PHNOM PENH, CAMBODIA — The Asian Development Bank (ADB) is expanding a nationwide program to improve public service delivery through a $35 million loan to support the development of efficient and accountable subnational administrations (SNAs).

The loan will be used to fund subprogram 2 of the Decentralized Public Service and Financial Management Sector Development Program, comprising policy-based and project lending. Key activities include the development of policy and regulatory frameworks for decentralization, defining clear service delivery responsibilities of SNAs, and assigning efficient tax and non-tax revenue to SNAs. It will also provide funding to establish the Sub-National Investment Fund (SNIF) to promote fiscal transfer as well as capacity building to subnational administrations at districts, municipalities, and communes.

ADB has supported the implementation of the National Program for Sub-National Democratic Development 2010-2019 since its inception.

“The subprogram 2 will further improve access to and coverage of basic public services across Cambodia by supporting the development of subnational administrations accountable to their citizens,” said Hiroyuki Aoki, an ADB Senior Financial Sector Specialist. “The program will involve communities in the decision-making processes, enabling more efficient and transparent public service delivery that is relevant to local needs and reduces inequalities.”

ADB approved $37.5 million in 2012 for subprogram I of the Decentralized Public Service and Financial Management Sector Development Program. Subprogram I has enhanced accountability of local administrations to their constituencies through supporting inter-governmental fiscal networks, the design and implementation of public financial management systems for monitoring SNAs, and pilot decentralization of rural water supply operations. Under subprogram 2, the SNIF will provide 184 rural districts with grants for pilot investment projects including civil works in health and sanitation, infrastructure, and education, as well as capacity development for the SNIF Secretariat and subnational officials.

ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, ADB in December 2016 will mark 50 years of development partnership in the region. It is owned by 67 members – 48 from the region. In 2015, ADB assistance totaled $27.2 billion, including cofinancing of $10.7 billion.

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