Development Assistance and Agencies (Japanese)

[1O02] Case Study on Governance Improvement by Upazila Governance and Development Project (UGDP) in Bangladesh: Possibility of Governance Loan

*Akira MUNAKATA¹, *Takashi Sugiyama² (1. Japan International Cooperation Agency (JICA), 2. KRC)

Keywords:Local government, Governance, Yen Loan, Bangladesh, Performance assessment

A case study on Upazila Government and Development Project (UGDP) in Bangladesh as governance improvement of local government. UGDP is an ODA loan project worth approximately 14.7 billion yen (about 100 million US dollar). Major activities of UGDP are 1) Performance Assessment (PA) conducted annually for all Upazila (about 500); 2) Performance-based Allocation (PBA) to selected Upazila based on the PA results; and 3) Training and Upazila Development Facilitators (UDF) for Upazila governance improvement. These three is considered as a set-up of UGDP. A research question of the case study is: whether the se-up of UGDP contributed to governance improvement of Upazila or not. The research question is verified by the results of five PA. The average PA score of all Upazila (about 500) improved from 34 points in the 1st PA to 71 points in the 5th PA. Details are provided in the PA reports. PA is conducted by an external agent by checking relevant documents of each Upazila government work stipulated by laws and regulations. The five PA use the same indicators, so that changes of PA results objectively represent the governance of Upazila. In the UGDP, local infrastructure development (3351 subprojects) and training (9311 courses) were implemented by Upazila using development fund of Performance-based Allocation (PBA), which is distributed based on the PA result. The subproject of UGDP is also analyzed in the study. PBA accounts for about 80% of the total project cost of UGDP, while the five PA accounts for 0.5%, basic training for all Upazila accounts for 0.3%, and hiring cast of facilitators (UDF) accounts for 5% of the total project cost respectively. These three expenses directly for governance improvement is less than 7% of the total project cost. The experience of UGDP shows the possibility of "governance loan" that can dramatically improve the governance of local governments in wider area.