Agriculture, natural resources and rural development / Agricultural policy, institutional and capacity development - Agricultural production

Energy / Renewable energy generation - biomass and waste

The Technical Assistance (TA) prepared an agreed design of an investment project that addresses the rural infrastructure deficit that is considered the major binding constraint for the socio-economic development of the Northern Region, and compliment this with investments to raise agriculture productivity and enhance community resilence.

The ensuing Project, Grant 0235-LAO: Northern Rural Infrastructure Development Project - approved on 26 November 2010, will improve rural household incomes in the four northern provinces of Bokeo, Luang Namtha, Oudomxay, and Phongsaly. The outcome will be increased agricultural productivity in these project provinces. Four main outputs include: (i) production and productivity enhancing rural infrastructure constructed and/or rehabilitated; (ii) productivity and impact enhancing initiatives adopted; (iii) capacities of national, provincial and district agencies strengthened to enable a sector development approach; and (iv) efficient and effective delivery of subprojects and Project management.

The Project is consistent with ADB's Strategy 2020 and the (draft) Operational Plan for Sustainable Food Security. ADB's Country Strategy and Program 2007-2011 for Lao PDR is also aligned with the Government's 6th National Socio Economic Development Plan, and focuses on (i) promoting pro-poor sustainable growth: nurturing labor-intensive sources of growth (through small and medium sized enterprise development, transition to commercial agriculture, and regional integration as the main engine of outward-oriented growth); (ii) fostering inclusive social development: accelerating progress in non-income Millennium Development Goals (MDG)-basic education, primary health care, water supply; and (iii) addressing priority governance issues. A necessary pre-requisite for private sector-led growth and agricultural commercialization is market access (rural infrastructure) and enhanced productivity, in particular, the more efficient irrigation facilities.

The Project is consistent with the Government's objectives outlined in National Growth and Poverty Eradication Strategy (NGPES) and commitments under the MDGs, both of which target poverty reduction. The links between agricultural intensification through improved rural infrastructure and poverty reduction are well documented in TA 4521-LAO: Institutional Strengthening for Poverty Monitoring and Evaluation in which it concluded that "upgrading of roads had significant effect on poverty reduction, with the effect of upgrading from no vehicular access to only dry season access particularly large" Within the NGPES, rural infrastructure (including irrigation, rural markets and rural roads) has been accorded the highest priority as a means of achieving its poverty reduction objectives.