Uzbekistan: Public Finance Management Reform

Sovereign Project | 41041-013

Summary

The Project impact will be more efficient allocation and utilization of fiscal resources and improved macroeconomic management. The Project outcome will include (i) an efficient and sustainable Treasury mechanism fulfilling its mandated responsibilities as defined in the Treasury law; and (ii) improved transparency, accountability and efficiency of public finance management processes. The project impact outcome will be monitored by progresses in the following areas: (i) cash and debt management, (ii) expenditure control and management in line with budget policies and priorities, (iii) minimized delays in payment cycle, (iv) creation of a modern accounting system to conform to international standards, and (v) generation of timely and accurate management reports to meet diverse user needs.

Latest Project Documents


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Project Name Public Finance Management Reform
Project Number 41041-013
Country Uzbekistan
Project Status Closed
Project Type / Modality of Assistance Loan
Technical Assistance
Source of Funding / Amount
Loan 2338-UZB: Public Finance Management Reform
Ordinary capital resources US$ 20.70 million
TA 4946-UZB: Supporting Public Finance Management Reform
Technical Assistance Special Fund US$ 600,000.00
Strategic Agendas Inclusive economic growth
Drivers of Change
Sector / Subsector Public sector management - Public expenditure and fiscal management
Gender Equity and Mainstreaming
Description The Project impact will be more efficient allocation and utilization of fiscal resources and improved macroeconomic management. The Project outcome will include (i) an efficient and sustainable Treasury mechanism fulfilling its mandated responsibilities as defined in the Treasury law; and (ii) improved transparency, accountability and efficiency of public finance management processes. The project impact outcome will be monitored by progresses in the following areas: (i) cash and debt management, (ii) expenditure control and management in line with budget policies and priorities, (iii) minimized delays in payment cycle, (iv) creation of a modern accounting system to conform to international standards, and (v) generation of timely and accurate management reports to meet diverse user needs.
Project Rationale and Linkage to Country/Regional Strategy

The proposed Project aims to further improve the on-going efforts in introduction of MTBF and program budgeting, but would substantially focus on establishing a nation-wide network of Treasury offices and modernizing the Treasury operations. The establishment of the Treasury, with a single account processing all payment and receipts, will permit consolidated, consistent and timely reporting of expenditures and revenues for budget execution management and accounting purposes. In conjunction with introduction of MTBF and program budgeting, and by adoption of a classification system in line with international best practices, this will permit prompt and relevant reporting for the public and parliament, and thus enhance the accountability and transparency. This will also enable policy makers and institutions to respond in a timely manner to changes in the fiscal environment. The proposed Project will mark an important and necessary step in support for the authorities' pursuit for a public finance management (PFM) reform, and will provide a good foundation for future dialogue and cooperation between the authorities and ADB in fiscal reforms. This is in line with the Country Strategy and Program (CSP) endorsed by the ADB's Board in March 2006, which calls, inter alia, for continued support for the country's transition to a market-based economy, public sector capacity building and reforms aiming to improve transparency of public policies and creation of an enabling environment for the private sector development.

The proposed Project will mark an important and necessary step in support for the authorities pursuit for the PFM reform, and will provide a good foundation for future dialogue and cooperation between the authorities and ADB in fiscal reforms. This is in line with the CSP, supporting for the country s transition to a market-based economy, assisting the country in building up public institution capacity and formulating public polices that help ensure transparency and accountability and create an enabling environment for the private sector development.

Impact Improved planning and utilization of public resources.
Project Outcome
Description of Outcome Improved effectiveness, efficiency, transparency, and accountability of budget execution processes.
Progress Toward Outcome The project progress has been slow. However, government is very committed to Treasury reforms.
Implementation Progress
Description of Project Outputs

1. GFMIS developed and operational.

2. Treasury banking operations streamlined and consolidated.

3. A central accounting system created, using a COA built to reflect the revised budget classification in line with IMF's GFSM 2001 and IPSAS.

