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Ref.
2023/ERRDDFLAADC/10206

Job offer type
Experts

Type of contract
CDDU

Activity sectors
Public resource mobilisation, management and accountability ; Economic and financial governance

Deadline date
2024/02/29 18:06

Contract
Employee

Duration
17 mois

Mission description

The mission consists of providing technical assistance to the Ministry of Finance (MoF) of Lao PDR, to strengthen the institutional and legal framework of concession agreements, with a view to improving their contribution to public revenue.

The main objectives of this technical assistance are as follows:

  • Analysis of a limited sample of existing concession agreements, in the energy sector in particular, in terms of cost to the State budget and economic impacts, in order to draw up a diagnostic assessment;
  • Development of a simple, robust analysis tool (on Microsoft Excel) and training of MoF staff in its use;
  • Definition of fundamental principles, rules and procedures to govern the use of tax incentives for new concession applications;
  • Support for the drafting of legislation to reform the legal framework for concession agreements and their monitoring by the various stakeholders (MPI, MEM, MONRE, MoF) in order to achieve a balance between the interests of project developers and those of the Lao PDR's State, particularly in terms of preserving tax revenues.

More specifically, it will cover the following activities/results, for which enhanced support is expected:

  • The selected existing concession agreements will be analyzed in terms of tax expenditure, economic impacts and corresponding tax revenue projections;
  • The relevant staff of (i) the tax policy department and (ii) the tax department will benefit from similar feedbacks from other countries, and will be trained in the evaluation of tax expenditures, the analysis of their economic impacts and the projection of corresponding tax revenues;
  • An analysis tool (financial model and handbook of procedures for users) based on the results of the evaluation will be developed, and the staff concerned will be trained;
  • The fundamental principles, procedures and threshold entitling new concession applications to tax incentives will be determined. This framework will then enable certain current contracts to be renegotiated on the basis of a roadmap;
  • A diagnosis of the current mechanisms for managing these agreements is carried out;
  • All stakeholders acquire sufficient knowledge and skills in terms of good governance of concession agreements, through awareness-raising/training.
  • A dialogue between all institutional players is supported/facilitated so as to reach a consensual decision on the design of a new common regulation;
  • On this basis, legislation and regulations will be drawn up to ensure better coordination between stakeholders and to provide comprehensive data on concession agreements for better tax policy decisions;
  • This legislative framework will then be submitted to the government for approval and circulated to all stakeholders for implementation.

In carrying out the tasks assigned to it, technical assistance, in particular through the resident technical expert, will ensure the "gradual" empowerment of teams in the conduct of the various activities, and the effective transfer/appropriation of knowledge, skills and methods by the various stakeholders in the project:

  • Adopting a collaborative working approach throughout his assignment, with particular emphasis on the "animation" system;
  • Positioned to identify needs, plan activities and supervise their implementation;
  • Production of documents for steering, monitoring and capitalization purposes (tools, methods, systems developed).

The resident expert will benefit from a short-term pool of expertise (based on a budget of around 150 to 200 days).

Project or context description

The Government of Lao PDR is currently implementing its 9th Five-Year National Socio-Economic Development Plan (2021-2025), and is finalizing its Financing Strategy, which sets out the broad guidelines for mobilizing resources to finance the measures needed to achieve the development objectives set. In view of the weakness of fiscal resources (tax revenue/GDP ratio of 8.9%), the authorities wish to broaden the tax base by rationalizing tax exemptions for private investment and reviewing concession agreements. 

Since the 1990s, to attract foreign direct investment (FDI), the Lao PDR's government has granted numerous tax exemptions under concession agreements for hydroelectric, mining and infrastructure projects, especially in Special Economic Zones (SEZs). However, the monitoring of these concession agreements and the exemptions granted - which involves the Ministry of Planning and Investment (MPI), the Ministry of Energy and Mines (MEM), the Ministry of Natural Resources and Environment (MONRE) and the Ministry of Finance (MoF) - is not structured in an integrated manner, due to the lack of common rules and monitoring tools. This lack of tools and inter-ministerial coordination not only hampers tax collection on projects in progress (and its monitoring), but also affects tax policy choices when negotiating future concession contracts. 

