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W o r l d B a n k G r o u p

Mashreq MaxiMizing Finance For DevelopMent (MFD) strategy2 0 1 9 – 2 0 2 1

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stanDarD DisclaiMerThis volume is a product of the staff of the International Bank for Reconstruction and Development/The World Bank. The findings, interpretations, and conclusions expressed in this paper do not necessarily reflect the views of the Executive Directors of the World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries.

copyright stateMentThe material in this publication is copyrighted. Copying and/or transmitting portions or all of this work without permission may be a violation of applicable law. The International Bank for Reconstruction and Development/The World Bank encourages dissemination of its work and will normally grant permission to reproduce portions of the work promptly.

For permission to photocopy or reprint any part of this work, please send a request with complete information to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, USA, telephone 8400-750-978, fax 4470-750-978, http://www.copyright.com.

All other queries on rights and licenses, including subsidiary rights, should be addressed to the Office of the Publisher, The World Bank, 1818 H Street NW, Washington, DC 20433, USA, fax 2422-522-202, e-mail pubrights@worldbank.org.

Cover photos: © World Bank

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TABlE OF CONTENT

Acknowledgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7Acronyms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

I. THE PRIORITY OF MFD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

II. RATIONALE AND KEY ELEMENTS OF THE MFD APPROACH IN THE MASHREQ . . . . . . . . . . . . . . . . . . 12

III. MASHREQ MFD STRATEGY - OBJECTIVES, PRINCIPLES AND RESULTS . . . . . . . . . . . . . . . . . . . . . . . . . . 16A. Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17B. The Principles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17C. The Results Targeted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

IV. COUNTRY STATUS FOR MFD READINESS AND WBG PRIORITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24A. JORDAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25B. lEBANON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27C. IRAQ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

V. ORGANISING FOR DELIVERY – JOINT IMPLEMENTATION PLANS, INSTITUTIONAL ARRANGEMENTS AND RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

A. JOINT IMPlEMENTATION PlANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33B. INSTITUTIONAl ARRANGEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35C. STRATEGY RISKS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

VI. ANNEX I – KEY INDICATORS FOR MFD READINESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

VII. ANNEX II – MASHREQ MFD STRATEGY - RESULTS FRAMEWORK MATRIX . . . . . . . . . . . . . . . . . . . . . 42

VIII. ANNEX III – MFD PIPELINE FY18-20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44A. IBRD pipeline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45B. IFC Projects Pipeline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51C. MIGA Exposures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

IX. ANNEX IV – KEY REFORMS BY SECTOR AND COUNTRY - MASHREQ MFD REFORM MATRICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58

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ACKNOWlEDGMENTS

This document was co-authored by Peter Mousley (Program leader, Equitable Growth, Finance and Institutions Global Practices – World Bank), Dalia Wahba (Country Manager, levant – IFC), and Mena Cammett (Risk Management Officer - Multilateral Investment Guarantee Agency) with the support of Patricia Haydamous (Consultant, Finance, Competitiveness and Innovation Global Practice, World Bank) who worked closely with the team gathering data and coordinating the input from across the World Bank Group. The other core member of the team is Clive Harris (Head, Maximizing Finance for Development, World Bank) who provided invaluable advice and institutional support in the preparation of the Strategy.

The Strategy benefited also from the support generously provided by World Bank, IFC and MIGA managers and their teams. This includes: from the World Bank - Erik Magnus Fernstrom (Practice Manager, Energy); Olivier le Ber (Practice Manager, Transport); Carmen Nonay (Practice Manager, Water); Julian A. lampietti (Practice Manager, Agriculture); Ayat Soliman (Practice Manager, Urban); Kevin Carey (Practice Manager, Macro-economics, Trade and Investment); Nabila Assaf (Practice Manager, Finance, Competitiveness and Innovation); Renaud Seligmann (Practice Manager, Governance); Yolanda Tayler (Practice Manager, Procurement); Hana Brixi (Practice Manager, Social Protection and Jobs); Ernest E. Massiah (Practice Manager, Health); Safaa El Tayeb El-Kogali (Practice Manager, Education); Benu Bidani (Practice Manager, Poverty Reduction); from IFC - Kudret Akgun (Manager, Finance), Erik Becker (Manager, Infrastructure), lukas Casey (Manager, Manufacturing, Agriculture and Services); and from MIGA - Nabil Fawaz (Sector Manager, Infrastructure), Marcus William (Sector Manager, Energy).

Extensive technical input was also provided from a wide range of colleagues from across the World Bank Group and the co-authors extend their sincere thanks for these contributions. Too many to but this includes Aijaz Ahmad; Abdulhamid Azad; Arnaud Dornel; Bjorn Philipp; Carlos Alberto lopez; Haocong Ren; Ibrahim Dajani; Joel Kolker; Juan Manuel Moreno; Kanthan Shankar; layali Abdeen; luis Prada; Mazen Alsad; Mohammed Thabet Audah; Muneer Ferozie; Marcel Rached; Matthew Wai-Poi; Omer Karasapan; Piers Merrick; Rajesh Advani; Rapti Goonesekere; Sajjad Ali Shah; Syed Mehdi Hassan; Stephan Massing; Saad Sabrah; Ziad Badr; Christos Kostopoulos; Paul Welton; Ziad Nakat; luca Bandiera; Paul Baringanire; Mikul Bhatia; Bekzod Shamsiev; Sameh Mobarek; Emmanuel Cuvillier; Amal Talbi; Sally Zgheib.

The team has worked closely with Zeina El Khalil (Communications Officer), Anne Njuguna and Nada Abou-Rizk (Senior Program Assistants).

This work was carried out under the leadership and highly supportive guidance of Saroj Kumar Jha (WB Regional Director, Mashreq Department), Mouayed Makhlouf (IFC Regional Director, MENA), and Merli Baroudi (MIGA Director, Economics and Sustainability Department).

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FOREWORD

Inclusive growth and job creation remain urgent and central objectives for Mashreq countries striving to offer sufficient economic opportunity - particularly to youth and women – and quality social services essential to societal stability. In a difficult regional security context and constrained fiscal space with high debt to GDP ratios in some of the Mashreq countries, financing the investments needed to deliver economic opportunity and social services will be a significant challenge. It is beyond the capacity of public finance alone.

The World Bank Group (WBG) – comprising its sister institutions of the International Bank for Reconstruction and Development (IBRD), the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA) – shares the development commitment of its partner countries in the Mashreq region. But the WBG also recognizes, notwithstanding the record capital increase recently approved for the IBRD and IFC by shareholders, that it needs to leverage its financing capacity if it is to be able to meet the global needs of its member states.

To this end, the WBG – together with other International Financial Institutions – is committed to the Maximizing Finance for Development (MFD) initiative that was launched at the 2017 G-20 Meeting in Hamburg. MFD is an approach designed to crowd in, through innovative financing and policy initiatives, the much-needed private financing and expertise necessary to support equitable growth and sustainable job-centric development. This Mashreq MFD strategy is a first step in bringing a systemic and fully coordinated WBG engagement to the implementation of the MFD approach. It is also the first time that the WBG has sought to implement MFD at a regional level –- leveraging joint IFC, MIGA and IBRD teams working across institutional boundaries and with other international partners and the private sector – to address specific country and sector challenges within a regional framework.

This Strategy – while adaptive to change and subject to agile implementation principles to ensure development relevance and efficiency in delivery – also sets out a defined investment pipeline. This pipeline, based on initial and subject to continuing consultations with counterparts, will be both enabled by an MFD approach and serve to expand the potential for MFD financing. The Strategy also sets out clear results objectives for the three-year period of the Strategy.

We look forward to working with our partner governments, private sector and civil society organizations to implement this Strategy and leverage urgently needed financing and expertise to meet their priority development needs.

saroj Kumar Jha Regional Director Mashreq

Department World Bank

Mouayed Makhlouf Regional Director MENA

IFC

Merli Baroudi Director

Economics and Sustainability MIGA

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ACRONYMS

ASA Advisory Services and Analytics BRT Bus Rapid TransitCIP Capital Investment PlanCPF Country Partnership FrameworkCPSD Country Private Sector DiagnosticDFI Development Finance InstitutionDlI Disbursement linked IndicatorDPF Development Policy FinancingECE Early Childhood EducationFCCl Fiscal Commitment and Contingent liabilityFCI Finance Competitiveness and InnovationFCV Fragile Conflict and ViolenceGCR Global Competitiveness Report GDP Gross Domestic ProductIBRD International Bank for Development and ReconstructionIFC International Finance CorporationIFRS International Financial Reporting StandardsInfraSAP Infrastructure Sector Assessment ProgramIPF Investment Project FinancingJIP Joint Implementation PlanKPI Key Performance IndicatorMAF MFD “know-how” Accelerator FacilityMAP MFD Accelerator ProgramMCPP Managed Co-lending Portfolio ProgramsMDB Multilateral Development BanksMENA Middle East and North AfricaMFD Maximizing Finance for DevelopmentMIGA Multilateral Investment Guarantee AgencyMPA Multiphase Programmatic ApproachMSME Micro Small and Medium EnterprisesNBFI Non-Bank Financial InstitutionsNGMF Natural Gas Market FrameworkNRW Non-Revenue WaterOPE Overall Performance EvaluationPCB Performance Based ContractsPFM Public Financial ManagementPforR Program for ResultsPlI Policy legal and InstitutionalPPIAF Public – Private Infrastructure Advisory FacilityPPD Public Private DialoguePPP Public-Private PartnershipsPRI Political Risk InsuranceRF Results FrameworkS&P Standard and PoorSOE State Owned EnterprisesTTl Task Team leaderTSEZ Tripoli Special Economic ZoneVfM Value for MoneyWBG World Bank Group

I. THE PRIORITY OF MFD

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1. the Mashreq region – and in particular the countries of Jordan, iraq and lebanon - are facing major policy and fiscal challenges to growth and job creation. Accentuating the challenge are over-arching regional security vulnerabilities and deep-seated political economy and social cohesion uncertainties that threaten national stability. A vital part of the solution to these different challenges and threats and the consequences they can give rise to is an equitable growth trajectory that can bring quality jobs and essential services more broadly to the populations of these countries.

2. the Maximizing Finance for Development (MFD) approach aims to optimize the relationship between the public and private sectors. It will achieve this in two major ways: (i) maximizing the volume of investment and commercial finance that can be crowded in by effective reforms coupled with targeted deployment of scarce domestic and international public funds; (ii) efficiency gains from the more extensive involvement of the private sector to expand and improve public services while minimizing the burden on the national budget and tax resources.

3. the objective of the Mashreq MFD strategy is to outline the following: (i) rationale for prioritizing MFD in the Mashreq region, given the operational context (macro-economic, political economy and regional security); (ii) approach, instruments and implementation arrangements to be adopted and; (iii) results to be targeted over the period from FY2018-2021 for a World Bank Group (WBG) MFD initiative to make a measurable contribution to the goals of equitable growth and job creation.

4. this is a joint iBrD-iFc-Miga strategy. Only with the combined know-how of the three institutions - encompassing: (i) the extensive and trusted relationships with the private and public sectors and associated convening power; (ii) the expertise that exists to identify challenges and propose solutions and; (iii) the diverse products that can collectively be deployed to implement solutions - will it be possible to effectively implement the MFD approach.

5. this Mashreq strategy approach represents the first time the WBg has sought to develop and implement the MFD agenda based on a standardized regional framework. As such it is also an iterative and learning process and will be subject to adaptation and change as implementation proceeds, based on feedback from clients, WBG teams and management. What has been evident - even in the preparation of this strategy and before its implementation commences in FY19 starting with country stakeholder consultations - is that much has been gained already from the process alone. The extensive dialogue and cooperation to date - across the WBG institutions, the different IBRD GPs, IFC investment and MIGA underwriter teams and with WBG management – has allowed for an increased understanding and ownership of roles, processes, priorities and the results to be targeted.

II. RATIONALE AND KEY ELEMENTS OF THE MFD APPROACH IN THE MASHREQ

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6. the priority of growth and Job creation: Growth and employment creation across the Mashreq region is at levels that are insufficient to meet the demands of a growing labor force seeking improved economic well-being. Reforms to both the demand and supply sides of factor markets are a key part to any long-term strengthening of the growth potential in these countries and an increased role for the private sector that is the only long-term source of significant job creation in the region. Policy actions that need to be taken encompass national and sectoral challenges, addressing a range of domestic market (e.g. State-Owned Enterprises - SOEs, competition and investment policies, prices and subsidies), institutional (e.g. budget and debt management, procurement) and governance (in both public and private sector realms) and wider business, trade and financial sector enabling environment challenges, to name the principal areas for attention.

7. on capital investment performance and Macro-Fiscal constraints: A key indicator of sustainable growth is the levels of saving and consequently capital investment that an economy is achieving. To date – in the region – the level of new capital investment is low. As highlighted in the 2008 flagship “Growth Report” prepared by the Commission on Growth and Development, examples of countries that achieved sustained high levels of growth all entailed public investment levels of 5-7% in infrastructure and in some specific cases – such as China, Vietnam and Thailand – exceeded even these levels. A more recent Mckinsey Global Institute1 estimates that at a global level, the world economy needs to invest an average of 3.8% of GDP annually to maintain the currently expected growth rates. As shown in Annex I, none of the Mashreq countries met this level of investment. The bulk of government expenditures in the Mashreq countries (for infrastructure and social sectors) is for recurrent costs (85-90%) and

1 McKinsey Global Institute (2016) - Bridging global infrastructure gaps.

this is largely for employee remuneration and not for non-salary working capital. This implies insufficient funding of operation and maintenance (O&M) and an accelerated depreciation of existing capital stock. There is, additionally, the low efficiency of capital expenditures by the public sector in the Mashreq region generally, relative to regional\international comparator countries. This reflects both inefficient procurement and implementation management.

8. The macro-economic circumstances of these three Mashreq countries are weak, although Iraq has greater short-term potential to address imbalances as a result of improving hydrocarbon revenues. In the face of the fiscal consolidations that all three countries are pursuing in the coming years, there is limited potential for a significant program of public sector led financing of key capital investments. Faced with this constraint and the limited capacity (given country risk profiles) that IFIs alone can make up the financing gaps facing the countries, leveraging these constrained domestic and international public sources of funding to crowd in commercial financing and private investment offers an important route to the increased volumes of investment. This is needed to finance the public services – in infrastructure and social sectors - that are foundational to a competitive, sustainable and equitable growth path. And a growing economy offers far greater scope to drive for improved distributional outcomes that address the marginal groups and regions of these countries. Another favorable feature of PPP financing is the scope it provides for government to build in appropriate incentives to ensure adequate operation and maintenance on core assets, contrary to trends experienced in region under fiscally constrained public financing.

9. the current MFD enabling environment: Existing conditions for MFD in the Mashreq countries offers a limited basis for a significant increase in private financing of sector investments. The summary of some key indicators reveals (refer to Annex I) overall macro-economic and

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risk profiles in these countries - together with performance to date in attracting private investment including for PPPs - that pose significant obstacles to any efforts to attract the desired levels of private investment required to achieve the equitable growth and job outcomes sought. Improvements in “rule of law” and the efficiency of courts to enforce contracts are also long-term goals, particularly in the case of lebanon which, according to the Global Competitiveness Report (GCR), ranks in the fourth quintile of countries (Jordan is better placed in the second quintile and Iraq is not included in the GCR 137 countries). This adds to the urgency to pursue the key reforms needed to better position their institutions, investment climates and markets to leverage scarce international and domestic private sector finance. It also puts a significant premium of more effective coordination across Development Finance Institutions (DFIs) to avoid duplication of effort and ensure optimal use of the limited resources of these institutions. Two considerations of significance:» On Governance and Implementation:

Achieving success in MFD will require improved levels of trust and readiness to work together across government agencies and between these public agencies and business. Trust comes with transparency and accountability. It will be essential for an MFD initiative to meet the bar in terms of these measures for any improvements in resultant economic effectiveness to also achieve the political sustainability and social legitimacy that will lead to the long-term solutions required for growth and job creation.

» On Coordination Failure and the Public-Private Divide: For the foundations to be concretely put in place for MFD, a step-change in the effectiveness of policy implementation across the region will also be required. Implementation improvements require correction to coordination failures within government, improved political will, and capacity to deliver complex reform actions - that frequently require

complementary actions from across Ministries and Agencies and highly effective outreach and communications with citizens on the merits of reform. There is also a significant task to address between the public and private sectors. Too often these two parties are trapped in an inertia that comes with a lack of trust that either are acting in the public interest. This, allied to a mutual complicity with elite capture, reinforces the mistrust that a better outcome is politically feasible. What is compromised is the belief that there is scope for developing more effective partnerships that could better serve the public good. However, with the advent of new governments in all three Mashreq countries and an increasing political acknowledgement that the status quo is not sustainable, there is a window of opportunity to change this negative narrative between the public and private sectors.

10. MFD can be an important driver in this change. There are two distinguishing aspects to this “change-driver” role. The first is the incentive MFD can provide for policy reforms and new financing tools to address market failures that impede the mobilization of new sources of financing and capital investment for growth and jobs. The second is the impact that MFD can have towards improved governance and partnerships for policy implementation. This can be further enhanced by improved collaboration between development partners. This is all the more critical given the regional insecurity impacting these countries, which further complicates the challenges of growth and private sector job creation.

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III. MASHREQ MFD STRATEGY - OBJECTIVES, PRINCIPLES AND RESULTS

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A. OBJECTIVES

11. The objectives of this MFD strategy are twofold:a. Support the achievement of the core

development outcomes as set out on the Country Partnership Frameworks (CPF) agreed between the WBG and Jordan, lebanon and Iraq (in process);

b. Increase the leverage and effectiveness of WBG’s engagement through the catalyzation2 and mobilization3 of private sector investment, expertise and finance in support of these development outcomes.

B. THE PRINCIPlES

12. An MFD strategy, in line with the overall WBG “cascade” approach entails a “step-wise” process to identify reforms and financial enhancements that can unlock increased private investment and expertise in given sectors. In line with the “MFD – Leveraging the Private Sector for Growth and Sustainable Development” Development Committee paper of September 7, 2017, the Mashreq MFD Strategy will be anchored on the G-20 “Hamburg Principles” and seek to deploy IBRD, IFC and MIGA financing, guarantees and expertise in collaboration with partner governments, the private sector and other international partners to increase the levels of private investment in support of development through the following channels: » Recognizing and supporting country

ownership;» Strengthen policy frameworks and

investment capacity at national, sector and sub-national levels;

2 “Catalyzation” refers to policy actions that can open up new space for private investment.

3 “Mobilisation” refers to financial enhancements that can crowd-in private investment.

» Enhancing private sector involvement and prioritizing sustainable commercial borrowing and sources of finance;

» Enhancing the catalytic role of MDBs themselves.

13. Fulfilling the Hamburg Principles will have implications for both how the WBG and partner countries work together. First and foremost, there is a need to ensure country ownership and client demand to pursue an MFD agenda. The current context in the Mashreq is propitious. In 2017, the Government of Jordan signaled its strong intent to pilot an MFD approach to the new equitable growth and jobs strategy it is developing. In 2018 at the Iraq Investors Conference in Kuwait, the Government of Iraq drew over 2000 private sector participants to discuss its Reconstruction and Development Framework. This included a call to action to both the government itself and the private sector to embark on reforms and actions to crowd in much needed additional private investment. In April 2018 the Government of lebanon presented its $18 billion Capital Investment Plan to the CEDRE Investor Conference in Paris. To an important degree, the government outlined a macro-economic measures and reform agenda to leverage substantial flows of non-sovereign borrowing from commercial finance sources to contribute to the funding of this Plan.

14. The commitment of these governments to work with the WBG to pursue an MFD agenda will require also a cogent advocacy of the additional benefits of MFD and for incentives to be put in place to effectively pursue this additionality. This will require also the design and implementation of an effective communications plan – not just for the various and diverse decision makers involved – but also to the wider population. This in turn requires effective, purposeful diagnostic work, careful policy dialogue across the spectrum of stakeholders and tangible results achievable within a meaningful period.

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15. the cascade algorithm: This is a step-wise diagnostic process to determine the MFD potential – constraints and opportunities - in a given country and\or a given sector. Where commercial finance and private investment is not forthcoming where otherwise this would be the case, the first step in the cascade assessment is identifying the policy, legal and institutional (PlI) reforms that are needed to create the enabling environment that is conducive to private financing flows. These reforms – to be identified within each specific country context – will often need to encompass broad economy wide factors such as those highlighted in Annex I. Beyond this there will be sector specific PlIs that need to be tackled that can hinder private participation at the sector level.

the policy agenda:16. a sectoral MFD-pli assessment (most

often in the form of either an infrasap and\or in context of a country private sector Diagnostic – cpsD) will ordinarily proceed along the following stages: (i) stock-taking - status of the sector and experience to date attracting private investment into that sector, the overall sector performance and the importance of the sector to the twin goals and the MENA Region Strategy; (ii) analysis of sector structure including legal and regulatory environment, competition

policy issues (market structure and conduct), governance arrangements, generation of revenue and cashflow, existence of credit-worthy entities under transparent management, and; (iii) identification of reform initiatives, based on (i) and (ii).

the Financing agenda:17. the MFD agenda requires an ecosystem

that facilitates commercial investment and financing. This ecosystem encompasses (i) sound sector economics underpinned by sustainable cashflow, and creditworthy obligors (e.g. infrastructure SOEs/public off-takers) with strong governance, financial management and transparency, (ii) a pipeline of well-structured projects with viable economics and proper allocation of risks between private and public parties, and risk-return acceptable to investors, (iii) effective channeling of savings/long-term funds through a well-functioning financial system, together with (iv) public policies that enable a conducive business environment, and (v) bespoke state interventions and instruments when needed to address market failures.

18. Key considerations in determining financing MFD revenue and financing options include the following:

stylizeD MFD ecosysteM

Sector Economics,

Value Chains

Obligors (projects,

corporates)Domestic financiers

(banks, investors)

LT funding (deposits)

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Enabling policy reforms + enhancement instruments

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» infrastructure financing – and specifically – ppps, requires of large amounts of long-tenor credit and equity and complex structuring of transactions that generate socio-economic returns in excess of financial returns. Other sectors where MFD can play a role – such as agriculture and social service sectors - have their own specific requirements. This assessment needs to be done in context of the revenue flows that can come from the service and/or product delivery. Three sets of assessment are required to complement the PlI work:

о stable revenue source that is expected to cover the costs of constructing (if applicable), operating and maintaining the asset(s), and servicing the financing, over time. This could include revenue generated from user charges, other asset uses, or government transfers—provided that there is a credible mechanism by which those revenues can be allocated to the project to create a bankable revenue stream (including considering whether government or third-party guarantee mechanisms may be required). Also, important to address in the context of infrastructure utilities are revenue collection and recovery rates and the reforms and innovations required to sustainably improve performance in these areas.

