Regions and Countries

	Table of Contents
p. 5 of 5 BACK | NEXT I. Country Strategy II. Current Development Trends and Issues III. Implementation of the Country Strategy and Program IV. Portfolio Management Issues V. Country Performance and Assitance Levels

Country Strategy and Program Update 2007-2009: Palau

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V. Country Performance and Lending Levels

A. Proposed Lending Level

38. Palau’s absorptive capacity is still unknown. A debt sustainability study in 2007 will assess financing needs and absorptive capacity, which will guide future lending levels. Nevertheless, external debt ratios are high, and Palau has access to other sources of external assistance, in particular to grants. Therefore, a modest ordinary capital resource lending program, blended with grant cofinancing is envisaged. Flexibility in the scope and volume of ADB lending will be essential.

B. Nonlending Program

39. The TA pipeline and proposed multi-year advisory TA (Appendix 1, Table A1.8) has been designed to support the strategic focus of ADB’s program described in para. 2. In addition, a project preparatory TA for a proposed water supply and sanitation project is also in the pipeline, for the amount of $300,000. The indicative TA program for 2007–2009 amounts to $900,000. Given the large needs for capacity building and sector analysis, grant cofinancing will be sought for ADB’s TA operations.

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