Mongolia: Promoting Inclusive Growth

Sovereign Project | 46060-001

Summary

To increase the capacity to develop policies on inclusive growth among key public and private stakeholders, the TA will (i) identify the main drivers of inequality and constraints to more inclusiveness in Mongolia, (ii) conduct a consultative process to identify key constraints to inclusive growth involving key public and private stakeholders to support these efforts, (iii) improve institutional and human capacity for inclusive growth in selected government and professional business entities, and (iv) provide policy recommendations on inclusive growth and future project investments in priority areas.

Latest Project Documents

Title Document Date
Promoting Inclusive Growth Dec 2012

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Project Name Promoting Inclusive Growth
Project Number 46060-001
Country Mongolia
Project Status Approved
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 8241-MON: Promoting Inclusive Growth
Japan Fund for Poverty Reduction US$ 1.00 million
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Sector / Subsector

Education - Technical and vocational education and training

Finance - Small and medium enterprise finance and leasing

Industry and trade - Small and medium enterprise development

Public sector management - Public expenditure and fiscal management - Social protection initiatives

Gender Equity and Mainstreaming
Description To increase the capacity to develop policies on inclusive growth among key public and private stakeholders, the TA will (i) identify the main drivers of inequality and constraints to more inclusiveness in Mongolia, (ii) conduct a consultative process to identify key constraints to inclusive growth involving key public and private stakeholders to support these efforts, (iii) improve institutional and human capacity for inclusive growth in selected government and professional business entities, and (iv) provide policy recommendations on inclusive growth and future project investments in priority areas.
Project Rationale and Linkage to Country/Regional Strategy

Protecting people with low skills and income from the impact of high inflation and enabling their full participation in economic growth through greater employment and access to core public services is a key government responsibility. Strategy 2020 identifies inclusive growth as one of ADB's three strategic pillars along with environmental sustainability and regional integration. It emphasizes the need to promote a development strategy which (i) provides greater access to opportunities by expanding human capacities through investments in education, health, and basic social protection; (ii) improves the poor's access to markets and basic productive assets by putting in place sound policies and institutions; and (iii) strengthens social safety nets. The Organisation for Economic Co-operation and Development further supports the thrust of ADB's Strategy 2020 by advocating a policy approach to reducing inequality based on three pillars: human capital investment, inclusive employment promotion, and well-designed redistribution policies. There is a need to analyze constraints to inclusive growth in Mongolia, with emphasis on the non-resource sectors. Given the changes in the economy and the resulting rapid socioeconomic changes, there is also a need to refocus broader development objectives and prioritize inclusiveness in development planning and policies. This necessitates consensus and capacity building at the national and local levels and the development of clear road maps for policies and programs.

To support inclusive growth, the government is supporting inclusion by strengthening vocational training, increasing social security coverage, promoting employment for disadvantaged groups, and investing in disadvantaged urban areas. These need to be complemented by policy development capacity and a long-term strategy focused on achieving inclusive growth to (i) create and expand economic opportunities (mainly productive employment); and (ii) ensure broader access to these opportunities for members of society to participate in and benefit from growth. Currently, there is limited public debate and understanding of the consequences of social and economic inequality; no monitoring and a lack of capacity across various sectors (government, private sector, media, civil society) to define and monitor progress toward inclusive growth; and weak policy and development capacity to be able to address inclusive growth in key sectors. Identifying and addressing such constraints will support inclusive growth and good governance.

Since 2009, ADB, in cooperation with Japan International Cooperation Agency and the World Bank, has supported modernization of the social welfare system in Mongolia by improving targeting methodologies and introducing social transfers directly targeted at the poor. As a second step, poor and marginalized households need to be brought into the formal labor market to obtain decent and productive jobs to sustain their living standards.

Impact Mongolia's medium-term strategic plan and the corresponding yearly socioeconomic guidelines reflect inclusive growth policies.
Project Outcome
Description of Outcome Improved capacity to develop policies on inclusive growth among key public and private stakeholders
Progress Toward Outcome
Implementation Progress
Description of Project Outputs

1. Analysis of the main drivers of inequality and constraints to inclusiveness of growth in Mongolia

2. A consultative process to identify key constraints to inclusiveness of growth has reached key public and private stakeholders.

3. Institutional and human capacity for inclusive growth is improved in selected government and professional business entities.

4. Policy recommendations on inclusiveness of growth and future investment in priority areas are identified.

Status of Implementation Progress (Outputs, Activities, and Issues) The TA review mission was fielded in October 2014 to review TA implementation. Implementation is delayed and reports produced so far are generally satisfactory but lack analytical depth. The team leader of the firm has resigned in October 2014 and was replaced in March 2015. Although the TA is delayed, the TA benefits from committed consultants and supportive executing agency. The firm is responsive but needs to ensure that the consultants deliver timely outputs of a sufficient level of quality.
Geographical Location
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation The TA will focus on stakeholders and activities at four levels: (i) at a macro level it will identify and analyze the significant drivers of inequality and key sectors affected; (ii) at the government level it will work with NDIC and the cabinet to identify inclusive growth indictors and an effective monitoring framework to assist in mid- and long-term development planning, prioritization, and monitoring; (iii) at the stakeholder level it will conduct a broad participatory assessment and awareness building with private sector, the public, and civil society to help better define their roles in sustaining inclusive growth; and (iv) at the community level it will implement two pilots focusing on maximizing the potential for promoting inclusive growth through two government programs which support decentralization and targeting.
Business Opportunities
Consulting Services ADB will recruit a consulting entity using quality- and cost-based selection with the standard ratio of 80:20 to provide 16 person-months of international and 64 person-months of national consultants, including expertise in (i) socioeconomic analysis and policy development; (ii) consultative processes and outreach; and (iii) the development and implementation of social surveys. The firm will be recruited in accordance with ADB's Guidelines on the Use of Consultants (2010, as amended from time to time). An administrative and technical coordinator will be recruited as an individual consultant to facilitate day-to-day organizational and technical matters and liaise with the executing agency.
Procurement The consulting firm will be responsible for procurement of the TA equipment in accordance with ADB's Procurement Guidelines (2010, as amended from time to time). The executing agency will retain the equipment upon TA completion.
Responsible ADB Officer Claude Bodart
Responsible ADB Department East Asia Department
Responsible ADB Division Urban and Social Sectors Division, EARD
Executing Agencies
Ministry of FinanceGovernment Building-2
Negdsen Undestnii gudamj-5/1
Ulaanbaatar-210646, Mongolia
Timetable
Concept Clearance 18 May 2012
Fact Finding 12 Mar 2012 to 16 Mar 2012
MRM -
Approval 06 Dec 2012
Last Review Mission -
Last PDS Update 30 Mar 2015

TA 8241-MON

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
06 Dec 2012 07 Feb 2013 07 Feb 2013 31 May 2015 31 May 2016 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
0.00 1,000,000.00 0.00 0.00 0.00 0.00 1,000,000.00 06 Dec 2012 369,289.70
Title Document Type Document Date
Promoting Inclusive Growth Technical Assistance Reports Dec 2012

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