Guinea - Technical Assistance For Economic Management Project

Doar The Wh FOR OmC Repo No. 9892 PROJECT COMPLETION REPORT REPUBLIC OF GUINEA TECHNICAL ASSISTANCE PROJECT FOR ECONOMIC MANAGEYENT (CREDIT 1559-GUI) SEPTEMBER 13, 1991 Country Operations Division Occidental and Central Africa Department This document has a 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 Currency: Guinean Franc (GF) (Average - GF per US$) 1985 1986 1987 1988 1989 1990 24.3 345.0 428.0 475.0 591.6 661.0 ABBREVIATIONS AND ACRONYMS CNP National Productivity Center (Centre National de Productivit6) CNMP National Public Procurement Commission (Commission Nationale des Marches Publics) CNPG National Center for Management (Centre National de Perfectionnement a la Gestion) DDE External Debt Division (Division de la Dette Ext6rieure) IDA International Development Association IMF International Monetary Fund MEF Ministry of Economy and Finance (Ministere de l'Economie et des Finances) MIS Management Information System MPCI Ministry of Planning and International Cooperation (Ministere du Plan et de la Cooperation Internationale) MPRN Ministry of Planning and Natural Resources (Minist&re du Plan et des Ressources Naturelles) PIP Public Investment Program SAC Structural Adjustment Credit TA Technical Assistance Fiscal Year January 1 - December 31  FOR O0FCIAL USA ONLY THE WORLD BANK Washington, D.C. 20433 U.S.A. Ofte CA Dvectnvr.lewaI Opwatons IV#W1gu"a September 13, 1991 MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Completion Report on The Republic of Guinea - Technical Assistance Proiect for Economic Management (Credit 1559-GUI) Attached, for information, is a copy of a report entitled 'Project Completion Report on The Republic of Guinea - Technical Assistance Project for Economic Management (Credit 1559-GUI)." prepared by the Country Operations Division of the Central and Occidental Africa Department of the Africa Region, with Part II of the report contributed by the Borrower. No audit of this project has been made by the Operations Evaluation Department at this time. Attachment This document has a 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.  FOR OFFICAL USE ONLY PROJECT COMPLETION REPORT REPUBLIC OF GUINEA TECHNICAL ASSISTANCE PROJECT FOR ECONOMIC MANAGEMENT (Credit 1559-GUI} TABLE OF CONTENTS Page No. Preface . . . . . . . . . . . . . . . . . . . . . i Evaluation Si-mmary . . . . . . . . . . . . . . . . . . . . .iii I. PART I: PROJECT REVIEW FROM THE BANK'S PERSPECTIVE Project Identity . . . . . . . . . . . . . . . . . . . 1 Background .1... . . . . . . . . . . . . . . . . . . Project Objectives and Descriptior. . . . . . . . . . . 3 Project Design and Organization . . . . . . . . . . . . 4 Project Implementation . . . . . . . . . . . . . . . . 5 Project Results .... . . . . . . . . . . . . . . . . 7 Project Sustainability . . . . . . . . . . . . . . . . 8 Bank Performance .... . . . . . . . . . . . . . . . 9 Borrower Performance . . . . . . . . . . . . . . . . . 9 Consultants Services .... . . . . . . . . . . . . . 10 Project Documentation and Data . . . . . . . . . . . . 10 Attachment I: Table of Project Results . . . . . . . . 11 II. PART II: PROJECT REV,EW FROM BORROWER'S PERSPECTIVE Summary Completion Report on PAGEN I . . . . . . . . . 15 III. PART III: SUMMARY OF STATISTICAL DATA Table 1 - Related Bank Loans . . . . . . . . . . . . . . 25 Table 2 - Project Timetable . . I . . . . . . . . . . . 26 Table 3 - Loan Disbursements . . . . . . . . . . . . . 27 Table 4 - Project Financing Costs . . . . . . . . . . . 28 Table 5 - Staff Inputs . . . . . . . . . . . . . . . . 29 This document has a 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.  PROJECT COMPLETION REPORT REPUBLIC OF GUINEA TECHNICAL ASSISTANCE PROJECT FOR ECONOMIC MANAGEMENT (Credit 1559-GUI) PREFACE This is the Project Completion Report (PCR) for the Technical Assistance Project for Economic Management in Guinea for which Credit 1559- GUI in the amount of US$9.5 million equivalent was approved on March 21, 1985. The loan was closed on June 30, 1990. one year behind schedule. It was fully disbursed and the last disbursement was made on January 30, 1990. The PCR was prepared by the Country Operations Division of the Central and Occidental Africa Department of the Africa Region (AFlCO). The Guinean authorities have submitted their own assessment of the Project which is attached as Part II of this Report. The PCR was compiled on the basis of information available in Washington. It is based, inter alia, on the President's Report, the Credit Agreement, supervision reports, correspondence between the rx.nk and the Borrower, the Project Implementation Monitoring system (PIT,), interviews "ith Bank staff involved in the project, discussions with representative of the Borrower and technical assistants in the field.  LIA. PROJECT COMPLETION REPORT REPUBLIC OF GUINEA TECHNICAL ASSISTANCE PROJECT FOR ECONOMIC MANAGEMENT (Credit 1559-GUI) EVALUATION SUMMARY Project Objectives 1. The project attempted to meet two major objectives: (i) to pro%ide the Guinean Government and the donors with the inputs -- data base, economic analyses, and operational procedures -- necessary for the design and implementation of the reform program; and (ii) to ensure in the process the institutional strengthening of the key agencies involved through a complete overhaul of their organization and their functions, as well as through formal and on-the-job training of their staff. Implementation Experience and Prolect Results 2. Project implementation commenced in an environment characterized by extremely difficult physical conditions, and a weak and disorgenised administrative apparatus. Opting for a consulting-firm approach to TA recruitment and management facilitated project implementation tremendously. All the issues associated with recruiting or replacing experts, helping them solve logistical problems, and on-the-spot coordination were handled by the consulting firm. Project organization proved insufficient. Project implementation suffered from a mix of incompetence in the area of accounting and mismanagement, where the former facilitated the latter. 3. Performance in meeting the two main project objectives varied. With regard to the first objective, i.e., providing Government and the donors with the inputs necessary for the design and implementation of the economic reform program, the record was as follows. While provision of the key inputs for the design of the economic reform program, such as data bases and economic analyses, did not run into any major implementation problem, the introduction of the tools necessary to program implementation was much more problematic. The management tools (e.g.,public investment program, budget, debt data base) and the operational procedures (e.g.,procurement code; new customs regulations and enforcement procedures; the legal texts creating the institutional framework for coordinating and implementing the divestiture/liquidation of public enterprises) were produced. Internalization, however, remained low due to the inadequate skill base in the administration, and implementation remained the hostage of vested interests within as well as outside the Government. 4. The objective of institutional strengthening encountered numerous obstacles many of them related to the slow pace of the still ongoing civil service reform. Lack of competent counterparts, high staff turnover, an incentive framework that does not favor learning and performance, lark of management and monitoring of the TA on-the-job training duty, im;eded meaningful progress in improving economic management capabilities ana rsore generally in improving the quality of the civil service. 5. The formal training component was the major success of the project. In order to adapt it better to the specific needs of the administration, the training component underwent a drastic change in design  iv at the implementation stage. While the first version entailed a wide array of short specialized courses, the subsequent one involved a longer-term curriculum. The two-year part-time courses consisted of a first year of upgrading the skills level in the basic areas of economlc management, and a second year of specialization. The component as redesigned involved specific mechani6ns to ensure on-the-job training and skills transfer from the expatriate TA to the national counterparts. All first-year courses are now taught by nat..nals, the quality of training is good, and attendance at the national training center (WtJPG) has increased far beyond the population targeted by the project. Project Sustainability 6. Despite improvements in some specific areas such as investment analysis, budget, and procurement, the Guinean administration remains highly dependent on technical assistance. The project, however, established an extremely effective training structure which if adequately used by the ministries in charge of economic management could play a pivotal role in the process of skill localization and institution strengthening. Findings and Lessons learned 7. In contexts where there is a lack of a rigorous accounting tradition and education as well as a wide tendency for mismanagement of public funds, incompetence in the area of accounting will facilitate mismanagement and make it difficult to detect in time. These issues can be most effectively addressed at the project design stage. Adequate training in specific aspects of procurement and related Bank procedures should be provided to project accountants. Financial and operational audits should be undertaken during implementation, so that fraudulent practices can be detected and acted upon in time. Finally in instances where adequate management of project resources cannot be ensured in line ministries, it might be preferable to establish independent project management units. Such a solution was adopted under the follow up project, Second Economic Management Support Project, credit Nc 1963-Gui. 8. In countries such as Guinea where the civil service skills base is weak and ill-adapted to the management of a market economy, technical assistance is doomed to play a substitution role in an early stage when TA outputs are urgently needed for the design of the adjustment program. What is crucial, however, is to set the stage for institutional strengthening from the outset and take the appropriate actions s..o meet the objective. The project teaches some useful lessons in that respect. 