PROGRAM INFORMATION DOCUMENT (PID)
CONCEPT STAGE
April 13, 2014
Report No.: 88449
Operation Name
Region
Country
Sector
Operation ID
Lending Instrument
Borrower(s)
Implementing Agency
Date PID Prepared
Estimated Date of Appraisal
Estimated Date of Board
Approval
Corporate Review Decision
I.
Bahia; Strengthening Public Sector Management and
promoting Inclusive Service Delivery Development Policy
Loan (DPL)
Latin America and the Caribbean Region
Brazil
Subnational government administration (50%); Other social
services (20%); public administration – education (30%)
P147984
Development Policy Lending
STATE OF BAHIA
State Secretariat of Planning
Av. Luis Viana Filho, 2a avenida, No 250
Centro Administrativo da Bahia
Salvador,
Bahia
Brazil
41.745-003
Luiza Amelia Melo
Tel: (55) 71 3115 3455; Fax (55) 71 3115 3945
luiza.mello@seplan.ba.gov.br
April 21, 2014
May 22, 2014
June, 26, 2013
Following the corporate review, the decision was taken to
proceed with the preparation of the operation.
Key development issues and rationale for Bank involvement
1.1. Bahia is the largest state in the Brazilian Northeast. First, the state’s GDP is the
largest among the nine states in the Northeast Region and the sixth among the 27 states in Brazil.
In 2012, it reached US$88 billion, representing 30 percent of the regional GDP and 4 percent of
the national GDP. Second, Bahia has also the largest population in the Northeast and the fourth
in the country. Its population is estimated to have reached 14.3 million inhabitants in 2012,
corresponding to 27 percent of the Northeastern and 7.5 percent of Brazil’s population.
1.2. In the last decade, the state of Bahia has improved its economic performance and
achieved a remarkable track record in reducing poverty and boosting shared prosperity.
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Between 2002 and 2012, average household per capita income in Bahia grew at an annual rate of
4.8 percent, well above the national average of 3.3 percent. As a result, moderate and extreme
poverty declined sharply in the same period, dropping from 43.4 percent to 18 percent and 18.4
percent to 7.5 percent, respectively1. Moreover, the income of the bottom 40 percent increased
rapidly at 6.9 percent annually (1.9 percentage points higher than the growth rate of the average
income), increasing their share in total income from 8 to 11 percent in 2012. Income inequality
fell as well, with the Gini coefficient falling from 0.6 to 0.55 in this period.
1.3. Nonetheless, Bahia still lags behind national averages and continues to be the state
with the largest absolute number of poor and extreme poor in the country. In 2011, Bahia’s
registered a per capita GDP of US$5,920, higher than the regional average of US$5,437 but well
below the national GDP per capita of US$11,235. Indeed, Bahia’s per capita GDP nineteenth in
the country. Bahia’s poverty rate is almost twice the national moderate poverty rate (9.5 percent)
and its extreme poverty rate is 75 percent higher than the national one (4.3 percent). Large
population and relatively higher poverty rates make Bahia the state with the largest population
below the moderate and extreme poverty lines in the country, 2.6 million and 1.1 million
respectively, which in both cases, corresponds to around 25 percent of the poor and extreme poor
in the Northeast and 14 percent of the poor and extreme in Brazil.
1.4. The proposed operation is designed to support the implementation of the GoBA
PPA-P. In accordance to the GoBA priorities and the areas of intervention defined in the PPA-P,
this operation focuses the Bank’s support on the first pillar (Social Inclusion and Affirmation of
Rights) and the third pillar (Democratic Management of the State). The proposed operation is
structured in two programmatic pillars: (i) Public Sector Management and (ii) Inclusive Service
Delivery.
II.
Proposed Objective(s)
The development objective of this operation is to assist the GoBA in strengthening public sector
management, governance and the delivery of services in education, health, public security with a
particular attention to the inclusion of women, afro-descendants, indigenous population, youth
and LGBT and promote their social and economic inclusion.
III.
Preliminary Description
1.5. This proposed DPL seeks to assist the GoBA in the implementation of its policy
reform agenda directed to strengthening cross-cutting aspects of public sector management
that are critical for the improvement of service delivery and key sector policies to make
services more inclusive. In particular, it will support the implementation of critical public-sector
management reforms including improvements in the GoBA ability to collect taxes, more
transparent social security policies, enhanced institutional framework for multi-sector and
territorial policies, and the introduction of performance-based remuneration in the public security
sector. The operation also supports actions in education, health, public security and productive
inclusion to ensure access of women, afro-descendants and other minorities to these services as
1
National unofficial moderate and extreme poverty lines are R$140/month and R$70per month.
2
well as tailoring them to serve their specific needs. This operation succeeds the first Bahia
development policy operation, which was fully disbursed at the end of 2013, and aims to
consolidate previous achievements, and expand on recently adopted inclusive policies, ensuring
the sustainability of the reforms through the next State administrative term in 2015-18.
IV.
Poverty and Social Impacts and Environment Aspects
Poverty and Social Impacts
The policy reforms supported by this loan are expected to contribute positively to reduce
poverty and income inequality in Bahia. The poor, extremely poor and most vulnerable social
groups may have the most positive gains from reforms in the delivery of public services. The
potential pro-poor effects of DPL supported policy reforms will be firstly felt as a result of
improvements in the access and quality of education, health services and the policies designed to
promote productive inclusion, to control crime and violence, and to mainstream gender and to
fight gender based violence.
Environment Aspects
The specific actions supported under the proposed operation are not likely to have
significant positive or negative effects on the state or country's environment, forests,
fisheries or other natural resources. The first pillar, Strengthening Public Sector Management,
has a primarily administrative nature, therefore policy actions under the first pillar are unlikely to
either exacerbate environmental problems or contribute to their remediation. The second pillar,
Promoting More Inclusive Service Delivery, encompasses policy actions focused on social
sectors that are expected to have very limited if any implications on environmental sustainability.
A policy action that could have potential environmental impact is the establishment of the
guarantee fund for PPPs which is expected to foster private sector participation in public
infrastructure investments. Nonetheless, Bahia has a comprehensive regulatory framework for
public investments projects that turn mandatory environmental impact studies and has adopted
regulations which ensure that environmental norms are also applied for PPPs projects.
V.
Tentative financing
($m.)
0
Source:
RECIPIENT
International Development Association (IDA)
Borrower/Recipient
IBRD
Others (specify)
400
Total
3
400
VI.
Contact point
World Bank
Contact: Fernando Andres Blanco Cossio
Title: Lead Economist
Tel: (202) 458-5075
Email: fblanco@worldbank.org
Borrower
Contact: Luiza Amelia Mello
State Secretariat of Planning (SEPLAN) Praia
Salvador, Bahia – Government’s Administrative Center
Tel: (55) 71 3115 3455
Email: luiza.mello@seplan.ba.gov.br
VII. For more information contact:
The InfoShop
The World Bank
1818 H Street, NW
Washington, D.C. 20433
Telephone: (202) 458-4500
Fax: (202) 522-1500
Web: http://www.worldbank.org/infoshop
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