Catalog

	Table of Contents
p. 19 of 21 BACK | NEXT Executive Summary I. Background II. Overview of Development Issues III. External Development Assistance IV. Priority Sectors for ADB's Future Operations V. ADB Strategy in Operation A. Issues Cutting Across Priority Area Interventions B. Absorptive Capacity C. Modalities of ADB Operations D. Risk Factors for ADB Operations E. Performance Indicators for ADB Operations

Country Operational Strategy - Cambodia : V. ADB Strategy in Operation

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C. Modalities of ADB Operations

1. Lending Modalities

152. This COS recommends facilitative roles in key areas of ADB involvement in the development of Cambodia (water resource management, education, roads). Given the shift in ADB focus toward broad-based development with poverty reduction as the unifying goal, developmental impact assessment and aid agency coordination take on more importance in ADB operations. Thus, project lending alone is no longer adequate to achieve the appropriate sequencing of capacity development, policy reform, and investment. It is expected, therefore, that ADB will make greater use of sector development programs that combine components of priority project investments with reform-linked sector budget support. In addition, these facilitative roles require additional staff resources, particularly in Programs Division (West) 3, the Cambodia Resident Mission, and in the relevant projects divisions, because of the greater need for economic sector work, policy leadership, and closer coordination with the Government and other aid agencies involved.

2. Technical Assistance

153. Judicious use of TA to build capacity in executing agencies (at central, provincial, and local levels) will be important for improved governance. These efforts should be concentrated in key sectors in which the ADB is playing a major facilitative role. Long-term commitment to sustainable capacity building at the key central agencies (MEF, NBC, Ministry of Planning) as well as in those involved with strengthening the rule of law (Council of Ministers, Ministry of Justice) is also an element of the strategy to strengthen governance. In each agency for which capacity building is intended, ADB should, together with the agency, prepare an action plan that includes short-, medium-, and long-term training. Moreover, the human resource management plan to be developed should address such issues as retention of staff through appropriate job descriptions, promotion criteria, and salary incentives. Efforts should be made during TA design to incorporate mechanisms to ensure knowledge transfer from international consultants to local staff.

154. As in the case with lending operations, in the preparation stage government ownership of the TA objective should be assessed and ensured. TA proposals should assess the impact of previous TAs, if any, and include a method for assessing the success of the TA upon completion. To reduce the tendency toward ad hoc efforts, greater use of cluster TAs in key areas such as governance and in conjunction with the sector development programs should be considered. Occasional regional TAs will provide additional support for GMS activities.

3. Partnerships

155. ADB and other aid agencies are developing closer partnerships with the Government and with each other. In addition to the annual Consultative Group Meeting, the Government holds quarterly meetings with local representatives of aid organizations to discuss progress on reform programs in forestry management, fiscal reform, public administration reform, demobilization, social sector efforts, and legal and judicial reform. To support these efforts, the aid organizations, including ADB, participate in local working groups on each of the reform programs. In addition, part of the effort to facilitate government leadership in the key sectors of water resource management, education, and roads will be to form partnerships with the relevant government and nongovernment groups. ADB is assisting the Government in preparing a second five-year socioeconomic development plan (SEDPII), which will focus on poverty reduction. The SEDPII, to be completed in 2000, will identify poverty indicators and targets and will culminate in a high-level forum on poverty reduction and a partnership agreement between ADB and the Government.

156. As a consequence of greater interest in coordination between aid agencies, there are more possibilities for mobilizing cofinancing of ADB loans and TAs than in the past. During 1992-1998, about $9.7 million of a total of about $42 million in TA was cofinancing. In addition, about $10 million of cofinancing for the Basic Education Textbook and Primary Roads Restoration projects was from UNICEF, Organization of Petroleum Exporting Countries, and AusAID. A country profile of the activities, interests, and funds available from various aid agencies active or interested in Cambodia, prepared by the Office of Cofinancing Operations, will make it easier for ADB staff to secure cofinancing. Potential cofinancing has already been identified for water resources, power, water supply and sanitation, education, transport, and environment.

157. In an effort to tap into the vast experience with local development conditions held by some of the NGOs working in Cambodia, ADB is developing a working relationship with the NGO community. By getting more advice on ADB's program in general and by making greater use of NGOs in implementation, ADB will achieve a greater developmental impact in the program. Operationally, the working relationship will be developed through semiannual meetings with NGO representatives during the Country Programming Mission to identify areas of common interest in the program pipeline, and during the Country Portfolio Review Mission to discuss lessons learned and ways to improve ADB operations. In addition, in the interest of information sharing and to ensure the widest possible participation in the design and implementation of ADB's program, ADB will forge closer working relationships with the business community, the legislative branch of government, the media, and other groups that represent civil society.

4. Economic Sector Work

158. The new approach to ADB operations outlined above will require additional rigor and effort in economic analysis. Studies already complete or ongoing in conjunction with the COS are the Urban Sector Strategy, the Environmental Sector Strategy Note, the governance study, the Secondary Education Investment Plan, and the financial sector strategy. In 2000, ADB will undertake the preparation of a water resource management profile and an energy sector strategy. Additional economic work will focus on the areas in which ADB is playing a key role: water resource management, education, transportation, and governance. Additional economic sector work is planned in macroeconomic policy and the capacity of the country to absorb aid.

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