Review of Progress of the Economic Cluster-Mini Budget 2009 BY - - PDF document

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Review of Progress of the Economic Cluster-Mini Budget 2009

BY Andre HABIMANA Coordinator Development Planning MINISTRY OF FINANCE AND ECONOMIC PLANNING

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Presentation Outline

1. Composition of Economic Cluster 2. Basis for Performance Evaluation 3. EDPRS Strategic Outcome Performance Review of: – Enhanced Business Climate – Economic Infrastructure Built – Increased Agricultural Productivity – Optimal utilisation of Natural Resources 4. Challenges and Solutions to address them 5. Overall Assessment of the Economic Cluster 6. Cross Cutting Issues 7. Lessons learnt

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Economic Cluster (Sector Actors)

Cluster Actors MACRO AND FINANCIAL SECTOR PRIVATE SECTOR INFRASTRUCTURE AGRICULTURE ENV, LAND AND WATER RESOURCES

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Joint Sector Reviews: Basis for Measuring Performance

Indicators/Targets Total Policy Actions The CPAF quantitative indicators were not assessed during the mini budget Joint sector reviews

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Traffic Light System used for Performance Measurement:

Green Fully met Yellow Not met but with significant progress Red Underperformed or not met

This presentation is based on the outcome of JSR and Summary of Sector Performance Reports that have been agreed both by the Government and Development Partners

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Indicators Target for 2009 Jan- June Actual Public Policy Action 2009 Jan-June

Actual Overall Credit to private sector (as % of GDP) 12.2 Operationalize MF credit fund MF credit fund

• perational

Financial sector: 3 policy actions, 2 fully met and 1 partially met Complete a feasibility study of establishing a rural micro- insurance company The option of rural micro insurance products was developed with existing insurance companies and tested(MINAGRI and SONARWA on tomato growing farmers) Adopt appropriate legal and regulatory framework for national payment systems, credit bureau and secured transactions Laws passed on security interest & secured

• transactions. A number
• f laws in the process to

be gazetted Index on business environment 56% Operationalize Commercial Registration Agency Commercial Registration Agency (RCRSA)

• perational

Effectively apply all modules of Asycuda and reinforce valuation unit in customs All borders connected to Asycuda ++ network except Rutete

EDPRS Strategic Outcome: Enhanced Business Climate

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Indicators Target for 2009 Jan- June Actual Public Policy Action 2009 Jan-June

Actual Overall Score of Investor Perceptions of regulatory issues, licensing burden, corruption and dispute resolution 60% baseline establishe d Implementation of the “quick wins reform” Reform was implemented Private sector: 5 Policy targets; all fully met Review all licenses, simplify and streamline the most cumbersome ones to reduce time and procedures taken to issue licenses All the licenses reviewed and identified for streamlining Conduct baseline survey on investor perception The survey was completed

EDPRS Strategic Outcome: Enhanced Business Climate

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Challenges and Solutions to address them: Financial Sector

Challenges:

• Stimulating economic recovery by

improving liquidity in the banking system

• Low savings and low utilization of

financial institutions (low financial literacy)

• Payment systems reforms that are

not moving fast enough Solutions:

• To improve the liquidity in the

banking system; GoR has reduced required reserve ratio from 8% to 5%, introduced medium and long term refinancing

• Umurenge SACCO policy has been

introduced to increase the levels of saving and utilization of financial institutions

• Strengthening the mechanisms for

payment systems

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Challenges and Solutions to address them: Private sector

Challenges:

• Improving investment statistics
• Low budget execution in respect

to recurrent budget due to low staff retention and difficulty hiring qualified staff

Solutions:

• Support to RDB in improving

investment statistics

• Capacity building support to

MINICOM in a coordinated manner

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EDPRS Strategic Outcome: Economic Infrastructure Built (Energy Sub-Sector)

Indicators Target for 2009 Jan-June Actual Public Policy Action 2009 Jan- June Actual Overall Number of electricity subscriptions 139,000

135,000

Choose technico-economic technology for rural electrification (Electrogaz and Mininfra) Least cost distribution technology chosen All policy targets fully met Project Management Directorate for implementation

• f the national electricity

Rollout program established in Electrogaz and operational PMD has been designed and the structure approved MW of electricity installed 80 MW Diversify energy sources (methane gas, hydro power & solar commission 20 MW,Heavy Fuel Oil Power Plant) 2 MW of methane

• nline, 20MW

heavy fuel commissioned Sign contract between Mininfra and at least 1 IPPs for generation of electricity Contract signed with Contour Global in March 2009

Challenges:

• Technical and commercial losses are

still important

• Scaling up power production to meet

increasing demand

• Development of renewable energy

and

• Investment in energy efficiency

measures

• The capacity of the energy staff
• Funding

Solutions:

• Rehabilitation, extension and

intensification of the electricity grid

• Develop renewable energies and

invest in energy efficiency measures

• Completion of the ongoing Hydro

power stations

• Projects in solar, wind, geothermal

and hydro

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Challenges and Solutions to address them

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EDPRS Strategic Outcome: Economic Infrastructure Built (Transport Sub- Sector)

Indicators Target for 2009 Jan-June Actual Public Policy Action 2009 Jan-June Actual Overall Percentage of classified National Road network in good condition 19% Commence and complete Rehabilitation of at least 20 km of the 271 of paved roads 48 km rehabilitated 6 policy targets, 3 fully met, 1 partially met and 2 not met Complete periodic maintenance of at least 120 km (cum) of the 780 km of the national Earth roads 127 km completed Establish Axle Load Control System for 50% of the national paved road network The roadmap to establish the Axle load control system is in place; Commencement of Transport master plan study. Firm has been selected to commence the study Cabinet adoption of road sector reform package covering an autonomous road agency as part of proposed Transport Board and Road Act The Transport reform package was adopted by the Cabinet.

