Benin report - Institut Africain de la Gouvernance

CHAPTER FIVE: CORPORATE GOVERNANCE__________________________________________________________________________the „capacity building‟ component is often used for the purchase ofvehicles, hence the proliferation of large-capacity vehicles; andthe executing agencies face difficulties adapting the annual expenditureprocedure with the duration of multi-year projects.582. These difficulties, coupled with the lack of training in public procurementprocedures and the malfunctioning of the relevant services, account for theabnormally slow awarding of these contracts and contribute to delays inexecuting state budgets.583. Furthermore, some people affirmed to the CRM that working with the state isa risky process. Often, the holder of a government financial claim for a publicprocurement is obliged to bribe a government employee in order to be paid inturn. To protect themselves against late payments, which can exceed two yearsin certain cases, some suppliers inflate their invoices (doubling or tripling theirprices) and/or bribe government employees. Other stakeholders mentioned thecase of ad hoc enterprises created solely for the purpose of bidding for a publiccontract, often at the suggestion of a friend or relative who is well placed inthe administration.584. Concurrently, while instruments provide for the appointment of secretariesgeneralof ministries for a period of five years and for the director of planningand forecasts for three years, the transfer of these senior officials – whichresults from each Cabinet reshuffle – also affects the efficiency ofprocurement procedures (and the functioning of the administration in general).585. In its GPRS for 2007-2009, the government of Benin plans to: (i) organisejoint capacity building workshops in public procurement for public services,local authorities and civil society organisations; (ii) draw up an official pricelist for the purchase of goods and services by sector, accompanied by anoutreach plan for all communication channels and languages of Benin; (iii)assess the effectiveness and impact of state audit services, as well as thebehaviour of state auditors; and (iv) institute a national label for governmentservice providers and suppliers who comply with the non-corruption clause.This national distinction would entitle them to exceptive tax facilities over agiven period.586. Bank financing and the status of the banking sector. After the serious crisisthat rocked state-owned banks in 1989, the privatisation of almost all banksand the arrival of many foreign banks and subsidiaries led to a significantimprovement in the quality of banking services in Benin. Except for one bankunder liquidation, the banking sector is controlled mainly by foreign privateinterests.587. The sector is characterised by:a low presence of formal financial intermediation relative to the size of theeconomy;204