Friday, 31 October 2008 3:02 AM

Japan, ADB to Help Kiribati with Budget Management and Public Sector Reform

MANILA, PHILIPPINES - The Asian Development Bank (ADB) will provide assistance to Kiribati to help strengthen public financial management through long-term budget strategies and to improve the efficiency of public enterprises.

The Japan Special Fund, through ADB, will provide an $800,000 grant to the initiative. The Kiribati Government will provide an equivalent of $80,000 to support counterpart staff and local communication.

Kiribati has experienced slow or even negative economic growth since 2002. In 2007, economic growth slowed to around 0.5%. This year, the island nation has been affected by high fuel and food prices.

"Capacity development is a central part of the ADB assistance, the design of which draws upon lessons highlighted in a recent Pacific Capacity Development Study commissioned by ADB," said ADB Country Economist Emma Ferguson.

The assistance will begin with a Capacity Development Diagnostic Analysis which includes a consultative and participatory assessment of the capacity of public enterprise and budget units of the Kiribati Government. "Once the capacity development needs have been identified, innovative responses may be considered such as the use of consultants as mentors or the use of local training institutions," she added.

A subproject will then be designed to help the government draft a Medium-Term Fiscal Framework based on the annual budgets. The second subproject will be on public enterprise reform strategy and its initial implementation.

ADB has approved six loan projects amounting to $15.14 million and 35 technical assistance projects amounting to more than $12.04 million for Kiribati since it joined ADB in 1974.

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