Tuvalu Second Development Policy Operation

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The Second Development Policy Operation for Tuvalu is the second in a programmatic series of two operations in support of the coutnry's ongoing reform efforts. This operation will support reforms to strengthen public financial management and improve social services delivery. Given the importance of the public sector to Tuvalu's economy, an effective system for public financial management (PFM) is critical. The first pillar of the program focuses on strengthening PFM with the specific development objectives of improved commitment control, enhanced oversight of fishing revenue, and streamlined reporting of local governments (Kapaules). The second pillar focuses on improved service delivery with the specific objectives of enhancing the management and efficiency of Tuvalu's essential, but costly, overseas medical treatment scheme and strengthening vocational training, including increased access for women. These services are essential to building and maintaining human capital, a key asset for an undiversified small economy. Together, the supported reforms are designed to help Tuvalu improve its fiscal position both in terms of revenue and expenditure, while maintaining the quality of public services.