Strengthening Fiscal Resilience for Sustainable Development Program, Subprogram 1 (ADB-57121-001)

Countries
  • Palau
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • Asian Development Bank (ADB)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Proposed
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
C
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Borrower
Government of Palau - Ministry of Finance
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Law and Government
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 12.50 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Project Cost (USD)
$ 25.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Bank Documents
Primary Source

Original disclosure @ ADB website

Updated in EWS May 11, 2024

Disclosed by Bank Feb 13, 2024

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

According to the Bank’s website, the proposed Strengthening Fiscal Resilience for Sustainable Development Program will complement and advance reforms initiated by the Government of Palau under the previous programs of the Asian Development Bank (ADB) designed to help the government recover from the coronavirus disease (COVID-19) pandemic, and to strengthen domestic resource mobilization (DRM) and public financial management (PFM).

It aims to further strengthen national and subnational public sector management (PSM) to improve fiscal discipline and strategic allocation of resources, while consolidating climate change mitigation and adaptation considerations into planning and budget execution. Specifically, the program will strengthen tax and customs administration systems, as well as land use and marine planning processes, and mainstream climate considerations into these to set the stage for faster and more sustainable growth. The program is aligned with ADB’s Strategy 2030 and its operational priorities of tackling climate change, building climate and disaster resilience, and enhancing environmental sustainability; strengthening governance and institutional capacity; and accelerating progress in gender equality.

Early Warning System Project Analysis
For a project with severe or irreversible impacts to local community and natural resources, the Early Warning System Team may conduct a thorough analysis regarding its potential impacts to human and environmental rights.

The program is considered low risk because (i) the loan amount does not exceed $50 million; (ii) MOF has previously executed externally financed operations; (iii) ADB has previous extensive experience in PFM in Palau; and (iv) the operation is not expected to be classified as category A in any safeguard category.

Investment Description
Here you can find a list of individual development financial institutions that finance the project.

The government has requested a concessional loan not exceeding $25.0 million from ADB’s ordinary capital resources to help meet the government’s development financing needs for FY2024 and FY2025. ADB’s proposed financing consists of $12.5 million for subprogram 1 in 2024 and $12.5 million for subprogram 2 in 2025. The government’s projected fiscal deficit (excluding grants) is estimated at $47.4 million (16.1% of GDP) in FY2024 and at $35.6 million (9.5% of GDP) in FY2025. ADB is engaging with the New Zealand Ministry of Foreign Affairs and Trade for possible grant cofinancing. Climate financing under subprogram 1 is estimated at $6.3 million based on policy actions that contribute to climate outcomes.


Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

No contacts available at the time of disclosure.

ACCESS TO INFORMATION

You can submit an information request for project information at: https://www.adb.org/forms/request-information-form

ADB has a two-stage appeals process for requesters who believe that ADB has denied their request for information in violation of its Access to Information Policy. You can learn more about filing an appeal at: https://www.adb.org/site/disclosure/appeals

ACCOUNTABILITY MECHANISM OF ADB

The Accountability Mechanism is an independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an Asian Development Bank-financed project. If you submit a complaint to the Accountability Mechanism, they may investigate to assess whether the Asian Development Bank is following its own policies and procedures for preventing harm to people or the environment. You can learn more about the Accountability Mechanism and how to file a complaint at: http://www.adb.org/site/accountability-mechanism/main.

How it works

How it works