Palau : Recovery through Improved Systems and Expenditure Support Program (Subprogram 2)
The Recovery through Improved Systems and Expenditure Support (RISES) Program comprises two subprograms supporting public sector management reforms that will facilitate Palau's recovery from the coronavirus disease (COVID-19) crisis. Subprogram 2 deepens and implements reforms initiated under subprogram 1, which was approved on 23 April 2021. Overall, the program seeks to (i) strengthen the policy and legislative framework for public financial management; (ii) reduce fiscal risks from weak management of public revenue, expenditure, and liabilities; and (iii) support private sector development, toward restoring sustained and equitable economic growth. Under subprogram 2, ADB supports 10 prior actions, all of which have been completed. The proposed budget support amount is $30 million (regular OCR) under subprogram 2 in FY2022, which along with the $25 million ($20 million COL and $5 million OCR) approved under subprogram 1, brings ADB's total financing under this program to $55 million.
Project Details
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Project Officer
Rabanal, Rommel F.
Pacific Department
Request for information -
Country/Economy
Palau -
Modality
-
Sector
- Public sector management
| Project Name | Recovery through Improved Systems and Expenditure Support Program (Subprogram 2) | ||||
| Project Number | 54284-002 | ||||
| Country / Economy | Palau |
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| Project Status | Closed | ||||
| Project Type / Modality of Assistance | Loan |
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| Source of Funding / Amount |
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| Operational Priorities | OP2: Accelerating progress in gender equality OP6: Strengthening governance and institutional capacity |
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| Sector / Subsector | Public sector management / Economic affairs management - Public expenditure and fiscal management |
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| Gender | Effective gender mainstreaming | ||||
| Description | The Recovery through Improved Systems and Expenditure Support (RISES) Program comprises two subprograms supporting public sector management reforms that will facilitate Palau's recovery from the coronavirus disease (COVID-19) crisis. Subprogram 2 deepens and implements reforms initiated under subprogram 1, which was approved on 23 April 2021. Overall, the program seeks to (i) strengthen the policy and legislative framework for public financial management; (ii) reduce fiscal risks from weak management of public revenue, expenditure, and liabilities; and (iii) support private sector development, toward restoring sustained and equitable economic growth. Under subprogram 2, ADB supports 10 prior actions, all of which have been completed. The proposed budget support amount is $30 million (regular OCR) under subprogram 2 in FY2022, which along with the $25 million ($20 million COL and $5 million OCR) approved under subprogram 1, brings ADB's total financing under this program to $55 million. Although Palau demonstrated sound macro-fiscal management by maintaining annual fiscal surpluses averaging 3.0% of GDP during FY2011FY2019, the lingering impacts of the coronavirus disease (COVID-19) pandemic have heightened fiscal risks that can constrain sustainable recovery. Recognizing these risks, the government has developed an ambitious reform agenda comprising critical policy reforms to, among others: develop an overarching fiscal responsibility legislation and a corresponding medium-term fiscal strategy; implement a comprehensive tax reform package to modernize and increase the efficiency of Palau's tax system; and strengthen the legal and institutional frameworks for international commercial arbitration, public-private partnerships, and business registrations. The RISES Program aligns with and supports government's broad-ranging reform agenda to help shift Palau's economic recovery onto a more sustainable path. |
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| Project Rationale and Linkage to Country/Regional Strategy | The programmatic approach comprises two subprograms in support of public sector management reforms to bolster Palau's recovery from the COVID-19 crisis. Subprogram 2 is the final subprogram, deepening and implementing the reforms initiated under subprogram 1, which was approved and disbursed in 2021. All policy actions completed under subprogram 1 remain in effect. Subprogram 2 builds on the achievements of subprogram 1 and further supports the government to strengthen PFM, reduce fiscal risks, and promote private sector development to restore sustained and equitable economic growth. The program is aligned with Strategy 2030 of the ADB and its operational priorities of strengthening governance and institutional capacityincluding a differentiated approach to institutional strengthening and private sector development in small island developing statesand accelerating progress in gender equality. It is consistent with the Pacific Approach 20212025, which prioritizes PFM improvements to achieve the strategic objective of preparing for and responding to shocks, and the broader goal of building resilience. | ||||
| Impact | Quality of life for current and future generations of Palauans enhanced |
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| Project Outcome | |
|---|---|
| Description of Outcome | Palau's economic recovery from the COVID-19 crisis shifted toward a more sustainable fiscal path |
| Progress Toward Outcome | |
| Implementation Progress | |
| Description of Project Outputs | Policy and legislative framework for public financial management strengthened Fiscal risks from weak management of public revenue, expenditure, and liabilities reduced Private sector development supported |
| Status of Implementation Progress (Outputs, Activities, and Issues) | |
| Geographical Location | Nation-wide |
| Safeguard Categories | |
|---|---|
| Environment | C |
| Involuntary Resettlement | C |
| Indigenous Peoples | C |
| Summary of Environmental and Social Aspects | |
|---|---|
| Environmental Aspects | |
| Involuntary Resettlement | |
| Indigenous Peoples | |
| Stakeholder Communication, Participation, and Consultation | |
| During Project Design | |
| During Project Implementation | |
| Responsible ADB Officer | Rabanal, Rommel F. |
| Responsible ADB Department | Pacific Department |
| Responsible ADB Division | PASP |
| Executing Agencies |
Ministry of Finance |
| Timetable | |
|---|---|
| Concept Clearance | - |
| Fact Finding | 11 May 2022 to 12 May 2022 |
| MRM | 15 Jun 2022 |
| Approval | 31 Aug 2022 |
| Last Review Mission | - |
| Last PDS Update | 31 Aug 2022 |
Loan 4206-PAL
| Milestones | |||||
|---|---|---|---|---|---|
| Approval | Signing Date | Effectivity Date | Closing | ||
| Original | Revised | Actual | |||
| 31 Aug 2022 | 15 Sep 2022 | 13 Oct 2022 | 31 Jan 2023 | - | 20 Jan 2023 |
| Financing Plan | Loan Utilization | ||||
|---|---|---|---|---|---|
| Total (Amount in US$ million) | Date | ADB | Others | Net Percentage | |
| Project Cost | 30.00 | Cumulative Contract Awards | |||
| ADB | 30.00 | 24 Jan 2023 | 30.00 | 0.00 | 100% |
| Counterpart | 0.00 | Cumulative Disbursements | |||
| Cofinancing | 0.00 | 24 Jan 2023 | 30.00 | 0.00 | 100% |
Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.
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| Title | Document Type | Document Date |
|---|---|---|
| Loan Agreement (Ordinary Operations) for Loan 4206-PAL: Recovery through Improved Systems and Expenditure Support Program (Subprogram 2) | Loan Agreement (Ordinary Resources) | Sep 2022 |
| Recovery through Improved Systems and Expenditure Support Program (Subprogram 2): Report and Recommendation of the President | Reports and Recommendations of the President | Aug 2022 |
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
None currently available.
Related Publications
None currently available.
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ADB Approves $30 Million Loan to Boost Palau’s Recovery from COVID-19
ADB has approved a $30 million policy-based loan to help Palau’s economy rebound from the COVID-19 pandemic under the Recovery through Improved Systems and Expenditure Support Program.
Tenders
Contracts Awarded
Procurement Plan
None currently available.