WASHINGTON, March 11, 2014 – The World Bank’s Board of Executive Directors has approved two projects for a total of US$55 million from the International Development Association (IDA)* to help Benin improve the country’s business environment and improve access to employment to the country’s youth. Both of the two projects approved today aim to accelerate real economic growth and pave the way for shared prosperity and reduced poverty.
The first IDA credit of US$20 million supports the Poverty Reduction Support Credit (PRSC 9), designed to improve both public administration and public financial management with enhanced budget planning and execution, procurement, auditing, and anti-corruption measures. The project builds on reforms supported under previous PRSC projects (PRSG-7 and PRSC-8), particularly those activities aimed at government administration, management and upgraded transparency.
“Supporting efficient and transparent government operations to help ensure that economic expansion improves the quality of life for all citizens is key to our mission in Benin,” said Ousmane Diagana, World Bank Country Director for Benin. “Today’s financing will help Benin to strengthen its public administration, create a business environment conducive to investment in the most promising sectors, and lay the foundation for the economic transformation necessary to lift the country’s population out of poverty.”
Benin has significant agriculture potential with plenty of arable land, good soils and adequate water resources, yet yields of major crops, including cotton, have remained persistently low. The PRSC 9’s second focus will tap into Benin’s agricultural promise with activities designed to strengthen the business environment to support job growth in the private sector, particularly in the areas of improved agricultural productivity and commerce.
“Unfortunately, the business enabling environment in Benin is weak and the bureaucracy imposes a heavy burden on the private sector, constraining growth and economic development,” said David Cal MacWilliam, World Bank Task Team Leader for the project. “Today’s Poverty Reduction Support Credit 9 will bring strengthened public sector governance and improved transparency to the government, both which are critical to ensuring that the benefits of economic growth and increased prosperity are spread to a broad cross-section of the population.”
The second IDA credit of US$35 million supports the Youth Employment Project, which aims to improve access to new skills and job opportunities for underemployed youth in Benin. The project will target those youth who are most affected by underemployment, such as young females, youth living in rural communities, and youth with low levels of education. The Benin Government is expected to provide US$1.9 million for the US$36.9 million project.
“The problem for many workers in Benin—especially youth—is underemployment,” said John Van Dyck, World Bank Task Team Leader for the project. “By supporting access to new skills and financial resources, the Youth Employment Project gives young workers an opportunity to increase their incomes and lift themselves and their families out of poverty.”
The Youth Employment Project has a particular focus on building skills for employment in small businesses, agri-business, and tourism. Youth will have opportunities to attend life skills training as well as gain technical expertise through apprenticeships. Beneficiaries will also have access to start-up funding for help starting new microbusinesses.
* The World Bank’s International Development Association (IDA), established in 1960, helps the world’s poorest countries by providing loans (called “credits”) and grants for projects and programs that boost economic growth, reduce poverty, and improve poor people’s lives. IDA is one of the largest sources of assistance for the world’s 81 poorest countries, 39 of which are in Africa. Resources from IDA bring positive change for 2.5 billion people living on less than $2 a day. Since 1960, IDA has supported development work in 108 countries. Annual commitments have increased steadily and averaged about $15 billion over the last three years, with about 50 percent of commitments going to Africa.