MANILA, PHILIPPINES – The Asian Development Bank (ADB) is helping the government of the People’s Republic of China (PRC) enhance its capacity in project development and implementation.

ADB will provide a $750,000 grant for the Technical Assistance to the People’s Republic of China for Operational Capacity Building and Value Addition, which is estimated to cost $950,000. The balance will be covered by the government.

The project will strengthen the capacity of the executing and implementing agencies of the government in planning, designing, implementing, managing, monitoring and operating ADB-financed projects. It will help streamline project implementation procedures and circulate knowledge, technology, best practices, and reform initiatives achieved through the successful implementation of ADB-financed projects.

“The focus of the project is to further enhance current efforts to improve portfolio performance and promote results-oriented project management by bringing about knowledge transfer, showcasing good practices and promoting lessons learned,” said Yaozhou Zhou, senior project officer of ADB’s People’s Republic of China Resident Mission.

“ADB recognizes the importance of capacity development for improving portfolio performance and, more importantly, for creating a more conducive environment for value additions to the country’s public sector development,” he said.

As of the end of 2006, ADB’s total loan commitment to the People’s Republic of China since the start of its operations in that country in 1986 stood at $17.8 billion for 125 public sector loans. Of that number, 78 are completed and 47 in the amount of $8.26 billion are ongoing. The portfolio is one of ADB’s largest and has been performing well, but there are some shortcomings such as delays in loan start-up activities, project implementation and disbursement processing. Country portfolio review missions have found that such delays are mainly caused by lack of familiarity with ADB requirements and guidelines.

Project design and implementation are also becoming more complex. ADB, in consultation with the government, is formulating a new Country Partnership Strategy for the People’s Republic of China, in line with the country’s 11th Five-Year Social and Economic Development Plan. The new Country Partnership Strategy is expected to focus more on assisting in agriculture and rural development, social sectors and environmental management. Such a change in ADB strategy and programs will create challenges for project design and implementation.