- The CPS program’s main areas of engagement are aligned with the Government’s medium-term Development Strategy 2020 and long-termKazakhstan 2050strategy, approved in early 2014. Thus, World Bank Group knowledge and financial resources focus on the following three themes:
- Improving competitiveness and fostering job creation, with seven planned outcomes: (a) strengthening fiscal discipline and trade integration; (b) expanding non-oil exports and employment; (c) reinvigorating the financial sector; (d) building skills for employment; (e) strengthening knowledge for sustained growth in agriculture; (f) improving energy transmission in poor areas; and (g) building transport connectivity and lowering costs;
- Strengthening governance and public services, with four planned outcomes: (a) improving governance; (b) strengthening budget and accountability institutions; (c) reforming the social protection system; and(d) sharpening strategic approaches to health reforms; and
- Ensuring development is environmentally sustainable, with two planned outcomes: (a) safeguarding the environment and (b) raising energy efficiency.
Program and Portfolio Delivery and Performance
- The World Bank’sloan portfolio as of July 2016 comprised 13 operations totaling US$4,812 million, of which eight totaling US$2,515 million have been committed during the current CPS to date.This compares to a portfolio comprising 12 operations totaling US$3,589.1 million as of July 1, 2012.The portfolio includes three very large operations—South-West Roads (US$2,125 million), East-West Roads (US$1,068 million), and a US$1 billion DPL.
- Investment project financing operations continue to be aligned with the CPS’ main pillars.12 operations totaling about US$1.6 billion, or65 percent of the combined legacy (pre-FY12) and current (FY13–16) portfolios, support thecompetitiveness and job creation area of engagement.Fiveoperations and almost 30 percent of commitments are focused on governance and public services delivery and the remaining three operations and 5 percent of commitments onenvironmentally sustainable development.
- The performance of the portfolio is mixed.By December 31, 2015, nine completed projects had exited the portfolio that was in place in June 2012. Out of the six for which Implementation Completion and Results Reports (ICRs) are available, outcomes for three were rated Satisfactory, twoModerately Satisfactory, and oneUnsatisfactory. As for the current portfolio, oneof the eightoperations approved during FY13–16 is rated Satisfactory for implementation progress, twoModerately Satisfactory,fourModerately Unsatisfactory, and one Unsatisfactory. Implementation as measured by loan disbursements is lagging, with only US$207million or 12 percent of the US$1,725 million balance disbursed inFY16.
- The last full Country Portfolio Performance Review (CPPR) was held in early FY14 and an update took place in April 2016.The core implementation issue notedin FY14—that government and World Bank processes and procedures are not well aligned, especially upstream in the project cycle—persists.The main visible symptoms are continued delays in loan signing and effectiveness, protracted project implementation, slow loan disbursements, and the frequency and length of extensions to closing dates. While remedial actions envisaged under the FY14 CPPR were partly implemented, they did not generate theneeded changes in legislative and government internalprocedures for loan signing and ratification. These long-standing issues were addressed in the 12-point action plan agreed as part of the April 2016 CPPR update.It covered loan processing, project staffing, procurement, and capacity building. This action plan, outlined in Box 2 below, is now the basis for more intensive periodic monitoring and more proactive portfolio management and supervision by the authorities (together with the World Bank), which aims to improve overall performance by end-FY17. In this connection, the World Bank’s increased use of country systems, such as the transfer of projects’ designated accounts to the treasury, is expected toensurethe seamless flow of project funds. Particular attention will be paid to the five operations currently rated Moderately Unsatisfactory or Unsatisfactory, which, absent significant improvement in implementation during FY17, may need to be restructured.
 The two large highway projects were excluded from the portfolio share calculation so that they do not distort the picture.
 For purposes of this analysis, half the US$1 billion Macroeconomic Management and Competitiveness DPL is allocated to the first area of engagement and half to the second.