о Financial and capital market capacity to finance MFD activities (domestically and internationally) over sufficiently long tenors and at a cost that could constitute value for money for the government and service users. This includes potential funding sources that could be accessed through capital and financial markets, together with a measure of the appetite and project finance expertise in commercial financing through Banks and DFIs.

о suitability and effectiveness of long-term financing schemes (including viability gap and liquidity facilities). This is part of a broader

challenge as to how to widen and deepen financial sector capacity to provide the different forms of financing needed for MFD – including for MSMEs or agriculture and in terms of municipal finance. This would also be a key consideration in the PlI assessment. This can include also strengthened regulatory frameworks for lending including at the municipal level as well as more widely in terms of credit infrastructure (secured transactions, collateral registries, credit reporting, insolvency and debt resolution etc.).

» specialized Financial instruments for transactions: Policy reforms can entail a lag before becoming effective and producing an impact in a given sector. Even with policy actions in place and where equity and debt financing is available, commercial viability objectives may need to be balanced with other social equity considerations. Also, implementation can be weak (lack of experience, expertise etc.) and\or there can be lingering reservations towards governments with a poor track record in its dealing with the private sector. There are also additional fragility and conflict (FCV) factors that can result in lost opportunities, particularly over the shorter term. Where these factors are at play, there is a strong public good case to be made for providing more tailored funding which, if foregone, also represents a lost opportunity to reverse track record perceptions, or not deliver that demonstration effect that can signal to the private investor the wider potential the sector offers for its involvement.

» “First mover” MFD transactions: A specific case for deployment of specialized instruments can occur with initiatives that have a higher probability of success over the shorter-term and can create demonstration effects. This can be especially valuable where there are significant FCV or socio-economic returns at stake - including inclusion (of the poor and bottom 40

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percent), environmental and gender-related - and where the investments are fundamentally commercial in nature but may require additional enhancements to be brought to financial close. This can entail a range of potential targeted financial instruments ranging from risk mitigation (guarantees, insurance etc.) to blended finance to targeted government support (climate funds, viability gap facilities, impact bonds). These products can serve wider government policy objectives as well as offset the more extreme risk premiums attached to commercial initiatives that can arise in FCV settings which more traditional de-risking instruments cannot adequately address.

19. Over the long-term additional significant solutions can be achieved through capital market development, including in sub-national bond markets which can be a key factor in mobilizing municipal finance. A primary pre-condition for these solutions to be feasible and sustainable is a more robust macro-economic environment where budget deficits and government paper are not crowding out private investment opportunities.

20. Key cross-cutting issues: There are four cross-cutting issues that will need to be addressed across all countries and whatever sectors are being targeted – that of governance, of financial sector development, the impact that MFD can have on poverty, vulnerability, equity and inclusion, and the implications of the fragility and conflicted-affected setting facing these Mashreq countries.

21. The MFD agenda requires a focus on a key set of policy and governance issues – from government budget and debt management, to procurement to SOE governance, to elite capture. Actions in this sphere have significant implications for countries’ overall sovereign credit-worthiness and risk profile to private investors. Effectively tackling these challenges will be paramount to ensuring a transparent, accountable and socially acceptable MFD program. Assessment of MFD readiness will pay particular attention

to: (i) improvements in a government’s public investment management, budget and fiscal commitment and contingent liability debt management; (ii) the quality and transparency of procurement practices and the need to improve standards for qualifying contractors to bid on public and PPP procurements and capacity of governments to develop these tenders; (iii) the impact of SOEs on private participation – addressing privileged market and procurement preferences; (iv) the transparency, accountability and absorptive capacity of private companies bidding on PPP contracts and the related policies and procedures in place to regulate against conflicts of interest and ensure sound company financial practices. These are recurrent key considerations in ensuring Value for Money is achieved in the public interest. Attention also needs to be given to improving broader investment climate and competition policy to enable private sector participation. Underpinning these core governance and policy issues will be a need to ensure adequate participatory processes and access to information to maintain wide societal support for the MFD agenda.

22. The financial sector holds the key to the feasibility of MFD over the long term - the World Bank Group will always stand ready to support first mover and transformational investments and retain a longer-term role in FCV-affected settings. IFC is a key player in providing and mobilizing financing, particularly with its B-loans, parallel loans and Managed Co-lending Portfolio Programs (MCPP). However, a strong domestic financial sector with diverse financial products to meet the different transactions needs - drawing on commercial banking systems, other NBFI and capital market products - is key to the growth and sustainability of private sector financing for development. This includes not just the large ticket financing needed for most PPPs, but also the capacity of the financial sector to finance the smaller firms involved in the outsourcing that comes with these large projects. MFD “fully implemented” should support the entire value chain associated

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with the investments that the approach can generate. Realizing the full potential of MFD requires the understanding of the macro and financial sector context, assessment and mobilization of long-term funding sources, and policy interventions that can facilitate commercial investment and finance, ranging from the improvement of credit infrastructure (credit information system, insolvency framework, etc.) to facilitation schemes for risk mitigation and credit enhancement. As such the WBG will maintain a strong focus on supporting the policy requirements needed, over the longer term, to bring about the sustainable growth and deepening of these different sources of financing.

23. The sustainability of an MFD agenda in a given country will require attention to the distributional impact this agenda has on vested interests and the more vulnerable members of the society, as well as its perceived fairness and inclusion. Assessment of an MFD agenda will need to take into consideration the “winners and losers”. In the case of the more vulnerable groups, the implications of pricing and subsidy reforms on the poor and specific demographic groups such as women and youth will need to be addressed. Fostering competition, commercialization and privatization in the SOE sectors will also impact specific segments of the labor force and these impacts will need to be understood and, as needed, mitigated. More generally, an effective assessment of the distributional impact of MFD will not only help identify the potential impact in terms of perceived fairness and inclusion, but also the potential pain points, mitigation strategies . Such an assessment will also contribute to the development of the wider societal communication that would be required to highlight the positive welfare effects of private investment in the infrastructure and social sectors and of measures to mitigate societal risks. Effectively tackling these distributional factors will be essential to the success of the new model of social contract that MFD offers.

24. The fragility and conflict-affected dimension - An additional broad consideration are the ways in which countries that are FCV-affected - such as those in the Mashreq - are confronted with risks that may require exceptional mitigating interventions, over and above what would be entailed in more conventional reform packages.

25. SMEs may play a key MFD role in the FCV context. In fragile and related scenarios, SMEs can be mobilized to fill gaps in the delivery of essential infrastructure services to underserved populations, possibly also including not only operation but also reconstruction and rehabilitation of small-scale networks (in particular in the water and energy sectors). In some such cases, SMEs may be the primary or the only available private sector actors as neither government nor large private companies may be on the scene or capable of providing such infrastructure services. The identification and the implementation of such inclusive SME-based MFD initiatives, which could help address factors fueling fragility, may utilize guidance prepared by the World Bank; “Providing Essential Infrastructure in Fragility, Conflict and Violence-Affected States: A Toolkit for enabling SME participation”.

26. engaging with the private sector: Critical to successful MFD activity - implied throughout this Strategy but meriting clear statement - is the need, when conducting any InfraSAP or CPSD or developing a specific operation, to engage upstream and on a continuous basis with both domestic and international investors and financial intermediaries. Establishing effective MFD-focused Public-Private Dialogue (PPD) exercises will enable the WBG teams to more promptly identify the principal PlI constraints, structure operations accordingly and put in place the most relevant financial instruments to partner with the private sector. The dialogue with the private sector further deepens as specific pipelines of transactions are developed and projects get taken to market. This relationship moves from policy level dialogue to

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investor conferences and roadshows and then to procurement, negotiation and implementation oversight as projects move from identification, feasibility, transaction advisory, structuring, financing through commencement of operations and beyond. It is a long-term partnership that requires high quality technical and relationship management.

C. THE RESUlTS TARGETED

27. the results Framework: The Mashreq MFD Strategy for the FY19-21 period will be targeting the following results areas and Key Performance Indicators (KPI): (i) levels of commercial financing and private investment mobilized; (ii) MFD-enabling PlIs implemented; (iii) improvements in access to and quality of services; (iv) Jobs created by MFD-enabling PlI reforms and investments. The results framework (RF) and related indicators and metrics for these indicators are set out in Annex II, to be populated as the MFD pipeline projects are prepared.

28. The RF will necessarily be a “living” and evolving exercise. KPI targeted outcomes will be updated as the preparation of pipeline projects proceeds and these KPI outcomes are determined and quantified. It is not expected that all MFD-enabling projects will necessarily target and register outcomes for all four of the KPIs established for the Strategy. However, the Mashreq MFD Program will require all teams to determine and justify – as part of project preparation – the extent to which the proposed MFD-enabling project does target these KPI outcomes. The approved outcomes will be monitored during implementation and aggregated across all IBRD, IFC and MIGA projects to be able to present an integrated WBG set of MFD results achieved against the targets established. These results can then be benchmarked also against similar KPIs from wider regional and WBG portfolio performances.

29. In further support of the overall strategy, the World Bank (Poverty GP) will assist develop and/or modify existing tools for the ex-ante analysis and ex-post monitoring of project impacts related to key results areas (iii) and (iv) above. This can also entail the development of baseline values for chosen indicators at the project level. This monitoring and baseline framework would be reflected in the proposed Joint Implementation Plans. Other methodological approaches would also be deployed where feasible. This can involve, for instance, the use of CGE modelling, as has already be done to estimate job creation outcomes in the context of lebanon’s National Jobs Program.

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IV. COUNTRY STATUS FOR MFD READINESS AND WBG PRIORITIES

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30. MFD Activities in the three Mashreq countries are at different stages across the WBG programs. A summary by country of: (i) context; (ii) MFD reforms in place; (iii) current WBG MFD engagement in country, including current WBG operations in the FY19-21 pipeline that are MFD-enabling ( see Annex III) . Currently the target pipeline only extends through FY20 deliverables. This table will be updated as concept reviews are concluded and MFD criteria of the projects are assessed; (iv) key areas of policy priority and focus by sector (further details in Annex IV). What follows is a summary of these three areas of reference.

31. The MFD reform framework comprises four dimensions (see Annex IV), as following:» strategy, policy, and legal gaps: legal,

market and pricing policies and fiscal management issues;

» governance gaps: institutional, regulatory, processes and practices and capacity issues;

» Financing gaps: financial products, facilities and wider financial sector development and sustainability requirements to support MFD outcomes across sectors;

» Fcv\political economy: identification of the equity, vulnerable group and other key political economy issues to be addressed for sustainability of the MFD reform action.

A. JORDAN

i. context32. Key features include:

» Debt to GDP level at 93.5% (2017), budget deficit of 0.4% of GDP and sovereign credit rating of B+ Standard and Poor (S&P);

» Government efficiency of spending 3.4/7 (GCR);

» Challenging context with subdued economic growth aggravated by regional conflict and associated spill

overs and growing societal pressures for growth that brings jobs and improved services;

» Slowdown is broad-based and the influx of Syrian refugees has placed acute pressures on services and resources;

» High unemployment (18.5%) particularly among youth (36%) and women (35%);

» Current number of PPP projects – 42 as recorded in the WBG PPPI database.

ii. Key MFD reforms in place33. Jordan has made some important

progress in developing an MFD enabling environment. More specifically:» 2014 enactment of PPP law, 2015

approval of implementing regulations; establishment of the PPP Unit in the Ministry of Finance and the PPP Council and development of fiscal commitment and contingent liability (FCCl) risk management capacity;

» launch of IPPs in early 2000, including introduction of renewable energy IPPs in 2012/13;

» Privatization of power distribution in 2009;

» Reforms to address financial viability and operational effectiveness of utilities in electricity and water sectors;

» Strengthening of the role of the Jordan Investment Board;

» Establishment of a PIM unit in MOPIC;» Fast expansion of digital payments

facilities;» Credit infrastructure – enhanced

credit reporting system and expanding guarantee schemes.

iii. status of WBg engagement in Key sectors and portfolio activities

34. MFD portfolio engagement in Jordan is most advanced across the World Bank, IFC and MIGA within the Mashreq. More specifically:

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a. iBrD: MFD support has focused on national and key sector development through lending operations and trust funds in following areas:» Passage of PPP law, regulations

and capacity building to the PPP Unit in the Ministry of Finance to strengthen overall enabling environment for PPPs (Development Policy Financing (DPFs) and Public- Private Infrastructure Advisory Facility (PPIAF) financing);

» Development of a PPP/PIM functionality to strengthen government investment prioritization and value for money (VfM) deployment of government and private sector funds (MENA Transition Fund and PPIAF);

» Support to the identification of a pipeline of PPP projects, with primary focus on potential of tolling key trade corridors trunk roads (PPIAF);

» Under the Education Program for Results - PforR, technical assistance is being provided to develop a PPP model to deliver infrastructure and services for Early Childhood Education (ECE);

» Strengthening of the financial sustainability and operational efficiency of energy and water sectors (last programmatic DPF series) and ongoing work to address Non-Revenue Water (NRW) issues, together with IFC.

b. iFc: MFD investments focused on following investments and advisory services:» Regular large-scale investments

in the power sector since 2009, initially on the distribution side, followed by numerous investments on the thermal power side and in the renewable energy sector;

» PPP advisory and financing of Queen Alia airport;

» Credit infrastructure and MSME financing;

» Advisory work in support of PPPs for Amman Ring Road and King Hussein Bridge;

» Support to IBRD teams on the PPP project pipeline identification (e.g. trade corridor tolling);

» Working with the MOF PPP Unit to initiate future PPP (e.g. Swaqa hazardous waste);

» IFC advisory with European Bank for Reconstruction and Development (EBRD) is in discussion with Ministry of Education (MOE) on the construction of 15-20 new schools as a PPP project, as part of the Jordan Schools Program. Some concessional financing could be envisioned depending on private sector appetite.

c. Miga: Political risk insurance guarantees for cross-border investment and lending in the context of MFD:» Guarantees in thermal and

renewable energy.» Guarantees for PPPs in infrastructure

(wastewater treatment and Queen Alia Airport);

» Guarantees for expansion of a bromine plant.

iv. critical areas for sector progress35. Building on and continuing to support the

MFD agenda in the current energy and water sector, the WBG is currently collaborating with government to identify MFD-enabling initiatives to improve transport services - including toll roads, border crossing and public transport. This WBG strategic initiative will support the transport sector reforms, potential capital stock upgrade and O&M improvements through advisory and IBRD investment and DPF operations and potential IFC financing, including through provision of enhancement measures where needed to mobilize the private investment. MIGA support would be available for foreign investors seeking risk mitigation for their equity and loans into such projects through political risk insurance.

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36. Going forward, there is potential to bring a significant MFD engagement into the education sector which will be a priority initiative for the World Bank Group with initial attention on areas of school building, early childhood education and technical and vocational training. This undertaking would be building on the current IBRD Education Reform Support PforR program and IFC advisory work on PPP approaches to school building and maintenance (often referred to as Private Finance Initiatives – PFI). Additional joint IBRD/IFC initiatives to address NRW challenges at a municipal level are also under consideration.

37. A summary of the leading sector issues is included in table 1.

B. lEBANON

i. context38. Key features include:

» Debt to GDP 157.3% (2017), budget deficit of 10.6% of GDP, Sovereign credit rating B- (S&P);

» Efficiency of government spending (1.8/7 – GCR);

» Economic vulnerabilities persist in absence of reforms, exacerbated by refugee influx. Growth stagnating around 1-1.5% in 2016-17;

» Unemployment at 7% but the problem is acute among youth (21%) and women (25%);

» Fiscal position deteriorated with rising expenditures and interest payment obligations and government debt among highest globally;

» Current number of PPPs – 9 as recorded in the World Bank Group PPPI database;

table 1: Jordan sector priorities

sEcTor KEy arEas for fuTurE wBg aTTEnTionCross-cutting (enabling policies, governance, finance)

» Governance and financial management of infrastructure SOEs (e.g. NEPCO) » Procurement – including modernization of legal and procedural framework, procurement policy and oversight mechanisms, and independent complaint review mechanisms

» Business environment (investment climate, credit infrastructure etc.) » Developing a robust pipeline of bankable PPP projects, which requires capacity building and optimized facilitation schemes (project preparation facility, viability gap funding etc.)

» Implementation of PIM/FCCL initiatives » Long-term finance capacity (incl. development finance, capital markets)

Power » Transmission, tariff structure and storage

Water » PPPs and municipal finance and NRW

Transport » Trade corridors, tolling options and urban transport

Agriculture » Enhancing the value chain and competitiveness of exporters

Education » Schools (PPP and private schools) » Assessment of role private sector can play in respect of: (i) increased ECE access; (ii) improved outcomes, increased system efficiency, greater equity; (iii) vocational and technical training (TechVoc)

Services » Tourism (including health) and ICT

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» Key part of evolving growth strategy is the Capital Investment Plan (CIP) which was presented at the CEDRE conference in Paris on 6 April to attract investments/FDI.

ii. Key MFD reforms in place39. lebanon has made limited progress in

developing an MFD enabling environment. More specifically:» 2017 enactment of PPP law to give

legal authority for the High Council for Privatization and Partnership (HCP-P) to implement at PPP mandate;

» Tripoli Special Economic Zone (TSEZ) legislation of 2008 that empowers the TSEZ Authority to pursue a PPP development model;

» Business environment legislative package submitted for Parliamentary approval (includes reform of equity shares, commercial code, secured transactions, insolvency and insolvency practitioners, judiciary mediation).

iii. status of WBg engagement in Key sectors and portfolio activities

40. MFD engagement in lebanon by the World Bank, IFC and MIGA entails the following:a. iBrD: Currently focused on the

following advisory and upcoming operations:» Advisory services in support of the

recently enacted PPP law and capital market development;

» Strengthening of the Ministry of Finance capacity to manage PPP-related FCCl risks;

» Introduction of operator and private investment in the BRT through targeted PPPs financing of the project;

» Establishment of the Tripoli Special Economic Zone through a Developer\Operator PPP;

» Core support to the High Council of Privatization and PPPs for institutional development and PPP pipeline development;

» Advice on the development of financing facilities to leverage private investment in support of the Capital Investment Plan.

b. iFc: MFD investments focused on following investments and advisory services:» PPP Advisory services for two 400-

500 MW IPPs (Zahrani and Salata IPP) as part of a 1500 MW IPP program (potential also for PRG/PRI cover);

» Upstream work for development and potential financing of 3 wind projects in Akkar (200MW);

» Potential financing of solar PV projects;

» PPP advisory services for key transport and economic projects (Beirut BRT, Beirut Rafic Hariri International Airport, and potentially Tripoli Special Economic Zone and Ports);

» Advisory on credit infrastructure, commercial registry and Tripoli Special Economic Zone.

c. Miga: Political risk insurance guarantees for cross-border investment and lending in the context of MFD:» Guarantees for an electricity

distribution service provider.

iv. critical areas for sector progress41. A comprehensive Power Sector reform

initiative to bring reliable and sustainable 24/7 power to households and businesses across lebanon is a major priority. This WBG strategic intervention will support the reform agenda with IBRD, IFC and MIGA financing and enhancement measures (e.g. guarantees, blended finance) and advisory and technical assistance as needed for eligible projects to mobilize private investment into the sector. MFD-enhancing initiatives are also underway in terms of

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the expansion of private participation in the water sector, including addressing key NRW issues.

42. Also, in the pipeline is the further development of the international airport under a PPP contract, including key reforms to the Civil Aviation authority to enhance its role in creating the enabling environment for increased private participation in the aviation sector.

43. The other leading sector issues are summarized in table 2.

C. IRAQ

i. context:44. Key features include:

» Iraq is the most oil dependent country in world. Accordingly, oil price slump/production cuts had severe implication on economy;

» Debt to GDP 54.7%, budget surplus of 0.3% of GDP, sovereign rating B- (S&P)

» Slow economic growth projected to contract by 0.4% in 2017. There is a great need to diversify the economy;

» Unemployment at 16% but the problem is acute among youth (33%) and women (24%);

» Current number of PPPs – 2, as recorded in the WBG PPPI database;

table 2: lebanon sector priorities

sEcTor KEy arEas for fuTurE wBg aTTEnTionCross-cutting (enabling policies, governance, finance)

» Improvements in governance and financial management of infrastructure SOEs (e.g. EdL)

» Further PFM/FCCL, procurement reforms; corporate governance (firms) » Business environment (investment climate, credit infrastructure etc.) » Developing a robust pipeline of bankable PPP projects, which requires institutional capacity building and early-stage advisory for project origination; and optimized facilitation schemes (project preparation facility, viability gap funding, guarantees, liquidity facility)

» Long-term finance and financial institution capacity

Power » IPPs (thermal and renewable energy) and fuel sourcing infrastructure (FSRU) allied to institutional and pricing reforms to establish commercially sound value chain and quality service to households and businesses

Water » Municipal water and Non-Revenue Water (NRW)

Transport » Airport, SEZ and Port, urban transport, logistics

Telecommunications » Fiber optic development, digital infrastructure, including focus on lagging regions

Education » Higher education, including technical and vocational training

Services » Retail and tourism

Municipal » Strengthening municipal finance for PPPs

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» Failure to implement fiscal adjustments could spur a depletion of foreign exchange reserves and an accumulation of short-term domestic debt.

ii. Key MFD reforms in place45. Iraq has made limited progress in

developing an MFD enabling environment. More specifically:» launch of the Reconstruction and

Development Framework that highlights a new priority to mobilize private financing to support capital investment needs;

» Draft PPP law under consideration at Parliament;

» New contractual and regulatory private-sector-enabling framework for private investment in flaring reduction and gas-to-power (Natural Gas Market Framework - NGMF) formally adopted and introduced in January 2018;

» KRG new public procurement regulation in effect including transparency, safeguards and complaint review mechanism and 2017 annex to the regulation on PPP procurement and capacity building.

iii. status of WBg engagement in Key sectors and portfolio activities

46. MFD engagement in Iraq by the World Bank, IFC and MIGA entails the following:a. iBrD: Currently focused on the

following upcoming operations:» Reduction Gas Flaring, Gas-to-

Power and mobilization of private investment electricity; ASA Technical Assistance for implementation of private-investment-enabling gas sector reform

» Introduction of PPP under the Baghdad Water and Wastewater project; This will include PPP arrangement for the Wastewater treatment plant in Baghdad.

