June 21, 2012 on: Economical

Asian Development Bank (ADB) is an organization established initially in 1966 with vision Asia and Pacific region/ member countries free of poverty.

As for Mongolia where the country is about to enter the fast development track ADB is ready to assist in making solutions for the future development and also for last 20 years ADB has carried out broad activities to support Mongolia's transition from centralized economy into a market economy . ADB has been assisting to Road, transport, energy and financial sectors of our country. There's no single soum in Mongolia where the ADB activities not been reached via the projects implemented in Health and educational sectors. ADB is planning to continue their financial support in 5 main sectors, whereas: Health, education, basic urban services, road transport and energy sectors. The amount of financial support from ADB is been increasing year after year. And the Mongolian Resident mission of ADB understands there is great need both to prevent from adverse affects of people from increasing number of projects which will occur in relation with increase in funding and to ensure the efficient use of funds. On ADB's activities and future perspectives I have talked to Mr Shane J Rosentail Deputy Director of Mongolia resident mission of ADB. He told, “As for this year under the consultation between ADB and Mongolian government Mongolia made a decision to become “B” class loan receiving, which means Mongolia used to have loan from special funds at ADB and after this change Mongolia will have right to get loan from ordinary capital resources of ADB. That means Mongolia will have more chances to get funding for bigger projects to be implemented in infrastructure sector. We ADB has quite a good experience to implement projects where the issues related to gender, environmental issues, minority issues, resettlement and land acquisition issues are well considered in early project preparation stages.That's why the most of banking and financial sector players know that ADB follows a principle where we aim not to harm any adverse affects to people from our project activities. In the past we have implemented projects in health and educational sector to deliver the basic services to remote places, road projects to connect the Ulaanbaatar city with all provincial centers and road project connecting Sainshand- Choir which about to be completed soon are the major examples of our achievement. I asked about the challenges and difficulties that were faced during implementation of these works and Mr.Shane J Rosentail's answer was: “In past 20 years we didn't have a major difficulties in relation to our projects. But of course all things can't happen without any challenges. There were at some extend issues raised on some projects but most of them resolved in assistance of Project implementation units or Implementation Agencies of Mongolian government“. “What are the common issues that were raised?”. -Issues relating to delays in funding of certain projects, issues where the unclear arrangements in communication and presence of private property on infrastructure project land were the common cases. There are many solutions to resolve the issues right on those occasions. Some cases the challenges remain without any solutions. ADB has internal accountability mechanism where we can give the final solutions to these type of issues. - You mentioned that ADB deals the issues related to gender, environmental issues, minority issues are well considered in early project preparation stages. What is Mongolia's current ranking on these issues? -In international practice the gender issues expressed in indices. According to this gender index Mongolia was ranked fairly high. For example recently I saw Mongolia was ranked position 3 among Asia region on gender issues. Reason why Mongolia ranked with such good result should be based on progresses made in educational sector and as well as measures and progresses achieved in maternal and infant health issues. Not depending on whether the issue is related to gender, environmental issue or national minority issue all issues are well considered in early project preparation stages. For example according to ADB's internal requirement we put relatively high requirement on gender issue. Based on this requirement each of the projects required to have gender issue plan to be formulated. Under this plan they create criteria where the results are measurable. And this criteria used in gender issue assessment after completion of projects. Also during the project implementation period we undertake monitoring on physical implementation of this plan. And for the project result assessment we trace back the pre-set gender criteria. -How about number of projects implemented or the overall amount in funding these projects? -If I express in monetary value than up to date we have assisted Mongolia with total of 829 Million USD funding in a form of financial support, loan and grant aid. Currently we have 8 loan projects with total value of 247 Million USD and 12 Grant aid projects with total value of 172 Million USD. Our main principle is to deliver the services at the possible highest level of quality. In order to implement our projects successfully we introducing the Accountability mechanism where the people can file their complaints and comments to us addressing the issues relating certain projects and we see it as one of ways to facilitate improvement in projects. -Are the majority of financial support given in funding of projects and programs in Mongolia in a form of loan or do you also provide grant aid as well ? -Most of the funding is given in a form of loan. Also we have provided quite substantial amount of funding in a form of grant aid. Those loans which were given earlier and for current loans the repayment conditions are softer meaning that it has low interest rate and with relatively long repayment period. -I understood that ADB financial support activities based on 5 year strategic planning process. As you mentioned the country Strategic partnership document with Mongolia for years 2012-2016 just been approved by the Board of Directors of ADB. What are the issues reflected in this documentation? -This documentation includes the joint consultation of ADB and the Mongolia's government on prioritizing the financial needs for the country. Of course it includes the measures to improve the gender issues, creating the good governance and constructing the basis for