KATHMANDU, July 18: Nepal's development assistance absorptive capacity is low, project management is weak and delays are common. If early indications are anything to go by, implementation of projects to be funded by Millennium Challenge Corporation (MCC) of US government won't be any different.
A meeting of the steering committee of MCC Nepal led by Finance Minister Bishnu Prasad Paudel held in the second week of June decided against renewing contract of Krishna Gyawali - the national coordinator of MCC Nepal.
After a gap of nearly a month, the government named Tulsi Prasad Sitaula as the officiating National Coordinator of MCC Nepal. Sitaula was working with MCC Nepal as a transportation expert.
“By not extending Gyawali's contract, the government has not behaved seriously toward MCC and unique funds that Nepal is receiving," Swarnim Wagle, former member of National Planning Commission, told Republica.
MCC Nepal is currently preparing projects to receive funds in range of US$ 300 million to $600 million. The two-year deadline for project preparation ends in May next year. The selected project has to be implemented within five years.
"MCC assistance can make a difference for Nepal by unlocking binding growth constraints via road and energy projects," added Wagle.
Implementation of projects funded by MCC will have a huge impact on country's economy, according to experts.
According to officials of MCC Nepal, due diligence audits of selected road and transmission line projects are currently underway.
“The government should not make this type of intervention in such important projects," Wagle said, expressing dissatisfaction over the decision to part ways with Gyawali.
Gyawali also expressed dissatisfaction in the way he was shown the doors. “Neither my performance was evaluated, nor they officially told me my contract has been terminated,” he added.
Though the cabinet has decided to appoint Gyawali for two years, he was given only yearlong contract as per the contracting practice of MCC.
"These type of fund managers look for seriousness in implementation and consistency in leadership to implement the project coherently," added Wagle.
Frequent changes in project managers are common characteristics of development projects in Nepal. It is said to be one of the major reasons behind poor implementation.
It will take some more time to find an appropriate candidate to lead the institution, according to sources privy to the issue.
Nepal was selected for MCC assistance in January, 2015.