Bangladesh - Independent Evaluation Group - World Bank

3. Relevance of World Bank Engagement on GAC Issues
Country-Level Relevance
3.1 Bangladesh had an innovative and ambitious governance agenda, which was in place
well before the introduction of the 2007 GAC Strategy. World Bank support to improving
core public sector management goes back to the early 1990s, and specifically to two
Institutional and Governance Reviews (World Bank 1996, 2000). The importance of crosscutting
governance improvements was featured in the CAS for the period 2001-03, both
because of the importance of sound governance to development results and because of the
requirements of the Bank for consideration of increased lending. Governance became the
focal point in the CAS for the period 2006-09. Indeed, this CAS is often referred to as the
“governance CAS” (World Bank 2006b).
3.2 The governance CAS had four main objectives: to improve implementation capacity;
to “tackle corruption” by fully operationalizing the ACC; to lay the foundation for
comprehensive legal and judicial reform; and to strengthen “voice, empowerment, and
participation” (World Bank 2006b; World Bank 2010c).
3.3 This approach is judged to be substantially relevant. The choice of a wide range of
instruments and areas of intervention was appropriate, given the political instability at the
time of 2006 CAS preparation. The Bank signaled it was ready to engage in all areas, and
could scale up or pull back depending on emerging political and bureaucratic commitment.
3.4 A deeper understanding of how formal and informal institutions have evolved in
Bangladesh would have given the Bank’s program greater relevance. On the one hand, the
program led to some GAC improvements in public financial management, procurement, local
government, investment climate, rural roads, and primary education. On the other hand, the
program was less successful in attaining GAC improvements in national highways and
independent accountability institutions. The strict approach to fiduciary risk increased the
confidence of the Bank’s shareholders, helping to enable a tenfold increase in Bank lending
since 2001 and the creation of new trust funds under the Bank’s management. Yet, the same
strict fiduciary standards led to the Bank’s withdrawal from support to national highways,
meaning that the Bank now has little influence over a binding constraint for economic
development and poverty reduction.
3.5 The preparation of the 2006 CAS also signaled the imperative of harmonizing the
Bank’s governance support with the work of other development partners, including the
creation of a joint strategic framework with DfID, the Asian Development Bank (ADB), and
Japan.
3.6 The current Country Partnership Strategy, adopted in July 2010, was prepared in a
more stable political environment, with a government elected in 2009 following substantial,
internationally acclaimed electoral reforms. The CPS proposes to focus on areas where there
is political commitment from the current government: public financial management (PFM),
procurement, local government and service delivery, and civil society, for example, its
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