Countries and Regions

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p. 3 of 4 BACK | NEXT I. Development Situation II. Implementation of the Country Strategy and Program III. Portfolio Management Issues IV. Country Performance and Lending Level

Country Strategy and Program Update 2002-2004: Maldives

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III. Portfolio Management Issues

A. Portfolio Performance Implementation

24. Overall, the Maldives has made good use of ADB assistance and has demonstrated satisfactory absorptive capacity. Since 1996 to date two projects have been postevaluated and both of them were rated as satisfactory (Appendix 3). ADB's current loan portfolio in the Maldives comprises only three active loans amounting to $21.3 million. The disbursement ratio has therefore varied according to project implementation stages. Past experience indicates delays occurring primarily in the initial phases of project implementation, in the appointment of consultants, procurement, and contract awards. More recently, the shortage of suitably qualified counterpart staff has become a concern.

25. Most of the projects focused on expanding infrastructure and institutional capacity in Malé, perhaps inadvertently contributing to regional inequity. Recent initiatives have begun to focus more on spreading the benefits of growth more widely. Disbursement and submission of audited accounts and financial statements were generally satisfactory. Only rarely have loan extensions been required. Compliance with the loan covenants on social and environmental measures have also been generally satisfactory as well as those on participation and ownership, institutional capability, budget availability, operation and maintenance, and benefit monitoring systems.

B. Counterpart Funding

26. The Government has provided sufficient counterpart funding for ADB-financed projects despite the fact that the Maldives’ economy has weathered two severe macroeconomic shocks during the past decade. This is a notable accomplishment and reflects the high priority that the Government accords to prompt implementation of ADB projects.

C. Monitoring and Evaluation

27. Since there is no ADB resident mission in the Maldives, project implementation has been monitored by project review missions and country portfolio review missions from ADB headquarters. The shift of ADB’s focus to the atolls for poverty reduction will require a greater effort to monitor and evaluate projects, including, among others, a thorough assessment, at the stage of project formulation, of the institutional capacity to implement projects in remote islands.

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