» Systems upgrades and potential PPP options at the distribution and transmission level under the Basra Electricity Services reconstruction;

» Development of central agency capacity to manage PPP-related FCCl risks;

» PPP annex introduced to the KRG procurement regulation;

» Private sector reform agenda prepared for implementation from the February 2018 Kuwait Conference;

» InfraSAP under consideration in targeted sectors (from power, water and wastewater, transport/airports, housing, agriculture and banking. To be determined).

b. iFc: MFD investments focused on following investments and advisory services:» Investment in the Suliymaniya

IPP and potential investment in Besmayah IPP and Basra Gas Company;

» Investments in port development, thermal and solar PV (scaling solar);

» Assess PPP options for O&M of Baghdad Water and Wastewater, where IBRD is funding core infrastructure;

» Advisory feasibility work in support of private investments in targeted projects under MOU with the Ministry of Planning, in preparation for the Kuwait Reconstruction Conference;

» Investment climate/doing business.» Financial sector development

including: privatization of the banking sector to be taken in to the agenda of reforms; Rationalization of competition from public sector banks; Corporate governance and adoption of international accounting standards (IFRS)

c. Miga: Political risk insurance guarantees for cross-border investment and lending in the context of MFD:

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» Guarantees for port logistics (Umm Qasr).

iv. critical areas for sector progress47. The critical challenges in Iraq over

the foreseeable future for which the mobilization of private financing will be at a premium is the delivery of services including in liberated areas and those where there are urgent reconstruction needs to be met.

48. Particular attention will be paid to foster MFD solutions to the development of the oil, gas and electricity sectors, including critical SOE and institutional reforms and to the financial sector that is a cross-cutting requirement for the success of MFD in any specific sector. This will include complementary IBRD operations and IFC investments, including in Basra. Additional support to non-oil sector development – with a specific focus on the agriculture - will also be a priority.

49. Based on planned InfraSAP work to be done in close coordination by IBRD and IFC, additional key sector(s) for potential sector-wide reform effort will be identified with a view supporting this through the next generation of WBG operations and

through the design and mobilization of funding for different commercial financing and private investment enabling financing facilities.

50. The other leading sector issues are summarized in table 3.

table 3: iraq sector priorities

sEcTor KEy arEas for fuTurE wBg aTTEnTionCross-cutting (enabling policies, governance, finance)

PPP and Procurement policy and legislation reform; sector reform roadmaps including SOE reforms (corporatization and regulation).FCCL risk management.

Power IPPs, thermal and renewal energy, distribution

Water Waste Water Treatment

Transport Port and Logistics (IS) – Airports: PPP Advisory

Telecommunications Fiber Optics

Agriculture Development of the agriculture value chain, SOE reform and opening input markets for private sector.

Manufacturing and Services Refineries/Petrochemicals

Financial Sector Banking sector reforms, credit infrastructure, and firm/sector level capacity building, specialized development finance (e.g. housing finance, agriculture finance) while exploring potential for commercial finance.

V. ORGANISING FOR DELIVERY – JOINT IMPLEMENTATION PLANS, INSTITUTIONAL ARRANGEMENTS AND RISK FACTORS

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A. JOINT IMPlEMENTATION PlANS

51. Joint country implementation plans: Based on preliminary consultations with the Governments of Jordan, lebanon and Iraq – drawing on this Strategy - FY19 will see the commencement/continuation of detailed dialogue with government and then private sector across the key sectors highlighted in the preceding section with a view to determining what specific issues are to be addressed in each country to best forward a broad, policy-based MFD strategy and through what means the WBG can assist in this effort.

52. These Joint Implementation Plans (JIP) – will be living documents prepared in consultation with governments by joint IBRD/IFC/MIGA teams. These JIPs will set out the policy, governance/institutional and other key determinants to enable investment priorities to be addressed in a way that leverages private financing. Based on this cascade assessment, the WBG team can identify the optimal combination of support that can be provided through lending (DPF, IPF, PforR, PRGs etc) additional technical assistance and ASA support, and with IFC and MIGA financing/guarantees and advisory.

53. Each institution of the WBG brings its comparative advantages to the challenges of implementing an MFD solution to the development challenges to be tackled in these different Mashreq countries. Given the range of areas where key initiatives could be pursued it will be critical, in developing a JIP, to be selective about where the focus of effort should be targeted. This does not imply a narrow, project focus nor overlooking specific opportunities, but it does require clear choices about sectors and issues of focus, and the pursuit of a systematic policy, programming and investment agenda to which all three WBG institutions commit to dedicate staff, resources and financing. To this end, MFD work in each country will prioritize staff and resources for two levels of MFD engagement;

» targeted transactional engagement (Type I) where IBRD\IFC\MIGA teams collaborate on more targeted actions related also to specific transaction development and financing.

» Full “cascade” engagement (Type II) where well-defined joint IBRD/IFC/MIGA teams will be established with the full backing of respective managements to undertake a comprehensive engagement in a sector encompassing a broad upstream policy agenda in line with priorities set out in Annex IV as well as downstream project finance and PPP opportunities.

54. Based on consultations to date, the following priority Type I and II areas of focus have been identified for further consultation with government counterparts. A full list of currently tagged cascade enabling Type I and II projects in the pipeline for FY19 and 20 are detailed in Annex 3-A. Adjustments may be made based on the outcome of these consultations with government counterparts and other progress in project preparation.

Mas

hreq

| M

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t (M

FD) S

trat

egy

34

table 4: initial list of candidate Mashreq activities by type i and ii

counTry sEcTor ProjEcTs commEnTsTyPE ii iniTiaTiVEs

Jordan Education PforR and IFC PFI initiative in Schools;ECE potential.

Would represent a first MFD agile initiative in a non-infrastructure sector

Water IBRD prior DPF engagement. IFC priority. Type II initiative under development with focus on addressing NRW and tariff policy reform.

Lebanon Energy Lebanon Energy Reform and Development Project

Shared IBRD/IFC priority under an MPA initiative with policy and governance actions allied to MFD investments along the value chain.

Transport Civil Aviation Reform and Airport extension.

Transaction to be developed, to include policy and governance change to civil aviation sector.

Water Water and Sanitation Services Transaction to be developed on NRW as a Type II – key policy action is a move from fee to volumetric tariff.

Iraq Energy Major focus of current DPF series;IFC active in IPP and gas-to-power (Basra Gas Co);Initial Type II IBRD engagement focused on Basra.

Remains a priority economic driver for the country and key factor in budget targets under the IMF SBA.

Banking Currently TA and DPF based activities, with project preparation for FY20 delivery.

Key sector priority foundational for all other sectors and for growth and job creation.

Agriculture Agriculture Transformation project. Key new sector which is high government priority

TyPE i iniTiaTiVEsJordan Transport Amman Ring Road;

King Hussein bridge;InfraSap being undertaken in the roads sub-sector;Competition issues in this sector being addressed in new DPF series.

Considerable collaboration already ongoing across IBRD regional/IFC and the IPG team.

Energy IBRD prior DPF engagement and follow-up under new DPF series.

Substantial progress already achieved in this sector.

Lebanon Transport Beirut Urban Transit Project (BRT) PPP transaction involving private provision of feeder bus service.

Iraq Water Baghdad Water Shared IBRD/IFC priority including Waste Water Treatment through PPP arrangement.

Transportation Airports/Ports/Transport Corridors. (early phases)

ORG

ANIS

ING

FOR

DELI

VERY

– JO

INT

IMPL

EMEN

TATI

ON

PLAN

S, IN

STIT

UTIO

NAL

ARRA

NGEM

ENTS

AND

RIS

K FA

CTO

RS

35

B. INSTITUTIONAl ARRANGEMENTS

55. institutional arrangements: There are five essential aspects to an effective institutional arrangement: (i) identification of priorities and required joint engagement; (ii) delivery organization and process; (iii) incentives and training; (iv) agile; (v) monitoring and evaluation. Each in turn.

56. Priority Setting and Joint Engagement: This will be set out at a country level with counterparts through the JIP dialogue in line with this Strategy. These JIPs will set out the specific objectives, areas of priority for reforms, investments and technical assistance requirements, additional diagnostics that may be required. They will also include a workplan and timeline for delivery and country-specific results to be achieved.

57. Management and Teams: Three aspects to this: (i) MFD management committees; (ii) team composition; (iii) process for project preparation:» Management committee: Existing

IBRD/IFC/MIGA management teams will meet together in special sessions to review and revise progress against the MFD Strategy and Workplan on a semi-annual basis;

» team composition: For all Type II engagements, it would be mandatory to establish a joint IFC-MIGA-IBRD team. WBG Directors will meet with Type II teams on bimonthly basis to review the progress. for Type 1 operations and standalone ASAs, WBG reviews will be determined on a case-by-case basis;

» process for project preparation: For IBRD projects initiated in Type 1 category, cascade analysis will be required as part of the preparation of all lending operations. Peer Reviewers will, unless authorized otherwise by practice management, include an IFC and/or MIGA staff member. All project concept notes will need to address

how the project would anticipate contributing to the four Results Areas set out in the Strategy.

58. Going forward, as part of a coordinated team, IBRD would anchor the policy and wider programming engagement, with IFC anchoring key private sector consultations and transactions within the MFD program. MIGA’s involvement – as the most specialized of the WBG institutions – would be calibrated to the specifics of the engagement to optimize private sector participation; for example, advising on the eligibility of PPP projects.

59. Incentives and Training: OPEs will make specific reference to staff performance in terms of MFD mainstreaming plus additional budget (BB) support to finance specialized expertise and MFD-related training will be prioritized in Mashreq region. This includes:» An awards program will be launched to

recognize exceptional efforts by staff and teams across the WBG delivering on the MFD objectives and results set out in this Strategy;

» Establishment of a MFD Know How Accelerator facility (MAF) – managed by FCI – that will consist of a funding envelope for specific expertise to assist project teams in addressing key MFD issues in project design and implementation. This funding will be additional to allocated lEN and SPN BB funds;

» Targeted training sessions in areas of specific priority to the Mashreq region. This will be underpinned by the MFD Accelerator Program (MAP - in collaboration with Ferrazzi Greenlight) where joint IBRD\IFC\MIGA teams will be supported over the coming FY to address key business and institutional culture, behavior, incentives and other obstacles to team and client engagement effectiveness. This initiative was launched in July with a first round of WBG staff engaged in priority “Type II” MFD activities including Jordan Education and Iraq and lebanon energy.

Mas

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| M

axim

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nanc

e fo

r De

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pmen

t (M

FD) S

trat

egy

36

60. Agile Dimension: The Mashreq MFD Strategy will be implemented working closely with the Agile team who will be looking to support teams specifically in the following areas, where details will be developed and tailored to each MFD team requirements:» Improve processes and documentation:

This entails piloting streamlined processes and deliverables across the three organization to avoid work duplication and save on time;

» Supporting MFD for delivery: Ensuring teams get the right support and expertise at the right time to efficiently deliver MFD project (such as technical, legal, procurement, E&S). This is being delivered through the establishment of the MAF which will provide additional resources – both financial and technical - to ensure teams have the right expertise in a timely manner to ensure robust project preparation work is completed in line with the cascade algorithm. the MaF will prioritize type ii project preparation.

61. Monitoring and Evaluation: Quarterly progress reports will be prepared detailing progress on the workplan and any results achieved to date. These reports will also be input for the management committee reviews. These reports will be prepared based on inputs from the relevant TTls. A template for information required will be prepared and distributed to TTls.

62. An evaluation plan will be developed for this MFD Strategy. It will cover efficiency, effectiveness and impact outcomes and be designed based on consultations across the World Bank GPs, IFC, MIGA and IEG. Of importance will be the determination of the baseline of WBG projects/investments on which specifically effectiveness and impact-type outcomes will be assessed. Currently the plan would be to include all projects/investments approved over the next two fiscal years (FY19 and FY20) with Annex III providing the current baseline.

63. Considering current MFD guidelines - specifically that private financing mobilized within a period up to three years

after project approval is to be included in results assessment – it is recognized that the timeframe over which this Strategy is to be assessed would be FY19-FY28. This would allow for 5-year projects approved in FY20 to assessed three years after project closure. Further guidance and consultation on the design of this evaluation plan will be undertaken and presented to the first semi-annual review by senior management of the Strategy.

C. STRATEGY RISKS

64. The successful implementation of the Strategy will require effective management and/or mitigation of a range of specific types of risks, including:» Regional: The ongoing conflicts

and political uncertainties in the region – and specifically the wider consequences of the Syrian crisis on neighboring countries – remains a significant impediment to private sector participation in the Mashreq countries, as most evidenced in the current declining FDI trends in lebanon and Jordan.

» Political: This includes (i) the political will to implement the key policy (e.g. pricing/subsidy/tariff) and legislative actions that are a sine qua non for private sector participation and risk-taking with government and (ii) the challenges faced by policy makers to ensure wider citizen buy-in for the reform actions required;

» Macro-Economic: Addressing the high debt burden faced by lebanon and Jordan and ensuring that an adequate framework to manage the fiscal commitment and contingent liabilities that can be associated with PPPs is in place;

» Governance: This includes risks associated with elite capture, weak procurement, financial management processes and poor contract management practices that can compromise level playing fields and

ORG

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ING

FOR

DELI

VERY

– JO

INT

IMPL

EMEN

TATI

ON

PLAN

S, IN

STIT

UTIO

NAL

ARRA

NGEM

ENTS

AND

RIS

K FA

CTO

RS

37

competition that, in turn, can lead to adverse pricing and poor service delivery not in the public interest;

» Absorptive Capacity: MFD requires different institutional, technical/political economy and behavioral capacities for policy making and program implementation that are often not in place in client countries. Attention will need to be paid to capacity building required to address these dimensions of the MFD agenda.

65. As operations are prepared, this range of key risk factors will be systematically addressed, revised and updated as needed and collated and tracked at the Strategic level, including in the Quarterly Progress Reports.

VI. ANNEX I KEY INDICATORS FOR MFD READINESS (2017 DATA - uNlESS INDICATED OThERwISE)

ANNE

X IK

EY IN

DICA

TORS

FO

R M

FD R

EADI

NESS

(201

7 da

ta -

unle

ss in

dica

ted

othe

rwis

e)

39

jo

rdan

lEBa

non

iraq

com

Para

Tor

coun

Try

mal

aysi

aTh

aila

ndm

Exic

oar

gEnT

ina

TurK

Eym

acro

-Eco

nom

ic, i

nsTi

TuTi

onal

and

inVE

sTm

EnT c

limaT

E ind

icaT

ors

Debt

/GDP

493

.5%

157.3

%54

.7%

53.6

%41

.6%

53.5

%54

.1%27

.8%

Budg

et D

efici

t5-0

.4%

-10.6

%0.

3%-2

.7%

-0.9

%-2

.5%

-5.5

%-2

.9%

Gros

s fixe

d Ca

pita

l For

mat

ion,

pr

ivate

sect

or (%

GDP)

617

%20

%N/

A17

%N/

A19

%N/

AN/

A

Gros

s fixe

d ca

pita

l for

mat

ion

(%GD

P)7

20%

22%

17%

25%

N/A

22%

15%

30%

Publ

ic ca

pita

l for

mat

ion

(%GD

P)8

3%2%

N/A

8%N/

A3%

N/A

N/A

Capi

tal e

xpen

ditu

res o

f tot

al p

ublic

ex

pend

iture

s 10

.2%

14.1%

--32

.6%

16.6

%13

.7%

----

Fore

ign

Dire

ct In

vest

men

t, ne

t in

flows

(%GD

P)

4.2%

N/A

N/A

3.0%

2.0%

2.80

%1.

9%1.

30%

Claim

s on

cent

ral g

over

nmen

t (%

GDP)

9 (201

6)30

.5%

102.

3%NA

10.2

%16

%16

.3%

23.%

9.2%

Budg

et Ef

ficien

cy (W

EF) `

effic

iency

of

gove

rnm

ent s

pend

ing

1- 7

) bes

t) (2

017-2

018)

3.4

1.8

N/A

4.8

3.6

2.2

2.7

n/a

4 IM

F Dat

aMap

per;

Gene

ral g

over

nmen

t net

lend

ing/

borr

owin

g; a

cces

sed

on 7

/8/2

018

5 IM

F Dat

aMap

per;

Gene

ral g

over

nmen

t net

lend

ing/

borr

owin

g; a

cces

sed

on 7

/8/2

018

6 Pr

ivat

e in

vest

men

t cov

ers

gros

s ou

tlays

by

the

priv

ate

sect

or (i

nclu

ding

priv

ate

nonp

rofit

age

ncie

s) o

n ad

ditio

ns to

its

fixed

dom

estic

ass

ets.

(WDI

dat

abas

e)

7 Gr

oss

fixed

cap

ital f

orm

atio

n (fo

rmer

ly g

ross

dom

estic

fixe

d in

vest

men

t) in

clud

es la

nd im

prov

emen

ts (f

ence

s, d

itche

s, d

rain

s, a

nd s

o on

); pl

ant,

mac

hine

ry, a

nd

equi

pmen

t pur

chas

es; a

nd th

e co

nstr

uctio

n of

road

s, ra

ilway

s, a

nd th

e lik

e, in

clud

ing

scho

ols,

off

ices

, hos

pita

ls, p

rivat

e re

side

ntia

l dw

ellin

gs, a

nd c

omm

erci

al

and

indu

stria

l bui

ldin

gs. A

ccor

ding

to th

e 19

93 S

NA, n

et a

cqui

sitio

ns o

f val

uabl

es a

re a

lso

cons

ider

ed c

apita

l for

mat

ion.

8 Ca

lcul

ated

by

subt

ract

ing

priv

ate

sect

or fi

xed

capi

tal f

orm

atio

n fr

om th

e gr

oss

fixed

cap

ital f

orm

atio

n.

9 Cl

aim

s on

cen

tral

gov

ernm

ent i

nclu

de lo

ans

to c

entr

al g

over

nmen

t ins

titut

ions

net

of d

epos

its. (

WDI

)

Mas

hreq

| M

axim

izin

g Fi

nanc

e fo

r De

velo

pmen

t (M

FD) S

trat

egy

40

jo

rdan

lEBa

non

iraq

com

Para

Tor

coun

Try

mal

aysi

aTh

aila

ndm

Exic

oar

gEnT

ina

TurK

EyQu

ality

of P

ublic

Inst

itutio

ns (W

EF)

publ

ic se

ctor

per

form

ance

(1-7

) be

st (2

017

-201

8)

3.8

2.7

N/A

4.9

3.7

2.9

2.9

3.4

Coup

on R

ate o

f 5-ye

ar B

ond

5.39

76.

746.

73.

61.

967.1

5.62

54.

875

Sove

reig

n Ra

ting (

S&P)

(201

8)B+

B-B-

A-BB

B+BB

B+B+

BB

Inve

stor

Pro

tect

ion

(DB

- DTF

) (2

018)

40.0

041

.67

46.6

780

73.3

358

.33

63.3

371

.67

Cour

ts (D

B - D

TF) (

2018

)53

.71

49.8

548

.02

66.6

167

.91

67.0

155

.66

68.8

7

finan

cial

sEc

Tor

and

sToc

K m

arKE

TDo

mes

tic cr

edit

to p

rivat

e sec

tor

by b

anks

(% of

GDP

) 1070

.2 (2

016)

104.

5%8.

5%12

5.1%

(201

6)11

1.6%

27.1%

15.5

%66

.5%

Dom

estic

cred

it pr

ovid

ed b

y fin

ancia

l sec

tor (

% of

GDP

)1110

8.3

(201

6)20

9.6

(201

6)14

5.3(

2016

)16

4.7%

55.2

%39

.2%

77.9

%

# of

liste

d co

mpa

nies

on S

tock

Ex

chan

ge19

410

84* (

coun

try

sour

ces)

894

688

141

9637

4

Mar

ket c

apita

lizat

ion

of lis

ted

dom

estic

com

pani

es (%

of G

DP)

59.8

%22

.2%

N/A

144.

9%12

0.6%

36.3

%17

.1%26

.7%

Stoc

ks tr

aded

, tot

al va

lue

(% of

GDP

)5.

58%

1.2%

43.7

%74

.6%

9.9%

1%44

.3%

10 D

omes

tic c

redi

t to

priv

ate

sect

or b

y ba

nks

refe

rs to

fina

ncia

l res

ourc

es p

rovi

ded

to th

e pr

ivat

e se

ctor

by

othe

r dep

osito

ry c

orpo

ratio

ns (d

epos

it ta

king

co

rpor

atio

ns e

xcep

t cen

tral

ban

ks),

such

as

thro

ugh

loan

s, p

urch

ases

of n

oneq

uity

sec

uriti

es, a

nd tr

ade

cred

its a

nd o

ther

acc

ount

s re

ceiv

able

, tha

t est

ablis

h a

clai

m fo

r rep

aym

ent.

11 D

omes

tic c

redi

t pro

vide

d by

the

finan

cial

sec

tor i

nclu

des

all c

redi

t to

vario

us s

ecto

rs o

n a

gros

s ba

sis,

with

the

exce

ptio

n of

cre

dit t

o th

e ce

ntra

l gov

ernm

ent,

whi

ch is

net

ANNE

X IK

EY IN

DICA

TORS

FO

R M

FD R

EADI

NESS

(201

7 da

ta -

unle

ss in

dica

ted

othe

rwis

e)

41

jo

rdan

lEBa

non

iraq

com

Para

Tor

coun

Try

mal

aysi

aTh

aila

ndm

Exic

oar

gEnT

ina

TurK

EyPP

P sT

aTus

12

Num

ber o

f PPP

pro

ject

s42

9 (2

016)

210

816

729

621

721

4

PPP

inve

stm

ents

(US

milli

on)

10,3

2438

32,

950

51,7

1439

,456

82.8

8755

,374

136,

020

PPP

proj

ects

canc

elled

or u

nder

di

stre

ss1

proj

ect

38%

of to

tal

inve

stm

ents

3 pr

ojec

ts

200%

of to

tal

inve

stm

ents

--22

pro

ject

s

346%

of to

tal

inve

stm

ents

3 pr

ojec

ts

107%

of to

tal

inve

stm

ents

23 p

roje

cts

318%

of to

tal

inve

stm

ents

41 p

roje

cts

423%

of to

tal

inve

stm

ents

2 pr

ojec

ts

9% of

tota

l in

vest

men

ts

PPP

Legis

latio

nLa

w No

. 31

of 2

014

conc

erni

ng

Publ

ic-Pr

ivate

Pa

rtner

ship

2017

- Pu

blic

Priva

te

Partn

ersh

ip

law

No P

PP la

w –

2014

- Ord

er

87 on

Pub

lic

Cont

ract

s

Inst

ruct

ions

No

. 1/2

014

on

Gove

rnm

ent

Cont

ract

Im

plem

enta

tion

1991

- la

w on

pr

ivatiz

atio

n in

clude

s PPP

2013

- Pr

ivate

In

vest

men

t in

Sta

te

Unde

rtaki

ng

Act

DOF 0

5-11

-20

12: L

aw on

Pu

blic

Priva

te

Partn

ersh

ip

Law

27,3

28 on

Pu

blic-

Priva

te

Partn

ersh

ip

Cont

ract

s

No P

PP

law;

mix

of

conc

essio

ns,

built

oper

ate

lease

and

trans

fer

mod

els

Quali

ty of

pre

para

tion

of P

PP

proj

ects

(0-10

0)29

04

4654

7517

46

Proc

urem

ent o

f PPP

(0 –

100)

7830

4843

6387

7363

PPP

cont

ract

man

agem

ent (

0 -10

0)43

1740

2457

8758

49

12 S

ourc

es: P

PI D

atab

ase

and

WBG

201

7; B

ench

mar

king

Pub

lic P

rivat

e Pa

rtne

rshi

ps P

rocu

rem

ent:

Asse

ssin

g Go

vern

men

t Cap

abili

ty to

Pre

pare

, Pro

cure

and

M

anag

e PP

Ps ,

2017

VII. ANNEX II MAShREQ MFD STRATEGY - RESulTS FRAMEwORK MATRIX

ANNE

X IIM

ASHR

EQ M

FD S

TRAT

EGY

- RES

ULTS

FRA

MEW

ORK

MAT

RIX

43

rEsulT rEsulTs indicaTors Proj

EcT T

iTlE

uniT

of m

Eas.

