WASHINGTON, December 20, 2017--The World Bank today approved a $51.9 million (about FCFA30 billion) International Development Association (IDA)* grant to boost Togo’s efforts to improve fiscal sustainability and promote economic growth.
The Fiscal Management and Infrastructure Reform program (FMIR1) will support measures to improve tax administration and policies, including simplifying and reducing tax rules and exemptions, and facilitating tax payments through online and mobile payments. It will also help improve the performance of the energy and information, communication and technology (ICT) sectors.
“This budget support operation for Togo---the first in several years---reflects the critical reform measures that have been taken by the authorities over the past year as they have embarked on an ambitious reform effort to restore fiscal stability and address issues in the energy sector and ICT sectors, among others, that have undermined their performance and contribution to economic growth. The reforms supported by this operation are also critical to help attract new private investments to Togo,” said Pierre Laporte, World Bank Country Director for Togo.
FMIR1 measures in the energy and ICT sectors are pivotal to improving economic and private sector performance in Togo. In the ICT sector, the high cost of services, inefficiency and poor quality limit individuals and private sector companies’ ability to take full advantage of the opportunities offered by mobile technology and internet services. ICT reforms supported by the FMIR series are helping increase competition and improve regulations to strengthen the quality of services and reduce the cost to users.
As for the energy sector, where some of the key power utilities are in financial distress due to a combination of high production costs, poor bill collection and operational inefficiency, the new operation will help restore financial viability through the clearance of arrears and ensuring timely bill payment by the government, least-cost power generation and optimal pricing of electricity.
The FMIR series is the World Bank’s first development policy financing operation in Togo since 2013. It is consistent with Togo’s Strategy for Accelerated Growth and Employment Promotion and the 2018-22 National Development Plan currently under preparation. It is also a key program in the World Bank Group’s 2017 Country Partnership Framework for Togo, most specifically to support improved governance and economic performance objectives. Finally, implementation of FMIR reforms will be supported by other World Bank/IDA operations, including the Economic Governance Project (co-funded with the European Union) approved in October 2017; the West Africa Regional Communications Infrastructure Project approved in 2013; and the Energy Sector Support and Investment Project approved today.
* The World Bank’s International Development Association (IDA), established in 1960, helps the world’s poorest countries by providing grants and low to zero-interest loans 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 75 poorest countries, 39 of which are in Africa. Resources from IDA bring positive change to the 1.5 billion people who live in IDA countries. Since 1960, IDA has supported development work in 113 countries. Annual commitments have averaged about $18 billion over the last three years, with about 54 percent going to Africa.