EUROPEAN PROFILES S.A

The Project will make a substantial contribution to the achievement of the overall objective, that is, to support the Government of Turkmenistan to contribute to the socio-economic development of Turkmenistan through an improved collection, allocation, usage and control of public resources. The overall objective of the current contract is further refined in its specific purpose as follows: Assist the Ministry of Finance with improving its readiness for the automation of core PFM operations.

This overall objective and specific purpose reflect the intention of the Government to diversify the national economy elaborated in the National Program for Socioeconomic Development over 2011-2030 (NPSD). NPSD incorporates four guiding principles: (1) high rates of growth and bigger contribution of the private sector to that growth; (2) macroeconomic stability; (3) private sector development; and (4) improved living standards.

The objective pursued by the project is built-up based on the 4 following components:

C.1. Further development of a sound budgetary system and macro-economic forecasting capacity; Support the budget regulatory framework, budget classification and preparation;

C.2. Support to the Treasury system. Provide assistance in the adoption of a modern treasury system, with a single treasury account is in place;

C.3. Strengthen the MOF's institutional and technical capacity in view of the implementation of a management information system (GFMIS);

C.4. Support to the Stabilization Fund and public investment operationsleading to a more transparent utilization of natural resource revenues and the allocation of proceeds;

 

The EU has supported during the recent years the economic reform process in Turkmenistan and was the first donor collaborating with the Ministry of Finance

• Component 1: FURTHER DEVELOPMENT OF A SOUND BUDGETARY SYSTEM & MACROECONOMIC FORECASTING CAPACITY. Activities:

1. Develop key indicators on performance budgeting (strategy, performance measures and targets), normative acts resulting from the budget code, implementation of the new budget classification in line with the Government Finance Statistics Manual 2011.

2. Develop a performance monitoring and reporting system

3. Support sector internal audit unit to evaluate some performance audit report quality

4. Conduct training in public sector accounting standards

5. Assist in developing and training in bookkeeping and financial accounting activities, conceptual framework, reporting transaction of an operation, recognition in financial statements and Assist in developing and training in practical accounting activities

6. Support the implementation of phase II guidelines of accounting and financial procedures

7. Implement the strategic framework to operate the Medium Term Budget Framework

8. Define the basic structure of Results Oriented Budgeting as part of the MTEF including pilot projects on ROB in line institutions, support to gradual transition to ROB, support to local authorities in using ROB

9. Develop a methodology to cast annual budget formulation and execution within a macroeconomic fiscal framework at different territorial levels

10. Support the strengthening of key tools for managing fiscal policy such as macro-fiscal analysis, accounting and reporting, and financial planning

11. Support the adoption of macro forecasting models in line with the macroeconomic outset of Turkmenistan. Development of macroeconomic indicators including design of medium term planning and monitoring methodology

12. Provide training in line with international practices on macroeconomic modelling with due regard to budgetary planning and execution.

• Component 2: SUPPORT TO THE TREASURY SYSTEM

Activity: Support the implementation of a Core Treasury System, including management of receipts and payments, commitment/purchasing, cash/fund management, accounting/general ledger.

• Component 3: ASSISTANCE TO THE MOF TO PREPARE THE FINAL GFMIS IMPLEMENTATION PLAN

Activity: Prepare the GFMIS implementation plan.

• Component 4: SUPPORT TO THE STABILISATION FUND AND PUBLIC INVESTMENT OPERATIONS. Activities:

1. Develop Capital Investment Planning (CIP) methodology and improve capacity of the MOF for efficient budgeting, prioritization, and implementation of capital expenditures

2. Prepare regulatory and legal framework for management, operation, mobilization and use of resources of Stabilization fund

3. Provide training in procedures of management of the fund, including public procurement