitment due to changes in institutional policy and/or

priorities • Changes in main staff for project management and implementation • The World Bank’s procurement guidelines and procedures

4. Assessment of Risk to Development Outcome 119. Rating: Moderate 120. Technical: From the technical perspective, the risk to the development outcomes is negligible to low. The main project outcomes (e.g. the Single Spine Pay Structure and the enhanced securities or insurance laws) follow the international standards. Government agencies in charge of the implementation and improvement of the outcomes have been put into place (e.g. the Fair Wages and Salary Commission and the FSD of the Ministry of Finance and Economic Planning). 121. Financial: From the financial perspective, the risk to the PSR outcome can be moderate to significant. This is related to the need to further streamline the government agencies and remove ghost workers, in order to make the reform more sustainable. The risk to the FSR outcomes is moderate. Donors are working with the Government to design new programs in support of continuous strengthening of financial sector’s regulatory regimes. However, more attention should be paid by the project beneficiaries on the costing and financing for continuous

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improvements of operational efficiency. Automated operational systems are necessary but costly investments, and their maintenance and upgrading should be planned and budgeted. Regular system audits can ensure that there is value for the money. 122. Political: From the political perspective, the risk to continuous public sector reform is considered as moderate to significant, due to the well-known challenges of the reform (some of which have been discussed elsewhere in this ICR). The risk to continuous financial sector reform is negligible to low in the medium-term, as the Government is implementing the FISSP II with the support of the donor community. 5. Assessment of Bank and Borrower Performance 5.1 Bank Performance (a) Bank Performance in Ensuring Quality at Entry 123. Rating: Unsatisfactory 124. The Bank responded to the government requests for support of public sector reform and implementation of FINSSP. The project design was aligned with the GOG and Bank strategies. The plan to pool donor resources under the Project was a good approach for coordinated DP interventions and ensured plenty funding of the Project.

125. The decision to combine two broad programs of limited synergies under one Bank investment operation was a major factor leading to the less than satisfactory outcomes. The management decision to combine those programs under one project was said to have been influenced more by budget and staffing concerns, rather than technical soundness and implications for implementation. Good recommendations were made at the QER time to improve the design of the PSR part. However, the approved project design did not incorporate those recommendations (perhaps due to the time limit). Lessons from the previous PSR and FSR operations in Ghana, in particular those about the scope and complexity of projects were not adequately incorporated in project design.

126. The decision to let a unit without public sector reform expertise to manage a PSR program for the sake of a bigger single investment in the Bank portfolio did not work, even if technical support from the PSR colleagues could have been timely and adequate. This is partly due to the fact that neither the Bank nor the client were organized and funded to conduct those complex cross-sector operations well. Other factors considered include the design defects of the implementation arrangement for the PSR part and the results framework for project monitoring and evaluation. The lack of proper project economic analysis is also a downward factor considered for the rating. (b) Quality of Supervision 127. Rating: Moderately Unsatisfactory

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128. The Bank team made commendable efforts in supervising project implementation. The 2009 mid-term review save the PSR part from failing to achieve the PDOs, and the supervision. The FSR components overcame the challenges brought by the wide span of control (6 main subsectors of the financial system, about 3 dozens of main activities, and ten implementing agencies), with a view to providing timely support to the implementation of FINSSP and FINSSP II. The Bank maintained a cordial working relationship with the MOFEP which was in charge of the overall implementation of the FSR part. 129. On the downside, it took the Bank too long (almost four years after the Board approval) to squarely face the design weaknesses of the PSR part. Furthermore, even when the problems were recognized and the scope of the PSR part reduced in 2009, the needed project restructuring was not carried out until June 2011. The challenges rising from the wide span of control under the FSR part was not fully recognized. More new activities were added late in project implementation without first analyzing their synergy with the project objectives and the implication for project efficiency. The FSR part should have undergone a detailed review similar to that of the PSR part at the MTR time, so that project supervision could be better oriented towards results.

130. Another major weakness can be found in project M&E and reporting. It appears that inadequate attention was given to the quality of the deliverables. There was more reporting on the status of the processes which did not do credit to the policy and/or technical discussions the Bank team must have conducted with the counterparts (e.g. the design of subvented agency retrenchment programs or the need to revise the 2006 insurance law to make it more in line with the latest IAIS core principles). The supervision reports were not quite candid about the status of the PSR part before the 2009 MTR, or the challenges faced by the FSR IAs (such as those identified by the ICR questionnaire respondents). Project restructurings should be good opportunities to analyze the progress made towards achieving the PDOs. However, only general remarks about the progresses were made in the Project Papers. The reluctance to revise the FSR part of the PDOs and its outcome indicators turned out to be a major hurdle to timely and candid evaluation of the progress towards the project objectives. Those supervision weaknesses might be partly attributed to the lack of supervision budget. The supervision budget allocation based on the regional average did not allow adequate participation of different technical expertise in the Bank team for the ambitious project (e.g. colleagues experienced in the regulation and/or institutional development of banking, securities, insurance, and pension industries). (c) Justification of Rating for Overall Bank Performance 131. Rating: Unsatisfactory 132. This rating takes into account the Bank performance in project design (Unsatisfactory) and supervision (Moderately Unsatisfactory). Positive factors accounted for are the strategic alignment, the provision of plenty of funding, and the quick responses to client’s requests, while the main factors pulling down the rating include the ambitious project scope and the inadequate attention to impact and efficiency.

