ADB, Mongolia Target Hospital, Drug Safety Improvements

News Release | 1 December 2010

MANILA, PHILIPPINES - The Asian Development Bank (ADB), the largest external financier in Mongolia's health sector, is providing fresh assistance to improve hospital services in the capital, Ulaanbaatar, and to strengthen the country's drug safety regime.

ADB's Board of Directors approved a grant of $14 million for the Fourth Health Sector Development Project, which follows three previous sector reform projects dating back to 1997.

"The outcome of this latest initiative will be improved health sector efficiency, governance and drug safety," said Claude Bodart, Senior Health Specialist in ADB's East Asia Department.

Mongolia's hospital sector absorbs the bulk of funds allocated to the Ministry of Health, but it is characterized by excessive capacity, inefficiencies, and a lack of quality services. The country also suffers from the availability of substandard medicines. While cost has been a barrier to reform in the past, the outlook for change has never been rosier with the advent of public-private partnerships to provide capital and management, increasing public clamor for improvements, and greater political urgency.

The latest ADB initiative differs from previous projects by taking a more macro approach to hospital reform, and it will help the government prepare its first hospital development policy for Ulaanbaatar. The Songinohairkhan district hospital in the capital region will be turned into a model multifunctional general hospital with expanded services which other district hospitals are expected to follow. Support will be given to strengthen medical residency training and postgraduate programs, as part of human resource development, while a drug regulatory authority will be set up and the drug control laboratory will be strengthened to increase access to safer drugs nationwide.

"The project will directly benefit over 250,000 mostly poor residents of Songinohairkhan district with better hospital services, as well more broadly improving the health status of the overall population resulting in reduced household expenditure and time spent seeking care," said Mr. Bodart.

The grant from ADB's concessional Asian Development Fund makes up over 77% of the total project cost of $18.1 million. The World Health Organization, one of the many development partners ADB works with in the health sector, will provide parallel cofinancing of $450,000, while the Government of Mongolia will fund the remaining $3.7 million.

The Ministry of Health is the executing agency for the project, which is due for completion in June 2016.