9. First, on the supply side, it is important to develop a training strategy tailored to meet the specific needs of the target population. The ingredients of such a strategy are formal and on-the-job training. Formal training has to start with upgrading of basic skills, with specialization needs being addressed later. Effective on-the-job training requires an intensive management of the technical assistance to ensure that training actually takes place and that progress is monitorable and measurable.  v 10. Second, on the detmand side, it is crucial to ensure tdLot the conditions on the recipient part, i.e. the administration, do not impede meetIng the institution strengthening objective. In particular reasonable staff stability, and an incentive framework that favors learning and performance should be introduced so that the technical assistants can fulfill their responsibility for training, and the formal training structure can be fully utilized by the target population.  PROJECT COMPLETION REPORT REPUBLIC OF GUINEA TECHNICAL ASSISTANCE PROJECT FOR ECONOMIC MANAGEMENT (CXedit 1552-GUI) PART I: PROJECT REVIEW FROM THE BANK'S PERSPECTIVE I. Prolect Identity Project Name s Technical Assistance Project For Economic Management Credit No. t Cr. 1559-GUI Credit Amount: SDR 9.7 million (US$9.5 millton equivalent) RVP Unit t Africa Country a Republic of Guinea Sector a Economic management II. Background 1. Despite agricultural, mineral, and energy resources which make it one of the best endowed countries in Africa, Guinea experienced declining economic performance from Independence in 1958 to the early 1980's. The private sector was largely displaced by a pervasive network of state enterprises i; all sectors as the Government increasingly followed a centrally-planned a)mel of economic management. 2. By the early 1980's, Government's finance had eroded due to poor performance of the parastatal sector. The economy's external position became unsustainable, largely as a result of public investment outside the mining enclave which failed to generate returns adequate to service the associated external debt. Mounting debt service obligations and private capital flight, unmatched by increments in capital inflows, resulted in a continual rise in the foreign liabilities of the Central Bank and a massive accumulation of payments arrears. 3. In the human and institutional areas the situaition was even worse: repressive policies sapped Gutinea of its intellectuals and its best entrepreneurs who emigrated in vast numbers; movements of people and goods were severely constrained; the legal system was in a shambles as arbitrary authority was substituted for due process; ard ineffectual public institutions proliferated in order to absorb an inflated, poorly paid end unskilled civil service plagued by corruption. 4. In 1985, most of Guinea's 5.8 million inhabitants lived at the margin of poverty. Per capita income wai about US$300, among the lowest in the developing countries, life expectancy was only 44 years, infant mortality was about 17 percent, 90 percent of the population had no access to safe water, and 80 percent of the adult population was illiterate. 5. As early as 1979, the pressure of the economic situation led the Government to take some limited steps towards improving economic management and decentralization of the economys excessive monetary growth was slightly reduced, the need for more explicit performance criteria and greater  2 autonomy of public enterprises was recognized, and the 1979 capital grants to parastatal required them to settle their futnre transactions in cash. 6. Though the Governement was not ready yet to embark on a meaningful reform process and adopt the structural economic reforms needed to arrest the downvard trend of the Guiaean economy, it was aware that such a process would require a strengthening of the Gove-nment's capabilities in management of economic affairs. In 1981, the Government formally requested IDA financing for a technical assistance project intended to strengthen the Ministries of Planning and Statistice, State Control, and the Central Bank of Guinea. 7. Project identification work began in 1981 after indications were received that (i) the Government was prepared to accept and use technical assistance for economic management; and (ii) other donors, and particularly UNDP, could not provide this assistance. More than three years elapsed between the first contact between Government and IDA and the project being approved. Discussions with Government on the scope and processing of the project during the Sekou Toure era were long and difficult. The Government was extremely reluctant to move away from its inefficient and highly centralized planning system. S. The change in Government fo3llowing the death of President Sekou Toure in March 1984 resulted in a radical shift in economic orientation. The new Government was committed to liberalizing the economy, and therefore to more far reaching economic and institutional reforms. This dramatic change resulted in much closer cooperation between Guinea and IDA. 9. As prepar. tion of the economic reform program to be later financed undpr a structural adjustment credit (SAC) proceeded, the new authorities decided that a complete overhaul of the relevant institutions was necessary. The adjustment program focused on economic liberalization measures and reform of public administration and public enterprises. Consultants financed under the PPF advances foa the technical assistance project examined the relationship between the Ministry of Planning and Statistics and other agencies and the functioning of the Ministry of Finance 1/. The IMF r2viewed the operation and structure of the Central Bank. Following discussions with the Association and the Fund, and in the context of a major reform of Government organization in December 1984, the authorities decided to undertake immediately a complete organizational overkaul of the thre4e key ministries charged with economic management. 10. The US$ 9.5 million equivalent Technical Assistance Project for Economic Management (Credit 1559-GUI) was approved on March 14, 1985; the credit agreement was signed on March 21, 1985 and declared effective on July 8, 19Z5. The project was closed on June 30, 1990. 1/ Two PPF advances totalling US$400,000 financed consultants and training for project preparation, organizational studies of the ministry of planning and the ministry of economy and finance, legal advice for implementing the reorganization. architectural designs and initial start-up activities (preparation of detailed training program, household survey and audit of external debt).  3 III. Project Objectives and Description 11. The principal aim of the project was to improve the quality of the Government's economic management, through a three-year, first-phase program of technical assistance and staff training. The project had five main componentes investment analysis, macroeconomic planning, preparation of economic data, control of public expenditure and revenues, and training. In addition, the project comprised important but smaller components on management of external debt statistics, and the parapublic sector. 12. The objective of the Investment Analysis Component was to improve the capacity of the Ministry of Planning and Natural Resources (MPRN) which became later the Ministry of Planning and International Cooperation (MPCI), and the technical ministrits for preparation, appraisal and monitoring of the public investment program including analysis of its capital and recurrent cost implications. The project provided for expatriate specialists in project preparation and economic and financial analysis, in order to assist the staff of MPRN in the identification, preparation and selection of investment prnjects. 13. Under the Macroeconomic Planning Component, the project was to finance a resident macroeconomic planner to assist MPRN's General Planning Division for three years. After a review of past performance and identification of constraints to development, the division would prepare the outline for a strategy in the drea of public investment programming and related policies. This would focus particularly on the overall potential for developing the rural and agricultural sector. The working group would prepare the macroeconomic and policy framework for the rolling three-year investment program", and, as appropriate, would supply macroeconomic input to the technical ministries preparing sectoral investment programs. 