Give donation to Consortium

Wednesday, June 03, 2009

2009 First Quarter ODA disbursement totaled US$619M

For the first quarter of 2009, the government disbursed a total of US$619 million of official development assistance (ODA), according to the National Economic and Development Authority (NEDA). This amount is 145 percent higher than the disbursement level for the same period in 2008, said the Project Monitoring Staff (PMS) in its Official Development Assistance (ODA) Loans Performance Report for the first quarter of 2009.

Disbursements from project loans reached US$267 million and US$352 million from program loans. This data excludes projects funded by China and others, as disbursement figures are yet to be released by the Bureau of Treasury.  Disbursement level is the actual amount of funds released from all programs and projects funded by ODA loans

"The significant increase in disbursements was largely attributed to the single tranche release of two program loans of US$150 million and US$200 million funded by ADB and World Bank," NEDA-PMS Director Roderick M. Planta said.

The two program loans which contributed to the significant increase in disbursements are Governance in Justice Sector Reform Program, Subprogram I (GJSRP) of the ADB and The Global Food Crisis Response Program Development Policy Operations (GFRP-DPO) of the WB.  The GJSRP aims to support the Government in its efforts to enhance the rule of law in the Philippines, improve governance and efficiency of agencies in the justice sector and expand access to justice. On the other hand, the GFRP-DPO aims to reduce the negative impacts of high and volatile food prices by supporting the government in designing sustainable policies to mitigate these adverse impacts.

Implementing agencies achieved an average of 90 percent of their target disbursements for the period, although at an eight percentage point decrease over the previous year's disbursement rate of 98 percent.

Meanwhile, the PMS reported that total cumulative ODA loans amounted to US$7.57 billion as of the first quarter of 2009.  This financed 87 loans consisting of US$6.15 billion (81%) project loans and US$1.42 billion (19%) program loans.

This represented a drop from the US$9.72-billion worth of 117 ODA loans in 2008, consisting of some US$7.95 billion (82%) project loans and US$1.77 billion (18%) program loans.

Of the 87 programs and projects, 82 loans worth US$7.3 billion are still ongoing, four  were closed during the quarter while one was signed in 2007 but is yet to be made effective (Northrail Project Phase I, Section II). Five of the ongoing loans were signed or became effective within the first quarter of 2009 The newly-signed loan is the National Road Improvement Management Project Phase II while the newly effective loans are the Governance in Justice Sector Reform Program, Agrarian Reform Communities Project II, Mega Bridges for Urban and Rural Development and The Global Food Crisis Response Program Development Policy Operation.

The top source of donor aid for the quarter is the Government of Japan-Japan International Cooperation Agency (GOJ-JICA) with around US$3 billion (39%), followed by the World Bank (WB) with some US$1.4 billion (19%) and the Asian Development Bank (ADB) with about US$1.2 billion (16%).  Other sources of ODA are (Germany, Belgium, International Fund for Agricultural Development [IFAD], Kuwait, France, Finland, Nordic Development Fund [NDF], Organization of Petroleum Exporting Countries [OPEC], Netherlands, Korea, Saudi Arabia, Swedish International Cooperation Development Agency [SIDA], Spain and the United Kingdom) with some US$1 billion (14%) and China with around US$960 million (12%).

Availment rate, or the ratio of actual amount released compared to the expected amount to be availed, decreased by two percentage points from 82 percent in 2008 to 80 percent for 2009 for ADB, GOJ-JICA and WB. For project loans, availment rate declined by five percentage points, from 79 percent in the first quarter of 2008 to 74 percent in the same period this year, while that of programs decreased by two percentage points, from 97 percent to 95 percent. The data exclude projects funded by China and other sources.

In terms of disbursement ratio, the government's performance stood at 15 percent for the quarter, from 13 percent posted during the same period in 2008.  The disbursement ratio is the percentage of actual fund releases to the net loan amount available. This indicator is usually used by funding agencies to assess their ODA performance, with the common benchmark being 20 percent (assuming the projects are implemented over a 5-year period).

"About 26 program and project loans funded by the ADB, GOJ-JICA and WB have disbursement rates below 50 percent. Factors cited by implementing agencies for the poor disbursement performance of some projects were procurement, financial issues and other concerns," Planta said.

Procurement issues include delayed procurement and processing of contracts/subproject preparations as well as delayed procurement of consultants.

Financial problems encountered were delayed release of budget, revision of targets due to cost increase, and delayed settlement of contractor's bills.

Other concerns that caused poor disbursement include start-up problems, slow gestation of activities, modification of design, delayed availability of Project Operation Manual, changes in key officials in management, poor performance of the contractor, limited technical capability of LGUs, security issues, failure of bidding, non-implementation, and limited project monitoring office staff.

The abovementioned concerns were subjects of detailed discussions and facilitative actions in various project meetings and performance reviews among GOP implementing and oversight agencies as well as funding institutions, the most recent of which were agency performance meetings in connection with the 17th Annual ODA Review. Results of continuing close monitoring of agreements and facilitative, problem-solving meetings by the NEDA PMS with project management offices and implementing agencies will be highlighted in subsequent ODA Loans Performance reports.

No comments:

Post a Comment