Managing for Development Results at ADB

Results Matter December 2007

Improving Portfolio Performance in Nepal
By Ki Hee Ryu, Head, Portfolio Management Unit, Nepal Resident Mission

Nepal’s portfolio performance had been well below ADB-wide averages for many years. Following the adoption of the first results-based Country Strategy and Program for Nepal in 2004, improving performance of the Nepal portfolio—and accelerating the delivery of results on the ground—in a conflict environment became the priority of the ADB–Government team. By 2006, the performance of ADB’s Nepal portfolio had improved considerably (Table).

What helped facilitate these improvements?
Key actions taken by the ADB–Government team include:

1. Comprehensive country portfolio reviews to assess not only portfolio performance, but also “development results” in terms of progress toward outputs and outcomes (since 2006).

2. Portfolio performance action plans agreed with the Government (2005). Bimonthly meetings with the Government held to identify and remove policy and institutional constraints under ADB-financed projects.

3. ‘Early warming system’ on portfolio performance—frequent regular monitoring of project performance reports and other data and meetings to enable timely actions—established in ADB’s South Asia Regional Department (2005).

4. Portfolio management strategy to mainstream conflict-sensitive approach adopted by Nepal Resident Mission (2006).

5. Annual spring cleaning exercises undertaken to remove poorly performing portfolio elements (since 2005, $75 million in loan savings have been reallocated).

6. Sector results profile as monitoring tool—a snapshot of progress toward expected results—prepared for priority sectors, updated and assessed regularly to identify issues and take timely action (since 2005).

7. Project readiness filters adopted to reduce start-up delays and accelerate implementation (since 2005).

8. Reforms in procurement and financial management undertaken by the Government to strengthen country systems (since 2005).

9. Upfront screening mechanism adopted to assess project design during the early stage of project preparation (since 2006).

Source: South Asia Regional Department, Asian Development Bank.

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