Countries and Regions

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p. 4 of 5 BACK | NEXT I. Country Strategy II. Current Development Trends and Issues III. Implementation of the Country Strategy and Program IV. Portfolio Management Issues V. Country Performance and Assistance Levels

Country Strategy and Program Update 2003-2005: Fiji Islands, Republic of the

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IV. Portfolio Management Issues

A. Portfolio Performance

26. Since 1970, 13 loans have been approved by ADB amounting to US$161.1 million. They include four road upgrading loans, three power sector loans, three agricultural and natural resources loans, two development bank loans, and one low-income housing development loan. It is important to note that only two loans have been approved over the past 10 years, and that no loans were approved between 1998 and 2001. Currently, the only ongoing loan is for the Third Road Upgrading Project (FRUP III), for US$40.0 million, approved in August 1997. Project implementation progress is satisfactory. Loan 1902-FIJ: Ports Development Project, for US$16.8 million, was approved in March 2002.

27. Since 1970, 63 TAs have been approved totaling US$18.9 million. As of January 2002, there were 12 TAs ongoing. The TA for Public Enterprise Reforms (Phase II) is expected to have a significant beneficial impact on the corporate governance of state-owned enterprises. Other ongoing advisory TAs include assistance for debt management, preparation of a national development plan, review of the Fiji Development Bank, capacity building of the Capital Market Development Authority and the Native Land Trust Board. Most TAs are being implemented satisfactorily. ADB continues to be involved in helping improve the policy framework in key sectors, including agriculture, infrastructure, and the environment.

28. The Government has provided sufficient counterpart funding for ADB-financed projects, despite the severe economic slowdown and the coup. However, with migration of skilled staff, the availability of high-caliber staff to implement programs could be a problem, considering the large number of young, inexperienced staff in various ministries and departments. This could affect the absorptive capacity of the various government agencies. ADB will ensure that both its loan and TA programs give due consideration to both financial and human resources to ensure timely implementation. ADB will provide support in strengthening capacity in key government ministries.

B. Performance Monitoring and Evaluation

29. Generally, the Fiji Islands has complied with project loan covenants, including submission of regular progress and audit reports. Some covenants pertaining to road sector policies are yet to be complied with, due to pending reform of the Public Works Department's road section. There is a need to further strengthen the monitoring and evaluation, aid coordination, and planning units in the Ministry of Finance and Planning. As the ADB's portfolio increases, for better monitoring, ADB will evaluate the possibility of establishing a subregional office in the Fiji Islands. No country strategy and program (CSP) is planned in the short term, but as the portfolio increases over the period 2003-2005, a full CSP will be necessary. In anticipation of a full CSP, preparation is under way to prepare a detailed Pacific island economic report in 2003.

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