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LESSONS:

Agriculture Sector Program (Loan 1445-CAM[SF])

sector: Agriculture, Natural Resources, and Rural Development | country: Cambodia | region: Greater Mekong Subregion

Earmarking the use of counterpart funds for reform purposes contributed to continued implementation after loan closing, and ensured that funds were used in accordance with the reform objectives.

Identifying key sector issues is necessary but not sufficient for the design of a program loan. The program needs in-depth analysis of the various factors underlying the issues identified, as well as clear causal links among the sector issues, underlying causes, proposed policy interventions, and expected outcomes.

Overstatement in program objectives may lead to less favorable rating of program performance, which needs to be evaluated against expectations specified in the Report and Recomendations of the President (RRP). Appraisal teams should be encouraged to limit themselves to realistic estimations; review of draft RRPs should remove ambitious statements.

Promotion of agricultural technologies should not be based solely on their potential to raise productivity without considering marketing limitations. The promotion is best driven by market demand identified by the private sector instead of by government agencies.

The attached technical assistance focused on short-term implementation and used consultants to implement reform measures for the government. This resulted in the achievement of all program measures but not program objectives.

The importance of proper sequencing in the design of policy interventions should be highlighted. Since it is impossible for one program loan to remove all sector constraints, interventions should focus on the most binding obstacle(s), and the remaining constraints should be explicitly identified as risks or assumptions.

The success of the Land Law can be attributed to the full participation of the government in the reform process, as well as extensive consultations with stakeholders. The long duration (4-5 years) of this process was justified: it produced a law accepted by all primary stakeholders, strong government ownership has led to continued reforms, and institutional capacity was developed through this process. In contrast, an unrealistic time frame for formulating strategies and policies generated undue pressure on the government to use consultants to merely meet reform requirements on time without benefiting from reform process.

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