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Saturday, September 17, 2005
ADB reports low success of projects in RP, other small Pacific economies
MANILA - An in-house audit has found that Asian Development Bank (ADB) project lending has a low success rate in the Philippines, Papua New Guinea and the small island economies in the Pacific, the Manila-based institution said yesterday.
A report found a success rate of “more than two thirds” in Bhutan, China, Mongolia, the central Asian republics, Maldives, as well as the Greater Mekong subregion.
Success rate
However, “the project success rate in the Pacific Islands, Papua New Guinea, and the Philippines was below 50 percent.”
The bank approved $5.3 billion in loans and $196.6 million in technical assistance last year, of which $200 million dollars went to Manila.
Projects
The ADB said that in general, “projects in the infrastructure sector have consistently had high success rates, while projects in the agriculture sector and for lines of credit to government-owned development finance institutions have a lower probability of success.”
At the same time, “economic forecasts of project benefits have also been found to be consistently over-optimistic and the risks typically faced by ADB projects not sufficiently identified and mitigated,” it added.
Improved quality
The report concluded, though, that the quality of ADB projects has improved over time, particularly following efforts to devote more resources to portfolio management and loan administration in the early 1990s.
Last year, the ADB adopted a reform agenda to boost its development impact. (AFP)
(September 17, 2005 issue)
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