Evaluation Team

This report was prepared by Messrs. P.A ROCHON, Principal Evaluation Officer, and M. LABIDI, Consultant, following a mission to Cameroon from 10 to 24 November 2006. Questions on this report should be referred to Mr. H. RAZAFINDRAMANANA.

Objective

The purpose of this report is to evaluate the Bank Group’s multi-sector assistance to Cameroon. This exercise aims to provide an overview of the design and implementation of the Bank Group’s assistance program in support of reforms in Cameroon between 1996 and 2004. It shows the extent to which the Bank Group’s policy-based lending program (PBLP) loans achieved the overall objective of economic growth and poverty reduction. The study also draws lessons for improving the effectiveness of the Bank Group’s future assistance in this area. This evaluation will serve as an input to a more comprehensive evaluation of the Bank Group’s overall assistance to Cameroon.

Main Lessons

• The lack or inadequate identification and preparation of programs undermines their quality at entry. This quality would be enhanced by paying more attention to the lessons learnt from previous programs, which implies an adequate schedule for program appraisal, completion and post-evaluation reports. Complex measures should not be included in reform programs without prior analytical studies. In addition, coordination of the Bank with the IMF and the World Bank, which is crucial for the implementation of policy-based lending programs, was not sufficiently achieved by the Bank in developing its substantial contribution to the finalization of these reforms.

• Positive results were achieved in macroeconomic stabilization and growth under programs such as SAP II/SAP III, but it is difficult for these programs to ensure strong growth that will allow for poverty reduction and the achievement of the MDGs. Poverty reduction and improvement of social conditions are not always given the required attention in such programs. Consequently, SAP II puts less emphasis on poverty than SAP III.
   
• The composition of the Bank’s programs is evolving towards greater selectivity, and currently towards governance. Many governance measures under SAP III and the NGP, which were to be implemented within short time frames, shows the under-estimation of difficulties related to good governance.
   
• The usefulness of the policy-based lending instrument, in the form of support for the balance of payments, is confirmed by SAP II and SAP III results. It allowed for long-term Bank support for reforms and actions aimed at attaining the HIPC completion point. Budget support is not yet possible because of weaknesses in governance and public finance management.
   
• A major factor in the success of the programs was their ownership by the Government and the latter’s political will to implement them.

Main Recommendations

Recommendations to the Bank:

• Continue to support economic and social reforms in Cameroon, notably the fight against poverty, the improvement of governance, and capacity building in these areas. To this end, the Bank will use the suitable financing instrument, which is policy-based lending, in the form of support for balance of payments. Budget support will only be envisaged after further progress in public finance governance.

• Focus policy-based lending programs on a limited number of key areas and sectors (governance, social, agriculture) and limit the number of measures.

• Pay more attention to lessons from previous programs, systematically conduct program identification and preparation missions to improve the quality of programs at entry and adhere to an adequate schedule for the preparation of program appraisal, completion and post-evaluation reports;

• Ensure the existence of the necessary preliminary studies before adopting complex reforms, the availability of financing for key program components, and the realistic nature of the schedules retained.

Recommendations to the Borrower:

• Pursue the implementation of reforms, improve governance, better manage public finance, improve the business climate, and strengthen decentralization.

• Continue to give priority to poverty reduction and improvement of the social situation.

• Boost thinking and actions aimed at fostering strong growth in non-oil production, particularly in the preparation of the next PRSP for 2007.

• Pay adequate attention to the promotion of good governance, justice, and the fight against corruption. In this regard, it is important to ensure the successful implementation of the next GRSP and the efficient operation of the related institutional support project.
   
• Efficiently use resources made available by the attainment of the HIPC Initiative completion point and mobilize external financial resources, while ensuring the sustainability of external debt.    

• Ensure that its services comply with agreements between Cameroon and the Bank, in particular, the regular preparation of program monitoring reports and their submission to the Bank.