BasE

linE (

2018

)

y1 (2

019)

y2 (2

020)

y3 (2

021)

y4 (2

022)

y5 En

d Ta

rgET

(2

023)

y6 (2

024)

y7 (2

025)

y8 (2

026)

1. Private capital mobilized13 Results Indicator 1.2:

Private investment and commercial finance mobilized

2. MFD-enabling policies implemented14

Results Indicator 2.2: Number of MFD-Enabling Reforms achieved

3. Improve-ments in access and Quality of services as a result of MFD

Results Indicator 3.1: Improvement in access to services

Result Indicator 3.2: Improvements in Quality of Service –

4. Jobs Created by MFD enabled policies and investments

Results Indicator 4.1: number of direct and indirect jobs created as a result of project investments

13 According to the Core Sectors and Indicators Definition report by the Results Platforms, World Bank (2014), “Mobilized private capital” is private capital that has been fully committed. For projects where private capital comes from debt, equity, or both, private capital is mobilized when it is fully committed and all conditions precedent to the first drawdown are fulfilled or waived. Therefore, loan funds are available for drawdown. For projects where private capital comes from equity only, private capital is mobilized when the contract under which private equity will be provided is signed and becomes effective.

14 MFD-enabling reforms will require that private investment is catalyzed within three years after closure of project that supported the reform initiative

VIII. ANNEX III MFD PIPElINE FY18-20

ANNE

X III

MFD

PIP

ELIN

E FY

18-2

0

45

A. IB

RD P

IPEl

INE

P#na

mE

insT

rum

EnT

will

oPE

raTi

on

EnaB

lE Th

E “c

asca

dE”?

(y

Es o

r no

, Ty

PE i a

nd ii

)

if yE

s, h

ow w

ill Th

E oPE

raTi

on En

aBlE

ThE “

mfd

”?

iraq

P162

094

(TTL

: Abd

ulha

mid

Az

ad

Nafie

Moh

amm

ed

Mof

id)

Bagh

dad

Wat

er

& Se

wera

ge(F

Y18)

IPF

Yes –

Type

IPr

ojec

t sup

ports

the c

orpo

ratiz

atio

n of

wat

er u

tility

and

mun

icipa

lity o

f Bag

hdad

and

the

stre

ngth

enin

g of b

illing

s and

colle

ctio

ns so

as to

enab

le th

e inv

olve

men

t of t

he p

rivat

e sec

tor i

n op

erat

ion

and

main

tena

nce.

The p

roje

ct al

so fi

nanc

es p

umpi

ng st

atio

n an

d ne

twor

k inf

rast

ruct

ure

which

will

conn

ect t

o a n

ew w

aste

wate

r tre

atm

ent p

lant

with

a ca

pacit

y of 2

00,0

00 m

3/da

y tha

t is

unde

r con

sider

atio

n wi

th IF

C PP

P Ad

visor

y sup

port

for p

rivat

e sec

tor i

nvol

vem

ent (

per I

FC’s

rece

ntly

signe

d M

OU w

ith th

e Min

istry

of P

lann

ing)

. Thi

s IBR

D pr

ojec

t will

com

plem

ent w

ork

plan

ned

by IF

C by

fina

ncin

g the

feas

ibili

ty st

udy o

f the

Was

te W

ater

Trea

tmen

t Pla

nt (W

WTP

), ta

riff a

nd in

stitu

tiona

l ref

orm

as w

ell as

esse

ntial

infra

stru

ctur

e con

nect

ivity.

It is

estim

ated

that

US

$140

milli

on B

OT of

the A

l Kha

nsaa

was

te w

ater

trea

tmen

t pla

nt.

P164

676

(TTL

: Luc

a Ba

ndier

a, P

aul

Barin

gani

re)

3rd

Expe

nditu

re

Ratio

naliz

atio

n,

Ener

gy Ef

ficien

cy

and

SOE

Gove

rnan

ce

(FY1

9)

DPF

Yes –

Type

IITh

e DPF

pla

ys a

vital

role

in se

tting

the p

olicy

fram

ewor

k and

iden

tifyin

g crit

ical p

rior a

ctio

ns

to en

able

priva

te se

ctor

invo

lvem

ent i

n po

wer d

istrib

utio

n as

well

as p

rodu

ctio

n. Th

e ong

oing

re

form

s of t

he ga

s sec

tor f

or ex

ampl

e, w

here

in th

e con

tract

ual f

ram

ewor

ks fo

r priv

ate s

ecto

r in

volve

men

t are

bein

g res

truct

ured

, are

likel

y to a

ttrac

t the

priv

ate s

ecto

r int

o the

gas s

ecto

r de

mon

stra

bly i

n th

e sho

rt te

rm. T

he d

istrib

utio

n an

d ut

ility

leve

l ref

orm

s in

the e

nerg

y sec

tor

(inclu

ding

tarif

f ref

orm

) will

also

dire

ctly

supp

ort t

he en

hanc

ed p

erfo

rman

ce of

the e

nerg

y sec

tor

as a

whol

e and

com

plem

ents

IFC’

s ong

oing

invo

lvem

ent i

n th

e pro

duct

ion

end

wher

e sev

eral

IPP’

s ar

e und

erwa

y (in

KRG

and

Bagh

dad)

. Im

prov

ed go

vern

ance

in th

e SOE

sect

or w

ill op

en u

p sp

ace

for i

ncre

ased

priv

ate s

ecto

r inv

estm

ent.

P162

454

(TTL

: Pau

l Ba

ringa

nire

, M

oham

med

W

afaa

Al-A

ni)

Elect

ricity

Se

rvice

s Re

cons

truct

ion

and

Enha

ncem

ent

(FY1

9)

IPF

Yes –

Type

IIPr

ojec

ts su

ppor

ts th

e im

plem

enta

tion

of th

e rec

ently

appr

oved

elec

tricit

y law

whi

ch al

loca

tes

fisca

l and

tech

nica

l aut

onom

y to t

he B

asra

dire

ctor

ate o

f ele

ctric

ity. S

uppo

rts st

reng

then

ing

of d

istrib

utio

n an

d tra

nsm

issio

n ne

twor

k so a

s to e

nabl

e inv

olve

men

t of t

he p

rivat

e sec

tor

invo

lvem

ent i

n op

erat

ions

in th

e med

ium

term

. Thi

s inc

lude

s fea

sibili

ty st

udie

s for

viab

ility

of

pros

pect

ive sh

orte

r ter

m “d

emon

stra

tion

effe

ct” P

PP so

lutio

ns (e

.g. c

olle

ctio

ns) a

nd su

bseq

uent

im

plem

enta

tion

unde

r the

pro

ject

. Thi

s ini

tiativ

e is p

art o

f a w

ider

WBG

enga

gem

ent i

n th

e Bas

ra

regi

on an

d re

st of

the c

ount

ry co

verin

g also

pow

er ge

nera

tion

and

gas-

to-p

ower

(See

IFC

pipe

line

belo

w in

Ann

ex II

I-B).

Mas

hreq

| M

axim

izin

g Fi

nanc

e fo

r De

velo

pmen

t (M

FD) S

trat

egy

46

P#na

mE

insT

rum

EnT

will

oPE

raTi

on

EnaB

lE Th

E “c

asca

dE”?

(y

Es o

r no

, Ty

PE i a

nd ii

)

if yE

s, h

ow w

ill Th

E oPE

raTi

on En

aBlE

ThE “

mfd

”?

P163

871

(TTL

: Car

los A

. Lo

pez)

Gas S

ecto

r Re

form

/Fla

ring

Redu

ctio

n an

d Ga

s-to

-Pow

er(C

ompl

eted

)

ASA

Yes –

Sup

porti

ng

Type

IIPr

ojec

t des

igne

d to

Sup

port

GoI/M

oO to

adop

t and

intro

duce

priv

ate-

sect

or-e

nabl

ing c

ontra

ctua

l an

d re

gula

tory

fram

ewor

k for

inve

stm

ent i

n na

tura

l gas

capt

ure,

pro

cess

ing,

tran

spor

t and

co

mm

ercia

lizat

ion.

New

Nat

ural

Gas

Mar

ket F

ram

ewor

k (NG

MF)

form

ally a

dopt

ed b

y Cou

ncil

of M

inist

ers i

n Ja

nuar

y 201

8; im

plem

enta

tion

phas

e in

proc

ess w

ith W

B te

chni

cal a

ssist

ance

su

ppor

t.

P166

229

(TTL

: Bek

zod

Sham

siev)

Natio

nal

Agric

ultu

ral

Reco

very

and

Com

petit

ivene

ss(F

Y19)

IPF

Yes –

Type

IIPr

ojec

t will

focu

s on

mar

ket r

efor

ms t

o stre

ngth

en p

rivat

e inv

estm

ent i

n in

put a

nd d

owns

tream

ag

ri-bu

sines

s seg

men

ts of

the v

alue c

hain

.

P131

550

(TTL

: Ibr

ahim

Da

jani)

AF -

Tran

spor

t Co

rrido

rs(in

cludi

ng

Bagh

dad

Inte

rnat

iona

l Ai

rpor

t)

IPF/

PPP

Yes –

Type

IPr

ojec

t will

focu

s on

upgr

adin

g, m

oder

nizin

g and

com

mer

cializ

ing B

aghd

ad In

tern

atio

nal A

irpor

t (B

IA).

A co

mbi

natio

n of

pub

lic an

d pr

ivate

inve

stm

ents

is fo

rese

en. P

ossib

ly via

addi

tiona

l fin

ancin

g to T

rans

port

Corri

dors

Pro

ject

.

TBC

(TTL

: TBC

)Ba

nkin

g Sec

tor

Tran

sfor

mat

ion

Proj

ect

Pfor

R/IP

F with

DL

IsYe

s – Ty

pe II

Build

ing o

n on

goin

g tec

hnica

l ass

istan

ce a

nd re

cent

pol

icy ac

tions

achi

eved

in ov

er re

cent

DPF

op

erat

ions

, thi

s Pfo

rR/IP

F ini

tiativ

e wou

ld su

ppor

t the

rest

ruct

urin

g of t

he fi

nanc

ial se

ctor

SOE

s an

d im

plem

enta

tion

of ke

y pol

icy re

form

s/re

gula

tions

requ

ired

to op

en u

p th

e ban

king

and

NBFI

to

incr

ease

d pr

ivate

sect

or p

artic

ipat

ion.

ANNE

X III

MFD

PIP

ELIN

E FY

18-2

0

47

P#na

mE

insT

rum

EnT

will

oPE

raTi

on

EnaB

lE Th

E “c

asca

dE”?

(y

Es o

r no

, Ty

PE i a

nd ii

)

if yE

s, h

ow w

ill Th

E oPE

raTi

on En

aBlE

ThE “

mfd

”?

jord

an**

P166

577

(TTL

: Bjo

rn P

hilip

p,

Lina A

bdall

ah

Saee

d Ab

dalla

h)

Jord

an U

rban

an

d M

unici

pal

Prog

ram

for

Bala

nced

and

Inclu

sive G

rowt

h(F

Y19)

Pfor

R/IP

FYe

s – Ty

pe I

The P

rogr

am w

ould

supp

ort J

orda

n’s u

rban

grow

th ce

nter

s in

iden

tifyin

g and

appl

ying p

rivat

e se

ctor

par

ticip

atio

n op

portu

nitie

s in

the d

elive

ry of

pub

lic se

rvice

s. Th

is m

ay in

clude

inve

stm

ent

in st

ruct

ured

tran

spor

t sol

utio

ns in

Zarq

a, Ir

bid

and

Russ

eifa,

bui

ldin

g on

the e

xper

ience

with

the

Bus R

apid

Tran

sit (B

RT) s

yste

m cu

rrent

ly un

der d

evelo

pmen

t in

the G

reat

er A

mm

an M

unici

palit

y. Th

e pot

entia

l for

small

er-s

cale

serv

ice an

d op

erat

ion

cont

ract

s for

priv

ate s

ecto

r pro

visio

n of

m

unici

pal s

ervic

es. T

he P

rogr

am w

ould

also

supp

ort b

ette

r int

egra

tion

of ‘l

aggin

g reg

ions

’ int

o the

ec

onom

y, su

ppor

ting i

nves

tmen

ts an

d Pu

blic-

Priva

te D

ialog

ue al

ong t

he m

ain tr

ansp

ort c

orrid

ors

conn

ectin

g to A

mm

an in

the N

orth

and

Aqab

a in

the S

outh

will

also

be i

nves

tigat

ed. F

inall

y, po

tent

ial u

pstre

am re

form

s to t

he su

b-na

tiona

l fin

ance

syst

em, i

nclu

ding

a pr

opos

ed re

stru

ctur

ing

of th

e Citi

es an

d Vi

llage

s Dev

elopm

ent B

ank (

CVDB

), wo

uld

have

the p

oten

tial t

o mob

ilize

co

mm

ercia

l fin

ancin

g to d

evelo

p a f

unct

ioni

ng m

unici

pal c

redi

t mar

ket.

P153

441

(TTL

: Ale

xand

er A

. M

cPha

il)

Red

Sea-

Dead

Se

a Pha

se 1

PRG

(FY2

0)

IPF/

Guar

ante

esYe

s – Ty

pe I

Prov

ides

guar

ante

es, p

ossib

ly in

cludi

ng M

IGA

and

IFC p

rovid

ing i

nves

tmen

t sup

port

to th

e awa

rd-

winn

ing c

ontra

ctor

/con

sorti

um.

TBC

(TTL

: Suh

ail

Jme’A

n)

Wat

er R

esou

rces

Proj

ect

(TBC

)

IPF (

TBC)

Ye

s – Ty

pe II

The p

roje

ct in

tend

s to s

uppo

rt th

e red

uctio

n of

NRW

in Jo

rdan

. Und

er th

is pr

ojec

t, th

e Wor

ld B

ank

is wo

rkin

g clo

sely

with

IFC

unde

rtook

an as

sess

men

t of N

RW in

Miya

houn

a, an

d in

itial

resu

lts w

as

well r

ecei

ved.

Give

n th

e lev

el of

wat

er sc

arcit

y, th

e NRW

is a

prio

rity w

ater

reso

urce

s man

agem

ent

issue

. Fin

ancia

l loss

es in

the w

ater

sect

or n

eed

to b

e red

uced

in or

der t

o pos

ition

the s

ecto

r for

po

tent

ial in

crea

sed

priva

te se

ctor

par

ticip

atio

n

Mas

hreq

| M

axim

izin

g Fi

nanc

e fo

r De

velo

pmen

t (M

FD) S

trat

egy

48

P#na

mE

insT

rum

EnT

will

oPE

raTi

on

EnaB

lE Th

E “c

asca

dE”?

(y

Es o

r no

, Ty

PE i a

nd ii

)

if yE

s, h

ow w

ill Th

E oPE

raTi

on En

aBlE

ThE “

mfd

”?

P16

6360

(TTL

: Chr

istos

Ko

stop

oulo

s, A

lan

Andr

ew M

oody

, Al

varo

S. G

onza

lez)

P168

130

(TTL

: Chr

istos

Ko

stop

oulo

s, A

lan

Andr

ew M

oody

)

Jord

an Fi

rst

Grow

th an

d Jo

bs

DPF

(FY1

8)

Jord

an S

econ

d Gr

owth

and

Jobs

DP

F(F

Y19)

DPF

DPF

Yes –

Type

IIDP

O Pr

ogra

mm

atic

polic

y mat

rix w

ill b

e add

ress

ing k

ey M

FD co

nstra

ints

at n

atio

nal le

vel a

nd in

ta

rget

ed m

arke

ts.

P162

407

(TTL

: Kar

ine

Pezz

ani,

Juan

M

anue

l Mor

eno)

AF -

Educ

atio

n Re

form

Sup

port

Pfor

RYe

s – Ty

pe II

Build

ing o

n th

e tec

hnica

l ass

istan

ce w

ork t

o be u

nder

take

n un

der t

he cu

rrent

Pfo

rR, t

his p

oten

tial

Addi

tiona

l Fin

ancin

g wou

ld in

trodu

ce n

ew m

easu

res i

nclu

ding

pol

icy ac

tions

- as

det

erm

ined

fu

rther

to th

e TA

work

- to

impl

emen

t an

MFD

appr

oach

to th

e fin

ancin

g and

deli

very

of Ea

rly

Child

hood

Educ

atio

n (E

CE) s

ervic

es in

Jord

an.

lEBa

non

P160

224

(TTL

: Ziad

Sali

m EL

Na

kat)

Grea

ter B

eirut

Ur

ban

Tran

spor

t (F

Y18)

IPF

Yes –

Type

IGr

eate

r Beir

ut U

rban

Tran

spor

t (BR

T) w

ill m

obili

ze p

rivat

e sec

tor p

artic

ipat

ion

and

inve

stm

ents

in

syst

em op

erat

ions

and

main

tena

nce,

espe

cially

thro

ugh

priva

te se

ctor

co-fi

nanc

ing f

or th

e pu

rcha

se of

the b

us fl

eet a

nd it

s ope

ratio

n. Th

e pro

ject

is ex

pect

ed to

mob

ilize

bet

ween

US$

50 to

$U

S80

milli

on.

P163

576

(TTL

: Pet

er

Mou

sley,

Hane

en

Saye

d, Th

omas

Fa

role)

Crea

ting E

con

Oppo

rtuni

ties

in S

uppo

rt of

Leba

non

Natio

nal

Job

Crea

tion

Prog

ram

(FY1

8)

P4R

Yes –

Type

IITh

e pro

ject

supp

orts

the i

mpl

emen

tatio

n of

the n

ew P

PP la

w, in

cludi

ng tr

ansa

ctio

n ad

visor

y wor

k ne

eded

to b

ring v

iable

PPPs

to m

arke

t in

supp

ort o

f inv

estm

ents

soug

ht b

y the

gove

rnm

ent f

or

the C

apita

l Inve

stm

ent P

lan.

The p

roje

ct al

so co

-fina

nces

PPP

inve

stm

ent i

nitia

tives

spec

ifica

lly

in th

e Trip

oli S

pecia

l Eco

nom

ic Zo

ne (T

SEZ)

and

addr

esse

s pol

icy co

nstra

ints

to p

rivat

e sec

tor

inve

stm

ent,

inclu

ding

in d

owns

tream

dat

a ser

vice p

rovis

ion

arisi

ng fr

om th

e fib

er op

tic

inve

stm

ents

bein

g und

erta

ken

by th

e gov

ernm

ent.

The p

roje

ct al

so su

ppor

ts im

plem

enta

tion

of

new

laws

that

will

incr

ease

SM

E acc

ess t

o fin

ance

.

ANNE

X III

MFD

PIP

ELIN

E FY

18-2

0

49

P#na

mE

insT

rum

EnT

will

oPE

raTi

on

EnaB

lE Th

E “c

asca

dE”?

(y

Es o

r no

, Ty

PE i a

nd ii

)

if yE

s, h

ow w

ill Th

E oPE

raTi

on En

aBlE

ThE “

mfd

”?

P165

324

(TTL

: Pau

l Welt

on,

Mon

a El-C

ham

i)

Stre

ngth

enin

g Fis

cal

Gove

rnan

ce(F

Y20)

IPF\

PPF

Yes –

Type

IISu

ppor

t und

er th

is PP

F pro

ject

to st

reng

then

MOF

deb

t dep

artm

ent c

apac

ity to

asse

ss an

d m

onito

r pot

entia

l con

tinge

nt lia

bilit

y and

long

er-te

rm fi

scal

com

mitm

ents

(FCC

L) ar

ising

from

PPP

s.

P166

580

(TTL

: Sat

eh C

hafic

El

-Arn

aout

)

Leba

non

Mun

icipa

l In

vest

men

t Pr

ojec

t(F

Y20)

IPF

Yes –

Type

ISu

ppor

t mun

icipa

l dev

elopm

ent,

inclu

ding

priv

ate p

rovis

ion

of p

ublic

serv

ices.

P166

423

(TTL

: Sam

eh I.

M

obar

ek)

Leba

non

Ener

gy

Refo

rm an

d De

velo

pmen

t Pr

ojec

t(F

Y19)

IPF/

MPA

Yes –

Type

II B

ased

on a

sect

or-w

ide M

FD-e

nabl

ing r

efor

m ag

enda

agre

ed w

ith th

e GOL

that

addr

esse

s key

iss

ues i

nclu

ding

corp

orat

izatio

n, fi

nanc

ial vi

abili

ty (t

ariff

and

subs

idy r

efor

m, c

olle

ctio

ns et

c.),

ener

gy ef

ficien

cy al

ongs

ide s

yste

m u

pgra

ding

(gen

erat

ion,

tran

smiss

ion

and

dist

ribut

ion)

, WBG

su

ppor

t can

pot

entia

lly en

com

pass

: (i)

furth

er d

evelo

pmen

t of I

PP w

ith IF

C PP

P Ad

visor

y on

Zahr

ani a

nd S

alaa

ta t

rans

actio

ns (r

efer

to IF

C Pr

ojec

t “15

00M

W IP

P pr

ogra

m);

(ii) t

rans

miss

ion

line d

evelo

pmen

t to

incr

ease

the n

atio

nal g

rid’s

capa

city t

o abs

orb

this

new

gene

ratio

n an

d in

crea

se re

liabi

lity o

f ele

ctric

ity se

rvice

and

supp

ort t

o im

plem

ent s

ome o

f the

pro

ject

s on

a PPP

ba

sis (e

.g. c

olle

ctio

ns);

(iii)

inst

allat

ion

of fl

oatin

g sto

rage

rega

sifica

tion

units

(FSR

Us) a

nd th

eir

asso

ciate

d in

frast

ruct

ure t

o im

port

natu

ral g

as su

pplie

s for

IPPs

. WBG

supp

ort w

ill lik

ely f

ocus

on

parti

al ri

sk an

d po

tent

ial M

IGA

guar

ante

es on

non

-com

mer

cial r

isks,

IFC

finan

cing i

n su

ppor

t of

the t

rans

actio

ns an

d po

tent

ial P

forR

will

supp

ort t

he re

form

pro

gram

, inc

ludi

ng IB

RD P

artia

l Risk

Gu

aran

tees

(PRG

s).