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5.2 Borrower Performance (a) Government Performance 133. Rating: Moderately Satisfactory 134. The Government’s PSR strategy and FISSP I provided the basis for the project design. In particular, the GOG had maintained strong ownership of the financial sector reform program, and promptly implemented reform measures once they were formally adopted (e.g. establishment of FIC and NPRA and reposition of FSD/MOFEP). The participatory approach in the development and implementation of the two FISSPs ensured continuous commitment of the implementing agencies to the objectives of the FSR components. The role of the FSD/MOFEP was critical in ensuring the achievement of the expected results of the FSR components. The Ministry of Public Sector Reform and later the Public Sector Reform Secretariat might have played a similar role although information on this PMU’s performance is not available. However, several important factors were overlooked at the design phase, such as the need to assign one government agency as the overall owner of the whole project. Project M&E was weak for both the PSR and the FSR parts, and this includes a lack of proper record keeping. Capacity was limited for data collection and analysis. (b) Implementing Agency or Agencies Performance 135. Rating: Moderately Satisfactory 136. There were 10 implementing agencies for the PSR part of the Project (see Section A of the Datasheet for details). Specific information on the implementation performance by each IA is not available. From a result oriented perspective, it appears that the main PSR IAs’ performance was possibly moderately satisfactory, in particular:

• The Office of the Head of the Civil Service – Revision of the Civil Service Bill and Transformation of the Civil Service Training Colleague

• The Fair Wages and Salary Commission – Implementation of the pay reform

program/SSPS

• The GRATIS Foundation – Retrenchment program and restructuring exercise 137. Ten financial sector regulators and/or operators implemented the FSR components (see Section A of the Datasheet). Again, historical data on individual IA performance is missing. Assessed by the results achieved, the FSR IAs’ performance is at least moderately satisfactory; and the following agencies in particular had achieved major results:

• The Ministry of Finance and Economic Planning – FISSP I review and FISSP II preparation, Review/preparation/amendments of laws, and Development of the government debt management strategy

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• The Ghana Securities and Exchange Commission – Amendments of the securities law

and Improvements of operational efficiency • The Bank of Ghana – Improvements of operational efficiency • The National Insurance Commission – Preparation and implementation of the 2006

insurance law and Improvements of operational efficiency • The NPRA – Initiation of the new regulator and Implementation of the 2008 pension law

(c) Justification of Rating for Overall Borrower Performance 138. Rating: Moderately Satisfactory 139. This rating takes into account the performance of the Government as represented by the MOPSR/PSR Secretariat and the FSD/MOFEP; as well as the performance of the implementation agencies. The performance of implementing agencies could have been rated higher based on the final results, but the ICR review has to factor in the lack of detailed information on the performance of each IA, the moderately unsatisfactory overall performance of the PSR part in 2008 – 2009, and the serious delays in project implementation in the first two years under the FSR part. The neglect on project efficiency is another downward factor. 6. Lessons Learned 140. Several important lessons have been learnt from this challenging project, in addition to the repeated lessons about the importance of selectivity and sequencing. 141. Synergy is critical in cross-sector approach: This was overlooked when the PSR and the FSR programs were combined. Cross-sector approach could work if there is synergy: e.g. government debt management in public sector reform (e.g. forecasting, planning and cash management) and domestic bond market development in financial sector reform (e.g. primary and secondary markets, institutional investors). 142. Span of control is important: While there were synergies between some of the main activities of the different FSR components (e.g. RCB regulation and access to finance), the FSR part of the Project was populated by a large number of activities implemented by different agencies. Consequently, more energy was spent on keeping the project moving, rather than focusing on the results. Even if a sector-wide approach is appropriate, there has to be gives-and-takes between the theoretical presumptions and practicality. The institutional capacity of the Bank’s managing unit, as well as of the client and the implementing agencies, has to be considered when determining how wide a sector-wide approach should be. 143. Instrument of intervention has to fit: Given the open-endedness of the PSR program in the design phase, it appears an adaptable or more phased-in instrument would be more fitting. The selected instrument (SIL) is more fitting for operations where specific activities have been

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developed with costing; and the objectives are expected to be achieved within no longer than the medium-term (e.g. 5 years). 144. Quality assurance should not be once for all: There was only one QER close to the decision meeting for appraisal and project negotiation. It appears that before the Project was submitted for Board review, the design was not checked to see if the QER and decision meeting recommendations were incorporated. For a project as complex as the EMCB, it would be better to conduct QER earlier, for instance in the pre-appraisal phase, and a follow-up QER be carried out at the appraisal time to ensure the incorporation of QER recommendations. Quality at supervision review should also be planned and conducted for complex projects and projects which require several rounds of restructurings and closing date extensions.

145. Reform strategy should be broadly owned: The financial sector part of the Project benefited from strong ownership of the reform strategy by the GOG and the regulatory authorities, thanks to the participatory approach in years of FINSSP development. The regular FSAP updates (2003, 2006 and 2011) gave the Bank a handle on the status of Ghana’s financial sector. Without it the Bank would not be able to provide technical advice to the development and updating of the government reform strategy. Those elements were critical in overcoming (at least partially) the challenges brought by the overly ambitious scope and the wide span of control. 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners (a) Borrower/implementing agencies 146. At the time of this ICR, only the Financial Sector Division of the Ministry of Finance and Economic Planning provided a self-assessment of the FSR part of the Project. The Ministry found that the objectives of the Project were consistent with the Government’s Medium-Term Policy Framework. The Project was considered as generally satisfactory. The outcome indicators were deemed to have been achieved as there were improvements in financial deepening and competitive environment. The performance of the Government and the World Bank were also deemed satisfactory despite the frequent changes of Bank task team leaders and government officials in charge. The government took the ownership of the Project by setting up and leading the project steering committee and conducting frequent dialogue to sensitize the implementing agencies and the management on progress made under the Project. 147. According to the MOFEP assessment, the implementation challenges were incurred mainly in the earlier phases of project implementation, and included Slow decision making in implementation process by the IAs; inadequate personnel to handle the technical aspects of IAs’ procurement and monitoring & evaluation; World Bank delays in the approval processes affected the rest of those processes; and Frequent Changes of World Bank task team leaders and government officials resulted in temporary slowdown of activities. The MOFEP found that some of component-level indicators for the FSR part were not relevant given the institutional, growth and development of the country (e.g. number of the credit reporting bureau operational, on-site inspections coverage of insurers by the NIC). Among the lessons learnt, there were the needs to: (i) encourage sub-sector specific interventions rather than the all-inclusive approach which involves too many implementing agencies for implementation; (ii) review periodically the

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indicators to reflect changing economic and environmental conditions; and (iii) have a dedicated staff in each implementing agency to manage (and coordinate between) different components. The MOFEP’s self-assessment report is available upon request, and a more detailed summary of the report is provided in Annex 7. 148. The ICR review has no major reservations of the MOFEP assessments. (b) Cofinanciers 149. The FSR part of the Project benefited from the participation and co-financing of the UK’s Department for International Development (DFID), and Switzerland’s State Secretariat for Economic Affairs (SECO). 150. DFID originally contributed GBP 2.6 million (US$5 million equivalent at the exchange rate in August 2007) to the pooled fund for the FSR part. At the time of the conclusion of DFID involvement, more than GBP1.6 million was disbursed and the unutilized funding (GBP0.98 million) was cancelled. The decision not to co-finance the Project in the extended implementation period was in line with the realignment of DFID’s priorities with wider UK Government priorities, as DFID Ghana withdrew from engagement in the PSR and FSR sectors.35