the sustainable economy. In general our organization aims to make development benefits available to broader areas. -Do you provide loan to private sector? Are there any floor or ceiling limits on loans? -We provide loan to private sector. But among the loan that we have provided the portion of private sector loan is very small. In coming years we might provide extensive investment towards infrastructure sector. Of course this sector generally requires quite a lot of financing. In this context we aiming to commence the funding based on the Public private partnership principles. That's why we assuming the loans to private sector will be increased in the future. We generally reject from small amounted loan requests. We have policy to consider the loan requests that might bring bigger or broader results. -How about the loan repayment in general? -Of course any government who receives the development loans they undertake measures to control the debt amount. From our side we also maintain substantial control effort to prevent our loans become uncollectible ones. The loan repayment depends on from many factors. As for the loans given to Mongolia some of the loans had real preferential terms. Based on the Mongolian Government's request to receive loans from ADB's ordinary capital resources ADB has conducted credit rating assessment on Mongolia with cooperation of World Bank. After undertaking assessment on already issued loans the result was relatively positive. Currently ADB is holding consultations with Government of Mongolia on 5th Power plant solutions and we have been in deep discussion with Ulaanbaatar municipal government on solutions to eliminate the traffic condition challenges. Also we are managing quite a number of activities for projects such as improving the Ger district living conditions. By saying “Hope we will have time to discuss above mentioned issues separately” Mr. Shane J Rosentail finished his introduction part of our interview. Also he added, “This time we really aiming to give clear information to Mongolia's public on Asian Development Bank (ADB)'s Accountability mechanism . This accountability mechanism, which we use at ADB is not been used by any other projects here. Until today there were no single case of issuing complaints in which they reported people's rights adversely affected by projects that been implemented by ADB in Mongolia. But now Ms Karen Oswald will introduce us about the Accountability mechanism at ADB, of its presence and there is such a mechanism at ADB where one can send their complaints in case someone's rights adversely affected by ADB supported projects and seek for final solutions. So the interview has continued with Ms Karen. -What is the Accountability mechanism? The Asian Development Bank (ADB) accountability mechanism provides an independent forum for people adversely affected by ADB-assisted projects. It allows project-affected people to voice their concerns and seek solutions to their problems. They can also request compliance review of alleged noncompliance by ADB with its operational policies and procedures. In brief, any people who adversely affected by activities of projects implemented by ADB's support can file their complaints to accountability mechanism for final solutions or the mechanism should give opportunity to solve the issues based on the joint consultation of all parties of the project. -Who is accounted as adversely affected person/ people? -For example during the re-settlement of any project implementation some one couldn't get enough compensation. Or if some one's living standard hasn't been restored in newly settled places compared to previous location than one can file complaint. Besides that people can send complaint to us relating to designs of any project. In the case of construction of highway, the conditions for crossing the highway safely is not considered in the drawing and this also one of types of adverse affects too. That's why residents of that certain area have the right to request for construction of underground pass or flyover. -In this case already planned and approved project needs to think about other changes. Are there any possibilities to make the change to approved plans? -Yes. But a lot would depend on the complaint filing timing. If the complaint is sent earlier or in the designing stage of the project the troublesome issues can be solved faster. If the complaint comes in later stages of the project it would require all parties of the project to sit in same table for consultation and seek for the better solutions of the problem. But it's clear that if the harm is already happened than it will require additional cost and additional effort to correct the condition. -In past none of complaints went up to accountability mechanism level for its final solutions, does that mean ADB had real smooth flow of operations or is that mean Mongolia has favorable legal environment? -I think both factors have played role in it. I would like to highlight that the efforts made by project implementation units, Government of Mongolia and Operations department of ADB to solve the issues in earlier stages within the project has played big role for this achievement. Also it will show us the good performance of the Resident mission of ADB in Ulaanbaatar.. From our side who run the accountability mechanism it's very essential to introduce to public about this method of finding the positive solutions to your issues and complaints. So now its becoming our main task to introduce our job to people who living in far west of Mongolia who might be adversely affected from project activities. The issues relating to environmental hazards or issues regarding the minority groups are clearly defined in the Grievance redress documentations. And the accountability mechanism gives opportunity to prevent any of issues that caused complaints wouldn't swell to later or more harmful stages. -Accountability mechanism is a mechanism that seeks solutions as after risk occurs. Are there many of potential ways of solving issues prior the risk occurrence? There is one common requirement to all of ADB funded projects. This requirement is we should listen to ideas and comments from all stakeholders which will be engaged to project implementation. In other words the interests and requests from stakeholders must be reflected in project preparation period to certain level. Also we require that full information about the project should be delivered to local community on regular intervals. With