14. The Economic Data Component was to seek to improve MPRN's estimates of the national accounts aggregates by making better use of existing data; undertaking sample surveys to estimate unavailable data; and formulating guidelines for a longer term statistical program. 15. The Ministry of Economy and Finance Component sas to introduce modernized procedures for treasury, budget and customs administration. Under a twinning arrangement between the Guinean Ministry of Economy and Finance (MEF) and the French Tresor, France would provide support for the work program of MEF by the secondment of resident specialists to the office of the MEF and to the customs service. 16. Under the Training Component, a full-time resident expatriate Training Advisor was to assist the staff of the National Productivity Center (CNP) to prepare and implement a massive program of staff training in support of the other project components and closely related to their work program. Training would be provided by the MPRN's resident experts and the short-term specialists, as well as visiting training officers specialized in the topics to be covered -- economic and financial analysis, management systems, statistics, national accounts, computing and procurement management.  4 17. The External Debt Management Component was to transfer the External Debt Division (DDE) of the Central Bank to the MEP, which would henceforth be responsible for contracting, monitoring and servicing external debt. The project would provide for consultancy services to DDE to perform a complete audit of Guinea's external debt, checking data w;h major creditors; improve the timeliness, coverage and frequency of the debt reporting system; strengthen DDE's ability to sssess the repayment capacity and define appropriate financing terms for development projects and investments requiring debt guarantees; and help articulate a public sector borrowing strategy within the country's limited debt capacity. 18. The Parapublic Reform Component would finance the services of accounting, investment banking and management consulting experts in the MEF. The accounting experts were to supervise the liquidation of the network of government-owned regional stores handling crop marketing, retail trade, petroleum distribution and books and school supplies. Investment banking and consulting services would be engaged to manage the divestiture of selected public enterprises in other sectors. These experts would also assist the Government in coordinating the rehabilitation of those enterprises that would remain in its portfolio and in preparing new regulations and policies granting a larger autonomy to these enterprises. 19. Additional activities were to help the National Public Procurement Commission (CNMP) develop procurement procedures for government purchases, consistent with sound international practice and donor requirements, and pi nare guidelines for the preparation and negotiation of international contracts. Funds to be administered by MPRN, were to enable the Government to engage short-term consultants to help in the preparation and monitoring of the economic reform program; they would examine the impact of proposed policy changes on household budgets, rural production, and consumer and producer prices. Consultants were also to help the Government prepare a second technical assistance project. IV. Project Design and Organization 20. Project Design. From ita inception in 1981, until its approval in 1985, the size and the scope of the project were the object of substantial concern and exhaustive discussions within the Bank as well as between the Bank and the Guinean authorities. The starting situation was an economy in a shambles, an administrative apparatus operating according to a centrally-planned model of economic management. The administration was plagued by corruption and was lacking the most basic skills in all areas including the most crucial functions of economic management. In short, the country was bereft of the most essential tools for implementing its ambitious economic reform program. 21. In order tO avoid the risks associated with overly ambitious and complex projects, the TA program wisely focused on assisting the key economic management agencies. The project was designed to meet two major objectives: (i) to provide the Guinean Governme-t and the donors with the inputs -- data base, economic analyses, and operational procedures -- necessary for the design and implementation of the refonm program; and (ii) to ensure in the process the institutional strengthening of the key agencies involved through a complete overhaul of their organization and  5 their functions, as well as formal and on-the-job training of their staff. 22. Proiect OrganLzation. The Directors of the six units being assisted, MPRN's Planning and Statistics Directorates, CNP, and the MEF's Treasury, Customs, and External Debt divlsions would have professional responsibillty for preparing and carrying out their work programs. A full- time national administrator, located in the MPNR, assisted by a full time Guinean accountant, would handle day-to-day project administration. V. Pro1ect Implementation 23. Management of Technical Assistance. Project implementation started in 1985 in an environment which was neither physically nor administratively prepared to receive the amount of technical assistance that the project involved. On the logistics side, acute housing shortages, frequent water and power fallures, hazardous health conditions and poor quality of health services rendered the expatrlate experts' initial installation and subsequent daily life a strenuous experience. On the professional side, the extreme disorganization and lack of resources of the administration made working conditions very difficult. The latter were aggravated by material problems such as frequent power failures, old and crowded office buildings lacking the most basic equipment, and the poor state of telecommunications. 2: By opting for a consulting firm approach to TA recruitment and management, the project shifted the burden of solving these issues onto the firm. This arrangement did indeed facllitate and speed up logistical problem solving (eg., searching for housing, solving emergency health problems, replacing equipment parts). Most importantly, if consultants had been recruited individually, technical coordination of the TA would have been difficult. Given the difficulties of coordinating from Bank headquarters, and the absence of Guinean capacity in this regard, the provision of a resident coordinator by the foreign consultimg firm proved crucial. It adequately split the responsibility of TA management between the Guinean authorities, the Bank and the resident chief of the TA mission responsible for the technical coordination. 25. Owing to the unavoidable delays associated with upgrading the Mlnistry of Planning's building and equipping it, the expatriate staff set up their offices in a government-owned nearby annex. However, this situatlon together with the fact that the offices were equipped with an independent generator, computers, xerox machines etc., created tensions between the Guineans and the expatriates. Despite the presence of direct national counterparts at its side, the technical assistance was perceived as being privileged and as operating in seclusion. This enclave was also often expected to compensate for logistical and material deficiencies in MPCI and elsewhere. 26. Training. The training component underwent a drastic design change during implementation. The concept of a program of massive training through short-term specialized courses, in support of the other project components and linked directly to the work program, proved to be largely unsuitable for the actual skill base in the Guinean administration.  6 27. The low level of skills, and the fact that existing skills were for the most part ill-adapted to the new orientation _f the economy, made it necessary to redesign the component. The new two-year curriculum of part-time courses would (i) during the first year provide all trainees with a basic education in economics, statistics, and public administration; and (ii) during the second year allow them to specialize in one of the two areas of specialization offered, i.e., public management and analysis of investment projects. The number of trainees per year was consequently scaled down from a projected 400 per year in the initial version of the training component to an actual 50 per year in the subsequent one. 28. Skills Transfer. The project's expectations in terms of institution building underestimated the numerous obstacles to skills transfer in the Guinean environment. First, the TA project took place in the context of a civil service reform and a complete overhaul of the institutions in charge of economic management. The roles of the different agencies were being redefined and individuals were being shifted around. The tasks to be performed by individuals at the different levels of the hierarchy were not defined, a problem which often made on-the-job training impossible. Those counterparts that were designated by the administration prior to the arrival of the experts were often not selected on the basis of the level and adequacy of their skills, their competence or absorptive capacity. Many experts were not assigned counterparts when they arrived, and the project did not provide for any counterpart selection process involving a consultation between the administration and the experts. 