Regions and Countries

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p. 5 of 19 BACK | NEXT I. Country Performance Assessment A. Economic Performance Assessment B. Poverty Assessment C. Assessment of Socio-Environmental Performance E. Implementation 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 - Uzbekistan : I. Country Performance Assessment

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D. Implementation Assessment

1. The Portfolio

28. Uzbekistan became a member of the ADB in August 1995 and lending operations began in 1996. As of 30 June 2000, cumulative lending to Uzbekistan consisted of six loans for five projects for $267 million and 28 technical assistance projects for a total of $16.4 million. ADB's Uzbekistan portfolio is relatively young. No loans have been closed and post-evaluated. All ongoing loan projects are at the initial or middle stage of the project implementation cycle. Loans and technical assistance projects have helped to improve governance, build institutional capacity, support policy and institutional reforms, and rehabilitate basic social and physical infrastructure.

2. Issues in Project Implementation

29. Uzbekistan's capacity to absorb ADB assistance has been considerably lower than initially anticipated. The limited implementation capacity, slow development of institutional capacity, and the Government's pace and intensity of reform agenda, have initially hampered effective and efficient implementation of loans and TA projects. Although there has been an overall improvement in the project implementation indicators such as loan signing and effectiveness, and establishment of project implementation structures, contract awards and disbursement performance, and compliance of loan covenants need to be carefully monitored.

30. The executing agencies lack familiarity and experience with the international financial and business practices in general and ADB policies and procedures in particular. Making a candid assessment of the executing agency's absorptive and implementation capacity, and taking appropriate measures to strengthen its capacity and minimize implementation risks will continue to be critical. Therefore, all loan projects are accompanied by substantial capacity-building TAs and components to address policy and sector reforms, strengthen institutional and staff capabilities, develop legal and regulatory frameworks, and establish and maintain project performance management and monitoring systems.

31. Projects with the Government's highest level of commitment and the executing agency's ownership are assured have performed better. On the contrary, in the sector/project where the Government is not yet ready to be fully committed to implementing policy and sector reform agenda, the project continues to encounter implementation difficulties. There is still a high degree of uncertainty associated with project processing and implementation mainly caused by prolonged policy dialogue to reach agreement with the Government on acceptable policy and sector reforms, generally in any sector, and particularly in the agriculture and road sectors.

32. To overcome these problems, intensified efforts are required by the Government as well as ADB to enhance the Government's implementation capacities and the ownership of projects. Several measures have been taken including: intensifying participation of stakeholders during project preparation; pilot-testing; and ensuring that implementation arrangements are concluded early in the project preparation cycle, in combination with intensive supervision by ADB and early identification of problems. Continued efforts will be required to (i) ensure high quality supervision by ADB staff; and (ii) train counterpart staff in the project implementation units through piggy-backed TAs, on-the-job training, ADB seminars and training programs, and RETAs. To ensure counterpart funds availability, particular attention will be required to (i) strengthen the linkage between the medium-term public investment program and the budgetary allocations; and (ii) develop efficient project monitoring systems and procedures. The portfolio management specialist who has been assigned at the Uzbekistan Resident Mission in 2000 as part of implementation of the ADB's new Resident Mission Policy should contribute significantly to improving performance related to contractual matters by providing technical and professional inputs and advice for the executing agencies.

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