P166

956

(TTL

: Ziad

Nak

at)

Leba

non

Econ

omic

Corri

dors

(FY1

9)

IPF/

MPP

Yes –

Type

IITh

e pro

ject

is ai

med

at a

mul

ti-ph

ased

supp

ort t

o the

dev

elopm

ent o

f key

econ

omic

corri

dors

wi

thin

Leba

non

linki

ng al

so to

wid

er re

gion

al an

d gl

obal

mar

kets

, com

men

cing w

ith n

orth

ern

Leba

non

thro

ugh

inve

stm

ents

in cr

itica

l infra

stru

ctur

e and

asso

ciate

d ec

onom

ic ac

tiviti

es as

we

ll as t

o pre

pare

Leba

non

as a

hub

for i

ncre

ased

loca

l eco

nom

ic de

velo

pmen

t and

regi

onal

co

nnec

tivity

. The

pro

ject

is ex

pect

ed to

attra

ct su

bsta

ntial

priv

ate s

ecto

r inv

estm

ents

in p

lann

ed

econ

omic

activ

ities

arou

nd th

e cor

ridor

, suc

h as

in lo

gistic

al an

d/or

agrib

usin

ess z

ones

, the

fu

rther

mod

erni

zatio

n an

d ex

pans

ion

of Tr

ipol

i por

t, as

well

as th

e dev

elopm

ent o

f oth

er

asso

ciate

d fa

ciliti

es.

Mas

hreq

| M

axim

izin

g Fi

nanc

e fo

r De

velo

pmen

t (M

FD) S

trat

egy

50

P#na

mE

insT

rum

EnT

will

oPE

raTi

on

EnaB

lE Th

E “c

asca

dE”?

(y

Es o

r no

, Ty

PE i a

nd ii

)

if yE

s, h

ow w

ill Th

E oPE

raTi

on En

aBlE

ThE “

mfd

”?

P165

711

(TTL

: Am

al Ta

lbi,

Sally

Zghe

ib,

Nish

tha M

ehta

)

AF -

Grea

ter

Beiru

t Wat

er

Supp

ly Pr

ojec

t(F

Y18)

IPF

Yes –

Type

IFo

r the

wat

er su

pply

and

sani

tatio

n se

ctor

s, p

erfo

rman

ce b

ased

cont

ract

s (PB

C) to

oper

ate a

nd

man

age w

ould

hav

e two

adva

ntag

es: (

i) to

impr

ove t

he ac

coun

tabi

lity a

nd th

e per

form

ance

by

way o

f a la

rger

priv

ate s

ecto

r rol

e; an

d (ii

) cre

ate j

obs f

or n

atio

nal o

pera

tors

(dev

elop

small

and

med

ium

ente

rpris

es in

the w

ater

supp

ly an

d sa

nita

tion

sect

ors).

In th

e med

ium

term

, it w

ould

also

im

prov

e the

oper

atio

ns of

util

ities

and,

med

ium

to lo

ng te

rm th

eir ab

ility

to ac

cess

com

mer

cial

finan

cing a

nd re

ly le

ss on

the p

ublic

fund

s.As

a pa

rt of

the a

dditi

onal

fina

ncin

g of t

he G

reat

er B

eirut

Wat

er S

uppl

y Pro

ject

PBC

will

be

impl

emen

ted.

Und

er th

e par

ent P

roje

ct (P

1030

63),

the w

ater

util

ity B

eirut

and

Mou

nt Le

bano

n W

ater

Esta

blish

men

t (BM

LWE)

has

bee

n ab

le to

alre

ady e

nhan

ce it

s ope

ratio

ns, t

hrou

gh th

e im

plem

enta

tion

of fl

ow m

eter

s and

the S

CADA

syst

em. T

hese

inte

rven

tions

coup

led

with

tech

nica

l as

sista

nce f

or u

tility

capa

city b

uild

ing a

re al

lowi

ng th

e BM

LWE t

o par

tner

with

the p

rivat

e sec

tor i

n its

oper

atio

ns to

deli

ver b

ette

r ser

vices

to it

s cus

tom

ers.

TBC

(TTL

: L A

mal

Talb

i, Sa

lly Zg

heib

, and

Ni

shth

a Meh

ta

Wat

er an

d Sa

nita

tion

Serv

ices

(FY2

0 TB

C)

IPF (

TBC)

Ye

s - Ty

pe II

The p

roje

ct w

ould

scale

up

the N

RW w

ater

and

PBC

at n

atio

nal le

vel.

Durin

g the

pre

para

tion

the

Wor

ld B

ank t

eam

will

wor

k clo

sely

with

IFC.

The d

ialog

ue w

ill in

clude

the t

rans

ition

from

fee t

o vo

lum

etric

tarif

f whe

re th

e ser

vice s

hifts

from

inte

rmitt

ent w

ater

supp

ly to

cont

inuo

us w

ater

su

pply.

On

the s

anita

tion,

the p

roje

ct w

ill ta

ke st

ock o

n th

e cur

rent

stat

us of

the w

aste

wate

r tre

atm

ent p

lant

and

asse

ss w

ay to

reha

bilit

ate (

as n

eede

d) an

d in

crea

se th

e use

of th

e cur

rent

as

set.

The p

roje

ct w

ill al

so su

ppor

t as p

art o

f a m

ediu

m to

long

-term

visio

n, op

tions

for f

inan

cing

and

ways

to at

tract

priv

ate s

ecto

r par

ticip

atio

n go

ing b

eyon

d co

ntra

ct m

anag

emen

t to p

rivat

e or

com

mer

cial f

inan

cing.

P167

765

(TTL

: Ziad

Nak

at)

Civil

Avia

tion

Refo

rms

and

Airp

ort

Expa

nsio

n P4

R (F

Y20)

Pfor

RYe

s – Ty

pe II

The p

roje

ct is

follo

wing

the M

FD ap

proa

ch w

ith go

al of

mob

ilizin

g pub

lic se

ctor

viab

ility

gap

finan

cing f

or B

eirut

airp

ort e

xpan

sion

as w

ell as

setti

ng th

e pol

icy an

d re

gula

tory

fram

ewor

k to

attra

ct p

rivat

e sec

tor i

nves

tmen

ts in

the B

eirut

airp

ort T

erm

inal

expa

nsio

n (u

p to

US$

500

milli

on

of p

rivat

e sec

tor i

nves

tmen

ts ar

e tar

gete

d) . T

he p

roje

ct is

bein

g pre

pare

d in

clos

e col

labo

ratio

n wi

th IF

C wh

o are

also

in th

e pro

cess

of si

gnin

g an

advis

ory m

anda

te w

ith H

CP to

pre

pare

for t

he

term

inal

expa

nsio

n.

ANNE

X III

MFD

PIP

ELIN

E FY

18-2

0

51

P#na

mE

insT

rum

EnT

will

oPE

raTi

on

EnaB

lE Th

E “c

asca

dE”?

(y

Es o

r no

, Ty

PE i a

nd ii

)

if yE

s, h

ow w

ill Th

E oPE

raTi

on En

aBlE

ThE “

mfd

”?

P167

643

(TTL

: Pau

l Welt

on,

Sam

ia M

elham

, Pe

ter M

cCon

aghy

)

Leba

non

Digi

tal

Econ

omy

(FY2

0)

IPF/

MPA

Yes –

Type

IITh

is pr

ojec

t will

pro

mot

e the

intro

duct

ion

of d

igita

l sol

utio

ns an

d di

srup

tive t

echn

olog

ies t

o m

axim

ize fi

nanc

e for

bet

ter s

ervic

e deli

very

thro

ugh

the d

evelo

pmen

t of d

igita

l pla

tform

s. Th

is in

clude

s ini

tiativ

es in

dig

ital f

inan

cial s

ervic

es an

d e-

proc

urem

ent t

hat w

ill fo

ster

incr

ease

d pu

blic-

priva

te p

artic

ipat

ion

and

inclu

sive f

inan

ce.

B. IF

C PR

OJEC

TS P

IPEl

INE

Proj

EcT/

acTi

ViTy

Proj

EcT

dEsc

riPT

ion

will

oPE

raTi

on

EnaB

lE Th

E “c

asca

dE”?

(y

Es o

r no

)

if yE

s, h

ow w

ill Th

E oPE

raTi

on En

aBlE

ThE “

casc

adE”

?

iraq

Pre-

feas

ibili

ty st

udie

s whi

ch

are e

xpec

ted

to le

ad to

futu

re

trans

actio

n ad

visor

y man

date

Inve

stm

ent S

ervic

es

Seve

ral S

olar

Ph

otov

olta

ic pl

ants

(re

newa

ble e

nerg

y)

TBD

Cons

truct

ion

and

oper

atio

n of

sola

r PV

plan

ts u

p to

100

MW

. Pro

ject

s are

expe

cted

to b

e ide

ntifi

ed

as p

art o

f the

sign

ed M

oU w

ith th

e MoP

or th

roug

h di

rect

dev

elopm

ent w

ith sp

onso

rs.

Pre-

feas

ibili

ty st

udy w

hich

is

expe

cted

to le

ad to

futu

re

trans

actio

n ad

visor

y man

date

Cons

truct

ion

of A

l Kh

ansa

a Was

te

Wat

er Tr

eatm

ent

Plan

t (wa

ter)

TBD

Proj

ect i

s exp

ecte

d to

be i

dent

ified

as p

art o

f the

sign

ed M

oU w

ith th

e MoP

. Wor

k will

be i

n co

llabo

ratio

n wi

th th

e WB

unde

r the

casc

ade.

Plea

se re

fer t

o WB

FY 1

8 Pr

ojec

t “Ba

ghda

d W

ater

&

Sewe

rage

”.

Inve

stm

ent S

ervic

esTh

erm

al p

ower

ge

nera

tion

in

Bagh

dad

Yes

Deve

lopm

ent o

f 300

0 M

W ga

s fire

d IP

P in

Bag

hdad

. Con

tract

alre

ady a

ward

ed. T

his i

s a ty

pe I M

FD

initi

ative

Inve

stm

ent S

ervic

esZa

in Te

leco

mYe

sEx

pans

ion

of th

e mob

ile n

etwo

rk in

the n

orth

. Thi

s is a

type

I MFD

initi

ative

Mas

hreq

| M

axim

izin

g Fi

nanc

e fo

r De

velo

pmen

t (M

FD) S

trat

egy

52

Proj

EcT/

acTi

ViTy

Proj

EcT

dEsc

riPT

ion

will

oPE

raTi

on

EnaB

lE Th

E “c

asca

dE”?

(y

Es o

r no

)

if yE

s, h

ow w

ill Th

E oPE

raTi

on En

aBlE

ThE “

casc

adE”

?

Inve

stm

ent/A

dviso

ry S

ervic

esEs

tabl

ishm

ent o

f th

e firs

t com

mer

cial

Micr

ofin

ance

co

mpa

ny

Yes

Conv

ertin

g an

exist

ing N

GO to

a fo

rmal

com

pany

wor

king

with

one o

f the

exist

ing p

laye

rs. T

his i

s a

type

I MFD

initi

ative

.

Inve

stm

ent S

ervic

esEs

tabl

ishm

ent

of a

pre-

expo

rt fa

cility

to B

asra

Gas

Co

mpa

ny

Yes

This

is a s

pecif

ic tra

nsac

tion

that

will

serv

e to m

obili

ze ad

ditio

nal f

inan

ce th

roug

h M

CPP,

B lo

ans

and

para

llel f

inan

cing.

And

coor

dina

ted

with

IBRD

initi

ative

s in

Basr

a (se

e abo

ve A

nnex

III-A

).

jord

anTr

ansa

ctio

n ad

visor

yW

aste

Disp

osal

Tre

atm

ent i

n Al

Sw

aqa a

rea

TBD

Pion

eerin

g sys

tem

for h

azar

dous

med

ical &

indu

stria

l was

te d

ispos

al an

d tre

atm

ent,

in

colla

bora

tion

with

Min

istry

of En

viron

men

t. Si

te cl

ean-

up/re

med

iatio

n (d

onor

fund

ed) t

o be

follo

wed

by P

PP.

Tran

sact

ion

advis

ory

King

Hus

sein

Brid

geYe

sEx

pans

ion

of ke

y lan

d cr

ossin

g bet

ween

Jord

an an

d W

est B

ank.

Pot

entia

l MIG

A gu

aran

tees

and

conc

essio

nal f

undi

ng.

Tran

sact

ion

advis

ory

Amm

an R

ing R

oad

TBD

Phas

ed d

evelo

pmen

t of 7

1km

of to

lled

ring-

road

arou

nd A

mm

an, f

ollo

wed

by O

&M ov

er ex

istin

g po

rtion

of ri

ng-ro

ad (4

1km

) as w

ell as

the n

ew ex

tens

ion.

Clo

se co

ordi

natio

n wi

th W

B wh

o will

al

so b

e inv

olve

d in

road

safe

ty an

d m

ainte

nanc

e wor

k. P

lease

refe

r to W

B FY

18 P

roje

ct “A

mm

an

Deve

lopm

ent C

orrid

or P

h2”.

Tran

sact

ion

advis

ory

New

scho

ols

Yes

Supp

ortin

g the

Jord

an S

choo

ls Pr

ogra

m co

nsist

of b

uild

ing 6

00 sc

hool

s ove

r the

nex

t dec

ade

mos

tly u

nder

a PP

P sc

hem

e. P

ilot p

roje

ct co

nsist

s of 1

5 –

20 sc

hool

s in

an id

entif

ied

regi

on.

Plea

se re

fer t

o WB

FY19

Pro

ject

“Edu

catio

n Re

form

”.

Inve

stm

ent S

ervic

esM

iyaha

una N

RW

Wat

erYe

s$6

00 m

illion

pro

ject

to u

pgra

de th

e wat

er n

etwo

rk in

Am

man

give

n cu

rrent

loss

es of

50%

. The

re

will b

e a n

eed

for c

once

ssio

nal f

inan

cing a

s well

as co

ordi

natio

n wi

th ot

her D

FIs.

Inve

stm

ent S

ervic

esRe

ad D

ead

Yes

ANNE

X III

MFD

PIP

ELIN

E FY

18-2

0

53

Proj

EcT/

acTi

ViTy

Proj

EcT

dEsc

riPT

ion

will

oPE

raTi

on

EnaB

lE Th

E “c

asca

dE”?

(y

Es o

r no

)

if yE

s, h

ow w

ill Th

E oPE

raTi

on En

aBlE

ThE “

casc

adE”

?

lEBa

non

Pre-

feas

ibili

ty st

udy

Scali

ng so

lar

Yes

Cons

truct

ion

and

oper

atio

n of

a so

lar P

V pr

ojec

t up

to 3

0MW

to 4

0MW

.

Tran

sact

ion

advis

ory

1500

MW

IPP

prog

ram

Yes

Pilo

t IPP

s in

Zahr

ni an

d Sa

laat

a (45

0-55

0MW

each

), CA

PEX e

stim

ated

to am

ount

to ca

. US$

400

milli

on fo

r eac

h pr

ojec

t. Cl

ose c

oord

inat

ion

with

IBRD

will

be i

nvol

ved

in se

ctor

refo

rms,

FSRU

an

d po

tent

ial P

RG/ P

RI co

ver f

or th

e IPP

s. Pl

ease

refe

r to t

he W

B FY

18 P

roje

ct “P

ower

Sec

tor

Deve

lopm

ent (

IPP)

”.

Tran

sact

ion

Advis

ory

Expa

nsio

n of

Beir

ut

Airp

ort

Yes

Expa

nsio

n of

Beir

ut ai

rpor

t by o

ptim

izing

the e

xistin

g ter

min

al fa

ciliti

es an

d co

nstru

ctin

g new

te

rmin

al(s)

. Clo

se co

ordi

natio

n wi

th W

B wh

o will

be i

nvol

ved

in se

ctor

refo

rms a

nd re

gula

tory

fra

mew

ork i

n ad

ditio

n to

pot

entia

l PRG

/ PRI

cove

r for

the e

xpan

sion.

Plea

se re

fer t

o WB

FY18

Pr

ojec

t “ C

ivil A

viatio

n Re

form

s P4R

“.

Tran

sact

ion

advis

ory

Beiru

t BRT

Yes

Pote

ntial

PPP

for b

us p

rovis

ion

and

O&M

in co

llabo

ratio

n wi

th W

B. P

lease

refe

r to W

B FY

18

“Gre

ater

Beir

ut U

rban

Tran

spor

t (BR

T)”.

Inve

stm

ent S

ervic

esAk

kar W

ind

IPPs

Yes

Deve

lopm

ent o

f 3 w

ind

IPPs

with

tota

l cap

acity

of 2

00 M

W in

Akk

ar. P

roje

cts a

lread

y awa

rded

. IFC

is

work

ing w

ith th

e gov

ernm

ent o

n th

e pro

ject

doc

umen

ts. T

here

coul

d be

a ne

ed to

enha

nce t

he

paym

ent r

isk of

GoL

.

Mas

hreq

| M

axim

izin

g Fi

nanc

e fo

r De

velo

pmen

t (M

FD) S

trat

egy

54

Proj

EcT/

acTi

ViTy

Proj

EcT

dEsc

riPT

ion

will

oPE

raTi

on

EnaB

lE Th

E “c

asca

dE”?

(y

Es o

r no

)

if yE

s, h

ow w

ill Th

E oPE

raTi

on En

aBlE

ThE “

casc

adE”

?

Diag

nost

icLo

gistic

s Sec

tor

Asse

ssm

ent

TBD

Iden

tify o

ppor

tuni

ties i

n th

e log

istics

sect

or ac

ross

the v

alue c

hain

Tran

sact

ion

Advis

ory

Trip

oli S

EZYe

sPo

tent

ial P

PP fo

r anc

horin

g the

oper

atio

n an

d m

anag

emen

t of t

he TS

EZ.

C. M

IGA

ExPO

SURE

S

Proj

EcT/

acTi

ViTy

Proj

EcT

dEsc

riPT

ion

will

oPE

raTi

on

EnaB

lE Th

E “c

asca

dE”?

(y

Es o

r no

)

if yE

s, h

ow w

ill Th

E oPE

raTi

on En

aBlE

“mfd

”?

iraq

Guar

ante

e - P

RINa

fith

Logis

tics

FZ: g

uara

ntee

of

an in

vest

men

t in

por

t log

istics

un

der a

PPP

with

Ira

q’s s

tate

-own

ed

Gene

ral C

ompa

ny

for P

orts

Yes

The p

roje

ct in

volve

s bui

ldin

g and

man

agin

g a tr

uck-

cont

rol s

yste

m th

at re

gula

tes t

he en

try an

d flo

w of

truc

ks en

terin

g and

exiti

ng U

mm

Qas

r Por

t, tw

o sm

aller

por

ts (K

hor Z

ubair

and

Abu

Floos

), an

d th

e Saf

wan

bord

er cr

ossin

g with

Kuw

ait.

The P

PP st

ruct

ure e

nabl

es p

rivat

e inv

estm

ent i

n th

e lo

gistic

s sec

tor,

supp

ortin

g eco

nom

ic di

vers

ifica

tion

and

job

crea

tion

in Ir

aq’s

non-

oil e

cono

my.

ANNE

X III

MFD

PIP

ELIN

E FY

18-2

0

55

Proj

EcT/

acTi

ViTy

Proj

EcT

dEsc

riPT

ion

will

oPE

raTi

on

EnaB

lE Th

E “c

asca

dE”?

(y

Es o

r no

)

if yE

s, h

ow w

ill Th

E oPE

raTi

on En

aBlE

“mfd

”?

jord

anGu

aran

tee -

PRI

Jord

an B

rom

ine

Com

pany

: gu

aran

tee o

f an

inve

stm

ent i

n th

e exp

ansio

n of

ex

istin

g bro

min

e m

anuf

actu

ring

plan

ts

Yes

The p

roje

ct co

nsist

s of A

lbem

arle

Hold

ings

’ equ

ity in

vest

men

t in

Jord

an B

rom

ine C

ompa

ny

(JBC)

, for

min

g a jo

int v

entu

re w

ith JB

C ow

ner A

rab

Pota

sh C

ompa

ny (A

PC).

As A

PC is

a st

ate-

owne

d en

terp

rise (

co-o

wned

by v

ario

us A

rab

gove

rnm

ents

), th

e inv

estm

ent r

epre

sent

s a p

artia

l pr

ivatiz

atio

n of

JBC.

The p

rivat

e inv

estm

ent e

nabl

es ex

pans

ion

and

addi

tiona

l job

crea

tion.

Guar

ante

e - P

RIAd

eniu

m Jo

rdan

–

1: gu

aran

tee o

f an

inve

stm

ent i

n th

ree

sola

r pow

er p

lant

s

Yes

The p

roje

ct in

volve

s the

dev

elopm

ent,

cons

truct

ion,

oper

atio

n, an

d m

ainte

nanc

e of t

hree

10M

W

phot

ovol

taic

powe

r pla

nts i

n th

e Ma’a

n De

velo

pmen

t Are

a (M

DA) i

n So

uthe

rn Jo

rdan

. The

IPP

stru

ctur

e ena

bles

priv

ate s

ecto

r pow

er ge

nera

tion

with

offta

ke b

y Jor

dan’s

Nat

iona

l Ele

ctric

Pow

er

Com

pany

.

Guar

ante

e - P

RIJo

rdan

Sol

ar O

ne:

guar

ante

e of a

n in

vest

men

t in

a so

lar p

lant

Yes

The p

roje

ct in

volve

s the

dev

elopm

ent,

cons

truct

ion,

oper

atio

n, an

d m

ainte

nanc

e of a

sing

le 20

-meg

awat

t pho

tovo

ltaic

powe

r pro

ject

loca

ted

in M

afra

q, Jo

rdan

. The

IPP

stru

ctur

e ena

bles

pr

ivate

sect

or p

ower

gene

ratio

n wi

th of

ftake

by J

orda

n’s N

atio

nal E

lect

ric P

ower

Com

pany

.