29. Secondly, the incentives framework in the administration did not favor skills transfer. Salaries were so low (about $45 a month on average in 1987) that civil servants had to spend most of their time on additional income-generatIng activities. Career and salary structures were not linked to learning and performance, deterring the emergence of a demand from the counterparts for formal or informal training. The incentives framework for the technical advisors was also highly biased against on-the-job training. The experts were under tremendous pressure to produce the inputs needed for the structural adjustment program. In addition, they were judged on the quality of these inputs and their ability to produce them in a timely fashion rather than on the effort devoted to training counterparts. 30. Thirdly, the emphasis of the project was on providing an appropriate structure for upgrading the overall skills base through the CNPG curriculum and short seminars on specific techniques organized in the relevant agencies. This aspect proved relatively successful. The project was much less effective, however, in defining the modalities of on-the-job training and consequent skills transfer, in such a way that progress on that front could take place, and that such progress could be adequately monitored and supervised 2/. 31. In the training component, however, substantial skills transfer was realized. During the first year, all the courses were given by expatriate specialists, and the future national trainers attended the /See PAGEN IIs Pour Une Strategie de Formation sur le Tas" for a fuller discussion of this issue, available from AFlCO Guinea Desk.  7 classes and took the exams with the students. Those trainers who passed the first year exam were sent abroad for further training in their specific area of specialization. The following year, they gave the first year classes together with the expatriate experts. Each expert was required to provide the national counterparts with all the material needed for preparing and giving the class as well as testing the students and marking the exams, so that the national counterparts could provide the training all by themselves by the next year. The first year of the CNPG curriculum is now taught by nationals. 32. Project organization proved insufficient. The project administrator who had been involved in the project since its inception and was the best available candidate for managing it, was overwhelmed with other important functions -- Directeur National du Plan, SecrEtaire General du Comit4 de Coordination Economique et Financire -- and had little time for project management. As a result project accounts were kept haphazardly, and relied on consultants billing and somewhat incomplete procurement records. In addition, the project administrator had authority over components within other ministries for which his peers were responsible. This situation brought him into frequent conflict with other national directors. VI. Project Results 33. Project results were mixed. On the whole, the project was far more effective in reaching its technical objectives than its institutional ones. The technical assistance delivered the major inputs, critical for the design and implementation of the reform program. Internalization of analytical tools and new operational procedures, however, remained low due to a combination of two factorst the low skill base in the Guinean administration and the resistance to change from vested interests who benefit from existing ways of operating. In particular, the institutional strengthening and skills transfer objectives became the hostage of the difficulties encountered in the implementation of the civil service reform. 34. As a result of the training component, the CNPG now provides a solid training in economic statistics and public finance well-suited to domestic needs. The school trains between 50 and 60 new trainees each year. While the training component was initially targeting the staff of the project's ministries, the school attendance actually involves a few staff from those ministries and many from technical ministries, national enterprises, and the University of Conakry. 35. Guinea's first Public Investment Program was prepared for 1986. Subsequently, the Government adopted its first three year rolling public investment program for the period 1987-89 which was presented to the first Consultative Group for Guinea in March 1987. Also for the first time an attempt was made to situate this program within a macroeconomic framework and the concept of incorporating recurrent cost implications into project appraisal was introduced. The resulting macro forecasts, however, are not used as a consistency framework for the PIP. This situation persists up to the present time.  8 36. Investment programming and control procedures remain inadequate as sufficient capacity could not be developed for the formal monitoring of disbursements or physical progress. Project preparation and implementation continue to be of insufficient quality, and indigenous capacity for economic analysis remains extremely weak. 37. Implementation of the PIP also suffered from a lack of procurement procedures. The Procurement Code was prepared but its promulgation became hostage to disagreements between the MCPI and the MEF, which competed for a larger control of the investment program, as well as to vested interests within the Government which benefitted from the lack of transparency of existing procurement procedures. The Procurement Code was finally promulgated in December 1988 under Bank pressure as a condition of effectiveness for SAL II. The first texts governing its application were delayed until November 1989, and its implementation is still very rudimentary. 38. An external debt division was created in the MEF, but never became fully operational due to institutional conflicts with the Central Bank and staffing weaknesses. All the material necessary for Paris and London Club rescheduling negotiations was produced by the technical assistant. A formal debt data base was established and computerized, but improvements in debt management were only gradual, and significant arrears were accumulated in 1987 and 1988. Very little effort was made to develop national skills in debt management. 39. To sum up, the project succeeded in producing specific data and economic analyses crucial for the design of the reform program. It also succeeded in introducing important economic management tools such as the PIP, the debt data base and the budget. The introduction of management tools was not enough, however, to alter decision making and policy formulation processes: a three-year PIP was introduced but project choice did not improve much; the macro forecasts are not used as a constraint on the level of the PIP; the debt data base does not have much impact on debt contracting and repayment policies. VII. Project Sustainability 40. The Guinean administration remains extremely dependent on expatriate technical assistance, and will remain so in the medium term. The project was very successful in establishing a training structure which if adequately combined with on-the-job training could speed up tremendously the process of skills localization. In order, however, for this localization to take place, major changes falling outside of the mandate of this project and within the realm of the civil service reform would need to be initiated. 41. First, career and salary structures should more effectively link promotion and pay increases to learning and performance in order to create a demand for self-improvement within the civil service. Secondly, salaries should be increased to a level where civil servants do not need additional activities to cover their most basic living expenses. Thirdly, such salary increases should be accompanied by the introduction of disciplinary mechanisms to deter all kinds of deviant behavior such as absenteeism,  9 corruption and so on. At present there are few sanctions against such behavior, and this constitutes a major obstacle to improvements in the quality of the civil service. VIII. Bank Performance 42. The three years of preparation of the project were characterized by extensive analysis and thorough diagnosis of the Guinean administration, and intensive d'scussion within the Bank and between the Bank and the Government on pruject design. After the project became effective, the Bank's attitude was characterized by great flexibility allowing, for example, for major changes in the training component to better adapt it to existing conditions. 