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Marshall Islands Together, Forging a Better Future Development Effectiveness Brief Marshall Islands Together, Forging a Better Future © 2011 Asian Development Bank

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Marshall Islands Together, Forging a Better Future Development Effectiveness Brief Marshall Islands Together, Forging a Better Future © 2011 Asian Development Bank Development Effectiveness Brief Marshall Islands Together, Forging a Better Future Development Effectiveness Brief Marshall Islands Together, Forging a Better Future © 2011 Asian Development Bank All rights reserved. Published in 2011. Printed in the Philippines Publication Stock No. ARM113118 The views expressed in this publication are those of the authors and do not necessarily reflect the views and policies of the Asian Development Bank (ADB), its Board of Governors, or the governments they represent. ADB does not guarantee the accuracy of the data included in this publication and accepts no responsibility for any consequence of their use. By making any designation of or reference to a particular territory or geographic area, or by using the term “country” in this document, ADB does not intend to make any judgments as to the legal or other status of any territory or area. ADB encourages printing or copying information exclusively for personal and noncommercial use with proper acknowledgment of ADB. Users are restricted from reselling, redistributing, or creating derivative works for commercial purposes without the express, written consent of ADB. All photos, except for those on pages 5 and 6, were taken by Luis Ascui. The photos on pages 5 and 6 were taken by Samantha Brown. Note: In this report, “$” refers to US dollars. Asian Development Bank 6 ADB avenue, Mandaluyong City 1550 Metro Manila, Philippines Tel +63 2 632 4444 Fax +63 2 636 2444 www.adb.org For orders, please contact: Department of External Relations Fax +63 2 636 2648 [email protected] Printed on recycled paper Contents Marshall Islands Development Indicators iv Marshall Islands and ADB: Partners Looking to Tomorrow 1 ADB’s Contribution to Development and Poverty Reduction 4 Health: Protecting a Key Resource 4 Waste Management: Clearing a Way Forward 7 Tourism: Preparing to Attract the World 9 Land: Securing Prosperity 10 Public Sector Reform: Making Government Work Better 12 Operational Effectiveness: Improving Efficiency and Performance 14 Future Challenges 15 iii Marshall Islands Development Indicators Non–Millennium Development Goals Population in millions (2009) 0.05 Annual population growth rate (%) (2007–2009) 0.9 Adult literacy rate (%) (1999) 97 Population in urban areas (%) (2008) 71.1 Millennium Development Goals Population living below the national poverty line (%) (1999) 20 Under-5 mortality rate per 1,000 live births (2008) 36 Population using an improved drinking water source (%) (2000) 88 Source: Asian Development Bank and Republic of the Marshall Islands Fact Sheet. www.adb.org/Documents/ Fact_Sheets/RMI.pdf iv Marshall Islands and ADB: Partners Looking to Tomorrow At the only hospital on crowded Ebeye in the The Marshall Islands consists of 29 low- Republic of the Marshall Islands, 23-year-old lying atolls and 5 single islands that cover Jotyla Johnny treats and educates patients just 181 square kilometers of land area suffering from tuberculosis. The resilience and spread across nearly 2 million square miles hope of the Marshallese people can be seen in of the western Pacific Ocean. The country the nurse’s eyes as she speaks of helping those gained independence in 1979, having been here, many of whom have emigrated from administered by the United States as part of the outer islands to seek work at a United States Trust Territory of the Pacific Islands since 1947. military installation on nearby Kwajalein island. Today, the estimated population of 61,000 Many of the medical staff at the hospital, which enjoys a strongly traditional culture that coexists was built with Asian Development Bank (ADB) with the fledgling institutions of a young funding, are expatriates and she knows they will democracy. Glimpses of a potentially thriving not be here indefinitely. economy are seen in the tuna purse seiners clustering in the harbor of the capital Majuro, “I can be one of those who replace them,” she stores selling finely wrought handicrafts says. appealing to tourists, and the bustle of a workshop where traditional canoes are crafted. Johnny’s optimism and drive is not uncommon among the Marshallese people, who face Foreign grants fund more than two-thirds of serious economic and social development government expenditure in the Marshall Islands, challenges in the resource-poor nation. and the economy, in turn, relies heavily on ADB has funded projects across an array of sectors, including education, in the Marshall Islands 1 Development Effectiveness Brief: government spending. Most foreign grants are As of 31 December 2010, ADB Marshall Islands provided by the United States, which signed has approved 13 loans worth a renewed 20-year agreement, known as the Compact of Free Association, with the Marshall $87.63 million and 48 technical Islands in 2004. The grants