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Seminannual Report on Project Administration and Technical Assistance Implementation for the Period Ending 30 June 1999 : Country Implementation Highlights
Sri LankaThe ongoing loans decreased to 24 with the closing of one and no approvals during the period. All loans were rated satisfactory in both implementation progress and achievement of development objectives, except for one, which was rated as partly satisfactory in implementation progress. Three loans that were approved during the second half of 1998 were declared effective during the period. No loans were awaiting signing or effectiveness. One loan underwent a major change in implementation arrangements. Project implementation in the transport sector continued to be characterized by excessive delays in procurement and implementation decisions. Some improvement, however, was witnessed in projects in the agriculture sector. Endemic project implementation problems included delays in (i) the procurement process, (ii) setting up of project management units, (iii) recruitment of consultants, and (iv) submission of audited project accounts and financial statements. On the whole, however, portfolio performance during the period was reasonable. The RM conducted portfolio performance review meetings with project directors and officials of the line ministries and the Economic Relations Division of the Ministry of Finance to review the status of project implementation and portfolio performance. Agreements were reached on actions to be taken to improve portfolio performance. Delays in procurement matters are being addressed by the Procurement Support Bureau, recently established with assistance from the Bank. A cofinancing seminar for government agencies and private sector organizations was arranged, where standard bidding documents were distributed to all EAs and line ministries. None of the loans were delegated to or were under implementation by the RM. The Bank's anticorruption policy paper was distributed to all the relevant ministries and agencies, and preparations were under way to conduct a seminar to brief government representatives on the objectives of the policy and its implications for Bank operations, particularly in the areas of procurement, audit, and financial management. The Bank is assisting the Government at two levels on governance issues. At one level, support is being provided to improve key segments of the public administration systems, particularly in the institutions in the sectors where Bank operations are focused. At another level, assistance is being provided to strengthen capacity and performance across the public sector. The Bank's ongoing support to improve procurement practices and procedures is an example of such initiatives. Contract awards of $31.4 million represented 80 percent of the semiannual projection of $39.1 million and 46 percent of the annual projection of $68.9 million. Disbursements of $43.0 million were equivalent to almost 100 percent of the semiannual projection of $43.8 million and were 47 percent of the annual projection of $91.9 million. Contract awards and disbursements were generally satisfactory due to the higher than expected contract awards from the social sector and disbursements from the agriculture and energy sectors. There were no disbursements from program loans. The disbursement ratio of 7.6 percent was a decrease from 10 percent as of 30 June 1998 and the Bankwide average of 11.9 percent. Net resource transfer went up to $33.5 million from $26.7 million as of 30 June 1998 due to increased disbursements and a very nominal increase in the loan service payments. Audited project accounts and financial statements were due for 16 loans and compliance was achieved for 11. Compliance for the remaining five loans was delayed by less than six months. Compliance with this covenant is being closely monitored by the Bank; and the trend is improving. Environmental covenants were met for seven loans. Compliance for 12 loans was ongoing. The covenants were not applicable to the other five. Compliance with the social covenants was met for five loans and was ongoing for nine loans. The covenants were not applicable to the 10 others. Tables 73 and 74 summarize the data for Sri Lanka.  
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