43. The project itself was supervised formally only 6 times during its 5 year life span (1985-1990), which was clearly not enough given the novel nature of the operation, the close supervision technical assistance projects require, and the difficult communication links between Washington and Guinea. In reality, because the TA project was providing the inputs to the SAC, supervision was more frequent than it would appear, since all SAC supervision missions had to monitor progress on the TA front. As a result, however, supervision missions focused often on actual TA outputs to the detriment of qualitative aspects such as the necessary conditions for institutional sttengthening and skills transfer. IX. Borrower Performance 44. The Borrower did not provide the technical assistance with adequate conditions to fulfill its institutional strengthening mission. In many cases there were no counterparts designated to work with the expatriate experts. There were no selection processes established that the experts could use to select counterparts. The level of competence of the counterparts designated by the administration varied a lot, raising questions on the nature of the criteria on which their selection was based. 45. The Borrower's commitment to some of the institutional reforms, was at the least, questionable. Vested interests within the Government succeeded in delaying substantially the adoption and the application of the Procurement Code. Implementation of the parapublic sector reform suffered from the failure of the Government to provide the needed financial logistical and institutional support. Finally, project management was poor. Budget management and accounting systems were highly inadequate and as a result the Bank has not been able to ascertain whether project resources were properly used. The audit of the first phase of the project was rejected by IDA which required a further financial audit covering the whole project. 46. The conclusions of this latter audit were (i) lack of standard accounting procedures; (ii) insufficient documentation on the movements of funds on the special accounts; (iii) and a number of weaknesses in the internal control system. The internal control system suffered from a lack of adequate filing system for the accounting documentation. several anomalies in the making of withdrawal requests, and haphazard registration of requests for direct payments. As a result of these weaknesses the  10 auditors could not certify that the use of the project's funds were in line with the dispositions of the credit agreement. 47. These conclusions suggest that project implementation suffered from a mix of incompetence and mismanagement, where the former could make it easier to proceed with the latter. In the context of Guinea where rigorous accounting education and tradition were lacking, these conclusions are not surprising. They suggest however that in such a context, adequate management of projects resources requires as a preliminary condition additional training of project accountants in specific aspects of procurement and related Bank procedures. As regards potential mismanagement, financial and operational audits during implementation would allow errors to be detected and acted on in time. X. Consultants Services 48. Although consultant performance varied across individuals, on the whole consultants did a reasonably good job given the difficult conditions in which they had to operate. They provided the Government and the donors with the inputs urgently needed for the economic reforms. It is mainly in terms of on-the job-training and skills transfer that performance was very uneven ranging from outstanding in the training component to good in the public investment and procurement components to non-existent in debt management and in statistics. XI. Project Documentation and Data 49. Most of the information necessary for the preparation of the PCR was obtained from interviews of Bank staff, Guinean counterparts, and expatriate experts who worked on the project. Project files, in particular supervision and back-to-office reports, are very uneven in terms of factual data, analysis of issues involved in project implementation, and project results. Much of the data required for the statistical annexes were not available from MIS and project files.  11 Attachment I Project R-auts Investment Analysis Componont/subcomponents Status Coments Preparation of a throe-year complOtWd rolling public investment program Development of s*ctoral partially completed Soctoril strategies and programs should be strategios and investment developed by s*ctoral ministrl.s, and reviewed by programs and review of thse the Ministry of Planning For those sectors strategles and programs which developed strategies, Implementation was patchy. Project cholce remained donor-driven in that projects Inconsistent with declared strategy : still went ahoad if they wvr, on a donor agenda. Development and introduction completed but not Internalization of such tools is a function of within the administration of internalized improvementa in the *xill base of the an operational manual for the : administration and requires intensiv, training identification, preparation a and supervision over an *etxnded period of time and selection of invostment projects Prefeasability studioc of investment projects not completed Macro-economic Planning Component/subcomponents. Status Comments Diagnostic study of the partially completed A Cuinean vorsion of RMSM model, UPECUI, was Borrower's economy and . built and used. The onvelope for the public preparation and investment program (PIP) implied by the macro implementation of a global forecasts generatod by the model does not havo strategy for public much impact on the actual level of tho PIP. investment, notably In the Sectoral strategies for public invostment were rural sector dosigned for som sectors. Study of the organi2ation and completed UPCI and MEF were reorganized operation of tho Borrower's institutions responsible for macro-economic planning Preparation of macro-economic completed data for the annual updating of the throe-year rolling invostment program Preparation of macro-economic partially completed unreliable data base dta for sectoral invostment programs Preparation of a long-term not completed It will only be after the c;vil service reform Is institutional development and completed that such a strategy could be pr pered training program for the a and implemented management of the Borrower's *conomy  12 Economic Data Component/subcomponentm Status Coments Preparation of a medium-term, partially completed Shoddy and unrellable data annually-updated statistical program for the Borrower Preparation of notional partially completed National accounts gueestlt.ee were prepared, accounts estimate, on tho but the National statistics division was and basls of existing statistical still Is unable to properlv colFect, proc--e, and data and of *urveys, such as provido reliable data. The initIal constrtInt on price surveys and a farm the availability of reosonably trained staff has budget survey, and not been overcoe and the weakness of the preparation of a macro : division has an impact on both the macro-economic economic master plan for planning and the economic data components planning and policy purposoe Updating of notional not completed accounting plans and Introduction of new analytical techniques Study of the Borrower's partially comploted computer training and equipment requiremnts over the medium-term and preparation of a Computer Development Moster Plan Budgeting and Customs Component/subcomponents : Status Conments Analysis of tho Borrower's completed current budget procedures and internal paymente procedures, and the function of various ministries and their departments with respect thereto Updating of the Borrower's partially completed Major improvements in budgeting and financial budgeting and financial control were made, monthly statue report on control procedures and : budget implomentation was produced; the process introduction of these : cont;nues under follow up pro ect procedures throughout the Borrower's administration Improvement of tax revenue little progress Lack of progress Is due to administrative collection and acceleratIon : wesknesses and pervasive corruption of tax revenue transfers within the Borrower's administration Analysis of the Borrower's not completed current customs proceduros and customs code Preparation of new customs partially completed Ongoing under follow up project regulations and enforcement procedures  13 External Debt Management Component/subcomponente Status Co mme nts Complet, audit of the completed Borrower's external debt Impl_emntation of a quarterly not completed I. being done under follow up project external debt reporting system : Study of external debt not completed management institutions abroad Strength-ning of DOE's not completed ability to define appropriate financing terme fo; development projecto and Investments requiring the Borrower's repayment guarantee, to aseese oepayment capacity and articulate a public sector borrowing strategy Training Component/subcomponents Status Co ments Provision of on-the-job seo comment. training and se"inars to MPRN, MEF, CUE staff and officials from technical ministries responsible for project preparation and analysis in economic and financial analysis, man*gement systems, statistics, maintaining of national accounts, computing and procurem-nt management 3Du to the low skill bas -in the Guinean Provision of clerical administration the whole training component had training to MPRN, MEF, CME, : to