Ghana - Economic Reform Support Operation

 ICRR 10371 Report Number : ICRR10371 ICR Review Operations Evaluation Department 1. Project Data : OEDID : OEDID: C3094 Project ID : P055989 Project Name : Economic Reform Support Operation Country : Ghana Sector : Economic Management L/C Number : Partners involved : Prepared by : Michael R. Lav Reviewed by : John Johnson Group Manager : Ruben Lamdany Date Posted : 06/28/1999 2. Project Objectives, Financing, Costs and Components : Objectives : To bring the adjustment program back on track by implementing the VAT, increasing electricity tariffs, and reducing the fiscal deficit . In addition, the project sought to (a) improve fiscal management by implementing a medium-term expenditure framework, (b) speed public enterprise privatization by defining which enterprises would be privatized, (c) enact the Energy Commission and the Public Utilities Regulatory Commission Act to assist in public enterprise reform. (d) support the Cabinet Process by reforming its structure and supporting analytical capacity, and (e) assist in the reform of government agencies, Costs and financing : $50 million. 3. Achievement of Relevant Objectives : The project was successful in achieving the implementation of the VAT, increasing electricity tariffs, and reducing the fiscal deficit. A Tax Identification Numbering System for all taxpayers was implemented to improve treatment of taxpayers. The medium-term expenditure plan was also firmed up . Public enterprise reform was furthered by implementing the Energy Commission and the Public Utilities Regulatory Commission Acts . 4. Significant Achievements : The most significant achievement was to restore the momentum for adjustment, primarily fiscal adjustment by measures noted above. 5. Significant Shortcomings : A smaller number of enterprises than envisaged were proposed for privatization by the government . The appointments to improve the analytical capacity of the cabinet were not made as envisaged . This and other aspects of the project's Institutional Development program fell short of objectives . 6. Ratings : ICR OED Review Reason for Disagreement /Comments Outcome : Satisfactory Satisfactory Institutional Dev .: Negligible Negligible Sustainability : Likely Likely Bank Performance : Satisfactory Satisfactory Borrower Perf .: Satisfactory Satisfactory Quality of ICR : Satisfactory 7. Lessons of Broad Applicability : The Bank should move quickly to support government reform initiatives, especially in restarting adjustment programs, provided it is convinced of real ownership . However, Institutional Development needs to be carefully formulated and related measures should not be generally inclusion as components of adjustment lending . 8. Audit Recommended? Yes No 9. Comments on Quality of ICR : The ICR clearly presents relevant information . It is somewhat brief in terms of macroeconomic and fiscal analysis (for example, how will the lagging privatization program affect fiscal matters ), but is very clear on the role of the project in moving the reform program forward .