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Countries and Regions Country Partnership Strategies Document
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Country Strategy and Program 2005-2006: Lao People’s Democratic Republic
IV. Country Performance and Assistance LevelsA. Lending Level Proposed23. ADF fund allocation will depend upon the revised performance-based allocation (PBA) policy, which is expected to be finalized later in 2004. For planning purposes, the three-year annual allocation has been set at $36.1 million for national projects—subject to adjustment under the revised PBA policy—and incremental funding has been assumed to become potentially available for subregional cooperation. One project (Nam Theun 2 hydropower development) has also been included for financing from ordinary capital resources and private sector operations in 2005. The proposed lending pipeline was developed to reflect the strategic thrust and geographical focus identified in the CSP, in consultation with the government and other development partners. Possibilities of the sector-wide approach will be explored in water supply, urban development, education, and health. Priority was given to implementation of the NGPES and the northern region development strategy. The proposed lending program is in Appendix 1, Table A1.10. B. Nonlending Program24. Indicative annual TA of about $3.5 million focuses on quality project preparation in priority areas, governance and capacity building, and policy development support. The proposed nonlending program is in Appendix 1, Table A1.11. C. Summary of Changes to Lending and Nonlending Programs25. The lending program for 2004–2006 was adjusted to reflect the status of project preparation and ADF resource availability: (i) the forest plantation for livelihood improvement project (formerly tree plantation for livelihood improvement) slipped from 2004 to 2005; and (ii) a multiyear phased approach is adopted for the northern and central regions water supply and urban development project. Processing schedules of some project preparatory TAs were adjusted according to changes of loan processing timing and resource availability. 26. A Regional Cooperation Strategy and Program 2004–2008 (RCSP) for GMS was completed in early 2004. Limited funding for regional activities has required a review and adjustment of planned GMS operations: (i) the Nam Theun 2 hydropower project slipped from 2004 to 2005 to further consult with stakeholders and to carry out due diligence more carefully, (ii) the communicable disease control in border areas was advanced from 2006 standby to 2005 firm to more timely address recent communicable disease issues including SARS and avian flu, (iii) the information and communication technology project (formerly GMS: telecommunication backbone project phase I) was renamed to appropriately reflect the possible project scope, (iv) the new projects for pro-poor tourism development and the northern region economic bridge were introduced through the RCSP process for standby 2006, and (v) processing of the flood management project has been deferred for 2006 standby to better define project scope. 27. For reference, the 2004 assistance program for lending products and the 2004 assistance program for nonlending products and services are provided in Table A4.1 and A4.2, respectively.
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