Kiribati: Enhancing Economic Competitiveness through State-Owned Enterprise Reform

Sovereign Project | 46511-001 Status: Approved

Summary

The TA will contribute to reducing drain on the fiscal position of the government from underperforming SOEs. Of the six priority areas in the Kiribati Development Plan (KDP) 2012 2015, this TA will support Government efforts on economic growth and poverty reduction priority area. With the government providing substantial resources to subsidies and bailout underperforming SOEs, strengthening these SOEs will result in the effective allocation of resources leading to economic growth and achieving of national priorities. Economic growth and poverty reduction are also ADB's core specializations, as set out in Strategy 2020. The proposed TA will also address priority actions identified in the joint policy matrix

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Procurement Documents

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Project Name Enhancing Economic Competitiveness through State-Owned Enterprise Reform
Project Number 46511-001
Country Kiribati
Project Status Approved
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 8478-KIR: Enhancing Economic Competitiveness through State-Owned Enterprise Reform
Japan Fund for Poverty Reduction US$ 800,000.00
TA 8478-KIR: Enhancing Economic Competitiveness through State-Owned Enterprise Reform (Supplementary)
Technical Assistance Special Fund US$ 222,000.00
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Partnerships
Private sector development
Sector / Subsector

Public sector management - Economic affairs management - Reforms of state owned enterprises

Gender Equity and Mainstreaming No gender elements
Description
Project Rationale and Linkage to Country/Regional Strategy The TA will contribute to reducing drain on the fiscal position of the government from underperforming SOEs. Of the six priority areas in the Kiribati Development Plan (KDP) 2012 2015, this TA will support Government efforts on economic growth and poverty reduction priority area. With the government providing substantial resources to subsidies and bailout underperforming SOEs, strengthening these SOEs will result in the effective allocation of resources leading to economic growth and achieving of national priorities. Economic growth and poverty reduction are also ADB's core specializations, as set out in Strategy 2020. The proposed TA will also address priority actions identified in the joint policy matrix
Impact Reduced drain on the fiscal position of the government from underperforming SOEs

Project Outcome

Description of Outcome Improved financial, operational and governance performance of SOEs
Progress Toward Outcome Since inception that TA has provided advised Cabinet on the three SOEs it had identified for rationalization. The TA has also run the first workshop on financial management tageting SOE Financial Managers and CEOs.
Implementation Progress
Description of Project Outputs

1. Rationalization strategies for at least three SOEs Implemented

2. At least four training courses on SOE governance and monitoring

3. Director performance evaluation system developed and implemented

Status of Implementation Progress (Outputs, Activities, and Issues)

January 2016 progress:

1. The shipyard PPP concession is close to settlement.

2. Work on outer islands shipping has progressed to the stage of having identified

issues and options. Work completed included a review of the existing government-owned vessel. This review has concluded that the vessel is not in a suitable

state of repair, is unfit for the purpose it is being used and should be disposed of by GoK. A discussion document is being drafted for consultation in early 2016. Detailed design of recommended solutions will be undertaken in the first quarter of 2016.

3. Progress on reform of PVU has been slow, but the PVU advisory committee should

soon be able to make the difficult decisions on staffing levels and desired rental prices that are the prerequisite for implementation. The TA will assist with implementation once these decisions have been taken.

4. Field work on merger of the two copra companies to form a new SOE was completed in October 2015. The TA will need to continue to support implementation of the new processes as well as the transfer of Assistant Treasurers from the Ministry of Internal

Affairs to the SOE.

5. New Government in place following recent elections.

Geographical Location

Summary of Environmental and Social Aspects

Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design During Project Design, ADB consulted the Ministry of Finance and the SOE Monitoring Unit, the SOE Reform Steering Committee and Kiribati Development Partners.
During Project Implementation The review missions will consult the different stakeholders to update members on progress of the TA.

Business Opportunities

Consulting Services

Consulting services will support the three outputs of this technical assistance (TA).

The team leader, who will be a state-owned enterprise (SOE) reform specialist, will supervise the TA. The consultants will work closely together to ensure the TA is in line with the proposed scope. The TA will work closely with 3 SOEs, which the government will select from the 23 SOEs.

Consulting services will include:

i) SOE reform specialist and team leader (international, 10 person-months, intermittent);

ii) SOE legal specialist (international, 4 person-months, intermittent);

iii) SOE accounting specialist (international, 3 person-months, intermittent);

iv) Capacity building specialist (international, 3 person-months, intermittent); and

v) SOE specialist (national, 10 person-months, intermittent).

Procurement Financed by Japan Fund for Poverty Reduction-US$800,000.

Responsible Staff

Responsible ADB Officer Malie Lototele
Responsible ADB Department Pacific Department
Responsible ADB Division Pacific Subregional Office in Suva, Fiji
Executing Agencies
Ministry of Finance and Economic Development
P.O. Box 67
Bairiki, Tarawa
Kiribati

Timetable

Concept Clearance 10 Jun 2013
Fact Finding 29 Jul 2013 to 01 Aug 2013
MRM -
Approval 08 Oct 2013
Last Review Mission -
Last PDS Update 29 Mar 2016

TA 8478-KIR

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
08 Oct 2013 21 Oct 2013 21 Oct 2013 31 Dec 2016 31 Mar 2017 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
222,000.00 800,000.00 80,000.00 0.00 0.00 0.00 1,102,000.00 08 Oct 2013 643,334.97

Safeguard Documents See also: Safeguards

Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

None currently available.

Evaluation Documents See also: Independent Evaluation

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Related Publications

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