Democratic Republic of Congo Transitional Support for Economic Recovery

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The Transitional Support for Economic Recovery Operation Project is a one-tranche operation, the third budget and balance of payments support operation to the Democratic Republic of Congo (DRC) since 2002. The Grant is designed to support key policy measures aiming at: (1) in creasing the impact on the poor o f public spending in key priority areas, education and health; (2) strengthening public expenditure and civil service management; and (3) improving governance in forestry and mining sectors. The project addresses poverty reduction in two important ways at a critical time in the country's transition from post-conflict phase to peaceful elections. First, the Grant directly contributes to maintaining a stable macroeconomic framework conducive to economic growth by helping to bridge the financing gap associated with implementing the Government's Economic Program. Second, reforms which the Grant is designed to support will have positive impacts on poverty reduction. Improved efficiency and transparency in public expenditure management will ensure that the Government's budget priorities are increasingly in line with the priorities defined in the Interim Poverty Reduction Strategy Paper, and result in actual releases of resources to public service providers. In particular, better budget execution of health and education ministries will help improve access by the poor to public services provided by these ministries, by reducing user fees which are currently collected. Strengthening civil service management will help restore motivations for civil servants to provide quality public service on which the poor depends. Finally, improving governance in two of the key productive sectors, forestry and mining, will help the population share the country's natural resources in a more equitable manner and enhance sustainability of policies governing the sectors.