Countries and Regions

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p. 3 of 4 BACK | NEXT I. Current Development Trends and Issues II. Implementation of the Country Strategy and Program III. Portfolio Management Issues IV. Country Performance and Assistance Levels

Country Strategy and Program Update 2004-2006: Bhutan

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III. Portfolio Management Issues

A. Portfolio Performance

18. Eighteen loans have been approved, for a total of $101.8 million, since 1983, when ADB started lending to Bhutan. As of 31 December 2002, the cumulative value of the project portfolio was $40.1 million; $19.9 million was disbursed. Of this, four public sector loans, with a net loan amount of $32.4 million were ongoing (Appendix 1, Table A1.6). The four ongoing loans in the portfolio are for sustainable rural electrification, road improvement, urban infrastructure, and basic skills development. Because only four public sector loans are ongoing, the total contract awards tend to fluctuate considerably each year, depending on the maturity profile of individual loans. For 2002, contract awards and commitments totaled $14.6 million (115% of the annual projection), and disbursements totaled $13.9 million (114% of the projection).¹⁸ The disbursement ratio (with program loans) was 43.3% compared with the ADB-wide average for Asian Development Fund (ADF) countries of 19.7%. Without program loans, disbursement ratio for Bhutan was 28.4%, compared with the ADB-wide average for ADF countries of 15.6%. Compliance with loan covenants and assurances on social and environmental measures have generally been satisfactory. With the fulfillment of covenants associated with the disbursement of the second tranche of the Financial Sector Policy Loan, overall portfolio performance is now rated as satisfactory. Most audited project accounts and financial statements were submitted on time, although compliance was late for one project. The Government has provided adequate counterpart funds for all projects, as agreed during Project formulation.

B. Performance Monitoring and Evaluation

19. No performance evaluation of ADB projects was done in 2002 (Appendix 1, Table A1.8).¹⁹ At the end of 2002, the implementation progress and achievement of development objectives of the four ongoing projects were rated as satisfactory (Appendix 1, Table A1.9).

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