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Micronesia, Federated States of: Health Expenditure and Livelihoods Support Program

Sovereign (Public) Project | 54309-001 Status: Approved

The HEALS program is part of an integrated package of assistance by the Asian Development Bank (ADB) to FSM to support short-term efforts in mitigating the potential health consequences and socioeconomic impacts of the coronavirus disease (COVID-19) pandemic. It is aligned with the Pacific Approach's priority of managing risks and building economic resilience to protect the population from hardships; and the priority of directing ADB grant resources to the most vulnerable developing member countries. The FSM meets all of the access criteria of ADB's CPRO, which include sound macroeconomic management, undertaking key structural reforms, a pro-poor countercyclical expenditure program, and debt sustainability.

Project Details

Project Officer
Romero-Torres, Jennifer Pacific Department Request for information
Country
  • Micronesia, Federated States of
Sector
  • Public sector management
 
Project Name Health Expenditure and Livelihoods Support Program
Project Number 54309-001
Country Micronesia, Federated States of
Project Status Approved
Project Type / Modality of Assistance Grant
Source of Funding / Amount
Grant 0751-FSM: Health Expenditure and Livelihoods Support Program
concessional ordinary capital resources lending / Asian Development Fund US$ 14.00 million
Strategic Agendas Inclusive economic growth
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Partnerships
Private sector development
Sector / Subsector

Health / Disease control of communicable disease - Health system development

Public sector management / Economic affairs management - Public expenditure and fiscal management - Social protection initiatives

Gender Equity and Mainstreaming Effective gender mainstreaming
Description The HEALS program is part of an integrated package of assistance by the Asian Development Bank (ADB) to FSM to support short-term efforts in mitigating the potential health consequences and socioeconomic impacts of the coronavirus disease (COVID-19) pandemic. It is aligned with the Pacific Approach's priority of managing risks and building economic resilience to protect the population from hardships; and the priority of directing ADB grant resources to the most vulnerable developing member countries. The FSM meets all of the access criteria of ADB's CPRO, which include sound macroeconomic management, undertaking key structural reforms, a pro-poor countercyclical expenditure program, and debt sustainability.
Project Rationale and Linkage to Country/Regional Strategy

The FSM is a remote Pacific small island developing state encompassing 607 islands that are spread over the world's 14th largest geographic exclusive economic zone. It is a lower middle income island nation with a small population of 104,468 in 2018, of which approximately 45% live in Chuuk, 37% in Pohnpei, 11% in Yap, and 7% in Kosrae. The country is vulnerable to climate change, facing frequent natural hazards and rising sea levels. The public sector dominates the economy, with private economic activities focused mainly on subsistence farming and fishing, wholesale and retail trade, transportation, and tourism services. Less than 15% of the population was under formal employment in 2010, with significantly more people under the age of 15 (36%), outside of the labor force (27%) or in the subsistence sector (16%). In FY2018, the government and public enterprises account for 32% of gross domestic product (GDP), followed by households (26%), and private enterprises (19%), and financial institutions (16%). The FSM has one of the highest estimated rates of poverty in the Pacific with 41% of the population living below the poverty line and 10% below the food poverty line. The FSM was ranked 135th out of 189 countries by the United Nations Development Programme's human development index for 2019.

Despite the geographic isolation of the Pacific, the risk of COVID-19 transmission on vulnerable population remains high, with confirmed cases in Fiji and Papua New Guinea. As a small-island developing state, the FSM faces a set of distinct challenges to counter the pandemic and mitigate impacts such as having weak health infrastructure, a narrow economic base, geographically dispersed population, and a fragile environment that is already vulnerable to climate change. While the spread of COVID-19 has not reached the FSM with no confirmed cases to date, the projected health, economic, and social impacts of the COVID-19 pandemic are already significant.

Impact

Effective health preparedness and mitigation to COVID-19 ensured

Economic activities in FSM restored, with adverse impacts of COVID-19 to vulnerable segments mitigated

Project Outcome
Description of Outcome Adverse effects of COVID-19 on citizens and businesses reduced
Progress Toward Outcome
Implementation Progress
Description of Project Outputs

Measures to combat the entry and spread of COVID-19 in the FSM delivered

Measures to provide economic stimulus relief to businesses implemented

Measures to provide social protection to poor and vulnerable groups enhanced

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 Romero-Torres, Jennifer
Responsible ADB Department Pacific Department
Responsible ADB Division PASP
Executing Agencies
Asian Development Bank
6 ADB Avenue,
Mandaluyong City 1550, Philippines
Department of Finance and Administration
PS2, Palikhir
Pohnpei State
Federated States of Micronesia
Timetable
Concept Clearance -
Fact Finding 03 Aug 2020 to 07 Aug 2020
MRM 22 Sep 2020
Approval 12 Nov 2020
Last Review Mission -
Last PDS Update 16 Nov 2020

Grant 0751-FSM

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
12 Nov 2020 - - 30 Sep 2021 - -
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 14.00 Cumulative Contract Awards
ADB 14.00 12 Nov 2020 0.00 0.00 0%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 12 Nov 2020 0.00 0.00 0%

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Tenders

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Contracts Awarded

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Procurement Plan

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