The Government of Indonesia's National Poverty Reduction Strategy identified the lack of basic infrastructure in rural areas as an underlying cause of poverty. Its Medium-Term Development Plan, 2004-2009 underscored the need for investing in rural infrastructure. The plan identified investment needs of about $145 billion in infrastructure, which were deemed necessary to maintain a sustained gross domestic product growth rate of 6% and to make steady progress toward achieving the Millennium Development Goals (MDGs) during the plan period. Of these, public sector requirements were estimated at about $25 billion for infrastructure in rural areas that was traditionally unattractive for the private sector.
This report validates the completion report's assessment of the project which aims to improve access of the poor and near poor in the rural areas of Indonesia to basic infrastructure services. IED overall assessment: Successful