Kiribati Fifth Economic Reform Development Policy Operation

The development objective of the Fifth Economic Reform Development Policy Operation for Kiribati is to: (i) improve public financial management with respect to financial and physical assets; and (ii) support the prospects for inclusive growth by strengthening fisheries sector management and improving access to basic services. The first pillar, on public financial management, includes actions to strengthen the management of Kiribati’s sovereign wealth fund, improve cash management, and address weaknesses in the public investment cycle, including procurement and asset maintenance. This pillar consolidates and complements measures supported in previous series on the sovereign wealth fund, debt policy and management, and state-owned enterprise governance. Over time and in conjunction with other measures, these actions should contribute to improvements in the quality of public spending. The second pillar, on inclusive growth, includes actions to strengthen governance of fisheries, one of the few sectors with significant potential to drive growth and employment creation in Kiribati. This pillar also includes actions to expand access to safe drinking water and establish a legislative framework for early childhood care and education – basic services that are crucial building blocks for a healthy and educated workforce. This pillar complements measures supported in previous series on fisheries revenue, improving access to electricity for the poor, and telecom sector liberalization and service expansion in the outer islands. As part of the ongoing policy dialogue with the Bank and other budget support donors, the Government of Kiribati (GoK) has published its 2019 Fiscal Strategy (the first time a fiscal strategy has been made public), and the Strategy includes a commitment to no further step changes to salaries in the 2019 budget, and not until the impacts of the 2018 decision