Guar

ante

e - P

RIAl

Zarq

a Pow

er

Plan

t for

Ener

gy

Gene

ratio

n PS

C

Yes

The p

roje

ct in

volve

s the

des

ign,

cons

truct

ion,

owne

rshi

p, op

erat

ion

and

main

tena

nce o

f a 4

85M

W

com

bine

d cy

cle d

ual f

uel t

herm

al p

ower

gene

ratin

g fac

ility

in Za

rqa,

Jord

an. T

he IP

P st

ruct

ure

enab

les p

rivat

e sec

tor p

ower

gene

ratio

n wi

th of

ftake

by J

orda

n’s N

atio

nal E

lect

ric P

ower

Com

pany

.

Guar

ante

e - P

RIAs

Sam

ra:

guar

ante

e of a

n in

vest

men

t in

a was

tewa

ter

treat

men

t pla

nt

Yes

The p

roje

ct in

volve

s the

expa

nsio

n of

the e

xistin

g was

tewa

ter t

reat

men

t pla

nt S

amra

Was

tewa

ter

Treat

men

t Pla

nt C

ompa

ny, L

td, o

n an

exte

nded

25-

year

bui

ld-o

pera

te-tr

ansfe

r (BO

T) b

asis.

The

PPP

stru

ctur

e ena

bles

priv

ate s

ecto

r par

ticip

atio

n in

serv

ice d

elive

ry in

Jord

an, o

ne of

the w

orld

’s m

ost w

ater

-poo

r cou

ntrie

s.

Mas

hreq

| M

axim

izin

g Fi

nanc

e fo

r De

velo

pmen

t (M

FD) S

trat

egy

56

Proj

EcT/

acTi

ViTy

Proj

EcT

dEsc

riPT

ion

will

oPE

raTi

on

EnaB

lE Th

E “c

asca

dE”?

(y

Es o

r no

)

if yE

s, h

ow w

ill Th

E oPE

raTi

on En

aBlE

“mfd

”?

Guar

ante

e - P

RIQu

een

Alia

Airp

ort:

guar

ante

e of a

n in

vest

men

t in

an

airpo

rt co

nces

sion

Yes

The p

roje

ct co

nsist

s of t

he ac

quisi

tion

of an

equi

ty st

ake i

n AI

G, w

hich

ente

red

a 25-

year

co

nces

sion

agre

emen

t with

the G

over

nmen

t of J

orda

n in

200

7 to

reha

bilit

ate,

expa

nd an

d op

erat

e Qu

een

Alia

Inte

rnat

iona

l Airp

ort.

The P

PP st

ruct

ure e

nabl

es p

rivat

e inv

estm

ent i

n on

e of J

orda

n’s

mos

t im

porta

nt in

frast

ruct

ure a

sset

s.

lEBa

non

Guar

ante

e - P

RIBu

tec L

eban

on:

guar

ante

e of

an el

ectri

city

dist

ribut

ion

serv

ices p

rovid

er

cont

ract

with

Le

bano

n’s p

ower

ut

ility

Yes

The p

roje

ct co

nsist

s of B

utec

’s ele

ctric

ity d

istrib

utio

n se

rvice

pro

vider

(DSP

) con

tract

for t

he

North

ern

Leba

non

regi

on se

rvin

g 350

,000

hou

seho

lds.

The D

SP co

ntra

cts w

ere t

he fi

rst P

PPs

in Le

bano

n, an

d th

e int

rodu

ctio

n of

priv

ate s

ecto

r par

ticip

atio

n se

rves

to im

prov

e effi

cienc

y, re

liabi

lity,

and

quali

ty of

serv

ice d

elive

ry.

ANNE

X III

MFD

PIP

ELIN

E FY

18-2

0

57

IX. ANNEX IV KEY REFORMS BY SECTOR AND COuNTRY - MAShREQ MFD REFORM MATRICES

ANNE

X IV

KEY

REF

ORM

S BY

SEC

TOR

AND

COUN

TRY

- MAS

HREQ

MFD

REF

ORM

MAT

RICE

S

59

cros

s-cu

TTin

g ar

Eas15

sTra

TEgy

, Pol

icy a

nd

lEga

l go

VErn

ancE

finan

cEfc

V/Po

liTic

s

jordan

»Bu

sines

s env

ironm

ent

refo

rms.

»Co

nsol

idat

ion

of th

e leg

al

fram

ewor

k by a

dopt

ion

of a

proc

urem

ent B

y-La

w (o

r Law

) cov

erin

g pr

ocur

emen

t of g

oods

, wo

rks a

nd se

rvice

s (in

cludi

ng co

nsul

tanc

y se

rvice

in an

d ap

art

from

cons

truct

ion)

, and

su

ppor

ting d

ocum

ents

(in

cludi

ng a

full r

ange

of

stan

dard

bid

ding

and

cont

ract

doc

umen

ts).

»De

velo

pmen

t of a

Fisc

al

Com

mitm

ents

and

Cont

inge

nt Li

abili

ties

fram

ewor

k and

deb

t m

anag

emen

t stra

tegy

.

»M

oder

niza

tion

of p

rocu

rem

ent m

etho

ds an

d pr

oced

ures

16.

»De

velo

pmen

t of s

tand

ardi

zed

docu

men

ts, t

ools

and

tem

plat

es to

supp

ort

prep

arat

ion

of h

igh

quali

ty p

roje

cts.

»De

velo

pmen

t of p

olicy

and

over

sight

func

tions

, ind

epen

dent

from

pro

cure

men

t op

erat

ions

, to m

onito

r and

guid

e the

dev

elopm

ent o

f the

pro

cure

men

t sys

tem

. »Pr

epar

atio

n of

Mun

icipa

l PPP

Reg

ulat

ion

to fa

cilita

te d

evelo

pmen

t of m

unici

pal-

leve

l pro

ject

s. »De

velo

pmen

t of:

–ac

coun

ting a

nd b

udge

t tre

atm

ent o

f PPP

s to p

rovid

e com

fort

on G

oJ ab

ility

to

deliv

er lo

ng-te

rm fi

nanc

ial co

mm

itmen

ts to

PPP

s; –po

licy o

n di

sclo

sure

to th

e gen

eral

pub

lic of

info

rmat

ion

on P

PP p

roje

cts.

–De

velo

pmen

t of a

sim

plifi

ed “P

IM-P

PP G

over

nanc

e Fra

mew

ork”

to im

prov

e th

e effi

cienc

y and

effic

acy o

f cap

ital e

xpen

ditu

res a

nd en

sure

rigo

rous

pr

ojec

t ide

ntifi

catio

n an

d se

lect

ion

syst

ems.

–Se

t up

of a

“Cen

tral P

IM U

nit”

at th

e Min

istry

of P

lann

ing a

nd In

tern

atio

nal

Coop

erat

ion

(MoP

IC) t

o sup

port

the a

lloca

tion

of p

ublic

fund

s thr

ough

the

cent

raliz

atio

n of

seve

ral c

oord

inat

ion

func

tions

and

to as

sist l

ine m

inist

ries.

–Se

t up

of th

e “In

ter-A

genc

y PIM

-PPP

Com

mitt

ee” t

o be m

anda

ted

as a

tech

nica

l sec

reta

riat c

harg

ed w

ith p

repa

ring t

he se

lect

ion

of P

IP an

d PP

P pr

ojec

ts.

–De

velo

ping

a ro

bust

PPP

pip

eline

(cap

acity

bui

ldin

g of P

PP u

nits

and

cont

ract

ing a

genc

ies,

pro

ject

pre

para

tion

fund

, tra

nsac

tion

advis

ory).

–Im

prov

e the

effic

iency

and

cred

it-wo

rthin

ess o

f inf

rast

ruct

ure S

OEs (

e.g.

NE

PCO)

, by i

mpr

ovin

g gov

erna

nce a

nd fi

nanc

ial m

anag

emen

t (in

tand

em w

ith

sect

or re

form

s).

»De

sign

and

oper

atio

naliz

atio

n of

a Vi

abili

ty G

ap Fi

nanc

ing

Facil

ity; a

sses

sing t

he

need

for o

ther

form

s of

finan

cing f

acili

tatio

n (e

.g. g

uara

ntee

s). »As

sess

and

impr

ove

long

-term

fina

nce

capa

city (

inclu

ding

de

velo

pmen

t fin

ance

, ca

pita

l mar

kets

).

»De

velo

pmen

t of

the a

rrang

emen

ts

and

proc

edur

es

for i

ndep

ende

nt

revie

w of

com

plain

ts

from

bid

ders

abou

t th

e con

duct

of

proc

urem

ent c

ontra

ct

awar

d pr

oces

ses.

15 A

ll of

the

actio

n ar

eas

will

requ

ire d

iffer

ent t

echn

ical

ass

ista

nce

supp

ort a

nd c

apac

ity b

uild

ing

incl

udin

g a

focu

s on

gov

ernm

ent i

nstit

utio

ns s

uch

line

min

istr

ies/

cont

ract

ing

agen

cies

, PPP

uni

ts, P

ublic

Pro

cure

men

t Age

ncie

s, a

nd p

rivat

e se

ctor

and

con

trac

ters

and

oth

er s

take

hold

ers.

16 M

oder

niza

tion

of p

rocu

rem

ent i

nclu

des:

add

ing

prov

isio

ns o

n fr

amew

ork

agre

emen

ts, o

utpu

t bas

ed s

peci

ficat

ions

, life

-cyc

le c

ostin

g an

d us

e of

rate

d cr

iteria

in

eval

uatio

n of

bid

s, p

rocu

rem

ent m

etho

d fo

r con

sulta

ncy

serv

ices

(not

mer

ely

for c

onst

ruct

ion-

rela

ted

cons

ulta

ncy

serv

ices

) and

fram

ewor

k ag

reem

ents

.

Mas

hreq

| M

axim

izin

g Fi

nanc

e fo

r De

velo

pmen

t (M

FD) S

trat

egy

60

cros

s-cu

TTin

g ar

Eas15

sTra

TEgy

, Pol

icy a

nd

lEga

l go

VErn

ancE

finan

cEfc

V/Po

liTic

s

lebanon

»Bu

sines

s env

ironm

ent

refo

rms.

»En

act r

evise

d Pr

ocur

emen

t La

w.

»De

velo

p Fis

cal

Com

mitm

ents

and

Cont

inge

nt Li

abili

ties

Fram

ewor

k.

»De

velo

p an

d de

liver

com

mun

icatio

ns st

rate

gy to

dem

onst

rate

GoL

com

mitm

ent

and

owne

rshi

p of

PPP

pro

gram

. »De

velo

p ef

fect

ivene

ss an

d ac

coun

tabi

lity o

f pro

cure

men

t by S

OEs,

in lin

e with

pu

blic

proc

urem

ent p

rincip

les a

nd p

roce

dure

s, an

d es

tabl

ish co

mpe

titive

ne

utra

lity w

hen

SOEs

are b

idde

rs.

»M

oder

niza

tion

of p

rocu

rem

ent m

etho

ds an

d pr

oced

ures

inclu

ding

issu

ance

of a

rang

e of u

pdat

ed st

anda

rd b

iddi

ng an

d co

ntra

ct d

ocum

ents

. »Fin

alize

and

issue

a co

nsol

idat

ed se

t of r

egul

atio

ns an

d gu

ideli

nes o

f a n

ew

Proc

urem

ent l

aw, a

nd en

sure

cons

isten

cy of

pro

cure

men

t asp

ects

with

the

rece

ntly

pass

ed P

PP la

w an

d its

regu

latio

ns.

»Es

tabl

ishm

ent o

f ins

titut

iona

l and

oper

atio

nal a

rrang

emen

ts fo

r the

im

plem

enta

tion

of th

e FCC

L fra

mew

ork.

»En

sure

a na

tionw

ide a

ppro

ach

to m

unici

pal le

vel P

PP p

roje

cts t

hrou

gh th

e pr

epar

atio

ns of

spec

ific M

unici

pal P

PP G

uide

lines

. »In

stitu

tiona

l cap

acity

-bui

ldin

g and

supp

ort t

o ear

ly-st

age a

dviso

ry fo

r PPP

pro

ject

or

igin

atio

n at

HCP

and

sect

or m

inist

ries.

»Im

prov

e the

effic

iency

and

cred

it-wo

rthin

ess o

f EdL

and

othe

r inf

rast

ruct

ure

SOEs

, by i

mpr

ovin

g gov

erna

nce a

nd fi

nanc

ial m

anag

emen

t (in

tand

em w

ith

sect

or re

form

s).

»De

velo

p an

in

frast

ruct

ure

finan

cing f

acili

tatio

n fra

mew

ork (

inclu

ding

via

bilit

y gap

fund

ing,

gu

aran

tees

, liq

uidi

ty

facil

ity) s

uppo

rted

by th

e pro

pose

d Le

bano

n In

frast

ruct

ure

Facil

itatio

n Fu

nd (L

IFF).

»Co

nduc

t a d

iagn

ostic

of

the f

inan

cial s

yste

m’s

capa

city f

or M

FD (m

acro

co

nstra

ints

inclu

ding

cr

owdi

ng-o

ut b

y the

pu

blic

sect

or, a

nd th

e ba

lanc

e of p

aym

ent

situa

tion;

dom

estic

ba

nkin

g sec

tor c

apac

ity

and

cred

it as

sess

men

t/ris

k man

agem

ent

capa

city;

and

capi

tal

mar

ket p

oten

tial).

»Re

visit

the d

evelo

pmen

t fin

ance

fram

ewor

k (p

oten

tial s

ucce

ssor

op

tions

to th

e sub

sidize

d liq

uidi

ty w

indo

ws ru

n by

th

e BdL

).

ANNE

X IV

KEY

REF

ORM

S BY

SEC

TOR

AND

COUN

TRY

- MAS

HREQ

MFD

REF

ORM

MAT

RICE

S

61

cros

s-cu

TTin

g ar

Eas15

sTra

TEgy

, Pol

icy a

nd

lEga

l go

VErn

ancE

finan

cEfc

V/Po

liTic

s

iraq

»Bu

sines

s env

ironm

ent

refo

rms.

»En

actm

ent o

f rob

ust

PPP

Law

and

furth

er

deve

lopm

ent o

f leg

al an

d re

gula

tory

fram

ewor

k fo

r con

duct

ing t

he

PPP

proj

ect c

ycle

proc

ess (

iden

tifica

tion,

de

velo

pmen

t, pr

ocur

emen

t and

cont

ract

m

anag

emen

t). »De

velo

pmen

t of a

Fisc

al

Com

mitm

ents

and

Cont

inge

nt Li

abili

ties

fram

ewor

k. »De

velo

pmen

t and

ad

optio

n of

a cle

ar an

d co

nsol

idat

ed, m

oder

n le

gal f

ram

ewor

k for

pub

lic

proc

urem

ent a

t the

Fede

ral

leve

l.

»De

velo

pmen

t of r

egul

ator

y fun

ctio

ns fo

r the

pro

cure

men

t sys

tem

(in

the f

orm

of

a cen

tral p

olicy

and

over

sight

offic

e to m

onito

r and

guid

e the

dev

elopm

ent o

f the

pu

blic

proc

urem

ent s

yste

m).

»Im

prov

ed co

rpor

ate g

over

nanc

e of S

OEs,

inclu

ding

mod

erni

zing a

nd h

arm

onizi

ng

proc

urem

ent p

ract

ices,

in lin

e with

bas

ic pu

blic

proc

urem

ent p

rincip

les a

nd

acco

unta

bilit

y saf

egua

rds,

and

esta

blish

com

petit

ive n

eutra

lity w

hen

SOEs

are

bidd

ers.

»De

velo

pmen

t of a

sim

plifi

ed “P

IM-P

PP G

over

nanc

e Fra

mew

ork”

to im

prov

e the

ef

ficien

cy an

d ef

ficac

y of c

apita

l exp

endi

ture

s. Ri

goro

us p

roje

ct id

entif

icatio

n an

d se

lect

ion

syst

ems t

o ser

ve as

a sc

reen

ing m

echa

nism

. »Es

tabl

ishm

ent o

f ins

titut

iona

l and

oper

atio

nal a

rrang

emen

ts fo

r the

im

plem

enta

tion

of th

e FCC

L fra

mew

ork.

»Fu

nctio

nal R

evie

w an

d PI

M C

apac

ity N

eeds

Ass

essm

ent f

or fe

dera

l Min

istry

of

Plan

ning

Kur

dist

an R

egio

nal G

over

nmen

t (KR

G) M

inist

ry of

Pla

nnin

g to r

evie

w th

e cu

rrent

Fede

ral M

oP an

d KR

G M

oP ar

rang

emen

ts an

d ca

pacit

y cap

abili

ty ag

ainst

th

e fut

ure P

IM-P

PP G

over

nanc

e Fra

mew

ork.

»Up

grad

e of I

raqi

Dev

elopm

ent M

anag

emen

t Sys

tem

(IDM

S) an

d Ku

rdist

an

Deve

lopm

ent M

anag

emen

t Sys

tem

(KDM

S) to

capt

ure a

ll the

stag

es of

the P

IM-

PPP

Gove

rnan

ce Fr

amew

ork.

»De

velo

p se

ctor

refo

rm ro

adm

aps (

e.g.

elec

tricit

y), in

cludi

ng co

rpor

atiza

tion

and

impr

ovin

g cre

ditw

orth

ines

s of i

nfra

stru

ctur

e ent

ities

;

»Pu

rsue

ban

king

sect

or

refo

rm (g

over

nanc

e,

oper

atio

nal a

nd

finan

cial r

estru

ctur

ing

of st

ate-

owne

d ba

nks

and

stre

ngth

enin

g of

priva

te b

anks

) to s

tart

layin

g the

foun

datio

n of

so

und

finan

cial s

ecto

r de

velo

pmen

t to p

rovid

e m

eani

ngfu

l sup

port

for M

FD (s

ee b

anki

ng

sect

or m

atrix

). »Im

prov

e spe

cializ

ed

deve

lopm

ent f

inan

ce

(e.g

. hou

sing f

inan

ce,

agric

ultu

ral f

inan

ce),

and

expl

ore t

he p

oten

tial f

or

leve

ragin

g com

mer

cial

finan

ce.

»Es

tabl

ishm

ent

of m

echa

nism

fo

r exp

edite

d,

inde

pend

ent r

evie

w of

com

plain

ts

from

bid

ders

with

m

eani

ngfu

l rem

edie

s av

ailab

le.

Mas

hreq

| M

axim

izin

g Fi

nanc

e fo

r De

velo

pmen

t (M

FD) S

trat

egy

62

Pow

Er s

EcTo

rsT

raTE

gy, P

olic

y and

lEga

l go

VErn

ancE

finan

cEfc

V/Po

liTic

s

jordan

»Ra

tiona

lize t

ariff

cros

s-sub

sidie

s and

in

trodu

ce co

st-re

flect

ive ta

riffs

for a

ll co

nsum

er ca

tego

ries.

»M

ove t

o a m

ulti-

year

tarif

f fra

mew

ork.

»Im

prov

e effi

cient

use

of en

ergy

to

min

imize

(cro

ss) s

ubsid

y im

pact

as

well a

s cos

t to t

he ov

erall

econ

omy

– fo

ster

priv

ate i

nves

tmen

t in

Ener

gy

Effic

iency

at re

siden

tial a

nd p

ublic

le

vels

(e.g

. pub

lic lig

htin

g).

»Un

bund

le ta

riff s

truct

ure t

o allo

w im

plem

enta

tion

of sm

art-m

eter

ing.

»Re

view

and

ratio

naliz

e cus

tom

s and

sa

les t

axes

for R

E and

EE eq

uipm

ent.

»De

velo

p a s

trate

gic p

lan

on

inte

rnat

iona

l ene

rgy a

nd en

ergy

tra

de, i

nclu

ding

cons

truct

ion

of

pipe

lines

to im

port

gas.

»De

velo

p po

licy,

inst

itutio

nal a

nd

tech

nica

l fra

mew

orks

for i

nsta

lling

en

ergy

stor

age t

echn

olog

ies t

o en

able

grea

ter i

nteg

ratio

n of

do

mes

tic re

newa

ble e

nerg

y in

the

natio

nal g

rid. T

his w

ould

enco

mpa

ss

batte

ry, h

ydro

and

ther

mal

stor

age

(CSP

) sys

tem

s.

»Un

derta

ke st

ruct

ural

refo

rms a

t NEP

CO b

y fun

ctio

nal

and

acco

untin

g sep

arat

ion

of b

usin

ess l

ines

such

as

: (i)

Tran

smiss

ion

oper

ator

, (ii)

Sys

tem

and

Mar

ket

Oper

ator

, (iii

) Fue

l pur

chas

er an

d Su

pplie

r, an

d (iv

) Si

ngle

Buye

r, in

pre

para

tion

for e

vent

ual u

nbun

dlin

g in

to d

augh

ter e

ntiti

es.

»In

stitu

tiona

lize t

he p

roce

ss of

pre

parin

g and

im

plem

entin

g a n

atio

nal e

nerg

y stra

tegy

to

com

plem

ent t

he p

erio

dic p

rovis

ion

of an

elec

tricit

y m

aste

r pla

n. S

treng

then

leas

t-cos

t and

risk

-re

spon

sive e

nerg

y pla

nnin

g cap

abili

ty an

d ap

ply t

o all

futu

re p

roje

cts.

»St

reng

then

ed co

nsul

tativ

e pro

cess

and

mor

e pr

edict

abili

ty b

etwe

en re

gula

tor (

EMRC

- En

ergy

and

Min

eral

s Reg

ulat

ory C

omm

issio

n), c

onsu

mer

s and

ke

y sta

keho

lder

s reg

ardi

ng ra

tiona

le an

d pr

oces

s for

ta

riff s

ettin

g\ad

just

men

ts.

»De

ploy

ing c

redi

t enh

ance

men

ts

with

WBG

guar

ante

es fo

r the

de

velo

pmen

t and

adop

tion

of a

Liqui

datio

n Pl

an fo

r ou

tsta

ndin

g leg

acy d

ebt,

with

su

itabl

e mec

hani

sms b

y: – le

vera

ging f

oreig

n an

d do

mes

tic d

ebt m

arke

ts;

–cr

eatin

g tar

iff sp

ace f

or d

ebt

repa

ymen

t; –he

dgin

g fue

l cos

t risk

goin

g fo

rwar

d. –De

velo

p a g

ener

atio

n an

d tra

nsm

issio

n pl

an w

ith

finan

cial m

odell

ing c

apac

ity.

