Countries and Regions

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p. 15 of 19 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 - Maldives

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V. Donor Activities and Aid Coordination

43. In 1997 the Committee for Development Planning of the General Assembly of the United Nations reviewed the classification of the Maldives as a “Least Developed Country” and recommended that in the year 2000 it should graduate from this category. If this recommendation is adopted, it may lead to a change in the amount and terms of development assistance available to the country in the form of grant and loan. The Government has been contesting this recommendation in light of the country's continuing vulnerability to external shocks, both economic and environmental. In May 1999 at the Donor Roundtable Meeting on Maldives, there was unanimous support from the donors for the Government's position that Maldives should not be graduated at this time from the Least Developed Country status because of the vulnerability of the economy and the need for continued assistance to consolidate the impressive development gains made in recent years.

44. Maldives received official development assistance as both grants and concessional loans at an average of about $40 million per year during 1994-1998 (on disbursement basis). The assistance (about evenly split between grants and concessional loans) amounts to about 12 percent of GDP and is critical for supporting Maldives’ development efforts. Japan, ADB, the United Nations agencies, and the World Bank are the principal donors. Japan has been the country's largest grant aid donor (about $10 million per annum). It has provided support for seawall construction, fisheries, island electrification and other infrastructure projects through Japan International Cooperation Agency (JICA). At the Donor Roundtable meeting held in 1999, Japan announced its continued grant assistance at around the same annual level to Maldives in the next five years. Japan Bank for International Cooperation (JBIC) is also prepared to start operations in Maldives once suitable projects have been identified. The World Bank has provided assistance for fisheries and education.²²

45. In recent years there has been a noticeable decline in sources of bilateral assistance and this is of concern to the Government. The Government is taking the lead in aid coordination and has accorded high priority to closer coordination with other donors in the formulation of ADB's loan and TA programs and also in the design of specific projects and in seeking co-financing opportunities for ADB-financed projects. As the majority of the donor agencies have no resident offices in Maldives, the ADB’s Country Programming Mission to Sri Lanka actively consults representatives of major donor agencies in Colombo that cover also Maldives. Recent donor assistance in Maldives is given in Appendix 3.

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