Bhutan - First Growth and Jobs Development Policy Financing

Overview & Synopsis

The development objectives of the First Growth and Jobs Development Policy Financing (DPF) for Bhutan are to: (i) strengthen fiscal and debt management; (ii) foster private sector development; and (iii) enhance systems that protect workers and build resilience. The operation is designed and implemented with due consideration to capacity constraints and the evolving reform context. The DPF incorporates lessons from earlier DPFs in Bhutan. These lessons include better assessment of technical capacity and implementation risks and more regular monitoring, greater attention to the sustainability of reforms, and clearer line of sight of result indicators to the outcomes of the Prior Action (PAs). The operation complements the previous World Bank-funded Bhutan Climate and Disaster Resilience DPF with a Catastrophe Deferred Drawdown Option. This DPF has been screened for potential climate and disaster risks, which are assessed low, given that the outcomes are not directly exposed to climate-induced risks. The operation supports resilience-building reforms and reinforces the previous DPF’s climate adaptation objectives.