151. In October 2011, DFID issued the Project Completion Report for Financial Sector Reform, which covered the EMCB Project.36 In general, DFID found that the expected outputs were only partially achieved, although significant progress was made during the project period in the expansion of financial services to MSMEs and poor and rural households. Two lessons were learnt. First, country ownership of projects is a significant factor in the success of projects (referring to the two main activities under Component 7 (FinScope and Remittance Country Partnership) which DFID particularly championed. Second, procurement expertise is important for the speedy implementation of a project such as EMCB. DFID found that an early investment in procurement expertise at the level of the relevant implementing agencies would have significantly enhanced project implementation. Annex 8 has reproduced the Executive Summary of the DFID report. 152. SECO joined the partnership for the FSR part of the EMCB in August 2009 and originally contributed USD2.44 million. When SECO concluded the engagement in April 30, 2013, USD2.23 million was disbursed and the rest of the funding cancelled. 153. SECO has provided a brief summary of the DP’s views of the EMCB Project in October 2013 which can be found in Annex 8. The participating development partner found that the operation was and still is very relevant. SECO also recognized that the broad design has paved the way for more dialogue and coordination among regulators and associated stakeholders in the sector. The main shortcomings were attributed to the large number of implementers, a certain disconnect between high level aggregate objectives, indicators and activities, and a large number

35 Operational Plan 2011 – 2015, DFID Ghana, updated June 2012 36 DFID Ghana Project Completion Report for Financial Sector Reform, October 2011

39

of activities without clear contribution path to the overall objective. Importance implementation challenges recognized included inadequate human resources at the expense of results monitoring and guidance for prioritization and sequencing of the project activities. SECO is inconclusive as to whether the EMCB achieved the expected impact of the program. 154. The ICR review has no major comments of the views of DFID and SECO. (c) Other partners and stakeholders 155. Not applicable

40

Annex 1 Project Costs and Financing

Ghana Economic Management Capacity Building (P092986)

(a) Project Cost by Component

Components

Appraisal Estimate

(USD millions)

2007 DFID Cofinancing

of C2-C7

2007 Restructuring/

Additional Financing

Estimate (USD millions)

2009 SECO Cofinancing

of C2-C7

2011 Restructuring

Estimate (USD million)

Actual/ Latest

Estimate (USD

millions) Percentage of

Appraisal

Percentage of 2007

Restructuring/Additional Financing

Percentage of 2011

Restructuring Component 1: Public sector reform 5.0 n.a. 15.0 n.a. 15.0 13.1 262.0 87.3 87.3 Component 2: Regulation and supervision of financial markets 6.7 n.a. 4.6 n.a. 3.3 3.6 53.6 78.1 107.8 Component 3: Banking and NBFI regulation and supervision 13.4 n.a. 9.7 n.a. 8.2 8.0 59.9 82.9 97.4 Component 4: Insurance regulation and supervision 1.3 n.a. 0.8 n.a. 1.1 1.2 88.5 140.1 103.6 Component 5, Strengthening of capital markets 2.4 n.a. 1.6 n.a. 2.5 3.4 141.3 206.4 133.6 Component 6: Pension sector development 0.5 n.a. 0.3 n.a. 0.6 0.7 148.0 225.3 116.7 Component 7: Access to finance and financial sector governance 8.5 n.a. 5.3 n.a. 6.5 10.8 126.8 205.1 165.8

Total Baseline Cost 37.8 n.a. 37.3 n.a. 37.4 40.8 107.9 109.2 109.1 Physical Contingencies 0.0 n.a. 0.0 n.a. 0.0 0.0 0.0 0.0 0.0 Price Contingencies 0.0 n.a. 0.0 n.a. 0.0 0.0 0.0 0.0 0.0 DFID cofianced C2-C7 costs 5.2 n.a. n.a. n.a. 2.7 51.9 n.a. n.a. SECO cofinanced C2-C7 costs n.a. n.a. 2.4 n.a. 2.2 0.9 n.a. n.a. GOG financed C2-C7 costs 8.7 n.a. n.a. n.a. n.a. 0.9 10.0 n.a. n.a.

Total Project Costs 37.8 5.2 37.3 2.4 37.4 40.8 107.9 109.2 109.1 Total Financing Required 37.8 5.2 37.3 2.4 37.4 40.8 107.9 109.2 109.1

Notes:

1. Appraisal data of IDA financed costs are from PAD, dated Oct. 19, 2005, which included estimated locat costs. 2. DFIC appraisal estimate was in GBP and $5.2 million equivalent in Aug07. The actual cost estimate in USD is at the GBP/USD exchange rate of Oct. 2, 2013.

3. SECO appraisal estimate was in USD and dated Aug09.

4. 2007 estimates for C2-C7 are at the Financing Agreement date - April 14, 2008 SDR/USD exchange rate (1SDR=1.64221USD), which do not include GOG counterpart funding. 5. 2011 estimates for C2-C7 are at June, 16, 2011 SDR/USD exchange rate (1SDR=1.58592USD), which do not include counterpart funding.

6. Actuals are data from PSR Secretariat as of October 2011 and MOFEP as of Sept 30, 2013. The difference with the total disbursement data of the Bank's ClientConnection ($40.5 million) and that of the Bank's Operational Portal ($41.2 million) may be due to the exclusion/inclusion of un-refunded funding in the Designated Accounts and PPF advances.

41

Annex 1 Project Costs and Financing

Ghana Economic Management Capacity Building (092986) (b) Financing

Source of Funds Type of

Cofinancing

Appraisal Estimate

(USD millions)

2007 DFID Cofinancing

of C2-C7

2007 Restructuring/Additional Financing Estimate (USD

millions)

2009 SECO Cofinancing

of C2-C7

2011 Restructuring Estimate (USD

millions)

Actual/ Latest

Estimate (USD

millions) Percentage of Appraisal

Percentage of 2007

Restructuring/ Additional Financing

Percentage of 2011

Restructuring

Borrower Counterpart funding 8.7 Unknown Unknown 0.9 10.0 Unknown Unknown

International Development Association (IDA)

Specific Investment Lending 25.0 37.3 37.4 35.0 140.0 93.7 93.7

UK: British Department for International Development (DFID)

Pooled fund for FSR components n.a. 5.2 n.a. n.a. n.a. 2.7 51.9 n.a. n.a.