be redesigned. The now version Involved a and SCRO support staff : two-year program of part-time courses with a : first year of basic training in economic j statistics and public management, and a second : year of specialized training. The quality of : CNPO's training is good and the attendance has : Increased far beyond the population targeted by : the project. Preparation and compl-ted ; CNPG does not provide clerical training. implementation of a training and professional development program for accountants and auditors in the public sector and state onterprises Renovation of CNP's training completed and office facilities, Including provision of furniture and equipment On the job and external completed training of CNP's training staff  14 Procurement; Lagtlsation Coeponent/subcomponents Status Comments Preparation of legislation ccoploted *nd agreemnts relating to financial matters Proparation and partially completed Procedur-s were prepared; the approval of the imples ntation of new public procurement codo woo substantially delayed; it procurement procedures was finally approvod as a result of being a : condition of effectiveness for SAL I. Implementation was unevon Preparation of a follow up completed project in support of economic management Parepublic Sector Reform Component/subcompon-nts Status Coments Preparation and partially completed Most *nterprises were liquidatod ornprivatizod, implementation of a program but a number of them remained In the Govornment for divestiture, closure and : portfolio for no economically justifiable liquidation of selected d reason. The privatization deals were public enterpriseo characterized by lack of transparency; special concessions were granted on a case by crso basis to several privatized companies undermining the intended efficiency gains of the privatization program and its financial aims Preperation of a new not completed institutional, policy and rogulatory framework for public enterprises Proparation of a medium-term not completed program for rehabilitation of solected public entorprieas Civil Service Reform Component/subcompononts Status Coaments Implementation of a civil comploted service census Evaluation and selection of completed Though the actions to be undertaken under the civil servant. at MEF, mcPr : project were actually completed, the civil and other solected ministries : service reform which Is still going on has proved : long complex and difficult, severely hampering Acquisition of equipment and completed : progress In achioving the institutional supplies for the civil : strengthening objectives service files  PART II REPUBLIC OF GUINEA MINISTRY OF PLANNING AND INTERNATIONAL COOPERATION (MPCI) TECHNICAL ASSISTANCE PROJECT FOR ECONOMIC MANAGEMENT 1985 - 1988 SUMMARY COMPLETION REPORT ON PAGEN I  15 SUMMARY COMPLETION REPORT ON PAGEN I The first phase of the Economic Management Support Project to the Government of Guinea, built around six main program components, achieved the objectives set out in 1985. The Ministries of Planning and Finance were restructured to meet the needs of new policy approaches; the totally inadequate statistical service was improved; previously lacking analytical and simulation tools were devised and applied; a comprehensive economic and financial reform program (PREF), including three-year rolling public investment programming (PIP), replaced the Interim National Recovery Program (PIRN); procurement procedures were revised; information on Guinea's external debt was improved; and, finally, a vast program of training, both in service and outside Guinea, was undertaken to improve the quality of the civil service. These results, presented in detail below and achieved under the management of the Director General of Planning, were due to fruitful collaboration between expatriate experts and national counterparts working as a team, although the desired skills transfer was not totally achieved during this first phase. I. MACROECONOMIC ANALYSIS AND FORECASTING The prerequisite for this economic analysis was an initial survey of GuLnea's economy. The resulting diagnostic study, based on the macroeconomic and macrofinancial situation and eight sector studies, yielded -- via an analysis of constraints and potential -- the initial elements of a medium-term strategy consonant with the overall development directives established by the Government. Guinea's short, medium and long-term policies were then formulated in the report by the Government to the first Consultative Group meeting (March 1987), prepared by the Directorate General of Planning. Macroeconomic analysis and forecasting tools (MPEGUI) were also refined by adapting the World Bank's PMSM model to Guinea's situation. The MPEGUI model was constructed on Lotus 1-2-3 by using as basic data the national accounts for 1986, whose reliability remained to be confirmed. Significant macroeconomic analysis was carried out from autumn 1987 onwards with a view to producing an appropriate PIP for 1988-90 in terms of the major equilibria. This analysis was regularly reviewed in light of the work done on the national accounts since 1987, which has improved their accuracy. As part of the introduction of a permanent monitoring system for Guinea's economy, a note on the international context, covering various features of the economic, monitory and financial environment outside Guinea,  16 has been published monthly since March 1988. Since the first quarter of 1989, this has been complemented by a quarterly performance chart of Guinea's economy. At the end of the work on this first component, a short 'Statement of Options" was prepared summarizing all the studies carried out and documents published during the three years of PAGEN I. II. PROGRAMMING OF INVESTMENTS This second component of PAGEN I consisted essentially of improving investment programming and introducing effective procedures for project appraisal and execution. The programming work started at the end of 1985 with the preparation of the 1986 investment budget. The first exercise carried out by the Directorate General of Planning, involving not merely planning but public investment in particular, was to prepare a comprehensive listing of all ongoing and new projects, and review the nature and reliability of the information available on each project. Basic data were compiled in the form of a projects file, and projects were classified according to a large number of criteria; the introduction of sector and subsector nomenclature and the new availability of project data enabled an initial assessment of program execution to be made. During the next fiscal year, the rolling three-year programming procedure for the 1987-89 PIP was introduced. Ii-. addition, this phase saw significant qualitative progress as regards: - a comprehensive inventory of projects - the volume of information available on each project - the institutionalization of sector meetings w'ith the technical departments and the preparation by the latter of sector strategies, and - the incorporation of macroeconomic constraints. The 1987-89 investment program was an integral part of the Government's report to the Consultative Group meeting held in Paris in March 1987 and benefitted from a wide consensus among Guinea's principal donors. The third three-year planning exercise, for 1988-90, saw a further refinement of planning procedures through the use of more rigorous criteria (results of previous implementation, accuracy of expenditures, existence of external financing, scale of recurrent charges). Finally, the preparation of the 1989-91 investment program began in June 1988 with:  17 - recognition of the impact of macroeconomic constraints on the investment budget (need to balance the budget, external indebtedness considerations) t - the definition, prior to the programming exercise, of overall envelopes and sector envelopes - the observance of a budget timetable enabling the finance law to be adopted with effect from January 1, 1989, and - the incorporation of additional programming criteria. Given the very significant increase in information to be processed, it became necessary to go beyotid a mere computerized project file and produce an automated project programming system. Specific software was therefore prepared and introduced along with the necessary safeguards for system access, and data modification and conservation. The review of project execution procedures began in 1986 and continued until the beginning of 1988. It involved: - analyzing existing procedures for expenditure financed from external and domestic resources (role of the technical departments, Ministry of Planning, and Ministry of Economy and Finance in credit allocation and the advances system), and resulting inefficiencies; - organizing review groups with the Ministry of Economy and Finance; - preparing a number of documents proposing the rationalization of these procedures; - defining and introducing internal MPCI procedures (Departments, Sectoral Divisions and Financing Divisio-ni - updating records of commitments and payments from domestic and external financing sources. On the basis of the implementation procedures proposed, a permanent project monitoring system was set up during 1987 and introduced at the start of 1988, involving: - the collection of the data required for an accurate starting