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Countries and Regions Country Partnership Strategies Document
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Country Strategy and Program Update 2004-2006: Maldives
IV. Country Performance and Assistance LevelsA. Lending Level Proposed28. An indicative lending of $18.0 million, or an annual average of $6.0 million, is programmed for 2004-2006. The Maldives' performance was rated highly in the country performance assessment. However, the proposed Asian Development Fund lending levels are subject to the outcome of the annual performance-based allocation exercise and overall Asian Development Fund resource availability. The assessment of the country-specific criteria (Table A1.12) will be the basis for triggering high, base, or low lending scenarios each year. The country-specific criteria were developed to address the key macroeconomic, social, and structural challenges in undertaking the country performance assessment and reviewing the progress of the Poverty Reduction Partnership Agreement, including the deteriorating fiscal balance, the urgent need for youth employment, and the importance of financial sector development. In the past, the Maldives' performance in meeting the country-specific criteria has been satisfactory. Depending on ADF resource availability in 2004, the ADF lending program will need to be reviewed. The issue will be revisited and confirmed during the Country Program Confirmation Mission. The 2005 and 2006 ADF lending program will depend on the outcome of the discussions regarding ADF replenishment. 29. The proposed lending program for 2004-2006 consists of three projects: Regional Development (Phase II), Transport Infrastructure Development (formerly called Interisland Transport Development Project), and Islands Electrification Project (Phase II). The proposed program is consistent with the priorities identified in the Government's Sixth National Development Plan and with ADB's CSP for the Maldives, and focuses on development of the atolls. The assistance pipeline for lending products is in Table A1.10 of Appendix 1. 30. The Regional Development Project (Phase II) will support a part of the Government's wide-ranging efforts to develop a series of regional development nodes. In this second phase, the focus will be on social infrastructure, including water supply, sanitation, solid waste management, land use planning, and environmental monitoring in the Central North, Central, and Central South regions. The Transport Infrastructure Development Project will spur economic activities and improve access to better social services in the atolls by establishing a system of interisland transportation. The Islands Electrification Project (Phase II) is a follow-on project of the ongoing Outer Islands Electrification Project, and will focus on provision of electrification system on the islands that are not covered by the ongoing project. The scope of these projects is tentative and will be firmed up during project processing. While the three projects in the pipeline for 2004-2006 are expected to be classified as poverty intervention, the classification will be further reviewed in the course of project formulation. B. Nonlending Program31. An indicative nonlending assistance of $3.0 million, or annual average of $1.0 million, is programmed for 2004-2006. The current nonlending assistance pipeline focuses on project preparation, human resources development, and economic and social development in the atolls. The assistance pipeline for nonlending products and services is given in Table A1.11 of Appendix 1. C. Summary of Changes to Lending and Nonlending Program32. There have been a few changes in the 2004-2006 program. With regard to ADB's assistance in small and medium-sized enterprise development, the need for preparatory work on specific areas before providing a loan project has been recognized. Accordingly, two nonlending activities to explore the potential for commercialization of agriculture and mariculture and to develop credit schemes in the atolls have been added, and a loan project, Development of Small and Medium-Sized Enterprises in the Atolls, has been postponed to 2007. A loan project, Transport Infrastructure Development, has been advanced to 2005. A nonlending assistance project for graduation planning has been dropped, since the United Nations Development Programme is currently providing substantial assistance on this issue. Two new nonlending projects for human resources development have been added.
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