SWITZERLAND: State Secretariat for Economic Affairs (SECO)

Pooled fund for FSR components 2.4 n.a. n.a. 2.4 n.a. 2.2 91.7 n.a. n.a.

Notes: 1. Data on actuals are provided by PSR Secretariat (as of Oct. 2011) and MOFEP (as of September 30, 2013).

2. For exchange rates used please refer to Table (a) of Annex 1 of the ICR.

42

Annex 2 Outputs by Component

Ghana Economic Management Capacity Building Project (P092986) 1. Below is a summary of the outputs produced under the EMCB Project.

Component Outputs Implementing Agency

Component 1, Public Sector Reform: Review of 1993 Civil Service Law

• A revised civil service law (draft) for review which took into account the GOG’s decentralization policy

HOCS

Pay Reform • A final report on the Strategic Plan • Job evaluation/re-evaluation of selected Public

Service jobs • A final report on Financial Management System • A final report on Mapping & Assimilation Rules and

single Spine Salary Structure Payroll Monitoring System

• Review of Conditions of Service and Standardization of Allowances

• A final report on Market Premiums for selected Public Service jobs

• Training and equipment acquisition of FWSC

MOPSR/PSR Secretariat MOFEP FWSC

Central Management Agencies work environment support

• A new PSC website hosting all circulars to public services and making recruitment forms available to potential candidates nationwide

• A new set of curriculum for the Civil Service Training College targeting junior to middle level staff

• Provision of training by CSTC to trainees from Ghana and other Anglophone countries of the sub-region

PSC HOCS

Business process review

• Two analytical report on weak nesses and challenges within the two implementing agencies

MOT MOEST

Subvented agencies reform

• A detailed list of subvented agencies • Implementation of voluntary retirement scheme in

four agencies • A restructuring exercise in GRATIS Foundation

GTF GNPA GSB GRATIS Foundation

Service delivery improvement program

• 23 service units established in various MDAs • CSU at DVLA reduced the time for driver’s license

renewal to four hours and reduced the use of middlemen

• Citizens charter developed for 42 MDAs

MOPSR/PSR Secretariat

Development of human resource framework

• A draft performance management system PSC

Component 2, Regulation and supervision of capital markets: Legal and regulatory development

• Draft Securities Industry law submitted to Cabinet • A strategic plan for GSEC under implementation • A feasibility study on OTC market

GSEC

43


• A draft legal and regulatory framework for a commodities exchange and warehouse receipts system based on the relevant feasibility study for review

• A National Commodities Exchange & Warehouse Receipts Working Group established

Operational efficiency • An electronic surveillance system in operation and the related web portal in testing phase

GSEC

Training, workshops and public awareness activities

• Various staff training activities • Public conferences, lectures and educational visits • Publication of quarterly newsletters and other

investor education materials

GSEC

Component 3, Banking and NBFI regulation and supervision: Operational efficiency • An automated check clearing system (Codeline

Clearing) which reduced the clearing time to within a day

• An electronic banking application for central banking operations (Temenos T24)

• A banking supervision application for offsite surveillance purpose (eFass)

• A data warehouse application to interface with other data sources and extract analytical reports (iDecision)

• Human resource management system which provides self-services by staff and management (Oracle)

• An Interactive Data Extraction and Analysis system for banking supervision (IDEA – Audit module)

• A Document Management and Archiving System which provides a safe environment for document filing, indexing and management (Datastore32)

• Two remote data centers to house servers and network equipment (one serves as Disaster Recovery site)

• Establishment of a permanent Desk to monitor cross border capital flows

• Acquisitions of 4 vehicles

BOG


• The Center for Training and Professional Development was equipped with teaching aids and reference text books

• 157 BOG and commercial banks staff were trained in IT Examination, Risk-based Audit, Basel principles, Anti-money laundering, Microfinance, Credit risk and Loan techniques

BOG

Component 4, Insurance regulation and supervision: Legal and regulatory development

• Inputs to 2006 Insurance Act (Act724), including reviews and development of regulations, code of practice and market conduct rules

• A Code on Good Corporate Governance and Risk Management (to be issued)

NIC

44


• An accounting manual and a guide for completing supervision returns

Operational efficiency • A management information system which allows more effective interface with industry

• A web-based portal for regulated institutions to submit quarterly and annual supervision returns

• A financial application for analyzing supervision returns (Vizor)

• A 4-year business plan (2010 – 2013)

NIC


• A training needs assessment and A curriculum for training of industry employees by Ghana Insurance College

• Acquisition of Chartered Insurance Professional (CIP) course books for GIC

• Training for industry on automated supervision reporting system

• Equipment acquisition for Insurance Industry Training Center

• External attachments of 12 NIC staff (South Africa, Mauritius and India)

• Attendance of 19 staff in external training programs on corporate governance, leadership, management and regulation and supervision

• Participation of 15 staff in local training programs on onsite and offsite supervision, ICT, etc.

NIC

Component 5, Strengthening of capital markets: Legal and regulatory development

• Review and printing of the GSE Rule Book • Rules for an alternate market for SMEs (GAX to be

launched) • Operational rules for exchange-traded funds • Inputs to harmonization of trading rules for an

integrated West African securities market • Inputs to the new Foreign Exchange Act and

guidelines • A new regulation on the governing council’s

composition, mode of member appointment, and members’ qualifications and tenure.

