Annex 1: Bhutan CPS Results Matrix
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Document of The World Bank Group FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No. 88597-BT INTERNATIONAL DEVELOPMENT ASSOCIATION AND INTERNATIONAL FINANCE CORPORATION Public Disclosure Authorized COUNTRY PARTNERSHIP STRATEGY FOR THE KINGDOM OF BHUTAN FOR THE PERIOD FY2015–19 Public Disclosure Authorized August 25, 2014 Bhutan Country Management Unit South Asia Region Public Disclosure Authorized International Finance Corporation Asia Region This document has restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS Date of last Country Partnership Strategy: October 27, 2010 (Exchange Rate Effective as of April 4, 2014) Currency Unit: Bhutanese Ngultrum US$1.00 = BTN 60 GOVERNMENT’S FISCAL YEAR: (July 1–June 30) ABBREVIATIONS AND ACRONYMS AAA Analytical and Advisory Activities KPIs Key Performance Indicators ADB Asian Development Bank MDGs Millennium Development Goals BHU Basic Health Units MDTF Multi-Donor Trust Fund BNB Bhutan National Bank MIC Middle Income Country BISP Benazir Income Support Program MIGA Multilateral Investment Guarantee Agency BTFEC Bhutan Trust Fund for environmental Conservation MSME Micro, Small, and Medium Enterprise CPIA Country Policy and Institutional Assessment NKRA National Key Result Area CPS Country Partnership Strategy NLTA Non-Lending Technical Assistance CPSPR Country Partnership Strategy Progress Report NMES National Monitoring and Evaluation System DFID UK - Department of International Development NORAD Norwegian Agency for Development Cooperation DPC Development Policy Credit PDP People’s Democratic Party DPL Development Policy Loan PEFA Public Expenditure and Financial Accountability DPs Development Partners PER Public Expenditure Review DRM Disaster Risk Management PFM Public Financial Management DSA Debt Sustainability Analysis PHRD Japan Policy and Human Resource Development EDP Economic Development Policy PPP Public-Private Partnership EFTCS Electronic Funds Transfer Clearing System PPPD Public Procurement Policy Division FCPF Forest Carbon Partnership Facility REDD Reduced Emissions form Deforestation and Forest FDI Foreign Direct Investment Degradation GDP Gross Domestic Product RGoB Royal Government of Bhutan GEF Global Environment Facility RMA Royal Monetary Authority GFDRR Global Facility for Disaster Reduction RTM Round Table Meeting and Recovery RUB Royal University of Bhutan GNH Gross National Happiness SDC Swiss Development Corporation GNI Gross National Income SME Small and Medium Enterprise GTP Graduate Training Program SOE State-Owned Enterprise IBRD Int’l Bank for Reconstruction and Development TA Technical Assistance ICR Implementation Completion and Results Report TAP Technical Assistance Program IDA International Development Association TTF Trade and Transport Facilitation IDF Institutional Development Fund UCS Use of Country Systems IEG Independent Evaluation Group UNDP United Nations Development Programme IFC International Finance Corporation UNICEF United Nations Children’s Fund IMF International Monetary Fund WAVES Wealth Accounting and Valuation of Ecosystems JICA Japan International Corporation Agency Services WBG World Bank Group IDA IFC Vice President: Philippe Le Houérou Vice President: Karin Finkelston Country Director: Johannes Zutt Regional Director: Serge Devieux Country Manager: Kyle F. Kelhofer Task Team Leader: Genevieve Boyreau Task Team Leader: Om Bhandari/Junko Oikawa TABLE OF CONTENTS I. EXECUTIVE SUMMARY ......................................................................................................... I II. COUNTRY CONTEXT ............................................................................................................ 1 A. Social and Political Context ....................................................................................... 1 B. Bhutan’s Progress on Poverty Reduction and the MDGs........................................... 2 C. Recent Economic Developments ................................................................................ 3 D. Economic Prospects and Medium-Term Outlook ...................................................... 6 E. Private Sector Development and Jobs ...................................................................... 8 F. Spatial and Green Development ................................................................................ 8 G. Policy and Institutions ............................................................................................... 9 III. THE GOVERNMENT PROGRAM ......................................................................................... 10 IV. WORLD BANK GROUP PARTNERSHIP STRATEGY FY2015-19 ......................................... 11 A. Lessons Learned from the last CPS and Stakeholder Consultation ........................ 11 B. Proposed WBG Partnership Strategy ...................................................................... 12 C. Implementing the CPS ............................................................................................. 20 V. MANAGING RISKS.............................................................................................................. 24 Figures Figure 1: Growth is strong and poverty has dropped ...................................................................... 2 Figure 2: Growth and revenues are expected to pick up with the commissioning of hydro-projects ......................................................................................................................................................... 7 Figure 3: Bhutan CPS Results Chain – Results Areas and Outcomes .......................................... 13 Tables Table 1: Selected Macroeconomic Indicators (FY09-FY13) .......................................................... 4 Table 2: Indicative Non-lending Program .................................................................................... 21 Table 3: Indicative Financing Program......................................................................................... 21 Table 4: Donor Engagement in Bhutan ........................................................................................ 23 Table 5: WBG Engagement Risks and Mitigation Measures ....................................................... 24 ANNEXES Annex 1: Bhutan CPS Results Matrix .......................................................................................... 26 Annex 2: Bhutan CPS Completion Report FY11-14 .................................................................... 29 Annex 3A: Summary of CPS Program Program and Self Evaluation .......................................... 44 Annex 3B: Bhutan CPS Planned Lending Program and Actual Delivery .................................... 54 Annex 4: Bhutan Status of Millennium Development Goals ....................................................... 56 Annex 5: Poverty and Shared Prosperity ...................................................................................... 58 Annex 6: Gender Aspects in Bhutan ............................................................................................. 61 Annex 7: Selected Indicators of Bank Portfolio Performance and Management ......................... 63 Annex 8: IDA Operations Portfolio .............................................................................................. 64 Annex 9: IFC Investment Operation Program .............................................................................. 65 Annex 10: Bhutan Active Recipient and Bank Executed Trust Fund .......................................... 66 Annex 11: Bhutan at a Glance ...................................................................................................... 68 Map of Bhutan: IBRD 33373R2 The World Bank Group greatly appreciates the close collaboration of Bhutan’s authorities in the preparation of this Country Partnership Strategy and the feedback from stakeholders. The preparation of the document involved extensive discussions with government representatives, as well as other stakeholders, for example, the private sector, parliamentarians, the academia, youth groups and civil society. The strategy is a result of a team effort and the document received many useful contributions from the Bhutan Country Team and individuals across the WBG. Although it is impossible to name them all, we gratefully acknowledge and thank them for sharing their guidance, knowledge, and experience. I. EXECUTIVE SUMMARY i. Bhutan is a (lower) Middle Income Country (MIC) with a good record in reducing poverty and making progress towards achieving the Millennium Development Goals (MDGs). Its per capita income is US$2,400 and its estimated annual GDP growth over the next five years is 8 percent. After two successive elections, including a peaceful transfer of power, Bhutan continues to transition toward democracy within a constitutional monarchy and continues to enjoy political stability. Its policy makers are ambitious and reform-oriented and have outlined a unique development vision, where GDP is just one element among other non-monetary aspects to measure people’s well-being. The country’s mountainous terrain provides a considerable potential for the generation of hydroelectricity, for which India is the main financier and buyer. ii. To build on this progress, Bhutan needs to sustain macroeconomic stability while creating a business environment to promote private sector growth and job