This program significantly contributed to strengthening Armenia’s key institutions and improving public financing in the road, water supply, and power sectors. It played a critical role in building consensus among relevant government agencies on sector reform directions and succeeded in putting in place the key policies that would immediately bring about palpable results in improving operational efficiencies, services delivery, and the sustainability of public finances in the three targeted sectors. Drawing on this program’s experience, ADB must work closely with government counterparts to ensure that future PBLs focus on the core elements of the government reform agendas. While aligning the PBLs to developing member country needs, such a focus will also promote government ownership and continued support for the typically long and gradual process of effecting reforms.
Three minor changes in scope were made during project implementation. The first responded to changes in government plans that made government funding available for some activities while making others no longer necessary. The second and third were prompted by loan savings and unallocated loan proceeds. Overall, these changes enhanced the relevance of the project and bolstered its effectiveness in contributing to the realization of government development agenda and priorities.
Throughout implementation, the technical support required to carry out and continually enhance the integrated environmental management (IEM) and other new approaches introduced by the project was thoroughly examined and provided to the project implementing agencies (PIAs) and other participants. Information systems were strengthened and adapted to the changing needs of producers, supply managers, and value-addition and process managers, as well as enterprise management. The project allocated substantial resources for capacity development, which included (i) expanding the information available to project management through a project performance monitoring system that went beyond the indicators identified in the project design and monitoring framework to include all those required in effective project management and decision-making; (ii) developing PIA institutional capacity through a training of trainers program that amplified the reach of training courses in a sustainable and cost-effective manner; (iii) demonstrating new training approaches, including interactive farmer field schools, demonstration farms, and vineyards with supporting investment and information systems; and (iv) focusing on the effective use of local training resources through the development of the IEM demonstration center, managed by a public-private partnership. Replicating these approaches, while requiring a significant amount of investment, would yield invaluable and strategic socioeconomic and environmental benefits.
As in other places, inadequate land and agricultural assets hinder the adoption of sustainable land management by smallholders in China’s Ningxia Hui Autonomous Region. Under the project, the Ningxia Agriculture Reclamation Board, played the critical role of a dragon-head enterprise, supporting various businesses in halal meat processing, dairy, and wineries, with each industry supported by several farms. It connected smallholders to these businesses through supply contracts, which consequently improved their incomes significantly. Local labor supporting the growth of commercial enterprises also provided significant short-run benefits. While livelihood activities not directly linked to commercial enterprises continued to occur particularly in non-project areas, these generated lower returns due to market risks and the lack of a steady connection to the agricultural value chain. Specifically, the average per capita income of beneficiary households rose by 175% between 2009 and 2015, while that of the 80 household -control group mobilized by the project from outside the project area increased by 160%. Monitoring results further suggested that smallholders with links to market chains and processors were accumulating assets faster. Building on this experience, future similar projects should more intensively engage in establishing agricultural value chains and connecting smallholders to these value chains to improve rural incomes as well as wean them away from unsustainable agricultural practices.
Completion of this subprogram substantially improved the public financial management system of PSEs, specifically in terms of financial reporting, budgeting, and internal auditing. The policy actions, however, did not deliver the desired outcome of increased PSE profitability and incomes over the short, one-year implementation period. But as it has enabled the government to calibrate its PSE reform policy and plan and targets over the medium-term, subprogram 1 succeeded in setting off the realization of long-lasting public service reforms within a realistic timeframe. While sustaining the momentum for reforms already achieved, subprogram 2, approved within the same month this subprogram closed, focused on other structural reforms to support the commercialization, efficiency, and long-term profitability of PSEs in Pakistan
Pakistan’s politics of reform, which can be complicated particularly during political transitions, needed to be closely monitored and properly responded to. While identifying pro-reform leaders was important, involving a broader support base would have helped in better managing the risks and uncertainties associated with the changing political climate and reform commitments. Nevertheless, through intensive dialogue, the subprogram was able to overcome the challenges that came along with political transitions. Future similar interventions should aim to better manage the complexity of PSE and public service management reforms by being more flexible and drawing in the broadest number of public servants to the side of reforms.