»M

itiga

ting i

mpa

cts o

n vu

lner

able

sect

ions

with

a d

irect

ben

efit

trans

fer

sche

me,

thro

ugh

the

ratio

naliz

atio

n of

tarif

f cro

ss-

subs

idie

s and

intro

duct

ion

of (c

lose

r to)

cost

-refle

ctive

ta

riffs

for a

ll con

sum

er

cate

gorie

s. »In

crea

sed

cons

ulta

tion

with

pu

blic

rega

rdin

g tar

iff se

tting

pr

oces

s.

ANNE

X IV

KEY

REF

ORM

S BY

SEC

TOR

AND

COUN

TRY

- MAS

HREQ

MFD

REF

ORM

MAT

RICE

S

63

Pow

Er s

EcTo

rsT

raTE

gy, P

olic

y and

lEga

l go

VErn

ancE

finan

cEfc

V/Po

liTic

s

lebanon

»Se

quen

ce co

mm

ercia

l tar

iff re

form

lin

ked

to m

itiga

tion

of te

chni

cal

and

non-

tech

nica

l loss

es an

d in

crea

sed

cost

-effi

cient

supp

ly (in

cludi

ng su

ppor

ting i

nves

tmen

ts

in fu

el su

pply,

tran

smiss

ion

netw

ork

impr

ovem

ents

). »De

velo

p fra

mew

ork f

or p

rivat

e sec

tor

parti

cipat

ion

in ge

nera

tion

in lin

e wi

th n

atio

nal P

PP la

w. »Im

plem

ent r

efor

ms i

n Hy

drop

ower

se

ctor

for I

PPs.

»Es

tabl

ish a

regu

lato

ry au

thor

ity in

ac

cord

ance

with

law

462

(200

2).

»Co

rpor

atize

EdL b

ased

on co

mm

ercia

l pra

ctice

s with

a l

onge

r-ter

m vi

ew of

pur

suin

g a st

aged

pro

cess

to

unbu

ndlin

g acr

oss g

ener

atio

n, tr

ansm

issio

n an

d di

strib

utio

n un

its.

»De

velo

p ac

coun

ting f

ram

ewor

k and

pro

cedu

res t

o fa

cilita

te M

inist

ry of

Ener

gy an

d W

ater

over

sight

of

EdL f

inan

cial s

usta

inab

ility

. »St

anda

rdize

pro

cure

men

t and

dev

elop

mod

el co

ntra

ctua

l agr

eem

ents

for I

PPs.

»De

velo

p th

e fol

lowi

ng op

erat

iona

l initi

ative

s: –te

chni

cal s

tand

ards

for s

olar

and

wind

IPPs

. –co

des f

or p

ilotin

g net

met

erin

g pilo

ts.

»De

velo

p, d

eplo

y/ac

cess

cr

edit

enha

ncem

ent f

acili

ties

inclu

ding

: –Ri

sk gu

aran

tees

and

insu

ranc

es;

–Do

mes

tic lo

ng-te

rm liq

uidi

ty

inst

rum

ents

; –Ca

pita

l mar

kets

(ove

r lon

ger

term

). »De

velo

p, d

eplo

y/ac

cess

te

chni

cal a

ssist

ance

facil

ities

to

supp

ort p

olicy

and

trans

actio

n en

gage

men

ts.

»Ad

dres

s the

bur

den

of

powe

r ser

vices

to S

yrian

s (a

ccou

ntab

le fo

r hig

h pe

rcent

age o

f non

-tech

nica

l lo

sses

); »De

sign

prog

ram

to en

sure

ea

rly an

d m

easu

rabl

e win

s th

at re

flect

coun

try w

ide

refo

rm d

ivide

nd in

term

s,

inte

r alia

, of:

(i) ac

cess

and

quali

ty of

serv

ice; (

ii) jo

bs

crea

ted.

»As

sess

and

addr

ess s

ocial

im

plica

tions

of re

form

actio

ns

on m

argin

al gr

oups

(poo

r, wo

men

, lag

ging r

egio

ns et

c.,)

on th

e ref

orm

“los

ers”

, e.g

. pu

blic

sect

or/S

OE em

ploy

ees

impa

cted

by E

dL co

rpor

atio

n,

polit

ical in

tere

sts.

Mas

hreq

| M

axim

izin

g Fi

nanc

e fo

r De

velo

pmen

t (M

FD) S

trat

egy

64

Pow

Er s

EcTo

rsT

raTE

gy, P

olic

y and

lEga

l go

VErn

ancE

finan

cEfc

V/Po

liTic

s

iraq

»Ap

prov

al an

d im

plem

enta

tion

of

a roa

dmap

for e

lect

ricity

sect

or

which

aim

s at f

ull c

ost r

ecov

ery a

nd

impr

oved

serv

ice d

elive

ry.

»De

sign

of a

tarif

f rat

iona

lizat

ion

proc

ess t

hat l

eads

to co

st re

flect

ive

tarif

f stru

ctur

es.

»De

velo

p st

rate

gy to

fram

e de

regu

latio

n pr

oces

s.

»Re

stru

ctur

e gov

erna

nce a

nd op

erat

ion

of en

ergy

se

ctor

acro

ss fe

dera

l/gov

erno

rate

auth

oriti

es to

im

prov

e sup

ply d

elive

ry in

acco

rdan

ce w

ith th

e Ira

q In

tegr

ated

Nat

iona

l Ene

rgy S

trate

gy an

d th

e new

ele

ctric

ity la

w.

»De

fined

ring

-fenc

ed ro

les o

f ele

ctric

ity b

usin

ess

units

(Gen

erat

ion,

Tran

smiss

ion

and

Dist

ribut

ion)

for

enha

nced

acco

unta

bilit

y and

even

tual

unb

undl

ing a

s au

tono

mou

s com

mer

cial e

ntiti

es.

»Im

prov

e com

mer

cial o

pera

ting f

ound

atio

n of

di

strib

utio

n se

gmen

t (to

inclu

de a

com

mer

cial

man

agem

ent s

yste

m) t

o ach

ieve

: –Fin

ancia

l sus

tain

abili

ty;

–Re

duce

subs

idie

s tow

ards

cost

reco

very

tarif

fs.

»De

ploy

addi

tiona

l cre

dit

supp

ort t

o im

prov

e pe

rform

ance

of se

ctor

(thr

ough

co

nstru

ctio

n of

new

gene

ratio

n pl

ants

, and

reha

bilit

atio

n of

ex

istin

g pla

nts).

»De

velo

p a v

iable

finan

cing

plan

and

busin

ess p

lan

in

supp

ort t

o the

corp

orat

izatio

n of

the s

ecto

r. Th

is wi

ll inc

lude

m

itiga

tion

of sy

stem

tech

nica

l an

d fin

ancia

l loss

es to

attra

ct

priva

te se

ctor

inve

stm

ents

via

impr

ovem

ents

to tr

ansm

issio

n an

d di

strib

utio

n sy

stem

s.

»As

sess

and

addr

ess s

ocial

im

plica

tions

of re

form

ac

tions

on m

argin

al gr

oups

(p

oor,

wom

en, l

iber

ated

and

disa

dvan

tage

d re

gion

s etc)

on

the r

efor

m “l

oser

s”, e

.g.

publ

ic se

ctor

/SOE

empl

oyee

s im

pact

ed b

y ref

orm

s.

ANNE

X IV

KEY

REF

ORM

S BY

SEC

TOR

AND

COUN

TRY

- MAS

HREQ

MFD

REF

ORM

MAT

RICE

S

65

gas

sEcT

orsT

raTE

gy, P

olic

y and

lEga

l go

VErn

ancE

finan

cEfc

V/Po

liTic

s

iraq

»Es

tabl

ish p

olicy

guid

eline

s re

gard

ing n

atur

al ga

s de

velo

pmen

t and

use

, in

cludi

ng p

ublic

/priv

ate

sect

or p

artic

ipat

ion,

reso

urce

/pr

oduc

tion

owne

rshi

p, ga

s pr

icing

, gas

tran

spor

t, ga

s m

arke

ting r

ight

s, ga

s fla

ring,

and

prio

rity o

f res

ource

use

s. »Pr

ivate

sect

or p

artic

ipat

ion

(PSP

) fra

mew

ork:

crea

te a

valu

e pr

opos

ition

and

asso

ciate

d re

gula

tory

, con

tract

ual a

nd

com

mer

cial f

ram

ewor

ks to

enab

le pr

ivate

sect

or p

artic

ipat

ion

alon

g th

e gas

valu

e cha

in.

»Re

duce

inve

stor

unc

erta

inty

and

risk b

y pro

vidin

g clea

r gui

danc

e an

d ec

onom

ic in

cent

ives t

o pr

ivate

inve

stor

s, in

cludi

ng a

com

petit

ive la

ndsc

ape f

or p

ublic

/pr

ivate

pro

ject

dev

elopm

ent a

nd

right

s to a

cces

s exis

ting o

r bui

ld

new

gas-

rela

ted

infra

stru

ctur

e an

d m

arke

t nat

ural

gas

dom

estic

ally a

nd fo

r exp

ort.

»In

trodu

ce in

tern

atio

nally

be

nchm

arke

d, tr

ansp

aren

t and

st

able

gas p

ricin

g (up

stre

am)

and

tarif

f set

ting (

mid

stre

am an

d do

wnst

ream

) mec

hani

sms f

or

inve

stm

ent a

long

the n

atur

al ga

s va

lue c

hain

.

»Go

vern

ance

and

capa

city b

uild

ing:

esta

blish

and

incr

emen

tally

cons

olid

ate g

as-sp

ecifi

c gov

erna

nce c

apac

ity

(Pol

icy &

Pla

nnin

g, R

egul

ator

y, Op

erat

iona

l), in

cludi

ng ro

les

and

func

tions

of ke

y ins

titut

ions

and

priva

te se

ctor

acto

rs:

–Se

ctor

Min

istry

(pol

icy, l

aw an

d re

gula

tions

); –Re

gula

tory

auth

ority

(reg

ulat

ion,

over

sight

& FD

I); –SO

Es (s

tate

inve

stm

ent a

nd re

pres

enta

tion

in op

erat

ions

al

ong v

alue c

hain

); –IO

Cs (i

nves

tmen

t and

oper

atio

ns al

ong v

alue c

hain

). »Cl

early

stip

ulat

e leg

al in

stru

men

ts an

d to

ols (

laws

, re

gula

tions

, reg

ulat

ory r

esol

utio

ns an

d co

des,

cont

ract

s an

d lic

ense

s, re

spec

tivel

y) by

whi

ch th

eir fu

nctio

ns ar

e to b

e di

scha

rged

. »Im

prov

e inv

esto

r attr

activ

enes

s by e

stab

lishi

ng an

ef

fect

ive, e

vent

ually

inde

pend

ent r

egul

ator

y cap

acity

and

cons

olid

atin

g gas

-sec

tor-s

pecif

ic pl

anni

ng ca

pacit

y. »Ga

s sec

tor S

OEs:

cons

olid

ate a

nd m

oder

nize

exist

ing

gas-

rela

ted

stat

e-ow

ned

ente

rpris

es (S

OEs)

into

a ba

nkab

le, i

nter

natio

nally

com

petit

ive, f

or p

rofit

nat

iona

l ga

s com

pany

to co

mpe

titive

ly pa

rticip

ate i

n th

e mid

stre

am

and

down

stre

am of

the n

atur

al ga

s valu

e cha

in, i

nclu

ding

pr

oces

sing,

tran

spor

t, st

orag

e and

dist

ribut

ion

of n

atur

al

gas a

nd n

atur

al ga

s liq

uids

. »Pr

ogre

ssive

ly de

velo

p a t

rans

pare

nt, c

ompe

titive

and

sust

ainab

le le

gal f

ram

ewor

k of m

utua

lly in

terre

late

d an

d in

terd

epen

dent

regu

latio

ns an

d co

ntra

cts w

hich

late

r, wh

enev

er th

e int

erna

l pol

itica

l eco

nom

y con

sider

atio

ns

allow

, be c

appe

d by

an en

com

pass

ing P

etro

leum

Law.

»Co

ntra

ctua

l fra

mew

ork:

Intro

duce

inte

rnat

iona

lly

benc

hmar

ked

cont

ract

ual f

ram

ewor

k for

priv

ate i

nves

tmen

t in

nat

ural

gas d

evelo

pmen

t alo

ng th

e nat

ural

gas v

alue

chain

.

»Cr

edit

enha

ncem

ent

and

fund

ing:

Dep

loy

cred

it en

hanc

emen

t m

echa

nism

s thr

ough

W

BG gu

aran

tees

on

paym

ents

for d

ry ga

s de

liver

ies b

y sta

te of

f-ta

kers

. »Le

vera

ge IF

C lo

an,

equi

ty an

d gu

aran

tee

inst

rum

ents

to d

e-ris

k priv

ate s

ecto

r in

vest

men

t in

upst

ream

(fl

arin

g red

uctio

n an

d pr

oces

sing)

, m

idst

ream

(tra

nspo

rt)

and

down

stre

am (l

arge

of

ftake

and

dist

ribut

ion

for i

ndus

trial

, co

mm

ercia

l and

re

siden

tial u

ses).

»St

ress

risk

, cos

t and

fisc

al

adva

ntag

es st

emm

ing f

rom

shift

aw

ay fr

om st

ate-

led,

stat

e-de

pend

ent a

nd st

ate-

fund

ed,

fisca

lly-d

epen

dent

sect

or

deve

lopm

ent t

owar

ds a

priva

te-

sect

or-le

d in

vest

men

t fra

mew

ork.

»Hi

ghlig

ht b

enef

its in

term

s of

inve

stor

risk

per

cept

ion

and

attra

ctive

ness

from

pro

pose

d sh

ift fr

om tr

aditi

onal

regu

latio

n-by

-con

tract

pra

ctice

s of o

ne-o

n-on

e neg

otia

tions

of in

divid

ual

cont

ract

s beh

ind

close

d do

ors

with

pre

-des

igna

ted

inve

stor

s to

ward

s the

intro

duct

ion

of op

en,

trans

pare

nt an

d co

mpe

titive

co

ntra

ct aw

ard

proc

esse

s bas

ed

on C

oM-a

ppro

ved

tem

plat

es.

Mas

hreq

| M

axim

izin

g Fi

nanc

e fo

r De

velo

pmen

t (M

FD) S

trat

egy

66

Tran

sPor

TsT

raTE

gy, P

olic

y and

lEga

l go

VErn

ancE

finan

cEfc

V/Po

liTic

s

jordan

»Pr

epar

e a d

etail

ed A

ctio

n Pl

an to

: (i)

iden

tify a

ll reg

ulat

ions

and

prac

tices

th

at n

eed

to b

e mod

ified

to m

itiga

te

mar

ket d

istor

tions

; (ii)

def

ine a

n in

cent

ive

mec

hani

sm to

redu

ce, r

enew

or co

nsol

idat

e fle

et in

orde

r to e

nhan

ce th

e effi

cienc

y of

carg

o tra

nspo

rt fo

r the

Aqa

ba-A

mm

an

corri

dor.

»Id

entif

y and

addr

ess a

ny le

gisla

tive

cons

train

ts to

impl

emen

ting a

toll r

oad,

an

d pr

opos

e pot

entia

l sol

utio

ns.

»Re

view

the p

ublic

tran

spor

t tar

iff p

olicy

and

prep

are a

pla

n fo

r res

truct

urin

g the

tarif

f po

licy (

fare

stru

ctur

e).

»Pr

epar

e an

anal

ysis/

reco

mm

enda

tion

of op

tions

for t

he in

volve

men

t of t

he

priva

te se

ctor

: –es

tabl

ish an

appr

opria

te lis

t of

optio

ns fo

r priv

ate s

ecto

r inv

olve

men

t in

toll c

olle

ctio

n;

–un

derta

ke a

deta

iled

asse

ssm

ent o

f th

e opt

ions

for p

rivat

e inv

estm

ent

in to

ll col

lect

ion

and

prov

ision

of

main

tena

nce s

ervic

es, i

nclu

ding

fin

ancia

l and

risk

s ass

essm

ent.

»Op

timiza

tion

plan

for b

us

rout

es, b

us st

op lo

catio

n, p

ublic

tra

nspo

rt sc

hedu

le lic

ensin

g an

d in

tero

pera

bilit

y to i

mpr

ove

quali

ty of

serv

ices a

nd re

gion

al

conn

ectiv

ity.

»A

key c

onsid

erat

ion

when

re

viewi

ng th

e pub

lic tr

ansp

ort

tarif

f pol

icy w

ill b

e to e

nsur

e tha

t an

y res

truct

urin

g of t

he ta

riff

polic

y (fa

re st

ruct

ure)

addr

esse

s ac

cess

ibili

ty is

sues

for d

iffer

ent

socie

tal g

roup

s.

lebanon

»Re

view

civil a

viatio

n la

w an

d its

im

plem

entin

g dec

rees

. »Ad

opt a

com

preh

ensiv

e tra

nspo

rt se

ctor

st

rate

gy an

d pl

an en

cour

ages

priv

ate

sect

or p

artic

ipat

ion.

»Es

tabl

ishm

ent o

f civi

l avia

tion

auth

ority

. »Re

view

and

rein

force

gove

rnan

ce

stru

ctur

es of

SOE

s (e.

g. ra

ilway

and

publ

ic tra

nspo

rt au

thor

ity, T

ripol

i and

Be

irut P

ort A

utho

ritie

s). »Im

plem

enta

tion

of th

e tra

ffic l

aw.

» U

se p

ublic

fina

nce t

o mob

ilize

an

d le

vera

ge p

rivat

e fin

ancin

g (e

.g. B

eirut

BRT

). »Es

tabl

ish V

iabili

ty G

ap Fi

nanc

ing

for p

lann

ed P

PPs t

rans

actio

ns

(e.g

. Beir

ut A

irpor

t). »M

obili

ze as

nee

ded

guar

ante

es.

»Ad

dres

s mar

ginal

grou

p, re

fuge

e an

d ho

st co

mm

unity

impa

cts/

bene

fits f

rom

the r

efor

m.

»Ai

m at

lowe

r tra

nspo

rt co

sts

prov

ing f

inan

cing a

cces

sibili

ty of

th

e mos

t vul

nera

ble.

»In

frast

ruct

ure t

o cre

ate

loca

l em

ploy

men

t, im

prov

e re

gion

al co

nnec

tivity

, and

pr

epar

e Leb

anon

for S

yrian

re

cons

truct

ion.

iraq

»Re

view

and

upda

te in

line w

ith

inte

rnat

iona

l goo

d pr

actic

es th

e civi

l av

iatio

n la

w an

d im

plem

entin

g dec

rees

. »Up

date

the C

ivil A

viatio

n Se

ctor

in lin

e with

th

e 201

4 Tr

ansp

ort S

ecto

r Mas

terp

lan.

»Re

gula

tory

refo

rm in

the a

viatio

n se

ctor

, inc

ludi

ng th

e est

ablis

hmen

t of a

st

anda

lone

Civi

l Avia

tion

Auth

ority

.

»M

obili

ze as

nee

ded

inclu

ding

re

align

ing r

even

ues f

rom

the a

ir sp

ace r

even

ues.

»En

cour

age s

hift

from

priv

ate-

sect

or-e

nabl

ing r

heto

ric to

co

ncre

te p

rivat

e-se

ctor

-ena

blin

g ac

tion.

ANNE

X IV

KEY

REF

ORM

S BY

SEC

TOR

AND

COUN

TRY

- MAS

HREQ

MFD

REF

ORM

MAT

RICE

S

67

urBa

n sE

cTor

sTra

TEgy

, Pol

icy a

nd lE

gal

goVE

rnan

cEfin

ancE

fcV/

PoliT

ics

jordan

»Pr

iorit

ize id

entif

icatio

n an

d st

ruct

urin

g su

ppor

t for

priv

ate s

ecto

r par

ticip

atio

n in

m

unici

pal s

ervic

e deli

very

. »Ad

opt r

efor

m p

acka

ge to

rest

ruct

ure

Citie

s and

Vill

ages

Dev

elopm

ent B

ank

(CVD

B) an

d de

velo

p a f

unct

ioni

ng

mun

icipa

l cre

dit m

arke

t. »Re

vise f

iscal

tran

sfer f

orm

ula t

o ful

ly ap

ply p

erfo

rman

ce cr

iteria

to p

rovid

e in

cent

ives f

or m

unici

pal f

inan

cial

man

agem

ent r

efor

m to

enha

nce

cred

itwor

thin

ess.

»St

reng

then

mun

icipa

l own

-sou

rce

reve

nues

to re

duce

over

-dep

ende

nce o

n gr

ants

from

the c

entra

l leve

l. »In

trodu

ce h

ard

budg

et co

nstra

int.

»Re

stru

ctur

e CVD

B, in

cludi

ng to

revis

e com

posit

ion

and

votin

g rig

hts a

t CVD

B Bo

ard

of D

irect

ors,

to

incr

ease

inst

itutio

nal in

depe

nden

ce an

d en

able

mor

e com

mer

cial r

isk/ r

etur

n-ba

sed

lendi

ng

decis

ions

for m

unici

pal f

inan

ce.

»St

reng

then

cros

s-sec

tora

l pla

nnin

g and

inve

stm

ent

prio

ritiza

tion

amon

g lin

e age

ncie

s (e.

g., w

ater

, sa

nita

tion,

tran

spor

t, pu

blic

work

s and

ener

gy)

unde

r the

chair

man

ship

of lo

cal a

utho

ritie

s to o

pen

oppo

rtuni

ties f

or p

rivat

e sec

tor a

t the

sub-

natio

nal

leve

l. »In

crea

se tr

ansp

aren

cy of

mun

icipa

l fin

ance

, in

cludi

ng re

venu

e and

expe

nditu

re co

mpo

sitio

n to

bu

ild tr

ust b

etwe

en p

ublic

and

priva

te se

ctor

. »In

trodu

ce co

mm

ercia

l prin

ciple

s for

oper

atio

n of

re

venu

e-ge

nera

ting m

unici

pal s

ervic

es.

»Pr

ovid

e inc

entiv

es, i

nclu

ding

in

crea

sed

use o

f blen

ded

finan

ce an

d in

vest

men

t co

-fina

ncin

g ins

trum

ents

in

sele

cted

mun

icipa

litie

s to

mob

ilize

com

mer

cial

finan

cing f

or su

b-na

tiona

l in

vest

men

ts.

»Pr

ovid

e tar

gete

d te

chni

cal

assis

tanc

e to i

dent

ify an

d st

ruct

ure p

roje

ct fi

nanc

e op

portu

nitie

s in

mun

icipa

l in

vest

men

t and

serv

ice

prov

ision

.

