“The sustainability of AFT program is doubtful, mainly because of the lack of government contribution and increasing trend of donors in hiring their own consultants instead of building capacity of local institutions,” Ratnakar Adhikari, general secretary of South Asia Watch on Trade, Economics and Environment (SAWTEE), said, presenting a research report on ´Evaluating Development Effectiveness of Aid for Trade´ here on Monday.[break]
According to the report, 49 percent of the total respondents of the research said donors were not enhancing capacity of local institutions while implementing AFT projects supported by the donors.
Purushottam Ojha, secretary at the Ministry of Commerce and Supplies, said the government´s commitment on AFT program has increased with the commitment made in three-year plan of the government and Nepal Trade Integration Strategy aimed at promoting trade.
According to the report, funding for AFT program for Nepal has increased to $299.86 million in 2009, up from $121.37 million recorded in 2002. Global AFT growth has increased by 36 percent during Post-Hong Kong Ministerial Period (2006-09), compared the figures recorded during the base period (2002-05).
Nepal has seen its overall AFT commitment increase by 42 percent during the post-Hong Kong Ministerial period as compared to the base period.
The report, however, painted grim picture on government absorptive powers on implementation of AFT. “Although absorptive capacity of the government agencies responsible for implementing AFT project is not satisfactory, there has been some improvement over the past five years,” the report added.
Adhikari also expressed dissatisfaction over the continuation of Parallel Implementation Units (PIUs) that follows their own financial management, audit and procurement system. According to the report, 44 percent of the total respondents said AFT projects were implemented through PIUs created by donors themselves.
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