Countries and Regions

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p. 3 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 Assistance Levelsl

Country Strategy and Program Update 2003-2005: Samoa

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III. Implementation of the Country Strategy and Program

A. Progress Toward a Poverty Partnership Agreement

15. The poverty partnership agreement seeks the Government's commitment to better define and assess the concept of poverty, design appropriate strategies to reduce poverty and incorporate these strategies into the country's development plans, consistent with Government's priorities. The Government's current priority and ADB's proposed assistance program are generally in line with the thrust for poverty reduction. A draft of the poverty partnership agreement has been provided to the Government for consideration.

16. Assessment of progress towards achieving the Millenium Development Goals is made difficult by the paucity of data on selected indicators (Appendix 2, Table A2.1). ADB's ongoing TA for preparation of a household income and expenditure survey⁶ will help develop an appropriate perspective on poverty and improve the Government's database for policy analysis. The study will provide up-to-date analysis of the causes of economic and social inequalities and regional disparities. The economic, and poverty and social indicators are presented in Appendix 2, Tables A2.2 and A2.3, respectively. Strategies for poverty reduction will be more closely examined using participatory approaches under the ongoing regional technical assistance (RETA) for poverty consultation workshops.⁷

17. Progress in achieving the Millenium Development Goals in the social area will require sustained public investment in the education, health, and water and sanitation sectors, hence ADB's social infrastructure program focus on education and the environment. This includes a second loan for education and youth development programmed for 2004, and a sewerage and drainage project programmed for 2003. Overall progress in achieving the social goals will need to be assessed on the basis of the updated HDI by the United Nations Development Programme planned for 2003.

18. To promote sound environmental management and sustainability, the National Environmental Management Strategy, which was first formulated in 1993, needs to be updated and reactivated (Appendix 2, Table A2.4). ADB's new Pacific regional environmental strategy, planned for 2003, will aim at integrating environmental standards in government policy-making procedures and investment decisions. The proposed RETA for Pacific region environmental strategy will include Samoa.

B. Progress in the Country Strategy and Program Focus Areas

19. Implementation of the economic and public sector reform program continued in 2001, and the Government's commitment to ongoing reforms was reaffirmed in the SDS, which emphasizes the need for sustained economic growth, better education and health, and revitalized cultural and traditional values. Particular emphasis was placed on rural development through investment in economic infrastructure and social services, revitalization of village agriculture and fisheries, small business development, and support for community services. Further ADB technical assistance to economic and sector planning will include an examination of the means to facilitate greater factor mobilization including land.

20. The new PFMA provides the legal framework for improved fiscal governance, and the Public Bodies (Performance and Accountability) Act of 2001 likewise proposes the legal framework for better corporate performance and governance of public bodies. The ADB?financed Financial Sector Program provided the framework for these legislative changes.⁸ A major issue facing the Government is the question of privatization of Polynesian Airlines. The national carrier has experienced significant operating losses and was provided with a capital infusion totaling ST20 million ($6.7 million) in supplementary appropriations in FY2001 and in the FY2002 budget. Additionally, the first step in improving the commercial legal environment was taken with the passage of a Companies Act of 2001, which replaces the outmoded Companies Act of 1955. In the area of financial sector reform, the Financial Institutions Act of 1996 was amended to place nonbank financial intermediaries (notably SNPF, DBS, and insurance companies) under CBS supervision. Both these acts were introduced as a result of work carried out under the ADB-financed Financial Sector Program Loan (footnote 8). The Government also moved to improve regulation and supervision of the Offshore Finance Center by introducing amendments to the 1987 Offshore Banking Act.

C. Highlights in Coordination of External Funding and Partnership Arrangements

21. ADB has played and continues to play a strong catalytic role in strengthening of the macroeconomic analysis, planning, and policy-making capacity of government institutions through its program of capacity building with the Treasury Department (TD), with parallel financing from the Australian Agency for International Development (AusAID). As such, ADB is providing critical support at the focal point of Samoa's reform program, with consequent impact on both macroeconomic and sector efficiencies, which in turn provides an improved policy framework for external aid programs in Samoa.

22. The ongoing education sector loan also provides an excellent opportunity for coordination and exchange at the policy level with the important external assistance agencies in the sector, including AusAID, the New Zealand Overseas Development Agency, the Japanese International Cooperation Agency, and the European Union Commission.

23. The Government plays a very active role in coordination of external funding. Consultations on the overall state of economic development such as those held in 2001 for preparation of the SDS, and minisummits with strong sector focus such as the one on education and health held in 1999, are organized by the Government to obtain the view of a wide range of stakeholders. These consultations and minisummits are generally followed by aid coordination meetings, which are designed to ensure that adequate external financial assistance is available to complement government funding of the Public Sector Investment Programme, which evolves from the consultative process (Appendix 2, Table A2.5).

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