Countries and Regions

	Table of Contents
p. 5 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 2006-2008: Fiji Islands, Republic of the

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V. Country Performance and Assistance Levels

A. Proposed Lending Level

36. To support Fiji's structural change and promote new growth opportunities, ADB might consider, subject to progress on the reform agenda and the strengthening of the investment environment, an expansion of its assistance program. In addition, ADB will continue to explore the potential for private sector operations, particularly initiatives that would facilitate structural changes and reforms in state-owned enterprises and utilities. For 2006-2008, ordinary capital resources lending of about $220 million is programmed for five projects. The lending level could be increased, subject to progress in fiscal consolidation and debt management.

37. The 2007 RB-CSP will offer an opportunity for ADB to reassess assistance levels to the Fiji Islands, and to review the cost-sharing limit for projects in the country. An analysis of the balance of payments, investment program, debt sustainability, and sector and project characteristics will be undertaken with the Government during the preparation of the RB-CSP.

B. Nonlending Program

38. For 2006-2008, 12 TA projects for $8.15 million are programmed. Of these TAs, two-Strengthening Road Sector Performance (associated with the loan for FRUP IV) and Capacity Building for Economic and Public Sector Reforms-have slipped from the 2005 program to the 2006 program. Loan negotiations delayed the first TA, while the second slipped due to intentions to harmonize the TA with related assistance from development partners. The annual TA program is proposed to increase to about $2.5 million a year (from $1.5 million a year) to support policy and institutional development, and effective development processes. About three to five TAs per year are planned, with at least one for project preparation. The ongoing TA portfolio should be maintained at less than 10 TAs in 2006, and not more than eight from 2007 onwards. This will be consistent with available staff resources and the focus of the country strategy. The assistance program will aim to strengthen partnership with the Government, and to be flexible and responsive to the emerging development environment.

C. Summary of Changes to Lending and Nonlending Program

39. The lending program will undergo some minor changes. As indicated in para. 38, approvals of the loan and the associated TA for FRUP IV and the TA for Capacity Building for Economic and Public Sector Reforms have been shifted to the first quarter of 2006. The proposed Rural and Outer Islands Development Project has been moved up to 2006 from 2007. The proposed Renewable Power Sector Development Project, with a piggybacked TA for a Power Sector Development Road Map, has been introduced, on a standby basis, for 2006. Correspondingly, the proposed Airport Rehabilitation and Upgrading Project has been deferred to 2007 from 2005. The proposed Urban Sector Development Project has been deferred to 2007 from 2006, and will be addressed through the proposed Provincial and Local Governance Program.

40. The sequencing of nonlending assistance also has undergone some minor changes. In 2006, one project preparatory TA for the Natural Resource-Based Sector Development Program is planned, in addition to four advisory TAs. In 2007, one project preparatory TA for the Provincial and Local Governance Program and two advisory TAs are scheduled. Finally, in 2008, one project preparatory TA for Public Sector Reform Program and two advisory TAs are planned.

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