Bank Group–supported country strategies have become more relevant by building on long-standing relationships in core sectors while increasingly taking some risk to cover key development gaps in new sectors, risks that will also need to be managed. Having rebuilt its engagement by focusing on core sectors with existing relationships, the World Bank gradually shifted its approach toward addressing key human development challenges identified in the SCD while maintaining a focus on those core sectors where results were achieved. Engaging in new sectors requires taking some necessary risks that will also need to be managed. Conducting programmatic advisory services and analytics and using partnerships in these sectors (for example, health) helps mitigate some but not all risks.

The World Bank has increasingly leveraged its multilateral position and technical expertise to achieve more meaningful complementarities. During the evaluation period, the Bank Group provided about 9 percent of official development assistance, compared with 70 percent provided by the Australian government and the Asian Development Bank combined. Reflecting its status as a relatively small development partner in financial terms, the Bank Group’s role evolved from one focused on delivering services in core sectors (such as in transport and agriculture) to leading by demonstrating innovative technical approaches that others are replicating and by leveraging co-financing to achieve complementary donor aims.

However, decisions on the scope of Bank Group engagement have not always been based on an assessment of what is feasible and measurable. To achieve country strategy aims, a better sense of realism was needed about what could be achieved and measured, considering limited state capacity.

Data scarcity that has undermined planning, policy development, monitoring, and evaluation has been a major constraint in setting feasible and measurable objectives and in determining scope. The SCD (World Bank 2018a) cited the challenges to effective programming associated with outdated or nonexistent censuses, household and other survey data, and the lack of timely macroeconomic data. Data deficiencies have resulted in significant shortcomings in population estimates and the level of poverty and have prevented effective targeting for service delivery, especially in rural areas. Bank Group strategies did not sufficiently prioritize this constraint.

Bank performance in the early part of the evaluation period was less than satisfactory, but it has improved over time. Strategy implementation was challenging because of weak government capacity for financial and contract management, procurement, auditing, and safeguards in central or implementing agencies and insufficient counterpart funding. The Bank Group also underestimated capacity and implementation constraints. Some of the World Bank’s technical approaches have also overcomplicated engagement and overwhelmed client capacity, especially those associated with introducing international best practices, and so has switching approaches too often, including in response to changing corporate priorities.

The Bank Group has overcome some engagement challenges by increasingly adapting to the country context. The World Bank increased technical staff presence significantly in the region and country in ways that potentially allow programs to be better grounded in an understanding of context and the client. More effective support has been associated with high-frequency, low-intensity engagement by layering advice and support, not going too quickly, and never letting the engagement cool. This includes staff efforts to build personal relationships over time with clients in ways that help staff navigate patronage dynamics and identify appropriate entry points. Layering institutional analyses and technical fixes to address patronage dynamics over time, such as using performance-based approaches in the road sector, is showing promise. Other efforts featuring low-frequency, high-intensity support provided in short bursts have been less effective.

Other key challenges that continue to undermine the Bank Group effectiveness require additional reflection and adaptation. The high cost of operating in Papua New Guinea because of security constraints and high logistics prices has affected engagement and supervision capabilities negatively, and solutions to navigate this constraint more effectively are not forthcoming. The short duration of postings for international technical staff (because of the FCV nature of the environment) has limited opportunities for staff to build meaningful client relationships to support medium- to longer-term reforms. Using a regional hub has provided important continuity in some cases.

Despite progress at the sector level, Bank Group efforts to enable the nonextractive growth have been limited. To address deeply embedded patronage dynamics undermining nonextractive sector performance, the World Bank is effectively using performance-based contracts in the road sector and alternative service delivery models in the agriculture sector that others are replicating. However, IFC’s agribusiness work in Papua New Guinea has been limited, with modest results. The Bank Group (IFC and the World Bank) contributed to a significant increase in ICT infrastructure (and IFC contributed to banking services), but a lack of competition has undermined affordable access and use.

