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p. 4 of 6 BACK | NEXT Foreword I. The Asian Development Bank's (ADB) Mission II. A Framework for Poverty Reduction: Pillars of the Poverty Reduction Strategy III. The Strategy IV. Implementing the Strategy Appendix

Enhancing the Fight Against Poverty in Asia and the Pacific: The Poverty Reduction Strategy of the Asian Development Bank

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III. The Strategy

34. The following sections describe how the three pillars translate into a comprehensive strategy to guide policy reform, investment projects, and capacity building in individual countries.

A. Greater Country Focus

35. Focusing on individual countries is an essential element of the PRS and requires improving the quality of poverty and other analytical work; strengthening partnerships around national poverty reduction strategies (NPRS); and developing high-quality, results-oriented country strategies and programs.

1. Country-Focused Poverty Analysis

36. The analysis begins with a comprehensive examination of the constraints and opportunities for poverty reduction in each country that assesses the nature, intensity, and spread of poverty; its many causes; the effects of public policies; the focus and efficiency of public expenditures; and the effectiveness of government programs and institutions. ADB will involve other stakeholders in the analysis and will build on the extensive data already developed by governments and the donor community. It will also review poverty targets under the MDGs and sector strategies. In addition, the analysis will discuss the relationship between the incidence of poverty and interventions in the thematic areas and sectors. Wherever possible, ADB makes extensive use of poverty assessments done by development partners.

37. ADB recognizes that a great deal of work is ongoing in the region and that many borrowing countries have well-developed poverty reduction strategies and monitoring systems, in some cases developed with ADB’s help. ADB will also support improved data collection and management, research, and poverty analysis. The ADB Institute will assist in formulating long-term strategies for economic and social development and poverty reduction. Poverty assessments will review and comment on national strategies and recommend policies.

2. Building Partnerships around National Poverty Reduction Strategies

38. Prospects for poverty reduction are greatest if DMCs lead the preparation of the NPRS and commit to its full implementation. ADB should strengthen its operational links to the NPRS by fully mobilizing all stakeholders, strengthening partnerships, and improving the quality of its CSP. ADB’s resident missions will play lead roles in these efforts.

39. Developing partnerships is essential to poverty reduction and attaining the MDGs; DMC governments must take the lead. ADB collaborates with United Nations agencies and multilateral banks to assess poverty, to understand various approaches to reduce it, and to support preparation and implementation of the NPRS. Such partnerships also allow ADB to mobilize complementary resources to scale up interventions and access grant funds to test innovative approaches to poverty reduction. NGOs have also been actively involved in formulating ADB’s new framework for ADBNGO cooperation for 2003-2005.

40. Close cooperation and harmonization efforts among development partners can reduce transaction costs and thus increase development effectiveness. ADB will further its collaboration with the International Monetray Fund and the World Bank, United Nations agencies, and bilateral development organizations to include country strategy, program implementation, analytical work, cofinancing, sector-wide assistance approaches (SWAps), policy advocacy, and measuring and monitoring accomplishments in relation to the MDGs and to other poverty indicators. Working through resident missions, ADB will strengthen donor cooperation and will act together with stakeholders and civil society to monitor progress in reducing poverty.

3. Country Strategies and Results-Oriented Programming

41. Since 2000, most DMCs have formulated and adopted national poverty reduction strategies or have included them in their national development plans. If requested, ADB will assist with developing capacities for preparing and updating the strategies and will participate in discussions organized and led by governments—the key stakeholders—to discuss them.² The CSP then translates the substance and priorities of the NPRS into specific activities and a program of loans and assistance.

42. The CSP is generally prepared every 3–5 years but is updated regularly. The development objectives in the NPRS will be critically assessed during the preparation phase of the CSP to ensure that ADB’s role and objectives are clear, that there is a credible strategy and program in the CSP for achieving them, and that time-bound indicators are specified. The CSP should be prepared in close partnership with development partners and stakeholders, and reflect full ownership by the DMC.

43. The CSP will define the sector, subsector, and project type according to the country specific poverty context, national strategies and priorities for poverty reduction, and the availability of good practices to scale-up poverty reduction. The CSP will also specify whether ADB operations will directly target the poor or assist them indirectly. That choice will be made on the basis of in-depth country knowledge and experience.

44. All new CSPs will have a framework for results that includes monitoring and that links the constraints to poverty reduction identified in poverty assessments with the proposed program, desired outputs, and expected outcomes. Strengthening quality assurance for country assessments— poverty, sector, thematic, and past performance of ADB’s country assistance—will help to improve the consistency and coherence of the CSP.

