A. BACKGROUND

Mongolia has received a credit from the International Development Association (IDA) for the Strengthening Fiscal and Financial Stability Project (“SFFSP”). The development objective of Strengthening Fiscal and Financial Stability Project for Mongolia is to contribute to the Government of Mongolia’s efforts to strengthen fiscal and financial stability and improve the quality of expenditure. The project is designed into five components: (I) Strengthening Macroeconomic and Fiscal Management; (II) Improving the Efficiency of Public Financial Management; (III) Enhancing Financial Sector Stability; (IV) Strengthening the Social Protection System; (V) Project Management and Monitoring. The objectives are to: Strengthening fiscal responsibility and implementing relevant policy measures, improving fiscal discipline, strengthening the resiliency of the banking system, improving public expenditure quality in social protection, providing support for Project implementation, coordination, monitoring and evaluation, including, inter alia, audit arrangements, reporting requirements, procurement and financial management activities respectively. For more details, please refer to the Project Appraisal Document Report No. PAD2269.

Policy decisions are based on solutions to multi-criteria problems with numerous constraints, dealing with large flows of information that come from detailed data analysis, expert opinions and forecast scenarios; and consequently it has become essential for a sort of policy institution to formalise and structure the decision-making process, which is usually accomplished by setting up an economic model system. Despite theoretical constraints and practical limitations, models provide a systematic approach for economic analysis that ensures consistency in policy decisions. Furthermore, models have proven to be effective tools for the public institutions to accurately determine the socio-economic indicators. Nowadays, the policy decision-making process at the policy authorities, especially central banks, utilise a forecasting and policy analysis system (FPAS) for decision-making or at least be used for the verification of analysis and forecasting results, which are obtained by using of other tools, also by policy authorities that pursue other socio-economic policy types.

The FPAS is an organisational framework that provides the regular flow of macroeconomic information to policymakers for their decisions on the policy instrument paths. A typical FPAS is a set of models as its core, where each model has its own purpose, but it is nonetheless necessary to acknowledge that other elements that make up the FPAS (the database, reporting systems, and so on) should not be ignored.  An effective FPAS requires considerable integration of its parts the databases, the reporting system, the forecasting process, the information technology, the communication and decision-making framework, and so on. Applying best principles of inflation targeting central banks' FPASs into the Ministry of Finance, Mongolia (“ministry” hereafter) in the form of a system is not only realistic, also is expected to lead the more advanced organisation and formalisation of economic analysis and forecasting at the beneficiary organisation, so the more accurate forecast and simulation results will stand as the basis of the fiscal policy decision-making process.

B. OBJECTIVE OF THE ASSIGNMENT

The objective of this consultancy service is to help the ministry to create and develop a FPAS designed to support fiscal rules and, the fiscal policymaking process.  

C. SCOPE OF WORK

The scope of work has the tasks as follows: 

   1) Task 1.1: Background analysis

      • Conduct a detailed literature review on developing a FPAS for the ministry, in which the non-central banks’ utilisation of  such system is emphasized. A literature review should:

        - Be organised around a coherent set of questions;

        - Include the major classic studies related to the questions guiding the study;

        - Acknowledge the author’s biases, as well as the limitations of the review process;

        - Critically evaluate the quality of the research according to clear criteria;

        - Present critical evidences in the form of quotes, illustrations, graphs, and/or tables;

        - Present logical arguments and build a clear rationale for additional research;

        - Have an accurate and up­-to­-date bibliography that adheres to recognised style guidelines;

      Task 1.2: Proposal for a FPAS framework with the ministry’s characteristics

      • Create and develop a proposal for FPAS with the ministry’s characteristics. An ideal system is expected to have the characteristics as follows: a) Be effectively utilised international best practices and principles; b) Must be adaptable to the ministry’s characteristics of day-to-day activities; c) Must ensure the system is both efficient and effective, etc. This document must clearly illustrate the four critical areas for a successful and established FPAS: Model development, Information technology and systems (IT) development; Staff development, and the creation of a forecast and model culture;

      Task 1.3: Terms of reference (TOR) for a consultancy service provider on FPAS

      • Draft a TOR for a consultancy service provider on FPAS in the field developing econometric models (core and supporting); 

      Task 1.4: Workshop

      • Organise a workshop on a framework proposal of FPAS with the ministry’s characteristics;

   2) Task 2: Other assigned tasks

      • Undertake such other tasks as reasonably requested and/or assigned by the beneficiary; 

D. DELIVERABLES

The key deliverables include but not limited to the reports for all tasks as specified under “Scope of Work” as follows: 

   1) A detailed background analysis (literature review) on developing proposed framework of a FPAS designed to support fiscal rules and, the fiscal policymaking process for the ministry;  

   2) Report on proposal for a FPAS framework with the ministry’s characteristics;

   3) Terms of reference (TOR) for a consultancy service provider on FPAS in the field of developing econometric models for the FPAS; 

   4) A workshop on a framework proposal of FPAS with the ministry’s characteristics;

E. QUALIFICATION SELECTION CRITREIA

Education: A suitable candidate should have at least a master degree from an accredited academic institution in the field economics, public policy and other relevant areas;

Experience: At least 10 years relevant experience. Prior knowledge and experiences in FPAS are advantageous; 

Language skills: Excellent command of written English and Mongolian;

Other skills: a) Excellent communication and interpersonal skills; b) Strong research and problem-solving skills; c) Demonstrated ability to use relevant methods and instruments to conduct economic analysis; d) Ability to interact effectively with ministry staff, 

F. CONTRACT DURATION 

The assignment is expected to commence in December, 2019. The duration of the assignment is for 04 months. If consultant’s performance in accordance with tasks in the TOR is inadequate, the beneficiary shall be entitled to terminate the contract of the assignment.

If you possess the above qualifications, please submit following documents:

     ·  Cover letter indicating why she/he considers her/himself suitable for the position,

     ·  Detailed CV highlighting relevant skills/experience,

     ·  Copy of diplomas or certificates and,

     ·  2 reference letters from previous last two employers no later than 17:00, December 13, 2019.

The submitted documents will not be returned to the applicants. Please note that incomplete applications would not be considered for evaluation. Only selected candidates will be contacted. Candidates can be interviewed. Detailed terms of reference can be requested from procurement@sffs.mn.

Contact address: Attn: Ms.L. Bayarmaa, Procurement Specialist, Strengthening Fiscal and Financial Stability Project. Room #204, Negdsen undestnii 8/2, 4th khoroo, Chingeltei District, Ulaanbaatar, Mongolia; Tel: 70120582

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