Nauru : Improving Fiscal Sustainability Program (Subprogram 1)

Sovereign Project | 55017-001

The proposed Improving Fiscal Sustainability Program will help the Government of Nauru strengthen gender-responsive fiscal sustainability by implementing policy and institutional reforms to (i) enhance fiscal and debt management, (ii) improve the governance of state-owned enterprises (SOEs), (iii) advance social protection systems; (iv) increase women's economic participation; and (v) reduce gender-based violence (GBV). The program will support key operational priorities of Strategy 2030 of the Asian Development Bank (ADB): addressing remaining poverty and reducing inequalities, accelerating progress in gender equality, and strengthening governance and institutional capacity. The program aligns with all three objectives in ADB's Pacific Approach, 2021-2025: preparing for and responding to shocks, delivering sustainable services, and supporting inclusive growth. The program was designed knowing that Nauru is both a small island developing state and a fragile and conflict-affected situation.

Project Details

  • Project Officer
    Hodge, Matthew W.
    Sectors Group
    Request for information
  • Country/Economy
    Nauru
  • Sector
    • Public sector management
Project Name
Improving Fiscal Sustainability Program (Subprogram 1)
Project Number
55017-001
Country / Economy
  • Nauru
Project Status
Active
Project Type / Modality of Assistance
  • Grant
Source of Funding / Amount
Grant 0946-NAU: Improving Fiscal Sustainability Program (Subprogram 1)
Source Amount
Asian Development Fund US$ 5.00 million
Grant: Improving Fiscal Sustainability Program (Subprogram 1)
Source Amount
New Zealand Grant US$ 670,000.00
Operational Priorities
  • OP1: Addressing remaining poverty and reducing inequalities
  • OP2: Accelerating progress in gender equality
  • OP3: Tackling climate change, building climate and disaster resilience, and enhancing environmental sustainability
  • OP6: Strengthening governance and institutional capacity
Sector / Subsector
  • Public sector management / Public expenditure and fiscal management - Reforms of state owned enterprises - Social protection initiatives

Gender
Effective gender mainstreaming
Description
The proposed Improving Fiscal Sustainability Program will help the Government of Nauru strengthen gender-responsive fiscal sustainability by implementing policy and institutional reforms to (i) enhance fiscal and debt management, (ii) improve the governance of state-owned enterprises (SOEs), (iii) advance social protection systems; (iv) increase women's economic participation; and (v) reduce gender-based violence (GBV). The program will support key operational priorities of Strategy 2030 of the Asian Development Bank (ADB): addressing remaining poverty and reducing inequalities, accelerating progress in gender equality, and strengthening governance and institutional capacity. The program aligns with all three objectives in ADB's Pacific Approach, 2021-2025: preparing for and responding to shocks, delivering sustainable services, and supporting inclusive growth. The program was designed knowing that Nauru is both a small island developing state and a fragile and conflict-affected situation. Following the Joint Multilateral Development Bank Methodological Principles for Assessment of Paris Agreement Alignment of New Operations, the operation has been assessed as aligned with the goals of the Paris Agreement.
Project Rationale and Linkage to Country/Regional Strategy
Nauru's small size (with a population of about 12,668 in 2022), remoteness, and diseconomies of scale raise operating costs, limit private sector development, and leave public institutions thinly resourced. This hampers public service delivery and increases vulnerability to shocks. Average annual gross domestic product (GDP) growth slowed to 7.7% during fiscal year (FY) 2015 (ended 30 June)-FY2022, down from 18.1% during FY2011-FY2014, mainly because of declining phosphate exports and the winding down of the Australian-financed Nauru Regional Processing Centre (NRPC). The NRPC for asylum seekers operated during 2001-2008, and then reopened in 2012. Though Australia has not transferred people to Nauru for processing since 2014, the governments of Australia and Nauru agreed that Nauru will maintain "enduring capability" to enable processing of potential future refugees. The enduring capability model outlines how the governments of Australia and Nauru will collaborate given there are fewer refugees to process. Funding of this model is not public information. In 2013, poverty incidence is estimated at 24%, with another 44% of the population vulnerable to poverty. Households with children and youth and female-headed households are more likely to be poor. Key challenges to poverty alleviation include multidimensional deprivation, and low educational attainment and employment opportunities, especially for women.
Impact

Project Outcome

Description of Outcome
Progress Toward Outcome

Implementation Progress

Description of Project Outputs
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

Contact

Responsible ADB Officer
Hodge, Matthew W.
Responsible ADB Department
Sectors Group
Responsible ADB Division
Public Sector Management and Governance Sector Office (SG-PSMG)
Executing Agencies
Department of Finance

Timetable

Concept Clearance
06 Oct 2023
Fact Finding
15 Jan 2024 to 19 Jan 2024
MRM
22 Feb 2024
Approval
17 May 2024
Last Review Mission
-
Last PDS Update
20 May 2024

Funding

Grant 0946-NAU

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
17 May 2024 05 Jun 2024 19 Jun 2024 30 Sep 2024 - -
Financing Plan
  Total (Amount in US$ million)
Project Cost 5.00
ADB 5.00
Counterpart 0.00
Cofinancing 0.00
Grant Utilization
  Date ADB Others Net Percentage
Cumulative Contract Awards 03 Jul 2024 0.00 0.00 0%
Cumulative Disbursements 03 Jul 2024 5.00 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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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.

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Evaluation Documents See also: Independent Evaluation

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Related Publications

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  • 06 Jun 2024 | News Release

    ADB Signs $5 Million Grant to Help Nauru Improve Fiscal Sustainability

    ADB and the Government of Nauru have signed a $5 million policy-based grant agreement to help assist Nauru introduce a gender-responsive fiscal sustainability approach aimed at reducing debt, improving debt management practices, raising revenue, supporting state-owned enterprises, and helping the country’s most vulnerable citizens.   

Tenders

No tenders for this project were found.

Contracts Awarded

No contracts awarded for this project were found

Procurement Plan

None currently available.