Regions and Countries

	Table of Contents
p. 18 of 20 BACK | NEXT I. Country Performance Assessment II. 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 Program IX. Local Cost Financing

Country Assistance Plans - Federated States of Micronesia

---

VII. ADB’s Operational Program

47. Over the 2001-2003 period, proposed ADB lending to FSM amounts to about $12 million for one loan on ADF terms. Such lending level is considered appropriate as FSM's economic reform performance deserves continued ADB lending assistance, and the proposed lending intervention is not expected to unduly strain the country's absorptive capacity. Use of ADF resources for this loan is considered fully appropriate given FSM current severe economic difficulties brought about by a massive public sector restructuring program and significant reductions in Compact funding.

48. The TA program will underpin the three main thrusts of the country program, namely continue to enhance public sector performance, create a more conducive environment for private sector development, and improve basic health and education service in a sustainable manner. Public sector performance improvements will be supported by TAs which will emphasize areas of state governments capacity building, budget management, and fishery resources management. TAs for private sector development will stress areas of land management, law and development, and privatization. The social sector will be assisted through economic sector work, capacity building for statistics compilation and skills development.

49. The proposed loan and TA program over the 2001 - 2003 period is presented in Table 1 and is listed in Appendix 4. Appendix 5 shows proposed lending by poverty classification, crosscutting operational priority, and sector. A project profile for the 2001 loan is in Appendix 6.

Back VI. Cofinancing and Catalyzing External Resources	Next VIII. Economic and Sector Work Program