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LESSONS:

Country Assistance Program Evaluation for the Socialist Republic of Viet Nam (2009)

sector: Agriculture, Natural Resources, and Rural Development, Energy, Transport | country: Viet Nam, Socialist Republic of

1. Development partners can help influence government driven agenda by supporting pilot activities and knowledge sharing that would contribute to discussions on policy alternatives. Throughout Viet Nam’s economic development, the government has demonstrated strong ownership and direction of the country’s development agenda. Development partners are less likely to influence reforms where there is strong government ownership of the development agenda. Therefore, changes and reforms will not necessarily take place unless all concerned groups and decision makers are convinced of their benefits and political viability. [Executive Summary; Main text, para. 91,142]

2. Alignment with government plans and priorities facilitated the implementation of ADB’s programs, particularly those supporting higher level reform. During the CAPE period, the development agenda was (and still is) strongly driven by the Government. Given the relatively small share of official development assistance in the total investment expenditure, the Government’s commitment to its own development plan and planned reforms facilitated the achievement of development outcomes expected from ADB assistance, e.g., reforms in the nonbank financial and power sectors. ADB strategies had a continuing focus on growth as a key driver of poverty reduction, and sustained engagement in high priority sectors central to the Government’s growth-driven poverty reduction strategy, including in transport, energy, education, and agriculture and natural resources. [Main text, paras. 140,143]

3. As the legal, policy, and institutional framework is constantly evolving, development partners need to be able to adjust to changing circumstances. ADB demonstrated flexibility and pragmatism in its support of reforms: ADB worked with the Government flexibly in its support for power sector reforms, while support for state-owned enterprise reform adapted to its slow pace. ADB was responsive to the considerable financing requirements of Viet Nam, particularly for large infrastructure projects, with the increased use of ordinary capital resources from 2004 and the application of ADB’s innovative financing instrument, the multitranche financing facility. These helped address Viet Nam’s large infrastructure requirements and provide greater funding certainty for large infrastructure projects. [Main text, paras 86-88,144]

4. Where an experimental approach to reform or changes was employed, demonstrating success facilitated their replication in other locations. As such, the approach can be continued or applied in future interventions as well. For instance, ADB support in urban services and water supply and sanitation, agriculture, and secondary education had demonstrated relevance to the needs and priorities of target beneficiaries. Hence, in the next phase or follow-on project, similar activities were also undertaken. [Main text, para. 145]

5. Coordination with development partners facilitates complementarities in assistance and greater aid effectiveness. ADB strategies and programs were coordinated with those of development partners. ADB often consulted widely with development partners in preparing and coordinating its programs, strategies, and projects, and was active in aid harmonization initiatives. These facilitated complementarities in sector support such as finance, education, transport, and urban services and water supply and sanitation. The partnerships are also helping to find solutions for common official development assistance implementation issues and greater aid effectiveness, particularly through the Six Banks Harmonization initiative. [Main text, paras. 50,85,94,146]

6. Improving implementation performance of ADB-supported projects requires, among other factors, building the implementation capacity of the concerned government agencies at subnational levels by taking into account their institutional capacities and procedures in project designs. While disbursement ratios were improving during the period 1999 2003, it retreated with the approval of large infrastructure projects from 2004. Designs of ADB projects in Viet Nam have not fully taken into consideration the complex government procedures and weak implementation capacity of some executing agencies, particularly at subnational levels. These have led to insufficient efforts to build implementation capacity during Project Design, preparation, and implementation. In addition, project designs or implementation arrangements were too complex for the national and provincial institutional capacities and procedures. As a result, the portfolio performance of the Viet Nam program is lagging behind the average for the rest of ADB, even if the Asian Development Fund portfolio were considered separately. [Main text, paras. 66,141,148,159]

7. Considering that ADB technical assistance was less effective in building institutional capacity, new ways in delivering capacity building needs to be considered. Generic capacity building is less likely to be sustainable in the long term due to staff movement. Training should be linked to organizational and institutional needs, and not just the individual, for the institutions to benefit from capacity development programs. Sustained capacity development is required. [Main text, para. 149; Appendix 7]

8. The strategic focus on the Central Region does not seem to have led to any major economies of scale or synergies in implementation, in part, perhaps, because Viet Nam’s planning and development systems act at the provincial rather than at a regional level. The Central Region’s area of coverage was wide, and implementation requires more resources for day-to-day advice and support.

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