situation, comprising: * a listing of financing agreements * a listing of contracts 0 the financial execution status of contracts as at January 1, 1988  18 - the preparation of dossiers on the status of each project - a start on computerization of disbursement authorizations, as regards domestic financing, and payment orders, as rigards external financing. For project appraisal, a public investment appraisal manual was prepared defining procedures covering the identification, preparation, appraisal and selection of investment projects. This manual includes: - general project appraisal procedures - the contents of a project appraisal study - standard cost specifications, and _ appraisal by the Ministry of Planning. The manual was prepared in close association with sector divisions and was widely disseminated within the Ministry of Planning. It was also used extensively in the training seminars organized in the second half of 1987 for officials in the new Directorate General of Public Investments (DGIP) and in the technical ministries. As part of the practical utilization of this manual a number of pilot appraisals were made, for testing and training purposes, of projects selected in light of their representativenes~s and importance. These appraisals provided insight into the availability of basic data, the practical possibilities of adopting the procedures laid down in the manual, and problems regarding the skills level of staff in the General Directorate of Planning. III. UPGRADING OF THE STATISTICAL INFORMATION SYSTEM Formerly, statistics were provided exclusively by government departments and were sometimes considerably at variance with observable reality. The private sector was in effect ignored and was in any event very undeveloped. It was also often suffocated, as in agriculture (a priority sector), by an omnipresent and inefficient bureaucracy, inappropriate taxation and a system of remuneration for producers using official prices lacking any proper economic basis. Domestic output was therefore smuggled out of the country on a large scale, making it very difficult to determine the real situation as opposed to the official version. In the area of national accounts, despite some praiseworthy efforts, aggregates were merely calculations that for the most part were based on extrapolating projections for the previous year.  19 The profound changes occurring in Guinea's economic life required better coordination of the various forms of technical assistance received by the Ministry of Planning in the area of statistics (FAO, Canada, Italy, France) for the creation, among other things, of a rudimentary public statistics service, in anticipation of future developments. Three vital steps were therefore taken during PAGEN I: to remedy methodological shortcomings in the preparation of the national accounts, improve the data on the informal sector and include them in the national statistics, and, finally, prepare a National Accounting Plan. As regards the national accounts, a first methodological note, of a very didactic nature, was issued for the preparation of the 1985 accounts in light of the particular context of that time (fixed parity of the currency in relation to the SDR and a State-controlled economy). The environment for the 1986 accounts having changed, an automated system was prepared that incorporated data from the (remaining) public enterprises and the (emerging) private sector. Data from 85 large firms were processed and the first results of the surveys of the informal sector were also available. In addition to the revised layout for publication of the accounts, a methodological note was prepared and circulated to Guinean officials. In 1987 a new company survey was carried out using a more detailed questionnaire than in the preceding year, more than 200 firms being covered. A computerized data manual wa3 prepared for survey follow-up. The computerized system was upgraded, and particular mention should be made of the iitensive use of computers at the various stages of preparing the national accounts. By the end of the first phase of PAGEN I, excluding the national accounts system and work on the informal sector, 143 files had been created, viz. 87 Lotus 1-2-3 spreadsheets, 43 word processing files, 12 DBase III+ files and 1 edited file. These were merely the files required for record purposes or for future work (PAGEN II and beyond), particularly statistical series to be maintained, nomenclature and conversion tables. In the informal sector, whose importance for Guinea's economy is obvious, PAGEN I made it possible to: organize a first series of indicative discussions to help orient intervention in the sector; survey 17,263 establishments in Conakry, Kindia, Kankan, Labe and Mamou; and survey a sample of 1,200 establishments, of which 900 were retrieved. The results of this work were used to prepare the national accounts for 1986. Finally, as regards the National Accounting Plan (PCN), reforms were undertaken with the following aims: - preserving the achievements of the PCN - conforming to international standards and norms currently in force  20 - devising an original plan - notwithstanding this originality, creating a plan comparable to those in neighboring countries - taking advantage of new features in accounting - meeting economic and statistical information needs. The execution of this work required the establishment of a working group, a technical committee and an interministerial committee. Two officials from the National Accounting Division were permanently seconded to monitoring this work. The result is a Guinean General Accounting Plan (PCGG) complemented by a simplified accounting plan and an aggregated accounting plan, a conversion table from the PCN to the PCGG and, finally, an application manual using examples. The PCGG includes a proposed Statistical and Fiscal Declaration (DSF), which, subject to agreement with the tax administration authorities, is intended to become the principal tool for the regular collection of accounting, statistical and tax information from companies. Exploitation of the DSF by the new General Directorate of Statistics and Data Processing should lead to the establishment of a data processing system and a central register of balance sheets. When the inventory of companies is complete, this will provide the first part of an information system on companies. IV. MANAGEMENT OF THE EXTERNAL DEBT PAGEN I enabled the Ministry of Economy and Finance (MEF) to obtain better information on Guinea's external indebtedness. At the start of PAGEN I, the only locally available data on Guinea's external debts was held in the Central Bank in the form of manual records, most of these being seriously deficient. The MEF debt service division functioned poorly, having very limited information and only a superficial role vis-a-vis creditors approaching the ministry. it was evidently extremely urgent to obtain a more accurate picture of Guinea's debt (total obligations, debt service, arrears situation) so as to permit negotiations on a firm basis with international organizations and donors. Priority was therefore given to computerizing debt data using standard DBase III software with certain specific applications, such as the calculation of maturity dates, position statements at given dates and the introduction of exchange rates to allow simulations that were developed subsequently. The data required for creating files were collected, this systematic investigation work making it possible to list some 300 loan agreements.  21 The computerized system was organized around two main files: 1. The cover file, providing a "history of the debt," since it contains all the information pertaining to loan periods and terms and conditions, and 2. The maturities file, which contains complete debt schedules and can thus produce any statistics required. This latter file is the backbone of the system since it can produce debt positions for given dates, debt service figures for a given period (month, year), and medium and long-term projections. These statements can be produced for a wide range of criteria: type of donor, creditor, country, and currency. Once the work of data collection and inputting was completed, it was possible in January 1986 to produce the first estimates of Guinea's external debt as at the end of 1985. These showed a level of indebtedness that made it urgent to undertake rescheduling negotiations as quickly as possible. For this reason the Republic of Guinea took its case to the Paris Club. The rescheduling agreement signed on April 18, 1986 involved US$60 million and provided that the interest rates applicable to the rescheduled amounts should be the subject of bilateral negotiations between Guinea and each of its creditors. These negotiations were held in October 1986, with another series of talks covering bank and commercial debts taking place during 1987. The latter negotiations led to the signature of a refinancing agreement covering US$43 million and involving 23 private creditors. In addition to these results, namely, the establishment and maintenance of a computerized debt management system and the rescheduling negotiations, PAGEN I led to the organization of a debt management unit within MEF. Nonetheless, significant shortcomings still remained at the end of PAGEN I since this new unit has