Asia-Europe Meeting (ASEM) Asian Financial Crisis Response Trust Fund Review Overview of Progress 6/28/2006

Outline This presentation focuses on: Progress in portfolio implementation Impact of the Action Plan adopted at last year’s Review Meeting Benefits from completed grants Strategic coordination in the field Brief update on Country programs Visibility

What are the Key Achievements Highly positive impact of the Action Plan: current disbursement rate is 72% and is estimated to reach 80-85% by end-December when the program closes. In-country steering committees (ICSCs) have played proactive roles in grant monitoring and implementation

What is the Composition of the Portfolio ASEM TF2 Portfolio by Country as of June 2006 (million US$) The portfolio contains: 71 approved grants totaling $39.1 million Active portfolio: 39 active grants ($24.4 million) Closed portfolio: 29 completed grants ($13.3 million) 3 cancelled grants ($1.4 million) 3 grants have been cancelled, due to poor performance or shifts in the priorities of recipient countries

What is the Composition of the Portfolio ASEM TF2 Portfolio by Sector as of June 2006 (million US$) Sectoral proportions vary among countries In total: $20.3 million to financial projects $18.8 million to social sector projects

What is the Speed of Implementation? (as of June 15, 2006) Disbursements are 72 percent of the total grant amount Disbursement rates vary among countries: China: 84% Indonesia: 60% Philippines: 54% Thailand: 81% Vietnam: 76% Region: 70% Disbursements are now $25.4 million, up from $12.8 million a year ago and $19.2 million in October 2005 Disbursement rates range from more than 70 percent in China and Thailand to 51 percent and below in Indonesia and the Philippines

Why an Action Plan? The following were the key agreements reached at the ASEM TF2 Annual Review Meeting in Washington (April 2005): progress under ASEM had been positive, but grant implementation must be accelerated, intensified monitoring and evaluation would help to expedite grant implementation, and an action plan – which was endorsed in principle by Partners -- should be implemented.

Action Plan: What are the Main Elements Periodic portfolio reviews by in-country steering committees and World Bank Recognize good performers Scale back or cancel non-performing grants Strengthen capacities of weak implementing agencies Promote visibility of ASEM The Plan was agreed in May 2005 and quickly took effect.

What have been the Results: Positive impact on portfolio Improvement in speed of implementation; disbursements doubled in one year Stronger grant monitoring by in-country steering committees Regular portfolio reviews with the line agencies Training for implementing agencies in financial management and procurement

Disbursement Data (September 2004 – December 2006)

Topping up and scaling back: Why Based on recommendations by the ICSCs: China Four successful grants topped up One grant cancelled Indonesia Two grants allowed to close as scheduled, with unused balances cancelled Philippines One grant restructured Thailand and Vietnam In each country, one successful grant topped up

What have been the visible benefits of ASEM TF2 Most completed grants have achieved clear effects on policy making and program design: some major policy reforms ASEM grants have leveraged resources from other donors Close collaboration between partner countries (clients) and development partners (donors) Simple and streamlined procedures adopted in most countries, but consistent across region

What has been the role of the ICSCs Playing a very active role: Over the past year, in-country steering committees, have played proactive roles in grant monitoring and implementation Feedback provided: All ICSCs have stressed the positive contribution of ASEM TF2 to their countries’ ability to withstand crises and reduce poverty and vulnerability Philippines: ICSC members helped the implementing agencies to identify possible sources of risk in delivering their expected outputs and helped them come up with measures to manage those risks; the risk mitigation measures have been incorporated in the action plans for individual grants. Thailand: ICSC established a trouble-shooting team to help implementing agencies to solve problems faced by individual grant projects; the team is drawn from the World Bank, the Public Debt Management Office, and the Fiscal Policy Office. Vietnam: ICSC meetings have provided a useful forum for grant-project managers to seek and obtain help on specific implementation problems. Indonesia: Bank staff have been actively engaged with implementing agencies to speed up implementation and disbursement, and have met regularly with representatives of the Government and the EC to discuss problems and progress. Indonesia’s Central Planning Agency (which chairs the ICSC), the EC, and the World Bank plan to revive ICSC meetings to expedite disbursements and monitor implementation of the remaining portfolio

What have been the World Bank Actions to Accelerate Portfolio Implementation Bank task teams and implementing agencies have prepared time-bound action plans for slow moving grants. The action plans are monitored by the ASEM Secretariat and Country Trust Fund Coordinators. Increased number of missions from Bank HQs to discuss ASEM grants with recipients. ASEM Progress Reports are discussed with Partners in the field.

Program Overview: China 14 grants totaling $7.7 million 5 grants completed (3 in financial/corporate sector; 2 in social sector) Significant implementation progress in past 12 months Proactive In-Country Steering Committee Disbursements now 78 percent Full disbursement expected by time of program closure

Program Overview: Indonesia 17 grants totaling $6.8 million 7 grants completed (3 in financial/corporate sector, 4 in social sector) 1 grant cancelled Faster implementation progress in past 12 months; GOI regularly reviews project progress Disbursements now 51 percent, up from 26 percent a year ago Good progress under the Action Plan: World Bank devoted more resources to help implementing agencies speed implementation Central Planning Agency (which chairs ICSC), plans to revive ICSC meetings to expedite remaining disbursement and implementation

Program Overview: Philippines 9 projects totaling $5.2 million 3 grants completed, all in the financial/corporate sector 1 grant cancelled Disbursements still below 50 percent, but Speed of implementation much improved for most grants Under the Action Plan, the proactive In-Country Steering Committee guided an intense effort to speed up implementation and disbursement. Terms of reference have now been finalized for most components and procurement actions have been completed.

Program Overview: Thailand 11 grants totaling $7.2 million 6 grants completed (2 in corporate/governance sector and 4 in social sector/governance) Proactive ICSC Problems now resolved for four slow-disbursing projects listed in the Action Plan Disbursements now 74 percent Disbursements expected to be 98 percent by program closure

Program Overview: Vietnam 17 grants totaling $9.2 million 6 completed (2 in financial/corporate sector; 4 in social sectors) ICSC closely monitors grant closing dates Disbursements now 66 percent Disbursements expected to reach 93 percent by program closure

What has been done to promote Visibility Efforts continue to increase visibility of ASEM TF2 Program. ASEM Trust Fund website: High degree of openness and transparency exercised in the management (Feedback from Evaluation Team). ASEM Progress Reports circulated widely in recipient countries – effort being made to have ASEM be recognized as an important process for development work.

A good outlook Overall grant disbursement projected at 80-85 percent at the end of the program (comparable to the disbursement rate of ASEM TF1) Message should be conveyed to the In-country steering committees that they must continue to play proactive roles in grant monitoring and implementation