4. BSL and Treasury Law refined

5. Application of the revised budget classification in the preparation and execution of the budget.

Status of Implementation Progress (Outputs, Activities, and Issues)

The implementation is ongoing.

Procurement: Bidding for Package 1: Procurement of GFMIS and Main Servers is near complete. Bid opening for the first stage of GFMIS package took place on 28 April 2010. First stage evaluation was approved in May 2011 and second stage bids were opened on 23 June 2011. BER was submitted to ADB and is under review.

Biddings for Package 2(PCs) and 3 Package (Telecom equipment) are ongoing and bids were opened on 20 July 2011 and are being evaluated by the EA.

Geographical Location Uzbekistan
Safeguard Categories
Environment C
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects Project expects minor civil works for refurbishment of treasury offices and development of LAN that will be carried out in strict compliance with appropriate local legislation and monitored by authorized environmental agency.
Involuntary Resettlement Project is not expected to cause direct or indirect involuntary resettlements of people
Indigenous Peoples No issues.
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Business Opportunities
Consulting Services An International IT/procurement adviser will provide 8 person/months of consultancy to assist the PMO in conducting ICB procurements of the various components of the GFMIS, in particular the development and implementation of GFMIS software. The executing agency (EA) will engage an individual international consultant in accordance with the Guidelines on the Use of Consultants by Asian Development Bank and Its Borrowers (2006).
Procurement Goods and services will be procured in accordance with ADB's Procurement Guidelines (2006), as amended from time to time. Major contracts to be financed by the ADB's loan for information technology (IT) software and equipment costing $0.5 million equivalent or more will be awarded through International Competitive Bidding (ICB), while contracts estimated between $0.1 million and $0.5 million will be awarded on the basis of National Competitive Bidding (NCB). Before commencement of NCB procurement, ADB and the Borrower will review the Borrower's procurement procedures to ensure consistency with ADB requirements. Any necessary modifications or clarifications to the Borrower's procedures will be documented in the procurement plan. Shopping procedure will be used for contracts valued at $100,000 equivalent or less. For the procurement of items below $10,000, the EA may purchase the items directly from the supplier. In such cases, ADB should be satisfied that the price paid is reasonable. All goods and services financed by the loan shall be procured from ADB member countries. In addition, where the value of goods financed by the loan exceeds $1.0 million, a pre-shipment certificate from a reputable agency, acceptable to ADB, may be required. The award of all contracts and substantial contract variations will be subject to prior approval by ADB.
Responsible ADB Officer Bobir Gafurov
Responsible ADB Department Central and West Asia Department
Responsible ADB Division Uzbekistan Resident Mission
Executing Agencies
Ministry of FinanceBakhrom AshrafkhanovOGaniev@treasury.mf.uz5 Mustaqillik Maydoni Square
Tashkent 100008
Republic of Uzbekistan
Timetable
Concept Clearance 02 Jan 2007
Fact Finding 31 Jan 2007 to 19 Feb 2007
MRM 21 Mar 2007
Approval 28 Jun 2007
Last Review Mission -
PDS Creation Date 06 Apr 2007
Last PDS Update 02 Sep 2011

Loan 2338-UZB

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
28 Jun 2007 10 Dec 2007 14 Dec 2007 31 Jul 2012 - 21 Nov 2012
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 37.48 Cumulative Contract Awards
ADB 20.70 28 Jun 2007 6.36 0.00 100%
Counterpart 16.78 Cumulative Disbursements
Cofinancing 0.00 28 Jun 2007 6.36 0.00 100%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory - - - - Satisfactory

TA 4946-UZB

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
28 Jun 2007 04 Sep 2007 04 Sep 2007 31 Dec 2009 30 Dec 2010 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
600,000.00 0.00 0.00 0.00 0.00 0.00 600,000.00 28 Jun 2007 557,368.68
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory - - - - Satisfactory

Safeguard Documents

See also: Safeguards

No documents found.

Evaluation Documents

See also: Independent Evaluation

No documents found.


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