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The extractive industries (EI) sector occupies an outsize space in the economies of many developing countries. Economists, public finance professionals, and policy makers working in such countries are frequently confronted with issues that require an in-depth understanding of the sector. The objective of this volume is to provide a concise overview of EI-related topics these professionals are likely to encounter. The volume provides an overview of issues central to EI economics; discusses key components of the sector’s governance, policy, and institutional frameworks; and identifies the public sector’s EI-related financing obligations. Its discussion of EI economics covers the valuation of subsoil assets, the economic interpretation of ore, and the structure of energy and mineral markets. The volume maps the responsibilities of relevant government entities and outlines the characteristics of the EI sector’s legal and regulatory frameworks. Specific key functions of the sector are briefly discussed, as are the financial structures that underpin environmental and social safeguards; investment of public revenues generated from oil, gas, or minerals; as well as extractive-based economic diversification. The authors hope that decision makers in ministries of finance, international organizations, and other relevant entities will find the study useful to their understanding and analysis of the EI sector.

Since the cessation of conflict, Mozambique has achieved impressive economic growth and has become an example of successful post conflict reconstruction and development, moving from a one-party state to a multiparty democracy and from a socialist, command economy to a market-based economy. Mozambique’s development has been strongly supported by foreign aid, and since 2001 average annual disbursements of official development assistance (ODA) have amounted to over 1 billion dollar, or 12 percent of gross domestic product (GDP). Strong economic growth has contributed to a decline in income poverty, but the level of overall poverty remains high. This country program evaluation (CPE) focuses on the Bank’s program for FY2001-08, examining the following questions: did the Bank correctly assess the problems Mozambique faced?; was the Bank’s strategy appropriate for meeting the country’s development needs?; how effective was Bank assistance in implementing those strategies?; what were the outcomes of the assistance?; and to what extent did the Bank, other development partners, the government, or exogenous forces contribute to outcomes? The CPE is organized as follows: Chapter one assesses Mozambique’s economic and social development and identifies major development priorities and constraints facing the country. Chapter two is an overview of the Bank’s program of lending and analytic and advisory activities (AAA). Chapters three, four, and five cover thematic aspects: stabilization and growth (including infrastructure and agriculture development), poverty reduction and human development, and governance. Chapter six covers International Finance Corporation (IFC) activities in Mozambique, and chapter seven assesses partnership and harmonization. The last chapter contains conclusions, lessons, and recommendations.

The World Bank’s assistance strategies showed strong client orientation and were aligned with Uganda’s poverty reduction strategy. The programs were substantially effective in decentralization, public sector reform, growth and economic transformation, education, and water and sanitation. However, more could have been done to help counter the perception of increasing corruption, improve power supply, reduce transport costs, enhance agricultural productivity, and help with family planning and reproductive health. The AfDB’s assistance was also relevant and aligned with the government’s development goals. Its support substantially achieved its objectives for decentralization, public sector finance, growth and economic transformation, improved competitiveness, agriculture, and water and sanitation, as well as education and health. However, there were some shortcomings in the assistance provided for power and roads and in reducing corruption. This report evaluates World Bank and African Development Bank assistance to Uganda during 2001-07. The motivation to undertake a joint evaluation was the shift to a common strategic framework, the Uganda Joint Assistance Strategy (UJAS), to guide the formulation and delivery of their programs. Under a common strategic framework joint evaluation is, in principal, more cost effective than the equivalent separate evaluations, since at least some aspects of the evaluation can be done together. This also helps to reduce government transaction costs. The evaluation discusses the outcome of the support of each bank, rates each independently, noting that the two banks are of different size, capacity, and institutional setting. In addition, the two banks have programs that were not implemented jointly but in parallel, although they regularly engaged with one another as development partners. The outcome ratings for the two institutions are therefore not comparable and should not be used to imply that one institution did ‘better’ than the other.

Although the link between improved infrastructure services and economic growth is uncertain, it is clear that reforms aimed at creating competition and regulating natural monopolies establish an environment conducive to private sector participation, incentives for companies to strive for efficiency savings that can ultimately be passed on to consumers, and greater provision of services (such as faster roll-out of infrastructure or innovative solutions to service delivery for customers not connected to an existing network). In determining the form that infrastructure restructuring might undertake or the design of a regulatory agency, policymakers can generally benefit from a review of the experiences of other countries. A key element of any decision making process should be a review of how the various types of reform will affect the efficiency of the sector and whether they will increase private financing of its significant investment needs.