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9th ADB Business Opportunities Fair

Overview of Public Sector Management,


Governance & Capacity Development

Claudia Buentjen
Principal Public Management Specialist
14 March 2018
Contents

1) Why PSM and institutions matter


2) ADB policies, strategies and
approaches
3) Operational trends and pipeline
4) Business opportunities
Good governance leads
to better development results

Countries with sound


policies and regulations, an
effective public service, and
able to control corruption
have grown more quickly
than others

Weblink: www.adb.org/publications/asian-development-outlook-2013-update-
governance-and-public-service-delivery
Governance performance
in Asia-Pacific gradually improving

4.2

4.0

3.8 Central and West Asia


East Asia
3.6 South Asia
Southeast Asia
3.4 Pacific
Asia-Pacific Total
3.2

3.0

2.8
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

ADB’s PSM and Institutions Ratings, 2005–2015


Notes: Indicators range from 1 to 6 with higher values denoting better performance; subregional ratings are the simple
average of the relative country ratings; a) Myanmar was included in 2014, which lowered Southeast Asia average rating; b)
Cook Islands was excluded after 2007, which lowered the Pacific average rating.
But governance in Asia-Pacific
Still lags most other countries
World Governance Indicators, 2017 Update
Developing Asia Latin America & Carribbean Non-OECD Europe OECD Sub-Saharan Africa

Voice and Accountability


1.50

1.00

0.50
Political Stability and Absence of
Control of Corruption
Violence/Terrorism
0.00

-0.50

-1.00

Rule of Law Government Effectiveness

Regulatory Quality

Worldwide Governance Indicators, 2017 Update


Notes: Scores range from 2.5 to -2.5 with higher values denoting better governance quality; regional
score is the simple average of the country scores.
Source: Worldwide Governance Indicators (www.govindicators.org)
Source: Worldwide Governance Indicators (www.govindicators.org)
Source: Worldwide Governance Indicators (www.govindicators.org)
Source: Worldwide Governance Indicators (www.govindicators.org)
Source: Worldwide Governance Indicators (www.govindicators.org)
Governance central to achieving
Sustainable Development Goals (SDGs)
Key Targets:
16.3 Promote rule of law and access to justice
16.4 Reduce illicit financial flows, and recover and return stolen assets
16.5 Reduce all forms of corruption and bribery
16.6 Develop effective, accountable and transparent institutions at all levels
16.7 Ensure responsive, inclusive, participatory and representative decision-making
16.10 Ensure public access to information
17.1 Strengthen domestic resource mobilization, including tax and other revenue
17.6 Enhance access to technology and innovation, and knowledge sharing
17.9 Enhance effective and targeted capacity-building in developing countries

ADB’s PSM and Institutional


Support to DMCs
ADB’s Policies, Strategies
And Approaches
2016
Effective management Paper on ADB’s
of economic and social future PSM and
resources—4 elements: 2008 institutional
accountability, participation, Strategy
predictability, and 2007 approaches

transparency Capacity 2020


2006 Development
Second Governance Framework and
and Anticorruption Action Plan
1998 Action Plan
(GACAP II)
1995 Anticorruption
Governance Policy
Policy

Weblink: www.adb.org/sectors/governance/main
Public Sector Management Operations
PSM Financing by Subsector, 2015–2017 (%)

PSM Operations, 2015–2020 (in $ bn) Social


SOE Reforms Protection
12% 16%
2.50 2.48
Decentralizati
2.29 on
Standby 5%
0.65 Economic
Management
2.00
Public 7%
Public
1.67 Expenditure &
1.83 Administratio
Fiscal
n
Management
1.50 10%
1.33 51%
billion, USD

1.39
1.31
0.16
0.43
1.15
1.00
0.95 PSM by Department, 2015–2017 (%)

SERD
0.50 31%
12 15 % Total Sov Ops
8% 11% 7% 6%
% %
12 23 12 14 13 12 Number PSM Ops CWRD
54%
0.00
2015 2016 2017 2018 2019 2020
Actuals Estimate
s PARD
Progress in delivery of PSM 3% EARD
2017 Target: $1.44b SARD 6%
2017 Actual: $1.33b 6%
2018 Target: $2.48b

Sources: OSFMD, 2017 (for approvals); WPBF, 2018–2020 and President’s Planning Directions for 2018 and Preparation of WPBF, 2019–2021 (for estimates)
Estimated PSM Operations by Subsector, 2018 - 2019
2018
Firm Standby Total
Subsector Percent
($m) ($m) ($m)

Public Expenditure and Fiscal Management 1287.0 568.5 1855.5 75%


Public Administration 134.4 5.0 139.4 6%
Economic Affairs Management 5.0 30.0 35.0 1%
Decentralization - 50.0 50.0 2%
Social Protection initiatives 400.0 - 400.0 16%
Total 1,826.4 653.5 2,479.9 100%
Source: WPBF, 2018-2020

2019
Firm Standby Total
Subsector Percent
($m) ($m) ($m)
Public Expenditure and Fiscal Management 678.5 45.0 723.5 55%
Public Administration 7.5 -. 7.5 1%
Economic Affairs Management 165.0 110.0 275.0 21%
Decentralization 300.0 - 300 23%

Total 1,151.0 155.0 1,306.0 100%


Source: WPBF, 2018-2020
GCD in Sector Operations (%)
Operations (with Governance and Capacity PSM
100%

Development [GCD] as driver of change…) 100%

100%
INDUSTRY & TRADE
100%
GCD in Sovereign Operations, 2015–2017 (in $ bn)
100%
18.00 HEALTH
100%
16.1
16.00 15.0 94%
14.9 WATER
13.9 90%
14.00
12.7
92%
12.00 EDUCATION
11.2 93%

10.00 89%
AGRICULTURE
% Total 60%
8.00 81% 85% 92% Operations
(by Amount) 87%
6.00 FINANCE
86%

4.00 85%
TRANSPORT
83%
2.00
73%
ENERGY
- 61%
2015 2016 2017
Source: OSFMD, 2017

Total ADB Operations GCD Operations 62%


ICT
50%
By total number of operations:
0% 20% 40% 60% 80% 100%

2015: 80% (of 129) 2016: 89% (of 155) 2017: 90% of 115 (2015–2017)
Governance and Capacity Development
(GCD) Support in Operations

PSOD

PARD

SERD

CWRD

EARD

SARD

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
GCD as % of Total Operations

Source: ADB-SPD Commitments Database 2010-2017


General Business Opportunities

PSM focus areas:

Domestic resource Public expenditure Reform of state- Decentralization &


mobilization & financial owned enterprises subnational
management governance

Cross-cutting areas: GCD work: Investment types:


• Private sector development • Diagnostics (e.g. program impact • Policy-based lending
assessments, governance risk •
• Public-private partnerships Results-based lending
assessments)
• Information and communication • Investment projects
• Capacity development, incl.
technology • Technical assistance
organizational development
• Anticorruption
• Knowledge products
Contact information:

ADB’s Governance Thematic Group


Email: governance@adb.org
Website: www.adb.org/sectors/governance/main

Follow us:
@ADBgov

facebook.com/GovernanceTG/

linkedin.com/groups/8517272
Thank you …