ADB board likely to endorse $150m governance credit for Bangladesh

FE Team | Published: September 24, 2007 00:00:00 | Updated: February 01, 2018 00:00:00

A Z M Anas
The Asian Development Bank (ADB) is expected to endorse next month a US$150 million loan for Bangladesh, recognising the government's commitment to cracking down on graft, while reforming the judiciary and the executive.
"The ADB's board in Manila is likely to endorse the credit proposal on October 22, given the government's pledge to overhaul the judiciary and the civil administration," a senior economic relations division (ERD) official said Sunday.
"The loan negotiations concluded successfully and the government side agreed to amend the organograms of the Anti-Corruption Commission (ACC) and the judiciary in the first phase of a four-year programme," the official added. The ADB officials in Dhaka, however, were not immediately available for comments.
Officials say the proposed governance credit will be made available in the form of budgetary support and the interim administration will speed up reforms in key institutions such as the ACC, Cabinet Division, Public Service Commission, Chittagong Port Authority and the Supreme Judicial Commission.
"The ADB's soft loan will come as a great relief in view of the budgetary deficit running as high as 4.8 per cent of gross domestic product," an ERD official said.
In an aide memoire, the Manila-based multilateral capital donor has asked the government to announce establishment of an Office of the Ombudsman within 2008 to help redress the public grievance.
It also pressed the government negotiators hard to map out the National Integrity Strategy (NIS) and take steps to implement the UN Convention Against Corruption.
"As a first step to put in place a strong reform regime in governance, it is necessary to formulate and implement the National Integrity Strategy (NIS) which sits at the core of the good governance agenda," says the aide memoire submitted to the government.
The ADB feels that tackling graft requires that the ACC has a clear legal and policy framework, rigorous internal management systems, sufficient resources, and working partnerships with civil society.
It also feels that the recent efforts to separate the judiciary from the executive require that necessary systems are in place to anchor the separation on clear policies and legal frameworks.
Approval and publication of the National Integrity Strategy (NIS), gazette notification for the amendment to the ACC Act and alignment to the UN Convention Against Corruption, and decentralisation of the ACC are among the conditions for the proposed credit.
Also, the ADB wants the caretaker authority to review the existing quota system for entry into the civil service, and approve merit-based entry and promotion for civil servants to help bring about dynamism in the government.
To strengthen judiciary, it asked the government for issuing gazette notification relating to the separation of judiciary and completing entry exams for 100 assistant judges.
There will be two executing agencies for the programme: the Cabinet Division will oversee the activities relating to the executive while the Supreme Court will do the same for strengthening the judiciary.
The good governance programme is slated for completion over the next four years since the inception of the project, according to the ADB document.
The lending agency will release the credit in three tranches-the first installment worth $45 million, the second one, $40 million and the third, $45 million.
An ERD official said the disbursement of residual amount will be contingent upon the successful implementation of the first phase.
But the ADB has estimated that Bangladesh needs to invest at least $170 million to improve the governance system and stressed on other donors' involvement.
Earlier, the negotiators of the government and the ADB wound up a two-day loan negotiations on September 5-6 in the city.