provided under assistance grants for the Compact will continue until fiscal year $19.58 million. These have (FY)2023. While grants under the Compact decrease annually, they are offset by increasing supported development of the contributions to a trust fund that is intended education, fisheries, health, water, as a source of revenue after the grants end and transport sectors, and in 2023. assisted public sector reform and Aside from ADB and the United States, the structural adjustment government works with several external partners, including the International Monetary Fund; the World Bank; and the governments of ADB continuing to work with the government the European Union, Japan, and Taipei,China, to help the nation achieve self-sufficiency. as it strives to achieve the Millennium Development Goals (MDGs). As of 31 December 2010, ADB has approved 13 loans worth $87.63 million and 48 technical ADB lending to the Marshall Islands began in assistance grants for $19.58 million. Two grants 1990 but after the government fell behind in approved in 2010 are the first of their kind meeting repayments and amid disappointment to the Marshall Islands: one is for improving over some unsuccessful projects, the two parties energy supply to poor households agreed to suspend ADB’s lending program. No ($1.76 million) and the other is a portion of a new loans or grants were approved from 2004 Pacific regional grant for the social protection to 2009 but ADB continued providing technical of the vulnerable (of which $1.20 million is assistance aimed at improving the environment specifically allocated to the Marshall Islands). for business and government. The government has now caught up on its payments, however, ADB loans have supported development of and the loan program resumed in 2010 with the education, fisheries, health, water, and Loan and Grant Approvals ($ million) 1990–2005 2006 2007 2008 2009 2010 ADF 74.13 0 0 0 0 9.50 OCR 4.00 0 0 0 0 0 Total 78.13 0 0 0 0 9.50 Disbursements ($ million) 1990–2005 2006 2007 2008 2009 2010 ADF 59.99 0.10 0.06 0 0 9.50 OCR 000000 Total 59.99 0.10 0.06 0 0 9.50 ADF = Asian Development Fund, OCR = ordinary capital resources. Source: Asian Development Bank staff estimates. 2 Marshall Islands and ADB: Partners Looking to Tomorrow As a nation comprised mainly of atolls, much of Marshallese life revolves around the ocean transport sectors, and assisted public sector According to ADB’s Asian Development reform and structural adjustment. One loan Outlook 2010, gross domestic product in the assisted typhoon emergency rehabilitation. Marshall Islands is expected to grow by 0.5% As of 31 December 2010, of the 13 approved in FY2010, well below the 4.3% aggregate loan projects, in value terms, public sector growth projection for 2010 for the Pacific. management accounted for $33.50 million (38%) of the total loan amount. The health and ADB’s work in the Marshall Islands is mapped social protection sector followed with out in both the Country Operations Business $14.95 million while the education sector Plan 2010–2012 and the Country Strategy and received $14.83 million (each 17%). Program Update 2007–2011. ADB’s strategic thrusts are aligned with national priorities and The Marshallese economy grew at an average also consistent with the ADB’s Pacific Approach annual rate of 3.1% from FY2000 to FY2007, 2010–2014 and ADB’s long-term strategic though much of this growth was due to framework, Strategy 2020. Harmonization with external assistance. In FY2008, the economy other international development partners has contracted by 1.6% with a further contraction been sought to avoid duplication. of 2.1% in FY2009. The election of a new president in October 2009, however, calmed matters and the new government has begun According to ADB’s Asian several initiatives to reform the public sector, Development Outlook 2010, gross putting the Marshall Islands on a path of fiscal domestic product in the Marshall prudence, economic stability, and sustainable growth. A national election is slated to take Islands is expected to grow by 0.5% place toward the end of 2011. in FY2010 3 ADB’s Contribution to Development and Poverty Reduction Development Outputs from Health: Protecting ADB-Supported Projects in the Marshall Islands Outputs a Key Resource Achieved Sector 2004–2009 ADB’s health sector program promotes primary Education health care and targets assistance to high-risk populations, particularly poor children and Classrooms built or upgraded (number) 14 women of reproductive age. ADB’s support Associated facilities built or upgraded to the Marshall Islands focused on improving (number) 3 in-country health service capability, encouraging community participation, and helping the Learning institutions built or upgraded (number) 3 government to better utilize scarce financial resources in the health sector. Teachers trained (number) 58 Students benefiting (number) 1,220 Health Care on the Island of Ebeye Energy Tereasa Livai recuperates in a clean, orderly Installed energy generation capacity ward at the only hospital on the crowded island (MW equiv.) 6 of Ebeye, home to the second largest urban settlement in the Marshall Islands.
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