The World Bank has approved a $20 million grant from the International Development Association (IDA) to support Djibouti in enhancing its public finance governance and digital services. The Economic and Financial Governance Project is designed to improve tax administration efficiency, increase transparency in expenditure management, and boost citizen access to digital services.
The project will focus on strengthening tax policy formulation and administration, improving oversight of public finances, and engaging civil society. It aims to benefit a significant portion of Djibouti's citizens and several public institutions by making government services more accessible through online platforms.
Fatou Fall, Joint Resident Representative of the World Bank Group for Djibouti, stated: “This project is set to substantially improve tax administration, making it more efficient and providing better access to e-services. By enhancing the use of public funds, we expect to see a positive impact on the government's fiscal health and the well-being of Djiboutians, leading to lasting socioeconomic benefits." Fall added that improvements in managing public expenditures would create financial flexibility for sustaining and expanding investments.
Djibouti's strategic position contributes significantly to its economy through its port. However, recent crises such as COVID-19, climate change, and regional conflicts have affected growth negatively. These challenges have particularly impacted rural populations with limited access to public services.
The project aligns with Djibouti’s medium-term strategy for public financial management reform (2024-2030), Vision 2035, as well as frameworks from the World Bank Group including their Country Partnership Framework (CPF) and Gender Strategy.
The IDA is known for supporting economic growth projects in some of the world's poorest countries since 1960. It provides grants and low-interest loans aimed at reducing poverty and improving lives across 76 countries globally.