1. Indonesia: Partnering with a Middle Income Client
10/16/08
Indonesia: Partnering with a Middle Income Client
Mark Hagerstrom
March 2, 2011
Knowledge Series – Emerging Indonesia
MC2-850 1

2. CONTEXT of CPS FY09-12
Indonesia’s re-emergence as middle-income country; graduating (again) from IDA
Need for second generation reforms to avoid middle income trap
Vibrant democracy but weak institutions for policy development and implementation
Increased confidence in regional and global matters; geopolitical importance

3. Partnership
Support Government’s own development strategies, policy objectives and priority programs;
strengthening and using country systems and procedures to the extent possible;
yet continuing to put a strong emphasis on fiduciary controls, accountability and technical excellence;
making effective use of existing capacities and harmonizing support; and
supporting efforts to strengthen the consolidation and alignment of resources.

4. The Means
Support Government’s own development strategies, policy objectives and priority programs;
Flexible use of instruments, focusing on relationships and engagements
Lending increased to $2 billion annually
Programmatic and innovative approaches and knowledge services

5. Institutions
Accountability - incentives and processes to promote accountability for increased government effectiveness, including:
social accountability
transparency and public access to information
grievances processes
results based M&E
performance incentives
and fiduciary controls to promote cost-effectiveness and identify misuse of funds.

6. Institutions Capacity : legal and regulatory frameworks
operational, technical and administrative policies, procedures and standards
organizational structures, including roles and responsibilities
management, information and evaluation systems
planning and budgeting capacity
research and analytical capacity, including to support policy formulation
knowledge and information sharing, including on international best practice.

7. Areas of Engagement Central gov’t institutions and systems (CC)
Subnational institutions and systems (CC)
Private Sector Development
Infrastructure
Community Development and Social Protection
Education
Environmental Sustainability and Disaster Mitigation

8. Dropped costs Preparation time Portfolio Performance
Results?
Dropped costs
Preparation time
Portfolio Performance