||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.