To solve this problem, the MoF and MPI, in partnership with the United Nations Development Program (UNDP), are working together on a project to build a unified database within three years, which would bring together all the main information on concession projects, including all compulsory levies and tax incentives, and thus enable the tax authorities to recover the sums owed by big companies.

Along these lines and beyond, in order to better determine the various incentives, so as to continue to attract FDI without hampering the mobilization of domestic resources, the MoF would like to i) evaluate the tax expenditures linked to the granting of exemptions on previous concession agreements, and aims to have ii) analytical tools to examine potential new agreements and iii) an appropriate coordination mechanism between all the authorities concerned.

In this respect, Lao PDR's authorities have requested AFD's support in their efforts to rationalize tax exemptions and the management of concession agreements. The Lao PDR Ministry of Finance would like to benefit from French expertise and experience in strengthening the legal and institutional framework for managing concession agreements.

France's experience in rationalizing tax exemptions and negotiating and monitoring concession contracts is of particular interest to the Laotian MoF. France is renowned for its experience in using public-private partnerships (PPPs) to carry out public investments, and is one of Europe's most active markets for concessions. It has proven experience in concessions and PPPs with public payment, and in the use of tools (budgetary and fiscal sustainability studies, and economic, legal, environmental and social feasibility studies) to improve the governance of public investments.

The French PPP unit, called FININFRA, a sub-department of the French Treasury's Directorate General for the Economy, advises/supports project sponsors and issues opinions on mandatory assessments (budgetary sustainability, prior assessment, etc.). France's experience in institutional and legal frameworks, and in structuring and steering concession projects at interministerial level, is also instructive. Similarly, in France, the evaluation of tax expenditure is a collegial exercise, involving various divisions of the Ministry of Finance and other ministerial departments within an interministerial committee chaired by the General Inspectorate of Finance.

Required profile

EXPERIENCES

The resident technical expert must combine various qualifications, skills and aptitudes:

  • At least a Master's degree or equivalent in Economics, Taxation, Law;
  • At least ten (10) years of relevant professional experiences;
  • At least five (5) years of experience in managing and structuring concession or Public-Private Partnerships' contracts;
  • Proven experience in tax policy/evaluation;
  • Good command of the English language (oral/written);
  • Good analytical and writing skills;
  • Experience of working in or with public institutions;
  • Experience in the Energy sector would be an asset;
  • Professional experience in South-East Asia, especially in Lao PDR, would be an asset.

SKILLS AND KNOWLEDGE

  • Project management and change management skills;
  • Managerial skills;
  • Ability to adapt high standards to the specific needs of developing countries;
  • Ability to create and design the systems and tools needed to ensure the success of initiatives;
  • Workshop and training facilitation;
  • Consulting approach;
  • Ability to coordinate between different institutional players;
  • Fluent in English in a professional context (mandatory).

PERSONAL QUALITIES

  • Good adaptability
  • Good interpersonal skills
  • Team spirit
  • Thoroughness
  • Analytical skills
  • Accountability

Additional information

Mission start date: February 2024

Number of months available: between 12 and 17 (until April 2025)               

Place of work: Ministry of Finance of Lao PDR in Vientiane (Lao PDR)

Fixed-term contract with Expertise France (French "CDDU")

Deadline for application : 2024/02/29 18:06

Expertise France is the public agency for designing and implementing international technical cooperation projects. The agency operates around four key priorities :

  • democratic, economic, and financial governance ;
  • peace, stability, and security ;
  • climate, agriculture, and sustainable development ;
  • health and human development ;

In these areas, Expertise France conducts capacity-building initiatives and manages project implementation, leveraging technical expertise and acting as a project coordinator. This involves combining public sector expertise with private sector skills to drive impactful results. 

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