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Countries and Regions Country Assistance Plans Document
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Country Assistance Plans - Nauru
III. Sector StrategiesA. Agriculture21. Efforts are underway to start subsistence farming in Nauru. In the context of constraints on arable land, these efforts are expected to start with small backyard type operations until rehabilitation of the mined areas can be undertaken. The ADB proposes to support these activities with extension services provided through TAs and the diversification component of the program loan. B. Banking22. Banking sector reform is an important component of the Fiscal and Financial Reforms Program. The establishment of an alternate bank in Nauru is a top priority and key to the development of private sector, and diversification of the economy. The efforts of the Government to mitigate adverse impacts of reforms will be thwarted without a proper banking system which can mobilize domestic savings. Further advisory assistance will be provided through ongoing TAs for an early establishment of a credible banking system to resume normal commercial transactions. C. Health and Education23. As part of its efforts to improve the effectiveness and efficiency of service delivery in health, the Government has amalgamated the two hospitals in Nauru. The amalgamation was intended to upgrade the facilities and service capability of health care and is expected to lower overseas referral expenditures and thereby reduce overall health expenditures. The ADB will assist the Government determine the level of health services required, and related equipment, facilities and personnel. The proposed Health and Water Supply Project loan will improve the health and living environment of the atoll. 24. Substantial strengthening of the education sector is envisaged in the medium term through curriculum development and introduction of skills, vocational and entrepreneurial training. The Government also intends to set a minimum standard of educational attainment for any person wishing to gain employment in public service. Only those who pass this level will be eligible to work in Government. These initiatives have been covered in the policy matrix of the Program loan. D. Governance Dimensions of ADB Operations25. Considerable improvements have been made in transparency and accountability of the budgeting process and management. Further assistance has been sought by Government to improve budget formulation and further tighten financial controls. The policy matrix of the FFRP loan has several measures to improve governance throughout the public service system. However, lack of political endorsement may thwart substantial improvement in governance.E. Gender Dimension of ADB Operations26. Future ADB assistance to Nauru in skills and vocational training will address the needs of women as a priority. Development of the service sector through private initiative should also provide more employment opportunities for women. The Government is aware of the need to increase employment opportunities for women and to enhance to a medium level their participation at higher levels of Government.F. Private Sector Development27. The downsizing of the public sector is likely to cause significant increase in unemployment. The private sector will have to expand to absorb those rendered jobless. However, given the limited scope for private sector development due to Nauru’s distant location and lack of competitive advantage, the private sector will require considerable time. Development of small-scale business in the service sector and small agro-industries such as poultry and backyard agriculture seem to be viable options. The ADB is supporting such development through the FFRP and piggybacked TA. A TA for transitional support is providing training and business development assistance for retrenched Government employees. Privatization of utilities and state-owned enterprises are under consideration and will be supported by appropriate technical assistance.
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