so far been unable to reconcile Guinea's figures with those of its creditors, let alone undertake the regular notification of Guinea's debts to the World Bank. Efforts in this area will be continued as part of PAGEN II. V. REFORM OF THE PROCUREMENT SYSTEM The second main aim of PAGEN I within MEF was to improve procedures for awarding public contracts by: - encouraging public-sector buyers to seek lowest-cost solutions - providing information and training for these buyers - supporting small and medium Guinean businesses, and  22 - preparing regulations governing public contracts. Obtaining the best financial conditions for the State involves grouping purchases together so as to control the costs of contracts extending over a period of years (although this has a considerable impact on the application of the rule that certain contracts be renegotiated annually),* and the introduction of competition (by using bidding competitions and upgrading the committees analyzing bids and awarding contracts). The support provided to small and medium businesses has not yet produced all the expected results, despite the division of State contracts into small lots accessible to emerging small companies, most of which lack sufficient resources. The preparation of regulations governing public contracts was completed during PAGEN I through the drafting of the Public Contracts Code, the General Administrative Cost Specifications (CCAG) applicable to works contracts (construction and civil engineering), and of CCAG for contracts for goods and services. These regulations have improved the earlier legal framework governing public contracts, which for a long time was prejudicial to Guinea's economy. 'While the information provided to public-sector buyers during the first phase of PAGEN I was satisfactory, their training could not take place because of delays in promulgating Guinea's new regulations on public contracts. VI. TRAINING OF GOVERNMENT OFFICIALS Basically, the training of civil servants responsible for economic and financial administration was provided by the National Center for Management (CNPG) separately from the in-service training given by the resident experts and short-term consultants. By the end of PAGEN I, 16,000 man/days of training had been given by the CNPG (including 480 man/days of training given to the 10 CNPG trainers) against an initial projection of 8,600 man/days of classroom training. A number of programs involving teamwork have helped to train many Guinean officials on tAieir jobs. However, certain planning functions were of such a strongly technical character that they were virtually individual tasks, which resulted in the technical assistance during this first phase of the project being more a process of substitution than skills transfer. This situation persisted up to the publication of the results of the evaluation tests for government personnel and the selection of the full complement of permanent staff for the central and decentralized departments. Nevertheless, a number of seminars were organized in conjunction with the evaluation, selection and preparation of permanent staff. These * T.N. Assumed meaning  23 seminars essentially dealt with planning, (RCB indicative planning, modeling and econometrics), macroeconomics with reference to the use of the MPEGUI model, microcomputers (introduction to DOS, Lotus 1-2-3 and DBase III- software), the preparatior, programming and supervision of investment projects, and debt management. Practical training and in-service training in the above-mentioned areas were also organized outside Guinea for MPCI, MEF and CNPG personnel. The delay in completing the evaluation and selection of government personnel and the still unfinished posting of most of the permanent staff in the departments involved in the first phase of the PAGEN made it impossible to complete the training program, which has therefore been largely carried over to the second phase. It should, however, be noted that CNPG has acquired a large specialized library in various areas of economic and financial management and administration. CNPG has also, for each activity carried out, compiled a complete instructional dossier which is now facilitating the organization of training courses for its own trainers. Finally, the provision of modules for specialized areas provided CNPG, at the end of PAGEN I, with basic instructional materials enabling it to arrange ad hoc seminars in professional areas of relevance to the PAGEN; their preparation costs will henceforward be lower because of the existence of this documentation. CONCLUSION The foregoing makes it clear that PAGEN I created structures that operate efficiently, directed by national personnel trained using tested procedures and provided with appropriate regulatory texts and utilization manuals. Given the starting situation, this was a large task; much has been done but much still remains to be done, viz: Although at the end of PAGEN I short-term macroeconomic analytical and forecasting tools already existed, it remained to establish a system to monitor and guide the execution of economic policy; although an investment programming system was in place, it remained to improve the selection of investment projects and to supervise their execution; while draft new procurement regulations had been prepared, it remained to put them into effect and train those responsible for purchases and contracts by ministries; although the national accounts and an embryonic statistical service had been set up, it remained to complement the data collection system and develop statistical tools; while the Guinean authorities had more information about the public debt and could project trends therein, it remained to centralize the relevant information and complete the training of those responsible for debt management. Finally, although more than 16,000 man/days of training had been given, this was still modest in light of the needs arising from the reorientation of economic policy and the reorganization of the public administration.  24 These needs, fortunately, are being addressed in the context of the second phase of the project (PAGEN II), wh.'ch is building on the foundations of PAGEN I. MICHEL KAMANO National Project Coordinator  25 PROJECT COMPLETION REPORT REPUBLIC OF GUINEA TECHNICAL ASSISTANCE PROJECT FOR ECONOMIC MANAGEMENT (Credit 1559-GUI) PART III: SUMMARY OF STATISTICAL DATA TkX.E 1: RELATED PANIK LOANS Year of Losn/Credit Titio Purpose Approval Status Comments First Structural Promot, key macroeconomic policy changes, 106 Completed Adjustment Credit support the Government's economic recovery program, and allow economic activity to expand whil roform meosures ore implemented. Second Structural Support the second phase of the Government's 1908 on-going Second Tranche Adjustment Credit Economic and Financial Reform Program and not yet reloasod addres koy constraints on Guinea's medium- term growth potential Second Economic Provide technical support and training 10m on-golng Managemnt Project nocessary to strengthen economic and financial management and improve the civil service system; enhance oid cooperation in the area of technical assiostnce for economic management.  ?6 TABLE 2: PROJECT TIMETABLE item Drat Planned Actual Identifcnstion 10-09-81 10-09-81 Preparation 09-30-82 09-30-82 Appraisol Mission 12-14-82 12-14-82 Credit Negotiotions 01-29-86 01-29-86 Credit Signature 03-20-86 03-21-86 Credit effectiveness 07-19-86 07-08-86 Credit Closing 0o-30-89 06-30-90 Credit Completion 12-31-88 01-30-90  27 TAILU A: LOAN 0IS81SEMENTS Cumultive Estimated and Actual Dlsburseet. Cumulative Cumulative Actual as X Actual as X Appraisal Actual Estimto oe Total Estimate FY 196C 0.6 FY 1066 8.3 2.60 705 235 FY 1607 6.2 6.05 065 64X FY 1908 9.1 8.48 93X 89X FY 1989 9.5 11.14 1l7X 1171 FY 1900 12.02 s/ 1271 127X a/ Due to SOR/S fluctuations, actual disburamente were higher than estimated.  28 TA3LE 4: PROJECT FINANCING COSTS A. PROJECT COSTS _____________ Appraloal Estimate Estimated Costs: 000 usi (not of taxes and duties) --------------------------- Foreign Local Total Macruconoeic Planning, Project Analysis and 0stional Accounts 3060.3 147.0 8197.3 Procurement Regulation 94.6 8.0 97.6 Finance, Budget and Customs Managemnt 921.0 18.0 989.0 External Doebt Management 190.6 1.0 191.6 Training Actlvitles 2597.7 124.0 2721.7 Parapublic Reform Program 1163.0 20.0 1183.0 Other project activities and studios 912.6 60.0 962.6 Subtotal 8929.9 868.0 9292.9 Refinancing of PPF 194 400.0 - 400.0 Total Base Costs 9387.9 878.0 9710.9 Physical Contingencles 191.7 28.4 220.1 Price Contingencies 998.9 64.6 1068.4 0.0 Total Project Costs 10928.5 465.9 11884.4 S. PROJECT FINANCING Planned Credit Agre em nt USS Millions Source Foreign Local Total Government - 0.6 0.5 IDA 9.6 - 9.6 France 0.7 0.7 UNDP 0.8 - 0.3 TOTAL 10.6 0.5 11.0  29 TABLE 5: Use OF BNM RESOURCES Statf Inputs Stag ot Project Cycle I 81 1 82 1 05 1 U4 I U6 1 871 U I s91 o ITotal I I I I I I I I I I I Through Appraisal I 0.1 1 20.7 1 86.6 I 11.6 1 12.1 I1 1 1 87.2 Appraisal through I I I I 17.91 I I I 1 17.9 Board Approval I I I I I I I I I I I Board Approval I I I I I I I I I I I through Effectiveness I I I I n/l I I I I I Supervision 7 I I I I 7.7 1 18.2 1 15 I 19.4 1 8.4 1 1 63.7 Completion I I I I I . I I 1 1.4.21 4.2 I I I I I I I I I*1 1