Political fragmentation and an unpredictable policy environment limit the World Bank’s ability to support meaningful policy reforms. The World Bank was unsuccessful at using budget support to support fiscal and public management reforms. It inadequately identified and mitigated risks related to the government’s low capacity to implement reforms, particularly policies that constrain spending. Along with this, declining governance quality and increasing bilateral aid flows spurred by geopolitical interests are also making it challenging for the World Bank to pursue durable policy reforms.

The World Bank appropriately approached gender equality as smart economics, applied through culturally appropriate family and community-based models, but more evidence is needed about what works to achieve gender-related outcomes in different contexts. The Bank Group’s strategic focus on gender deepened over time by using data and analytics to show the economic benefits of women’s empowerment, thus giving gender issues more traction in certain sectors. Tested in the agriculture sector, the family-based engagement model reportedly helped achieve increased agency for women but mainly in matrilineal versus patrilineal areas, and results are hard to validate. Other sector efforts to employ women faced implementation challenges because of a lack of household discussions about labor allocations.

IFC led the way in demonstrating how to address GBV in the workplace directly. Through its advisory work, IFC showed the costs of GBV to doing business and has helped clients develop guidance, build coalitions, provide training, and establish safe houses for victims of GBV. IFC also engaged on the financial side.

The World Bank has taken a do-no-harm approach to GBV at the project level, but this approach falls short of achieving a more strategic engagement at the portfolio level and in partnership with others. The World Bank’s safeguards are not poised to address GBV directly at a strategy level, and they do not cover the more subtle GBV issues pertaining to coercive control, restrictions to economic opportunities and financial independence, and the lack of GBV services. The World Bank also lacks a gender specialist covering Papua New Guinea specifically.

Strategies identified compound and interrelated FCV, disaster, and climate change risks, but country engagement has not addressed them adequately. The RRA and SCD highlighted interrelated drivers of fragility and risks, but the Bank Group’s engagement strategy did not integrate them adequately, including as part of an adaptive management approach. A promised conflict watching brief also never materialized. The Bougainville situation is testing the World Bank’s ability to balance client relations with the need to sustain development gains in contested spaces. Youth employment programs made efforts to address drivers of urban crime and violence, but causal links are not evident.

Lessons

These findings yield the following lessons to inform the next CPF.

1. Data gaps need to be addressed to inform sound policy making and effective programming in Papua New Guinea. Using data has helped the World Bank engage in previously neglected sectors, such as health (tuberculosis) and nutrition (maternal, newborn, and child health and stunted growth in children), and on sensitive issues, such as gender equality. Yet a lack of timely economic and social data, especially household survey data, continues to undermine strategic decision-making and program targeting.
2. Declining governance quality and increasing bilateral aid will require the World Bank to reassess how it supports key policy reforms to achieve development impact, including through using DPOs. Coupled with the World Bank’s limited leverage in relation to other key donors, Papua New Guinea’s insufficient political capability to credibly commit to sustained policy reform is at the heart of the matter, particularly policies that constrain government spending and promote inclusive growth.
3. The Bank Group could elevate its impact on gender equality and GBV by shifting from a project-centric approach to a strategic country engagement approach. This will require assessing and sharing information better about the effectiveness of its different approaches to gender integration and GBV (including across sociocultural contexts), internally and as part of a wider country dialogue with clients and donor partners. The Bank Group has developed entry points on gender equality and GBV that clients accept, so it is appropriate and timely for the Bank Group to identify opportunities and address trade-offs more strategically at the country engagement and portfolio levels. Country-based staff with gender and GBV expertise will be critical for ensuring a more strategic approach to gender, as IFC’s effective advisory experience has shown.
4. The negative effects that compound and interrelated risks pose to achieving development aims need to be addressed more comprehensively. Relevant staff need to understand the interrelated drivers of fragility and risks examined in the RRA and the SCD, and those drivers should be integrated into strategy and portfolio decision-making as part of an adaptive management approach and appropriate analysis available to relevant staff. The World Bank can also address these risks in Bougainville by staying engaged so it can continue to build on past sector experiences that focused on strengthening social and economic resilience that also had a strong gender focus.