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Cont’d EDPRS Strategic Outcome: Economic Infrastructure Built (Transport Sub- Sector)

Indicators Target for 2009 Jan-June Actual Public Policy Action 2009 Jan- June Actual Overall Percentage of classified District Road network in good condition 28% Districts sign multi-annual (3 years) output and performance based road contracts (OPBRC’s) with at least 1 more contractor Only 1 contract signed

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Challenges:

• Poor condition of rural road network
• Co-financing required for major road

projects

• Low capacities of districts in planning

and monitoring of transport project

• Dialogue in the transport SWG

Solutions:

• Increasing capacity in planning for

transport infrastructure development at local government level

• Planning and reporting systems on

transport works at district levels need to be urgently developed

• Reinforce the Transport SWG
• rganization and align Donor Mission

schedules with the joint Sector review

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EDPRS Strategic Outcome: Increased Agricultural Productivity

Indicators Target for 2009 Jan-June Actual Public Policy Action 2009 Jan- June Actual Overall

Proportion of arable land sustainably managed against soil erosion 50% Feasibility studies for an additional 14 sites identified under the LWH for sustainable land and watershed management are tendered, contracted and initiated by MINAGRI. Fully met 7 policy targets, 4 fully met, 3 partially met Publish Land consolidation ministerial decree. Decree drafted and shared with stakeholders Mineral Fertilizer used (MT) 30,800 Develop an action plan for private sector-led fertilizer distribution based

• n key lessons from 2009A.

This is endorsed by the Ministry and shared with rural cluster Draft action plan developed, yet to be validated Extend fertilizer demonstration plot program to include at least 1 per sector in rural areas Implemented in all sectors

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Cont’d EDPRS Strategic Outcome: Increased Agricultural Productivity

Indicators Target for 2009 Jan-June Actual Public Policy Action 2009 Jan- June Actual Overall Production of Key food security crops (1,000 MT cereal equivalents) Draft and endorse an agriculture mechanization strategy

Draft shared with stakeholders, yet to be finalized

Adoption of seed policy and action plan by cabinet

Seed policy and action plan adopted by Cabinet in March

Draft, cost and validate the 5- year action plan to implement the Seed Policy.

Seed action plan costed and validated

Challenges and Solutions to address them

Challenges:

• Seed sub sector remains weak
• Aquaculture sector needs to be

strengthened

• Analyzing the impact of policies on

development of the agriculture sector needs to be reinforced

• High post harvest losses
• Increasing access to finance for

farmers

• Increasing the land area under

irrigation

Solutions:

• Form collaboration and joint

initiatives to assist the development

• f the Seed sub sector
• MINAGRI to Work with stakeholders

to improve fish production and to substitute imports

• Next household survey should assess

the impact of production increases

• n poverty reduction
• Increase focus on storage systems,

particularly warehouse receipt systems

• Focus on small scale irrigation for

smallholder producers as well

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EDPRS Strategic Outcome: Optimal utilization of Natural Resources

Indicators Target for 2009 Jan- June Actual Public Policy Action 2009 Jan- June Actual Overall Percentage of area of privately

• wned land

held under written title 10% Production of orthophotos for 75% of the country. 70% photos produced and 67% titles issued All 3 policy targets fully met Completion of assessing existing conditions in the country, marked by submission

• f a report of survey.

Assessment complete and draft report submitted Percentage area of land protected to maintain biological diversity 8.80% Rehabilitation of critically degraded ecosystems, repairing the bank of sebeya and Nyaborongo rivers , the shores of lake Kivu and Muhazi including side basins of Rweru, Kamiranzovu, Mugesera and Akagera The critically degraded systems have been rehabilitated

Challenges and Solutions to address them

Challenges:

• Excessive use of fuel wood for domestic

and industrial energy demands;

• Limited land for reforestation;
• Gap in knowledge of national potential

and extensive artisanal scale mining

• Land disputes and claims that delay

registration process

• Institutional coordination to support

integration of environment as a cross cutting issue,

• lack of effective support by the private

sector in Environmental Impact Assessment practice; insufficient data and studies on water resources

Solutions :

• Build capacity both human and

technical expertise in all areas of the sector to ensure effective management and rational utilization of natural resources.

• Reinforce coordination mechanisms at

national level to ensure delivery of sector outputs

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Total CPAF Indicators/ Targets Data Not Available Targets Met

• r Exceeded

Total Policy Actions Fully Implemented Partially Implemented Not Met

12 NA NA 28 21(75%) 5 (18%) 2 (7%)

Comments Overall Performance was good

Overall Assessment of the Economic Cluster

Cross Cutting Issues

• Overall reporting on cross cutting issues in the cluster

was weak

• The only sectors that explicitly discussed cross cutting

issues in their SPRs were the environment and natural resources , Transport, and even then there was room for improved reporting and analysis of linking CCIs to performance in the period evaluated

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Lessons Learnt

• There is a need for better reporting on cross cutting issues

in the cluster in alignment to the respective sector outputs and objectives

• There has been improved coordination overall in organizing

the JSRs, however more should be done to respect the guidelines and timelines provided by MINECOFIN

• There is also room for improvement on the analysis aspects
• f the reports especially with regards to challenges and

strategies to overcome them

• The mini budget was relatively a too short period and the

budget execution performance was affected

• There is also room need to further strengthen the sector

dialogue in some sectors

THANK YOU

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