all of above mentioned measures we try to provide conditions to prevent from any risks. Also we conduct initial environmental assessment during the project preparation period. Same time we carry out initial socio and economic evaluations. All of these evaluations become more clear criteria and requirements and they reflected in final project. Also it might include very simple actions and measures. For example the basic requirements such as translating the materials for certain regions of any country to make the materials easier to understand for local people can be an example. There are many examples that I can tell you. For example in relation to construction activity let say the dust pollution occurs in very small amount, but we still require making environmental impact assessment. In other words the noise or vibration created from construction activities really impacting negatively to people's living conditions than the accountability mechanism gives opportunity to solve the issues before it becomes more serious issue with more potential harms. -Can any one who understands he/ she is been adversely affected file a complaint for solving the issues? Yes. But ADB receives complaints that filed by any group of two or more people. It's open to every case when you think you already adversely affected or you think that you might be adversely affected in the future because of projects. But there is one condition that we require. Matters that the complainants have made good faith efforts to address with the operations department concerned and failed to get solutions are filed to next level of solution seeking process -Accountability mechanism - Is that mean that Accountability mechanism is an organization where it receives complaints from complainants who failed to resolve the issues at project or in initial levels ? -Yes, exactly. -Is there any criteria to complaints? Will you be accepting complaints on very small issues as well? -We do have the basic requirements to complaints. There is also framework of issues that don't directly concern to Accountability mechanism. For example the issues related to allegations of fraud and corruption will not be resolved at accountability mechanism. For these issues ADB has separate department that deals with these issues. -How wide are the possibility to solve the issues at initial or project level? -There are many cases where matters that the complainants have made good faith efforts to address with the operations department and loan receiving Government are solved in project level not letting the issue go up high to next level. In recent years in relation to expansion of our activities the numbers of cases filing the complaints and processes to solve them are increasing the same pace. -What are the common types of complaints? -Majority of complaints related to re-settlement issues. But for this I'm not talking about Mongolia. So far. What kind of conditions might rise in Mongolia in the future is hard to predict. The re-settlement related issues are happen quite lot in those countries where they implementing huge infrastructure sector projects. Also complaints come on issues like the participation of stakeholders not been fully available during project preparation period and also complaints come on issue explaining that project is not providing full information about what going to happen. Of course it will not be such pleasant news to any person when he receives a notice that requires him to leave his place and be a part of re-settlement without any prior information. That's why delivering the information on timely basis is very essential to projects. Also its quite common that we receive complaints from Road and transport sectors. If we think on regions than in recent years complaints coming more frequently from South Asian countries. But from East Asian countries we received only 1 complaint and it was filed from China.. -From what you told me I understood that you receive complaint on many issues. But what that means you received only one complaint from East Asian countries? Is that mean you haven't received any complaints from other East Asian countries and from Mongolia? -The majority of complaints been solved at project level right as after the complaints been filed. In other words ADB holds a principle where we understand it's not a correct approach that we solve the issues at Last resort and rather we encourage the project level solution of issues. And this is the reason why we receive a few complaints that failed to be solved at project or initial level and comes to Accountability mechanism. -There is Compliance review Panel operates under Accountability mechanism . Can you tell us about this briefly? -There are 2 offices operate under Accountability mechanism. Compliance review panel is one of these 2 offices. The compliance review function investigates alleged noncompliance by ADB with its operational policies and procedure. As for the involuntary re-settlement ADB holds a strong policy that we create better living conditions for settlers compared what they used to have in pre-settlement areas. At least we aim to restore the conditions where people used to live. Also we have internal department that monitors and ensures these restoration works. -Based on the behavioral conditions Mongolians are very calm and we tend not to much complaining. If there are cases that we file complaints than what are the areas of issues? -As for Mongolia up to date even the cases of complaints in project level is also very few. We assume that in relation to extensive implementation of projects in infrastructure sector we will be receiving more complaints in this sector. If we look from other point than it reflects the fairly well performance of Agencies and staff in charge of certain projects. Also it tells that methodology to plan the issues and solve the issues in place. Also ADB encourage Mongolian Government to use its internal procedures to solve the different issues. The cooperation of ADB and host country Government plays significant role in solving the issues in early stage. But ADB is not an organization that deals solely to only host Governments. We aim to ensure the participation of civil groups and organizations and try to make solutions on issues based on joint consultation with civil groups. In general ADB's operations concentrate on to prevent that someone's rights would adversely affected from any of certain conditions.


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