GSE

Operational efficiency • Purchase and implementation of an automated trading system

• A three-year business plan towards demutualization

GSE


• Various training on trading, clearing and settlement, surveillance, depository and supervision (15 GSE staff, 19 brokers and 50 other market operators)

• A workshop on the new Rule Book • Various public education programs (e.g. Investment

Clubs for schools)

GSE

Component 6, Pension sector development: Legal and regulatory • Inputs to pension reform process through the use of SSNIT and NPRA

45


development PROST (World Bank’s Pension Reform Option Simulation Toolkit) and an actuarial review of SSNIT

•

Operational efficiency • Logistic support for the establishment and fit-out of the new NPRA office

NPRA


• Various training for SSNIT and NPRA staff, as well as welfare/labor officials

• A sensitization and outreach program on the 3rd-tier pension scheme in Western Region (1,695 participants)

SSNIT and NPRA

Component 7, Access to finance and financial sector governance: Financial sector development

• Establishment of National Bond Market Committee 2012 and various training and public awareness activities

• Guidelines for corporate bond issuance and credit rating (pending adoption)

• A Finscope demand-side survey which highlighted the state of financial inclusion in Ghana (2010)

• Assessment of outcomes of FISSP I • Inputs to development of FISSP II (consultation

process and costing) • Contributions to development/amendment of 15

financial sector related bills • Draft Local Government Finance Bill and training

activities on municipal finance • Development of a prototype web portal for a national

remittances registry • Public Forums on financial literacy (in Accra and the

regions) • National Quiz on finance for high school students • Publishing of 3 microfinance newsletters • Various training on financial sector policy and

market operations, project management skills, etc. (20 FSD staff trained)

• 2 Ghana PPP/PFI conferences on Public-Private Partnerships for Social Services & Infrastructure, and Financing Ghana’s Infrastructure Need, respectively

• Field visits to 29 RCBs and 5 CUs to assess impact of training provided under another Bank-financed project

FSD/MOFEPPPFA/MOFEP Microfinance Unit/MOFEP

Debt management strengthening

• A reform plan to strengthen government debt management institution

• A debt strategy published together with annual budget

• A 5-year strategic plan and procedures manual for MOFEP, CAGD and BOG

• A common database for public debt data for

DMD/MOFEP

46


comprehensive debt reporting • Office equipment acquired (including Bloomberg

service connection) • 15 staff trained on various debt management issues

Rural finance • 2 advisors (2) worked at the ARB Apex Bank to strengthen supervision of RCBs

• Production of 98 audit reports, 9 follow-ups and 2 special reports

• Logistics support • Staff training on risk and credit management

ARB Apex Bank Ltd

Microfinance • Production of industry performance monitoring and benchmark reports using standards

• Assessment of organizational capacity of GHAMFIN and Ghana Cooperatives Credit Unions Association using SEEP’s Network Capacity Assessment tool

• Training on those tools • Overseas training of CUA representatives (Boulder

Institute, Italy) • GHAMFIN organized training for microfinance

practioners • Development of a monitoring tool (GMT) for

microfinance institutions apexes (e.g. GMT was installed at GCSCA)

GHAMFIN

Financial Intelligence Center

• Provision of office furniture and equipment, IT software and hardware and a vehicle for the establishment and operation of FIC

• 7 FIC staff trained in financial crime, anti-money laundering and IT forensics

FIC

Venture capital funds • Portfolio reviews of 15 investee companies • Implementation of a series of public awareness

programs (e.g. 2010 RoadShow with over 1,000 participants, and the 2011-2012 4 regional fora)

• Purchases and uses of office equipment • Implementation of a 3-module in-house training

program (40 professionals trained) • 5 training sessions with 150 trainees from 40

portfolio companies • Training on corporate governance for VCTF’s Board

of Trustees and investee companies’ directors

VCTF

47

Annex 3 Economic and Financial Analysis

Ghana Economic Management Capacity (P092986)

This is discussed in Section 3.3 (Efficiency) of the ICR.

48

Annex 4 Bank Lending and Implementation Support/Supervision Processes

Ghana Economic Management Capacity (P092986) (a) Task Team Members

Names Title Unit Responsibility/ Specialty

Lending Kofi-Boateng Agyen Senior Operations Officer AFTFW Task team member Carlos B. Cavalcanti Senior Economist PRMED Christopher Juan Costain Principal Regional Team Leader TWISA Task Team Leader Richard Paul Hinz Adviser HDNSP

Guillemette Sidonie Jaffrin Senior Private Sector Development Specialist SASFP

Smile Kwawukume Senior Public Sector Specialist AFTP3 Task team member Montserrat Pallares-Miralles Social Protection Specialist HDNSP Olaf S. Schmidt Principal Investment Officer CMGCS

Vivek Srivastava Lead Public Sector Development Specialist PRMPS

Antony Thompson Manager, Operations HDNOP Supervision/ICR Baba Imoru Abdulai Procurement Specialist AFTPE Adu-Gyamfi Abunyewa Senior Procurement Specialist AFTPW Kofi-Boateng Agyen Senior Operations Officer AFTFW Task team member Ferdinand Tsri Apronti Consultant AFTA1 Charles John Aryee Ashong Procurement Specialist AFTPW

Lorenzo Bertolini Senior Private Sector Development Specialist AFTFW Task Team Leader

John P. Byamukama Financial Analyst AFTFP Rona P. Cook Program Assistant AFTFE

Robert Wallace DeGraft-Hanson Senior Financial Management Specialist AFTMW

Manush A. Hristov Senior Counsel LEGEN Xiaofeng Hua Senior Financial Sector Specialist AFTFE ICR Team Leader Anders Jensen Senior M&E Specialist AFTDE Philip Brynnum Jespersen Senior Social Development Specialist AFTCS Jeannette Kah Le Guil Senior Program Assistant AFTFE Smile Kwawukume Senior Public Sector Specialist AFTP3 Task team member Thomas Losse-Mueller Senior Financial Sector Spec. AFTFE Patience Mensah Consultant AES Nozomi Mizuno Financial Sector Specialist AFTFE

Alan Andrew Moody Lead Private Sector Development Specialist AFTFW Task Team Leader

Edith Ruguru Mwenda Senior Counsel LEGAM Tanangachi Ngwira Operations Analyst AFTFE ICR team member Anthony Randle Consultant (pensions expert) SFTFW

49

Names Title Unit Responsibility/ Specialty

Riham M. E. Shendy Senior Economist AFTFW Nicola J. Smithers Lead Specialist PRMPS

Vivek Srivastava Lead Public Sector Development Specialist PRMPS

Amadou Tidiane Toure Consultant SARPS Kafu Kofi Tsikata Senior Communications Officer AFRSC Salli Wondergem Executive Assistant AFCW1

Ross Worthington Senior Public Sector Management Specialist

AFTPR-HIS

Frederick Yankey Senior Financial Management Specialist AFTMW

Fatou C. Assah Program Coordinator FCMNB Mark Charles Dorfman Senior Economist HDNSP Yongmei Zhou Manager OPSFC Vijayasekar Kalavakonda Senior Insurance Specialist CAIMR

