Regions and Countries

	Table of Contents
p. 16 of 22 BACK | NEXT I. Country Performance Assessment II. Poverty Reduction and Country Operational Strategy III. Sector Strategies IV. Regional Cooperation V. Donor Activities and Aid Coordination VI. Cofinancing and Catalyzing External Resources VII. ADB’s Operational Program VIII. Economic and Sector Work IX. Local Cost Financing

Country Assistance Plans - Cambodia

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V. Donor Activities and Aid Coordination

94. Because of the major role of aid in Cambodia, aid coordination, both for policy consistency and for efficiency of operations, is essential. In 1992-1998, the major contributors by disbursement were Japan ($625 million), France ($245 million), the US ($237 million), UN agencies ($236 million), the European Commission ($207 million), the World Bank ($175 million), ADB ($161 million), Australia ($137 million), and Sweden ($113 million). Non-Government Organizations (NGOs), of which there are some 400 operating in Cambodia, accounted for $187 million. Appendix 3 provides information on average disbursements in 1996- 1998 and disbursements in 1999 by major donors. Disbursements in 1999 are lower than the average for 1996-1998, in part because emergency assistance is declining and in part because of the delayed effect of disruption of aid programs in 1997.

95. Over the period 1992-1998, 41.0 percent of $2.75 billion in external assistance was categorized as capacity building and PPTA, 31.0 percent was for investment projects, relief aid was 17.0 percent, and budgetary support was 11.0 percent. The major intention of assistance has thus been to provide TA to weak public institutions. Through this assistance and through budgetary support, the international community supports the process of rebuilding a civil society and reshaping a market economy. At the same time, through project assistance, much-needed human and physical capital investments are funded.

96. The international community is reassessing its role in assisting the development of Cambodia. With the importance of emergency assistance and rehabilitation giving way to efforts for sustainable development, policy reform and long-term capacity building are becoming more critical. In addition, the large scale of aid activities in Cambodia and the extent of poverty cry out for cooperation rather than competition among the aid agencies. This is especially true in the case of policy reforms. While a diversity of opinions on development issues may not necessarily be bad, the insistence on policy reform as a condition of aid implies that donors must make efforts to coordinate policy dialogue

97. To increase opportunities for policy dialogue and improve its coordination, the Government and the aid community agreed at the 1999 CG Meeting in Tokyo, Japan, to hold periodic meetings in Phnom Penh to discuss progress on reform programs. To support these efforts, the aid organizations, including ADB, participate in local working groups in forestry management, fiscal reform, public administration reform, demobilization, social sector efforts, legal and judicial reform.

98. To improve aid coordination, the Government and aid community are moving toward comprehensive sector approaches, particularly in health and education. The Government has asked particular agencies to facilitate government ownership of sector development in priority sectors. The specific role of the aid agency and the extent of coordination vary by sector. ADB will, at Government request, facilitate government leadership in water resource management, education and roads. This entails ADB assisting in sector development planning, spearheading aid coordination efforts, supporting institution building, and financing priority investments.

99. At the Fourth CG Meeting on Cambodia, held in Paris, France from 24-26 May 2000, aid agencies commended the Government on progress in implementing reforms and indicated commitments of $550 million in assistance for the year as compared to $470 million pledged in 1999. At this meeting, partnerships and aid coordination was the theme of an informal discussion session. The Government stressed the need to strengthen local ownership of the development agenda, channel funds through the national budget, harmonize implementation procedures, and subordinate aid agency strategies to the national development strategy. Government and aid agencies agreed to gradually work towards the implementation of the sector wide approach (SWAP) mechanism, which would include aid agencies cofinancing, under harmonized procedures, a Government managed sector development plan.

100. In an effort to enhance the effectiveness of its program, ADB is making efforts to strengthen its partnerships with NGOs, who often have greater understanding of developmental issues at the local level. ADB undertook extensive dialogue with NGO groups during the preparation of the COS, in design of the Rural Credit and Savings Project, and in connection with efforts to revise the land law. Increasingly, ADB is using NGOs in project design and implementation. For example, an NGO is in charge of monitoring implementation of the resettlement action plan for the Phnom Penh to Ho Chi Minh City Highway Project.

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