World Bank Discusses New Country Assistance Strategy For Djibouti

World Bank press release, 2 January 2001

Washington—The World Bank’s Board of Executive Directors yesterday discussed a new Country Assistance Strategy (CAS) for Djibouti and approved a US$10 million credit to support Djibouti’s educational development strategy.

The purpose of the CAS, the Bank’s first for Djibouti, is to design an assistance strategy for FY2001-2003 that has the ultimate objective of a sustainable reduction in poverty. This strategy, developed in partnership with the country, is based on two pillars:

• Direct interventions to reduce poverty which will focus on reversing the extremely low enrollment rate in education; addressing overwhelming needs in health, particularly those related to high rates of infectious diseases; and preparing an assistance program for vulnerable groups to cushion the impact of adjustment.
• Measures to provide the basis for growth and employment generation supported through structural reforms designed to restore competitiveness and create opportunities for private investment. The strategy also aims at developing associated infrastructure services for the port to take full advantage of increased traffic transit, mainly to and from Ethiopia.

In addition to these two pillars, the crosscutting issues of institutional capacity building, macroeconomic stability, social concerns such as gender equity and empowerment will be treated as integral elements of the CAS through a range of non-lending services.

The objective of the education program, of which the first phase was approved by the Bank’s board yesterday, is to support the government’s strategy, developed through a nation-wide consultative process to enhance the quality of education and to double enrollment rates in primary schools over a 10-year period.

The project is expected to benefit children who do not have ready access to schooling because of lack of classrooms. In addition, benefits will also accrue to those students who are in schools but have learning difficulties as they do not have regular access to books and teaching materials. Djiboutian society as a whole should benefit in the long-run through the development of a better educated workforce and the implementation of a curriculum more relevant to Djibouti’s development needs.

The World Bank will support the overall program through an Adaptable Program Credit (APC) totaling US$ 30 million, in three phases of US$10 million each. The APC approach was selected as the preferred lending instrument because of the need to support the Government’s ambitious education program over a sustained period.

The cost of the first phase is US$11 million. The World Bank’s credit of US$10 million is on standard IDA (International Development Association) terms with a 40-year maturity, a 10-year grace period, and 0.75 percent service charge. The government of Djibouti will also contribute US$400,000 to the project, while other sources will contribute US$600,000.