»En

hanc

e soc

ial in

clusio

n an

d en

sure

mea

ning

ful

parti

cipat

ion

of Jo

rdan

ian

and

non-

Jord

anian

resid

ents

in

mun

icipa

l inve

stm

ent

plan

ning

and

serv

ice

deliv

ery.

»Es

tabl

ish st

rong

citiz

en

enga

gem

ent a

nd fe

edba

ck

mec

hani

sms,

inclu

ding

gr

ieva

nce r

edre

ss

mec

hani

sms,

to fo

ster

gr

eate

r pop

ular

supp

ort f

or

enha

nced

priv

ate s

ecto

r pa

rticip

atio

n an

d en

hanc

ed

cost

-reco

very

targ

ets f

or

loca

l pub

lic se

rvice

s.

lebanon

»Es

tabl

ish th

e ena

blin

g fra

mew

ork f

or

proj

ect f

inan

ce to

the m

unici

pal s

ecto

r in

Leba

non.

»De

velo

p th

e sec

onda

ry le

gisla

tion

(PPP

re

gula

tory

guid

eline

s and

fram

ewor

k)

to co

mpl

emen

t the

PPP

Law

pass

ed in

Se

ptem

ber 2

017,

inclu

ding

fram

ewor

k an

d gu

ideli

nes f

or cu

stom

ized

mun

icipa

l PP

P to

ols,

stan

dard

ized

proc

edur

es,

cont

ract

clau

se/te

mpl

ates

.

»De

fine t

he in

stitu

tiona

l and

regu

lato

ry ro

les o

f pu

blic

and

priva

te st

akeh

olde

rs in

volve

d in

pro

ject

fin

ance

at m

unici

pal le

vel (

i.e. B

dL, H

CP, M

inist

ry of

In

terio

r and

Mun

icipa

l Affa

irs, B

anki

ng se

ctor

, etc.

). »Id

entif

y and

dev

elop

a pip

eline

of m

unici

pal P

PP

trans

actio

ns at

the m

unici

pal le

vel.

»St

reng

then

ing c

apac

ity of

sele

cted

mun

icipa

litie

s in

the a

reas

of fi

nanc

ial m

anag

emen

t and

cr

editw

orth

ines

s. »In

stitu

ting a

cred

it ra

ting s

yste

m fo

r mun

icipa

litie

s. »De

velo

p th

e ena

blin

g env

ironm

ent t

o miti

gate

cred

it de

faul

t risk

s to t

he go

vern

men

t, th

e ban

king

sect

or

and

to m

unici

palit

ies.

»Us

e pub

lic fi

nanc

e (e.

g.

viabi

lity g

ap fa

ciliti

es)

and

guar

ante

e fac

ilitie

s wh

ere f

easib

le to

mob

ilize

co

mm

ercia

lly so

und

proj

ect

finan

ce to

the m

unici

pal

sect

or.

»Ex

plor

e the

pro

spec

ts fo

r in

trodu

cing s

ecur

itiza

tion

mea

sure

s aga

inst

land

as

sets

and/

or fu

ture

fisc

al

trans

fer s

tream

s to e

nsur

e pr

icing

of m

unici

pal lo

an

prod

ucts

is co

mpe

titive

.

»Ca

talyt

ic in

vest

men

ts to

cr

eate

loca

l em

ploy

men

t in

terti

ary M

unici

palit

ies

with

bac

kwar

d an

d fo

rwar

d lin

kage

s to S

econ

dary

M

unici

palit

ies.

Mas

hreq

| M

axim

izin

g Fi

nanc

e fo

r De

velo

pmen

t (M

FD) S

trat

egy

68

BanK

ing

sEcT

orsT

raTE

gy, P

olic

y and

lEga

l go

VErn

ancE

finan

cEfc

V/Po

liTic

s

iraq

Stat

e Own

ed B

ank R

efor

m:

»Re

stru

ctur

e and

priv

atiza

tion

of th

e two

larg

est

stat

e-ow

ned

bank

s (Ra

shee

d an

d Ra

fidai

n) to

un

lock

their

lend

ing p

oten

tial t

hrou

gh ad

ditio

nal

capi

taliz

atio

n an

d di

vest

men

t of M

OF ow

ners

hip

to st

rate

gic i

nves

tors

.

Deve

lopm

ent o

f Priv

ate B

anks

: »

Ensu

re im

plem

enta

tion

of th

e rec

ently

issu

ed

regu

latio

n th

at le

vels

the p

layin

g fiel

d fo

r Priv

ate

Sect

or B

anks

allo

wing

stat

e own

ed en

terp

rises

(S

OE) t

o do b

usin

ess w

ith th

em.

»Re

view

Licen

sing c

riter

ia an

d en

act m

easu

res t

o co

nsol

idat

e the

ban

king

sect

or (m

ore t

han

73

licen

sed

bank

s) th

roug

h hi

gher

pai

d up

capi

tal

and

othe

r pru

dent

ial r

equi

rem

ents

. »

Phas

e out

the d

ual f

oreig

n ex

chan

ge re

gim

e tha

t is

dist

ortin

g the

reve

nue s

tream

s of p

rivat

e sec

tor

bank

s and

ince

ntivi

ze p

rivat

e sec

tor b

anks

to

incr

ease

their

loan

por

tfolio

s. »

Issue

regu

latio

ns on

Ser

vice Q

ualit

y Sta

ndar

ds

and

Cons

umer

Pro

tect

ion

to en

hanc

e the

co

nfid

ence

of Ir

aqi p

ublic

in th

e ban

king

sect

or.

Stre

ngth

enin

g of R

egul

ator

y and

Sup

ervis

ory

Fram

ewor

k: »

Impr

ove r

egul

ator

y and

supe

rviso

ry fr

amew

ork t

o al

ign

with

inte

rnat

iona

l sta

ndar

ds (B

asel

/Fin

ancia

l St

abili

ty B

oard

(FSB

)/Fin

ancia

l Act

ion

Task

Forc

e (FA

TF)/I

FRS)

.

Cred

it In

frast

ruct

ure:

»

Impr

ove c

redi

t/fin

ancia

l infra

stru

ctur

e and

fra

mew

orks

by e

nact

ing r

egul

atio

ns (a

ccou

ntin

g/au

ditin

g, cr

edit

info

rmat

ion,

secu

red

trans

actio

ns,

inso

lvenc

y fra

mew

orks

, con

sum

er p

rote

ctio

n et

c);

Stat

e Own

ed B

ank R

efor

m:

»Fin

ancia

l and

oper

atio

nal r

estru

ctur

ing o

f the

two l

arge

st st

ate-

owne

d ba

nks (

Rash

eed

and

Rafid

ain

“R&R

”) in

cludi

ng co

rpor

ate

gove

rnan

ce, a

sset

qua

lity r

evie

ws le

adin

g to a

ccur

ate v

alua

tion

of as

sets

and

liabi

litie

s and

capi

tal s

hortf

alls,

reca

pita

lizat

ion,

op

erat

iona

l res

truct

urin

g inc

ludi

ng in

stal

latio

n of

core

ban

king

sy

stem

s, p

olici

es an

d pr

oced

ures

inclu

ding

risk

man

agem

ent a

nd

cont

rols.

»As

sess

oper

atio

nal a

nd ef

fect

ive ca

pacit

y of o

ther

Sta

te-O

wned

Ba

nks i

nclu

ding

the T

rade

Ban

k, A

gricu

lture

Ban

k, In

dust

rial B

ank,

Re

al Es

tate

Ban

k to p

rovid

e nee

ded

supp

ort t

o the

ir re

spec

tive

sect

ors.

Deve

lopm

ent o

f Priv

ate B

anks

: »

Augm

ent p

rivat

e fin

ancia

l sec

tor d

evel

opm

ent p

lans

, inc

ludi

ng

dom

estic

ban

ks’ c

apac

ity st

reng

then

ing r

e: –ba

lanc

e she

et st

ruct

ure,

conc

entra

tion,

–ca

pita

l ade

quac

y, cr

edit

qual

ity, m

atur

ity m

ismat

ch,

–cr

edit

asse

ssm

ent a

nd ri

sk.

Stre

ngth

enin

g of R

egul

ator

y and

Sup

ervis

ory F

ram

ewor

k: »

Stre

ngth

en th

e ind

epen

denc

e and

over

sight

capa

bilit

ies o

f CB

I inclu

ding

capa

city b

uild

ing s

uppo

rt fo

r offs

ite an

d on

-site

su

perv

ision

inclu

ding

risk

bas

ed su

perv

ision

and

deve

lopm

ent o

f hu

man

capi

tal.

»Im

plem

ent A

nti-M

oney

Laun

derin

g (AM

L)/Co

mba

ting t

he Fi

nanc

ing

of Te

rroris

m (C

FT) r

egul

atio

ns in

cludi

ng st

rong

Kno

w Yo

ur

Cust

omer

(KYC

) con

trols

to en

sure

cont

inue

d co

mpl

ianc

e with

FATF

re

quire

men

ts w

ith in

tern

atio

nal c

orre

spon

dent

s and

pay

men

t sy

stem

s, in

cludi

ng a

Natio

nal R

isk A

sses

smen

t to i

dent

ify ke

y are

as

of d

efici

encie

s in

AML/

CFT.

»Co

nsum

er p

rote

ctio

n m

easu

res t

o pro

vide c

onfid

ence

to co

nsum

er in

Ira

qi B

anki

ng S

yste

m.

Paym

ent S

yste

m R

efor

m:

»Im

prov

emen

t in

the p

aym

ent i

nfra

stru

ctur

e with

pol

icies

on

ePay

men

ts/M

obile

pay

men

ts in

cludi

ng d

igiti

zatio

n of

Gov

ernm

ent

sala

ry p

aym

ents

. »

Enac

tmen

t and

roll o

ut of

a bi

omet

ric N

atio

nal I

D sy

stem

.

»St

rip of

f/disp

ose

of th

e bad

asse

ts

of R

ashe

ed an

d Ra

fidai

n; re

capi

taliz

e th

e ban

ks b

ased

on

the a

ppra

isal a

nd

valu

atio

n of

asse

ts

and

liabi

litie

s. »

Deve

lop

spec

ializ

ed

finan

ce, e

.g. h

ousin

g,

agric

ultu

re.

»De

velo

p pa

rtial

cred

it gu

aran

tee s

chem

es to

su

ppor

t the

ban

ks.

»De

velo

p th

e Non

-Ba

nkin

g Fin

ancia

l In

stitu

tions

(Lea

sing,

M

icro F

inan

ce et

c) »

Deve

lop

early

stag

e fin

ancin

g for

SM

Es.

»Ex

plor

e pot

entia

l ca

pita

l mar

ket

inst

rum

ents

for S

MEs

. »

Stre

ngth

en an

d pr

omot

e the

av

ailab

ility

of cr

edit

insu

ranc

e mec

hani

sm

to p

rovid

e risk

m

itiga

tion

to b

anks

.

»M

itiga

ting

impa

cts o

n vu

lner

able

se

gmen

ts of

so

ciety

such

as

wom

en, a

nd yo

uth

thro

ugh

targ

eted

re

form

s. »

Ensu

re eq

uity

in

acce

ss to

go

vern

men

t su

ppor

t, e.

g.

subs

idie

s in

hou

sing

reco

nstru

ctio

n.

ANNE

X IV

KEY

REF

ORM

S BY

SEC

TOR

AND

COUN

TRY

- MAS

HREQ

MFD

REF

ORM

MAT

RICE

S

69

agri

culT

urE s

EcTo

rsT

raTE

gy, P

olic

y and

lEga

l go

VErn

ancE

finan

cEfc

V/Po

liTic

s

iraq

»Es

tabl

ish a

polic

y and

inve

stm

ent u

nit

with

in th

e Min

istry

of A

gricu

lture

. The

ob

ject

ive b

eing t

o ide

ntify

and

sequ

ence

re

gula

tory

and

polic

y ref

orm

s. »As

sess

and

impl

emen

t SOE

gove

rnan

ce

refo

rms i

n pa

rtner

ship

with

Min

istrie

s of

Agric

ultu

re, P

lann

ing a

nd Fi

nanc

e.

»Cr

eate

mar

ket-d

riven

pro

cure

men

t pr

efer

ence

s with

in in

put s

uppl

y valu

e ch

ains.

»Re

view

and

rest

ruct

ure g

over

nanc

e fed

eral

/gov

erno

rate

au

thor

ities

to fo

cus e

fforts

to im

prov

e the

effic

iency

and

effe

ctive

ness

of ag

ricul

tura

l sec

tor p

ublic

serv

ices.

»Id

entif

y and

enga

ge w

ith en

try p

oint

s tha

t will

enab

le a t

rans

form

atio

n of

exist

ing p

ublic

serv

ices t

owar

ds

sust

ainab

le pr

ivate

sect

or op

erat

ions

in ag

ricul

tura

l se

ctor

. An

initi

al fo

cus o

n in

put S

OEs a

nd ov

er lo

nger

ru

n th

ose S

OEs r

espo

nsib

le fo

r the

Pub

lic D

istrib

utio

n Sy

stem

(PDS

). »Im

prov

e com

mer

cial o

pera

ting f

ound

atio

n of

hig

h va

lue

prod

uct c

hain

s by i

nves

ting i

n:

–Fin

ancia

l sus

tain

abili

ty;

–Re

ducin

g/re

dire

ctin

g sub

sidie

s.

»Pi

lot a

nd sc

ale u

p m

echa

nism

s tha

t will

all

ow in

crea

sed

acce

ss to

fin

ance

in th

e sec

tor.

»De

velo

p a v

iable

finan

cing

plan

and

busin

ess p

lan

in su

ppor

t to i

ncre

ased

co

mm

ercia

l fin

ancin

g in

the s

ecto

r.

»En

sure

all in

terv

entio

ns/

actio

ns ar

e inc

lusiv

e an

d re

spon

sive t

o th

e circ

umst

ance

s of

mar

ginal

grou

ps (p

oor,

wom

en, l

iber

ated

and

disa

dvan

tage

d re

gion

s et

c).

waT

Er s

EcTo

rsT

raTE

gy, P

olic

y and

lEga

l go

VErn

ancE

finan

cEfc

V/Po

liTic

s

jordan

»In

crea

se ta

riff t

o red

uce f

inan

cial lo

sses

and

refle

ct th

e valu

e of t

he sc

arce

wat

er re

sour

ce.

»Im

prov

e effi

cient

use

of w

ater

(mun

icipa

l and

ag

ricul

ture

wat

er).

»Im

plem

ent c

usto

mer

met

ers t

o mea

sure

wat

er

effic

iency

and

allow

tran

sitio

n fro

m in

term

itten

t wa

ter t

o con

tinuo

us w

ater

supp

ly. »Re

duce

the o

veru

se of

grou

ndwa

ter (

impr

ove

effic

iency

in m

unici

pal a

nd ag

ricul

ture

wat

er,

non-

conv

entio

nal w

ater

sour

ces,

intro

duce

m

arke

t-bas

ed ec

onom

ic po

licie

s/in

cent

ives).

»Co

rrect

hig

h se

ctor

-wid

e NRW

leve

ls, w

hich

are a

roun

d 50

% ag

greg

ate a

t the

nat

iona

l leve

l. »Tr

ansit

ion

Amm

an’s

wate

r sup

ply s

yste

m to

deli

ver

cont

inuo

us su

pply

with

exist

ing w

ater

reso

urce

s –

achi

evab

le wi

th N

RW re

duct

ions

. »Im

prov

e com

mun

icatio

n on

the n

eed

to fo

rmali

ze

conn

ectio

ns (r

educ

e the

illeg

al co

nnec

tions

and

com

mer

cial lo

sses

) and

the i

ncre

ase o

f tar

iff d

ue to

in

crea

se of

ener

gy co

st an

d th

e nee

d to

redu

ce th

e fin

ancia

l loss

of th

e wat

er se

ctor

. Com

mun

icatio

n sh

ould

al

so b

e clea

r on

the w

ays g

over

nmen

t red

uces

the

impa

ct on

the m

ost v

ulne

rabl

e.

»Jo

int w

ork o

n NR

W in

Le

bano

n to

mob

ilize

pr

ivate

deb

t fin

ance

on

oper

ator

s’ ba

lanc

e she

ets f

or

inve

stm

ent i

n sy

stem

im

prov

emen

ts.

»St

ruct

ure P

PP fo

r pr

ivate

sect

or to

inve

st

in an

d m

anag

e a N

RW

redu

ctio

n in

itiat

ive fo

r Am

man

.

»M

itiga

ting i

mpa

cts o

n vu

lner

able

sect

ions

of

the p

opul

atio

n po

ssib

ly wi

th a

dire

ct

bene

fit tr

ansfe

r sc

hem

e.

Mas

hreq

| M

axim

izin

g Fi

nanc

e fo

r De

velo

pmen

t (M

FD) S

trat

egy

70

waT

Er s

EcTo

rsT

raTE

gy, P

olic

y and

lEga

l go

VErn

ancE

finan

cEfc

V/Po

liTic

s

lebanon

»Im

plem

enta

tion

of La

w 22

1 to

achi

eve

auto

nom

y of t

he fo

ur W

ater

Esta

blish

men

ts an

d su

bseq

uent

tran

sfer o

f ope

ratio

nal f

unct

ions

. »De

signi

ng a

tarif

f stru

ctur

e for

wat

er su

pply

and

wast

ewat

er se

rvice

s with

the o

bjec

tive o

f co

verin

g at l

east

oper

atio

n an

d m

ainte

nanc

e co

sts i

n th

e med

ium

to lo

ng-te

rm, w

hile

cons

ider

ing a

fford

abili

ty an

d ot

her s

ocial

as

pect

s. »Sc

ale u

p th

e use

cust

omer

met

ers,

SCA

DA

and

esta

blish

men

ts of

Dist

ricts

Met

erd

Area

s (P

roje

cts P

1030

63 an

d P1

6571

1 bo

th su

ppor

t th

ese a

ctio

ns in

par

ts of

Gre

ater

Beir

ut M

ount

Le

bano

n Ar

ea).

»In

itiat

e PSP

in w

ater

loss

redu

ctio

n in

Beir

ut th

roug

h fir

st-ti

me P

BC.

»Im

prov

e util

ity op

erat

iona

l and

fina

ncial

per

form

ance

th

roug

h wa

ter l

oss r

educ

tion

ther

eby c

ontri

butin

g to

impr

oved

cred

itwor

thin

ess.

»Co

mm

unica

tion

activ

ities

to se

nsiti

ze co

nsum

ers o

n th

e nee

d to

form

alize

conn

ectio

ns an

d ra

tiona

le fo

r tra

nsiti

on to

volu

met

ric ta

riff i

n a f

irst p

hase

, and

in

a sec

ond

phas

e, b

ased

impa

ct of

hig

her t

ariff

s on

econ

omic,

hea

lth an

d ot

her b

enef

its of

impr

oved

serv

ice

deliv

ery.

»Jo

int w

ork o

n NR

W in

Le

bano

n to

mob

ilize

pr

ivate

deb

t fin

ance

on

oper

ator

s’ ba

lanc

e she

ets f

or

inve

stm

ent i

n sy

stem

im

prov

emen

ts.

»M

itiga

ting i

mpa

cts o

n vu

lner

able

sect

ions

of

the p

opul

atio

n. »To

effe

ctive

ly m

anag

e co

nsum

er su

pppo

rt fo

r the

fee r

efor

ms,

se

quen

ce th

e tra

nsiti

on fr

om fl

at

user

fee t

o vol

umet

ric

tarif

f in

area

s whe

re

cons

umer

s hav

e st

arte

d to

ben

efit

from

cont

inuo

us

wate

r sup

ply a

s is

bein

g don

e by B

eirut

wa

ter u

tility

.

iraq

»As

sess

laws

and

regu

latio

n wi

th re

gard

s to

suita

bilit

y to a

ttrac

t priv

ate i

nves

tmen

t. Th

ese

are p

rese

ntly

com

plex

and

are n

ot co

nduc

ive to

at

tract

ing p

rivat

e sec

tor p

artic

ipat

ion.

»Gr

adua

l tar

iff in

crea

ses,

star

ting w

ith a

5%

acro

ss th

e boa

rd ta

riff i

ncre

ase e

very

3 ye

ars.

Cons

ider

atio

n of

hig

her t

ariff

incr

ease

s in

area

s re

ceivi

ng b

ette

r ser

vices

and

wher

e affo

rdab

le.

»St

reng

then

util

ity fi

nanc

ial m

anag

emen

t, in

cludi

ng

reve

nue m

anag

emen

t and

acco

untin

g, to

esta

blish

a ba

se fo

r attr

actin

g priv

ate i

nves

tmen

t in

the f

utur

e. »Di

gitiz

atio

n of

cons

umer

reco

rds a

nd co

mpu

teriz

atio

n of

billi

ng an

d co

llect

ion

syst

ems t

o stre

ngth

en re

venu

e st

ream

s of w

ater

util

ities

. »In

trodu

ctio

n of

per

form

ance

bas

ed op

erat

ions

and

main

tena

nce c

ontra

cts f

or se

wera

ge p

umpi

ng st

atio

ns.

»M

inist

ry of

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nnin

g to u

pdat

e and

impr

ove t

he cu

rrent

re

gula

tion

(201

4) go

vern

ing g

over

nmen

t con

tract

s, to

m

eet i

nter

natio

nal s

tand

ards

. »St

reng

then

the M

inist

ry of

Pla

nnin

g’s p

rocu

rem

ent

capa

city b

y con

duct

ing j

oint

wor

ksho

ps w

ith th

e In

tern

atio

nal F

eder

atio

n of

Con

sulti

ng En

ginee

rs (F

IDIC

), co

nsul

tant

s and

the p

rivat

e sec

tor.

»Ex

plor

e use

of

ince

ntive

s, in

cludi

ng

blen

ded

finan

ce,

guar

ante

es, a

nd

othe

r risk

miti

gatin

g in

stru

men

ts, s

uch

as

curre

ncy h

edge

s in

the

case

of in

tern

atio

nal

finan

ce, t

o mob

ilize

co

mm

ercia

l fin

ancin

g fo

r inv

estm

ent i

n wa

stew

ater

serv

ices.

»Gu

aran

tees

for p

rivat

e in

vest

ors t

o cov

er

gove

rnm

ent p

aym

ent

oblig

atio

ns u

nder

PPP

co

ntra

cts.

»As

sess

viab

ility

of

attra

ctin

g in

tern

atio

nal

inve

stor

s in

the

cont

ext o

f the

curre

nt

polit

ical in

stab

ility

in

Iraq

.