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Countries and Regions Country Partnership Strategies Document
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Country Strategy and Program Update 2004-2006: Maldives
III. Portfolio Management IssuesA. Portfolio Performance23. ADB's current portfolio in the Maldives comprises five active loans: Third Power System Development Project, Postsecondary Education Development Project, Regional Development Project, Outer Islands Electrification (Sector) Project, and Information Technology Development Project. One loan, Strengthening of the Public Accounting System Project, is expected to be effective in June 2003. The overall performance of the ongoing loan projects has been generally satisfactory. The Maldives' portfolio indicators are in Tables A1.6-A1.9 of Appendix 1. 24. A country portfolio review mission fielded in October 2002 reviewed all ongoing loan and technical assistance (TA) activities, identified generic as well as project-specific problems, and discussed remedial measures to improve portfolio performance and facilitate project implementation. All the ongoing projects have been either highly satisfactory or satisfactory in terms of development objectives and implementation progress. However, relatively weak performance has been identified in the following specific project implementation issues: (i) delays in key project activities including recruitment of consultants and installation of project equipment and civil works, (ii) inadequate counterpart staffing, (iii) delayed submission of audited financial statements, and (iv) delays in the signing of TA letters. 25. One of the major reasons for the relatively weak performance of procurement has been human resources constraints. Procurement suffered from delays due to the shortage of government staff with sufficient experience and knowledge in the tendering process. Thus, the process, including preparation of bidding documents and evaluation, takes time, leading to delays in project implementation. In this context, the mission and the Government understood the importance of (i) provision of sufficient consultancy or advisory services for direct assistance to project implementation work, (ii) provision of training and seminars for government officials to enhance their familiarity with ADB's guidelines and project implementation work, and (iii) appropriate utilization of advance procurement/retroactive financing. 26. The country portfolio review mission and the Government agreed upon an action plan to improve portfolio performance, key measures of which include: inclusion in the loan projects of sufficient consultancy or advisory services for direct assistance to project implementation work and training of project management unit staff, provision of training and seminars for government officials to enhance their familiarity with ADB's guidelines and project implementation work, appropriate utilization of advance procurement/retroactive financing, appointment of project management unit staff at the earlier stages of loan processing, enhancement of the capacity of the implementing agencies and the Ministry of Finance and Treasury as the Executing Agency (EA), and strict application of the rules on the submission of audited financial statements. B. Performance Monitoring and Evaluation27. 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. On the government side, the Ministry of Finance and Treasury, as the EA of all ADB-financed projects, takes responsibility for trying to ensure timely project implementation. Given the small size of the portfolio, the monitoring system has generally been adequate. However, 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. Since the last CSP update for the Maldives was endorsed, there has been no work on performance evaluation of ADB's projects.
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