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    • 74.

      One o f the areas o f weakness noted inthe PRSP i s that there i s very little mention o f

exactly how the proposed PRSP investments will contribute to the sought-after growth rate, largely because M a l i has not yet formulated a coherent and integrated growth strategy. For this reason, the FY04 CEM will focus on the growth prospects and will articulate an integrated pro-poor growth strategy. It i s expected that the sources o f growth will be from diversification o f the agricultural base into fruits, vegetables and Arabic gum, development

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    f agri-business and transformation o f agricultural products (i.e. textiles), expansion o f

mining, development o f the tourism and handicrafts industries and promotion o f small and medium-sized enterprises in services, communications and other non-agricultural sectors. The Integrated Framework for Trade for Mali (IF) (under preparation), an initiative supported by the World Bank, IMF, WTO, UNCTAD, UNDP, and the International Trade Commission, seeks to enhance Mali’s integration into the world economy and intemational trade policy discussions. The trade diagnostic study will highlight Mali’s comparative advantages and formulate an action plan for capacity buildingand technical assistance to promote export-led growth, centered around selected agri-industries and some traditional knowledge industries (namely music, handicrafts and tourism). The IF report will be discussed at the next UNRound Table for Trade - tentatively scheduled for December 2003.

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    The findings o f the IF and C E M diagnostics will provide essential inputs to the design

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      f the multi-sectoral Sources o f Growth Project (FY05). While it i s too early to pre-judge

the recommendations o f the IF and CEM, it i s expected that the Sources o f Growth Project will focus on three components: (isupport to further legal and regulatory reforms to create a more conducive environment for private sector development, with particular emphasis on the communications sector; (iithe implementation o f an innovative SME Department initiative inmicro, small, and medium enterprise (MSME) development involving improving access to capital and buildingknowledge. This would be complementary to the ongoing Financial Sector Project; and (iiidevelopment o f the mining sector since, while gold became the largest export eamer for M a l i in2002, it does not contribute as much as it might to the economy’s development7. The project will also ensure complementarity with the rural sector operations which focus on diversifying the agriculture base and developing agri-businesses.


To ensure selective and adequate coverage o f the rural sector inthe CAS, the Bank

conducted extensive analytical work which identifiedeight key issues and challenges to rural development inMali: unevenproductivity, poor infrastructure, perpetuationo f barriers to decentralization, unfavorable business climate for private sector, limited diversification o f income, weak export competitiveness and unfinishedprivatizations, an inadequate risk management strategy, natural resources constraints and capital depletion. The key conclusion o f this analysis i s that poverty i s synonymous to subsistence agriculture. Therefore, a key priority i s to allow farmers to get access to markets, generate cash income,

increase productivity through input, equipment and technology and get out o f the vicious circle o f subsistence agriculture, low productivity andpoverty.

The mining component will seek to respond to three key GoM concerns: (i) to ensure that Mali offers the optimal package to both attract incoming investors and increase revenues to the budget and the economy; (ii) to strengthen its capacity to track and analyze what mining companies are doing, both in generaloperations and with respectto environmental concerns; and (iiito help artisanal and small-scale miners to operate in a more efficient and environmentallyfriendlier manner. The Bank has a comparative advantage inthis area as aresult of significantrecent mining work inother countries.

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