Countries and Regions

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p. 5 of 7 BACK | NEXT Executive Summary I. Development Agenda II. ADB's Development Experience III. ADB’s Strategy IV. Operational Approach V. Three-Year Assistance Program VI. Performance Monitoring and Evaluation

Country Strategy and Program Update 2002-2004: Maldives

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IV. Operational Approach

A. Modalities of ADB Assistance

94. A combination of project loans, TAs, and official cofinancing will be the main modalities of ADB assistance for the next five years. Each loan will combine support for catalytic public investments with institutional strengthening, regulatory improvement, and essential policy reform. Where possible, effort will be made to attract official sources of cofinancing for loans, to reduce claims on scarce ADB resources, and to broaden the Maldives’ access to a range of bilateral funding sources. In the case of infrastructure delivery, efforts will be made to increase the involvement of the private sector in the provision and operation of economic infrastructure. Suitable TA efforts will be provided to help design the investment projects that will be financed and to support the Government’s efforts for capacity building and addressing thematic issues.

B. Participation of Civil Society, the Private Sector, and Subnational and Local Governments

95. ADB will actively encourage the participation of civil society, the private sector, and subnational and local governments in the design and implementation of all facets of ADB assistance. Extensive stakeholder consultation will be part of the design of each ADB-supported activity. The private sector will be actively encouraged to participate in ADB assistance programs. A concerted effort will be made to consult with the poor, with women’s organizations, and with local government bodies to better understand their special needs and to ensure that ADB’s assistance is in line with their priorities. Project goals and objectives will be carefully specified, both in terms of expected technical and economic impacts, and in terms of poverty reduction impacts and anticipated social outcomes. Well-designed baseline surveys and careful monitoring and evaluation efforts, often involving nongovernment organizations and local communities, will play an important role in ensuring that the efficacy, impact, and relevance of ADB activities are maximized.

C. Strengthening Government Capacity

96. Special attention will be paid to the Government’s capacity to effectively utilize foreign assistance. The Government faces a chronic capacity constraint and must enhance remuneration and skills development opportunities to prevent the erosion of public sector capacity. Technical advisory support will continue to be provided to design and effectively implement a number of investment projects. Helping the Government shift from being a direct provider to more of a facilitator and regulator of privately provided infrastructure, and economic and social services will ease the public finance and implementation capacity burden.

D. Aid Coordination

97. External assistance plays a key role in the Maldives’ development. In view of the small size of the country, external assistance provided by different sources must be closely monitored to ensure it does not overlap. ADB ensures this through close coordination with all agencies. The Government is taking the lead in aid coordination, supported by the UNDP through periodic meetings. Since many agencies operate out of their Sri Lanka offices, ADB has visited key agencies in Sri Lanka and has kept in close contact with others from ADB’s Manila headquarters. The country strategy and program (CSP) has been developed in consultation with and based on careful assessment of other agencies’ strategies and projects. Appendix 5 shows the agencies active in the Maldives and their sectors of operation.

98. The Government has encouraged ADB to seek cofinancing to leverage the volume of foreign assistance that can be mobilized. In recent years, official cofinancing has played a major role and will continue to do so. Between 1997 and 1999, ADB’s lending attracted cofinancing totaling $10.3 million from the Australian Agency for International Development, the Islamic Development Bank, and the Nordic Development Fund. ADB will continue its efforts to mobilize resources from other sources for its operations in the Maldives.

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