Peter Mousley Lead Private Sector Development Specialist MNSF1

(b) Staff Time and Cost

Stage of Project Cycle Staff Time and Cost (Bank Budget Only)

No. of staff weeks USD Thousands (including travel and consultant costs)

Lending FY05 30.66 101.99 FY06 36.70 144.90

Total: 67.36 246.89 Supervision/ICR

FY06 6.95 25.47 FY07 28.23 131.50 FY08 40.55 160.17 FY09 33.98 114.85 FY10 29.39 147.38 FY11 29.70 120.07 FY12 19.14 105.40 FY13 9.42 37.31

Total: 182.66 762.61

50

Annex 5 Beneficiary Survey Results

Ghana Economic Management Capacity (P092986) A questionnaire was provided to the FSD/MOFEP and the PSR Secretariat and through them the implementing agencies with an attempt to collect feedback on the project design and performance. The FSD/MOFEP and three FSR implementing agencies provided brief comments. A summary of those responses is available upon request.

51

Annex 6 Stakeholder Workshop Report and Results

Ghana Economic Management Capacity (P092986) No stakeholder workshop was held to wrap up and review project results.

52

Annex 7 Summary of Borrower's ICR and/or Comments on Draft ICR


Summary of MOFEP Evaluation on Financial Sector Reform Part

(October 14, 2013) A. Overview

• The achievement of the overall project objectives of the EMCB-FSR project, as well as the World Bank and Government’s performance, is generally deemed to be satisfactory.

• The Government took ownership of the project by putting in place the necessary institutional structure, i.e. the Ghana steering Committee to oversee and provide high-level monitoring for implementation of the financial sector reform. The financial sector division of the Ministry of Finance and Economic Planning (MOFEP) provided day-to-day project management.

• The listing of companies on GSE improved significantly. Total market capitalization improved significantly mainly due to increases in the prices of the shares and additional listings by the 34 listed companies.

• A notable achievement was also seen in the regulatory environment through the enactment of financial sector laws for the Banking & NBFI, Insurance, Pensions and Capital Markets industries.

• The pooled funding arrangement was appropriate. • The project design in terms of collaboration with the Public Sector Reform is deemed as

not to be the best as it combined two reforms under one project with no appropriate communication channels.

B. Impact • The capital market saw an increase in activities and higher visibility of its products.

The computerized systems for data storage and transmission, market surveillance and regulatory compliance and the on-site inspection activities by the GSEC instilled greater confidence in the transparency of GSEC operation and the market. The automation of the GSE resulted in improved efficiency, information dissemination, capacity and market competitiveness. The implementation of the 2nd tier pension scheme led to market liquidity improvements.

• The Banking and NBFI industry benefited from improved efficiency and more transparency in bank products and access to bank information. The rural banks can better compete with other financial institutions and big commercial banks. Reports of fraudulent activities in RCBs were reduced to the minimum. The capacity building programs and the airing of a documentary on venture capital financing contributed to the significant increases of the number of applications for venture capital financing.

• The insurance industry experienced remarkable improvements in the legal and regulatory framework and NIC’s operational capacity. The installed systems for management information and regulatory analysis improved submission of data and required reports by insurers, as well as the preparation and analysis of market statistics for early warning purposes. Foreign participation of the local insurance market increased together with the growth in the number of local insurance companies.

53

C. Results Framework • The PDO is considered as aligned to the Government’s Medium Term Policy Framework

(2006). • The overall outcome indicators were all met with the exception of a few component

based indicators. • The improved levels of financial deepening and intermediation were the result of the

growth and diversification of financial institutions and services over the years. • The competition environment was improved with the licensing of some regional banks. • Some of component-level indicators for the FSR part of the project were not relevant

given the institutional, growth and development of the country, specifically: Number of the credit reporting bureau operational in country: The small economy

does not need four operational Credit Referencing Bureaus as the project targeted. On-site inspections of insurers by the NIC: The indicator contradicted with Section

165 (4) of Act 74 (2006), which requires inspection of insurers at least once every two years, instead of every year as the project targeted.

The Long Term Savings Act: This indicator became redundant due to the passage of the Pensions Act (2008).

Compliance with Basel Core Principles: The indicator measures the compliance based on the 1999 BCP Assessment Methodology which was 100%, while the compliance level would fall to 88% by the 2006 methodology.

Compliance with IAIS: The target was not achieved due to the current legal and regulation environment of the insurance industry. The expected passage of the revised NIC Act would increase the compliance level.

D. Challenges during early periods of implementation

• Slow decision making in implementation process by the IAs led to a slowdown of the implementation process when approvals are granted by IDA/MOFEP.

• Delayed reimbursements were caused by two problems at the IA level: Failure to submit accurate documentation to facilitate speedy re-imbursement of these activities; and late application for re-imbursement or request for No-objection.

• Requirements of submission of quarterly and annual reports by IAs were often not met (late or no submissions), and inaccurate reporting by some IAs was a major challenge.

• There were inadequate personnel to handle the technical aspects of IAs’ procurement and monitoring & evaluation and a lack of effective communication with the IAs on the issues faced.

• World Bank delays in the approval processes affected the rest of those processes and put pressure on the internal resources of various IAs which was a cause of underachievement of the expected results.

• Overloaded yearly Work Plan by some IAs resulted in little or no achievement in the year, and the two project extensions to accommodate incomplete activities.

• Lack of Adequate Funds for several activities which had to be cancelled. • Frequent Changes of World Bank task team leaders and government officials resulted in

temporary slowdown of activities. • Delivery of imported goods suffered delays due to the difficulties in securing approvals

for exemption from duties/taxes on goods secured from outside Ghana.

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E. Lessons learnt

1. There is a need to consider insurance cover for delicate assets acquired under the projects. 2. There is a need for IAs to have a dedicated staff to manage (and coordinate between)

their components under the project. 3. Project indicators should be reviewed periodically to reflect changing economic and

environmental conditions. 4. Financial Literacy Education should be sustained over a long period rather than the once

a year annual financial literacy program. 5. There is a need to encourage sub-sector specific interventions rather than the all-inclusive

approach which involves too many IAs for implementation.