Examination during subprogram preparation of the country’s privatization experience highlighted the need for consensus to be developed on government’s role and core public services, lack of which accounted for much of the shortcomings in past efforts. Vested interests and corporate governance issues, which made it hard for PSE reforms to take off in certain sectors, were addressed right at the outset. By aligning the subprogram to the overall government PSE reform agenda, obstacles were significantly diminished, and stronger government commitment was elicited. Wide governmental interagency discussions on the costs and benefits of reforms further facilitated subprogram implementation
This subprogram has demonstrated the benefits of Asian Development Bank (ADB) internal consultations and stakeholder engagement in the design and implementation, especially of reform programs. Consultations among the relevant ADB divisions enriched subprogram formulation, specifically ensuring that (i) knowledge from previous similar experiences were built into the design and (ii) subprogram design and timing were in synergy with other ongoing and planned interventions in Pakistan by ADB and other development partners. Sustained policy dialogues generated high-level government support throughout the project cycle. Consultations with the affected public sector enterprises (PSEs) generated feedback that were most helpful in incorporating employee needs and interests to the subprogram policy actions and implementation approaches. Moving forward, the communication strategy formulated under this subprogram, which targets all key stakeholders and the general public, is expected to develop broad support and facilitate the smooth completion of the government’s PSE reform agenda.
ADB missions for this project were infrequent and did not provide strong supervision and guidance. The inception mission was fielded in a timely manner in July 2008, and the next mission was held in April 2009. However, no mission was conducted in 2010 and 2011 when procurement was ongoing. Validated rather late, the weaknesses in project design were recommended by the joint midterm review mission in 2012 to be addressed through a significant reduction in scope. Options to deliver the outputs envisaged at appraisal would have been identified and implemented early enough had regular monitoring and project review missions been conducted. Early adjustments in the original design and monitoring framework, which addressed binding constraints on skills development in the country but did not reflect the results of stakeholder analyses and consultations during project preparation, would have also been implemented.
Late procurement of works, goods, and services delayed the implementation of this project, which was physically completed only in June 2015, two years after the expected completion date. Consultants were recruited only about 14 months after loan effectiveness; the first contract for goods was signed 19 months after effectiveness; and the first civil works contracts, two years after. Weak capacity and unfamiliarity with ADB procedures of the project implementation unit accounted for the long procurement delays. ADB should do more to facilitate timely procurement in future projects. Aside from advance actions, which did not help much under this project, procurement training, handholding, and implementation support should be provided by ADB especially to new EAs and IAs. Ensuring that a favorable policy environment and institutional mechanisms are in place to support the pursuit of new and innovative approaches will also help ensure the timely and smooth implementation of ADB-assisted projects.
A comprehensive and in-depth assessment of EA and IA capacities, undertaken as part of project preparation, would have enabled the formulation of more realistic targets. This would have also allowed the identification of measures to address critical capacity constraints or improve implementation arrangements. For future projects, especially those that entail carrying out new and innovative approaches, government should assign well-qualified and motivated staff and ensure the support and cooperation from of relevant agencies. The Asian Development Bank (ADB) can also consider more proactively taking up with borrower governments the need for the most suitable implementation arrangements and capable project management staff to take charge of ADB-assisted projects.
As this was its first road project in the state of Bihar in India, the Asian Development Bank (ADB) provided substantial inputs to strengthen the project implementation and overall sector management capacity of the RCD. Most of these inputs were delivered through technical assistance (TA), under which trainings on procurement, contract management, and safeguards were conducted; and key policies and operational guidelines ─ such as on road administration, road safety, performance-based road maintenance, and road management system ─ were prepared, most of them are now in operation. Implementation support to help the RCD do better in areas where it was weak, for example, in the implementation of environmental monitoring and management plans, was provided through regular review missions and consultations in-between missions. Being the first to use the International Federation of Consulting Engineers (FIDIC) contract templates in Bihar’s road sector, the project also exposed the state road agencies to international best practices in procurement and contract management, knowledge from which may be useful in raising the bar and improving the performance of the local road construction industry. Notwithstanding the many institutional strengthening initiatives already completed, so much still needs to be done. Time and persistence, this project has shown, are important and will continue to be required to develop state-of-the-art road agencies amid fast-changing technologies.
Of the project’s 9 civil work contracts, 7 had been completed as of loan closing in January 2013, while 2 were substantially delayed, with construction works extending until March 2016. The delays ─ attributed by the Road Construction Department (RCD) of Bihar, the implementing agency, to local insurgency and contractor nonperformance and cash flow problems ─ highlight the extent to which deficiencies in the assessment of potential risks and in the bid evaluation process can affect project implementation. The uncertainty in the progress of works and the completion schedule of the then unfinished contracts prompted the RCD not to seek an extension of the loan closing date and complete the balance in works using government resources. To avoid a repeat of this experience ─ which delayed the delivery of project benefits in certain areas and caused the cost of civil works to rise in local currency terms ─ a conscientious assessment of all potential risks during project preparation and a more thorough evaluation of bids should be undertaken in future projects.