45. CSP outcomes are quantified by indicators for each relevant pillar, sector, and thematic priority. The CSP will indicate how the desired outcomes can be met through the country program by linking each lending, technical assistance, or knowledge product to one or more country outcome indicators. To complement the results framework, links between project outputs and sector outcomes will be emphasized in sector roadmaps. Collating these sector outcome indicators in the CSP will demonstrate the overall contribution of the country program to outcomes for the strategic pillars and thematic priorities (Figure 1). [ PDF: 44kb | 1 page ]

B. Thematic Priorities

46. Five themes complement the three pillars and are essential elements of the PRS: gender equality, environmental sustainability, private sector development, regional cooperation, and capacity development.

47. Gender Equality. Two thirds of the poor in the region are female, so improving the status of women is central to any strategy to reduce poverty in the region. ADB takes gender and development issues into consideration in its economic and sector work, loans, technical assistance, and other activities. ADB prepares country gender briefing papers and collaborates with civil society and development partners to learn about the status of women in its DMCs. ADB’s gender analyses feed directly into CSPs and project designs and support policy dialogue to integrate gender considerations more effectively into operations and broader public policy reform. Gender-inclusive measures are promoted in relevant projects. Stand-alone projects or project components targeting gender issues are designed and implemented. Such interventions will be required as long as structural constraints and barriers restrict women’s development. This is especially true where cultural traditions dictate the segregation of sexes or in situations where women require special assistance to enable their full participation in economic and social activities.

48. Environmental Sustainability. Environmental sustainability is critical for poverty reduction and is intimately intertwined in development strategies that promote economic growth; provide essential services, including clean water and sanitation; increase agricultural productivity; and improve the overall quality of life for the poor. For inclusive development to be achieved, a better understanding is needed of the environmental implications of policies to reduce poverty and of the impacts on the poor of environmental policies. The environment and natural resources in the region are under intense pressure. Recognizing this, ADB adopted an environmental policy that addresses

1. environmental interventions
2. mainstreaming of environmental issues in projects aimed at fostering economic growth
3. the maintenance of global and regional life support systems
4. fostering effective partnerships
5. integrating environmental considerations into ADB operations

ADB helps combat environmental degradation through advisory, regional, and project interventions. In addition to stand-alone interventions with specific environmental objectives, many important environmental issues are addressed through projects with other development aims. Environmental assessments are widely disseminated and discussed, and appropriate safeguards are taken to ensure that ADB projects respect the highest standards of sustainable development.

49. Private Sector Development. Development of a strong and dynamic private sector is crucial to long-term, rapid economic growth and is necessary for poverty reduction. ADB helps DMCs to create an enabling environment for private sector participation in development and to generate business opportunities through public sector operations. The contribution of the private sector to poverty reduction is enhanced through developing enterprises, expanding infrastructure and other public services, and bettering the quality and terms of employment by improving corporate governance and responsibility. Private operators are enabled to provide infrastructure and public services and projects targeting the poor. Regulatory reform precedes sector-specific approaches such as privatization, contracting-out, and private-public partnerships. In the CSP framework, ADB’s nonguaranteed private sector operations seek to achieve development impact by demonstrating new approaches and by removing obstacles to investment.

50. Regional Cooperation. Economic development increases when DMCs actively pursue regional and subregional cooperation. Regional cooperation can also spur private sector development, promote peace and stability, and provide greater economic opportunities to people living close to the borders who are often among the poorest in many countries. Cooperation is important for providing regional public goods that address joint constraints and opportunities such as preventing communicable diseases and environmental degradation. Building on its strong track record, ADB will continue to accord a high priority to regional cooperation as a means for DMCs to eliminate both physical and institutional impediments to trade and investment hence lowering transaction costs and increasing attractiveness to potential investors. Regional cooperation can help DMCs achieve greater economies of scale; diversify the structure of domestic production and exports; harmonize standards; share technologies; and jointly develop the facilities required for the delivery of essential public services such as health care, education, sanitation, electrification, and social protection. It can also promote regional environmental sustainability, facilitate the combating of global crimes such as money laundering and trafficking of women and children, and enhance the global bargaining power of individual states. It is also useful for knowledge sharing of all kinds.

51. Developing Capacity: A New PRS Emphasis. Achieving inclusive growth requires enhanced DMC capacity to formulate and implement policies, reforms, and investments. The importance of developing capacity is also underlined by the growing emphasis on the role of NPRS for managing poverty reduction in individual countries. This calls for strategic support for continuous development of knowledge and skills of societies, organizations, and individuals—including the poor—in DMCs. ADB has long recognized the importance of capacity development and has provided extensive support for it. ADB will aim at providing strategic support to enhance a DMC’s capacities to formulate and implement policies, reforms, and investments needed for poverty reduction. ADB will continue to support capacity development by developing and sharing new knowledge products; by reviewing constraints; by providing demand-driven advisory services; and by supporting investments aimed at building institutions and organizations that are fully accountable, effective, efficient in their operations, and responsive to the needs of the poor.

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