55

Annex 8 Comments of Cofinanciers and Other Partners/Stakeholders


In October 2011, DFID issued a project completion report for financial sector reform in Ghana, which covered the development partner’s participation of the EMCB Project. In addition, the ICR review has received SECO’s summary views of the Project. Below is the Executive Summary of DFID’s report and SECO’s summary views. DFID Executive Summary Quote: “The EMCB project was designed as a multi-Development Partner SWAp support to the Government of Ghana under a basket funding arrangement. DFID committed GBP 1.3 million37 through the EMCB to support the government to define and perform its role as a facilitator for economic development by establishing a level playing field in the financial sector focusing on outcomes rather than new institutions. The DFID support was specifically targeted at Component 7 of the EMCB: Access to Finance and Financial Sector Governance. Under this component, two major initiatives were targeted by DFID for support: the FinScope Survey and the Remittance Country Partnership. The log frame for the SFSR established the following Goal, Purpose and Outputs: Goal: Expansion of private sector financial services for micro, small and medium enterprises and poor rural and urban households Purpose: Improved capacity of Ghana's financial sector to meet the needs of micro, small and medium enterprises and poor rural and urban households Outputs Achievement of Financial Sector Reform development objectives as specified in the World Bank Economic Management and Capacity-Building Project Appraisal Enhanced financial sector policies and products Regular Information available to users/beneficiaries of remittances to increase transparency and competition Remittance Country Partnership Grants allocated to private sector for the development of innovative remittance projects The indicators for the outputs suggest that the outputs had only been partially realized as at June 30, 2011. The activities that were to drive the outputs were either delayed (FinScope Survey) or did not quite get off the ground (remittances). The most recent World Bank Project Implementation Mission rated the project as Moderately Satisfactory. Despite the setbacks in the implementation of these specific project activities, significant progress was made during the project period towards the project purpose as reflected in the expansion of financial services to MSMEs and poor and rural households. The number of financial institutions providing pro-poor services increased and deposits in rural and community banks grew at an annual rate well in excess of inflation.

37 This must be a typo as the relevant legal documents showed that DFID originally provided GBP2.6 million (USD5 million equivalent) to cofinance the FSR part of the Project.

56

These results have driven some important gains in the realization of project goals. Credit to the private sector has increased above targets, several laws have been passed to enhance financial regulation and regulatory supervision and compliance has been significantly improved. On balance, the risks associated with the project were as expected from start. While the risks anticipated with regard to FinScope did not materialize, the risks of the remittance component materialized, reflected in minimal implementation of the component activities as at June 2011. Programme management was supported by DFID’s active role in the Steering Committee and all implementation support missions. However, the implementation of the project was negatively impacted by turnover of government personnel (Minister, Chief Director and Director of Financial Sector Division of MOFEP) and the World Bank Task Team Leader. In addition, the lack of procurement expertise within the implementing agencies resulted in extremely weak implementation during the first year of the project. The lessons to be learned from the project are twofold. First, country ownership of projects is a significant factor in the success of projects. In was noted, for example, that the two projects championed by DFID (FinScope and Remittance Country Partnership) were not part of the recommendations of FINSSP suggesting that they were not fully demand driven and thus suffered from a lack of interest by the relevant stakeholders. Second, procurement expertise is important for the speedy implementation of a project such as EMCB. An early investment in procurement expertise at the level of the relevant implementing agencies would have significantly enhanced project implementation.” End of quote SECO summary views Quote: “In October 2003 Ghana’s Cabinet approved a comprehensive Financial Sector Strategic Plan FINSSP I aimed at promoting rapid financial sector development. The EMCB was addressing comprehensively financial sector reform and development needs. In this respect it mirrored the comprehensive high level government approach and government ownership to wholesome sector reforms. To strengthen this consolidated vision, and acknowledging that the fragmented nature of the sector needed to be addressed on the one hand and strong interconnections of the subsectors on the other side, a sector wide approach was considered to be the right approach. SECO joined the EMCB in 2009. In its decision process, SECO assessed the option join the coordinated efforts through formal alignment as well as the option of a pooled funding. Given the broad nature of the operation and the limited resources to monitor progress and actively participate in policy dialogue around the issues, SECO decided to:

• to pool funds with the World Bank and other donors, but to limit its attention to the following areas: banking regulation and supervision (component 2), pension sector development (component 5) and public debt management (component 6);38 and

• to complement the programme through targeted bilateral support initiatives in the mentioned areas.

Such initiatives were and are still ongoing, amongst others: strengthening of the banking supervision capacities of the Bank of Ghana, and the ability to assess and address systemic risks. Strengthen the central Bank’s ability to address money laundering issues, incentivize the use of formal channels for remittances, etc. It also embarked on a long-term cooperation with the

38 This could be a typo as public debt management was grouped under Component 7.

57

pensions regulator, NPRA. On debt management, SECO made funds available to strengthen the management of public debt. SECO was of the view and continues to hold the view that the operation was and still is very relevant. SECO recognizes that the main shortcomings in terms of results are attributable to the design of the EMCB:

• large number of implementers • a certain disconnect between high level aggregate objectives, indicators and activities;

and • large number of activities without clear contribution path to the overall, aggregate

objective. On the positive side, SECO recognizes that the broad design has paved the way for more dialogue and coordination among regulators and associated stakeholders in the sector. The merits of such increased dialogue are likely to become more apparent with increased integration into the global market and raising complexity of risks. SECO is inconclusive as to whether the EMCB achieved the expected impact of the program, which was to strengthen the effectiveness and competitiveness of the financial sector in Ghana and to enhance private sector access to competitive financial products and services. SECO also recognizes that the programme faced important implementation challenges, some of which again were attributable to the initial design. Whilst a number of steps taken to address the challenges have been adequate, e.g. redesign of the programme, strengthening of the procurement capacities, the allocated human resources to the EMCB have been inadequate. The limited resources were completely absorbed by the attempt to keep the programme together and track the execution of the numerous activities, but largely fell short to monitor results and provide strategic orientation (namely with regard to the sequencing and prioritization of activities). SECO therefore believes that sufficient resources will need to be allocated for the monitoring of such a complex operation. SECO has appreciated the collaboration with the World Bank and intends to pursue joint efforts in the future.” End of Quote

58

Annex 9 List of Supporting Documents


The World Bank documents related to Ghana EMCB Project: 1. Minutes of Quality Enhancement Review Meeting (June 29, 2005) 2. Minutes of Decision Meeting (August 3, 2005) 3. Project Appraisal Document (Report No: 33791-GH, October 19, 2005) 4. Project Papers (Report No: 41631-GH, November 14, 2007; and Report No: 62014-GH, June 2011) 5. Development Credit Agreement (December 28, 2005) 6. Financing Agreement (April 14, 2008) 7. Mid-Term Review Aide Memoir (August 17 – September 2, 2009) 8. Other World Bank mission aide memoirs and back-to-office reports (January 2005 – May 2013) 9. Implementation Results and Status Reports (March 2006 – May 2013) 10. Country Assistance Strategy Reports (February 20, 2004, May 31, 2007, March 1, 2010) 11. Country Partnership Strategy Paper (draft, July 3, 2013) 12. PADs and/or ICRs of Rural Financial Services Project, Micro, Small and Medium Enterprises Project,

Public Sector Reform Management Project, Public financial Management Technical Assistance Project, Non-Bank Financial Institutions Assistance Project, and Economic Reform Support Operation Credit II)

The Government documents: 1. MOPSR Public Sector Reform Strategy (August 2005) 2. MOU between GOG and Participating DPs for the Implementation of the National Public Sector

Reform Strategy (March 2006) 3. MOU between GOG and Participating DPs for the Implementation of the Financial Sector Reform

Program (draft, 2006) 4. Comprehensive Public Sector Reform Work Program (January 2007) 5. FINSSP II (June 16, 2011) 6. MOFEP 2011 Annual Progress Report (May 2012) 7. MOFEP Evaluation Report on FSR part of EMCB Project (October 14, 2013) Other Sources: 1. IMF Ghana FSAP Updates (February 24, 2003, and May 2, 2011) 2. IMF Ghana 2013 Article IV Consultation (June 2013) 3. DFID Country Study Ghana 2000 – 2005 (March 2006) 4. DFID Assessing DFID Support to Public Administration Reform in Ghana (March 21, 2008) 5. DFID Project Completion report for Financial Sector Reform (October 2011) 6. GiZ Status Report of Joint NIC-GIZ Cooperation Roadmap (August 2013) 7. FinMark Trust FinScope Ghana 2010 8. PWC Ghana 2012 Ghana Banking Survey (September 2012)

K w a h u P l a t e a u

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Mount AfadjatoMount Afadjato(880 m) (880 m)

U P P E R W E S TU P P E R W E S T

B R O N G - A H A F O B R O N G - A H A F O

A S H A N T IA S H A N T I

W E S T E R NW E S T E R N

C E N T R A LC E N T R A L

E A S T E R NE A S T E R N

V O L T A V O L T A

U P P E R E A S TU P P E R E A S T

N O R T H E R NN O R T H E R N

GREATERGREATERACCRAACCRATemaTema

WinnebaWinneba

EnchiEnchi

KadeKade

PresteaPrestea

Twifo PrasoTwifo Praso

TarkwaTarkwa

OdaOdaDunkwaDunkwa

KpanduKpandu

KrokosueKrokosue

DiasoDiaso

BibianiBibiani

GoasoGoaso

TechimanTechiman

YejiYeji

KwadwokuromKwadwokurom

DambaiDambai

NakpayiliNakpayili

YendiYendi

GushieguGushiegu

WalewaleWalewale

WalewaleTumuWalewaleTumu

NakpanduriNakpanduri

HamaleHamale

BoleBole

SawlaSawla

FufulsuFufulsu

AtebubuAtebubu

JemaJema

KintampoKintampo

MakongoMakongo

SalagaSalaga

AgogoAgogo

BerekumBerekum

NavrongoNavrongo

ObuasiObuasi

HoHo

WaWa

KumasiKumasi

TamaleTamale

SunyaniSunyani

KoforiduaKoforidua

BolgatangaBolgatanga

Takoradi

Newtown

Tema

Winneba

Axim

Enchi

Kade

Prestea

Aflao

Twifo Praso

Tarkwa

OdaDunkwa

Kpandu

Krokosue

Diaso

Bibiani

Goaso

Techiman

Yeji

Kwadwokurom

Dambai

Nakpayili

Yendi

Gushiegu

Walewale

WalewaleTumu

Nakpanduri

Hamale

Bole

Sawla

Fufulsu

Atebubu

Jema

Kintampo

Makongo

Salaga

Agogo

Berekum

Navrongo

Obuasi

Ho

Wa

Kumasi

Tamale

Sekondi

Sunyani

Koforidua

Cape Coast

Bolgatanga

ACCRA

U P P E R W E S T

B R O N G - A H A F O

A S H A N T I

W E S T E R N

C E N T R A L

E A S T E R N

V O L T A

U P P E R E A S T

N O R T H E R N

GREATERACCRA

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BENIN

CÔTED'IVOIRE

BURKINA FASO

White Volta

Kolpawn

Daka

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Pru Tain

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Pra

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Afram

Volta

Birim

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Blac

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Black Volta

Gul f of G uinea

LakeVolta

To Porto-Novo

To Abomey

To Sokodé

To Djougou

To Dapaong

To Tenkodogo

To Bobo-

Diolasso

To Ferkéssédougou

To Bouna

To A

gbov

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To A

bidj

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To Djougou

K w a h u P l a t e a u

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Mount Afadjato(880 m)

6° N

8° N

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6° N

8° N

10° N

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2° E

0°

2° W 2° E0°

GHANA

0 20 40 60

0 20 40 60 Miles

80 Kilometers

IBRD 33411

SEPTEMBER 2004

GHANASELECTED CITIES AND TOWNS

REGION CAPITALS

NATIONAL CAPITAL

RIVERS

MAIN ROADS

RAILROADS

REGION BOUNDARIES

INTERNATIONAL BOUNDARIES

This map was produced by the Map Design Unit of The World Bank. The boundaries, colors, denominations and any other information shown on this map do not imply, on the part of The World Bank Group, any judgment on the legal status of any territory, o r any endo r s emen t o r a c c e p t a n c e o f s u c h boundaries.

Document of The World Bank...AND AN ADDITIONAL FINANCING . IN THE AMOUNT OF SDR 6.4 MILLION (US$10...

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Transcript of Document of The World Bank...AND AN ADDITIONAL FINANCING . IN THE AMOUNT OF SDR 6.4 MILLION (US$10...