About 45 official development assistance (ODA)-funded projects, valued at roughly P2 trillion, were assessed or flagged as “actual problem projects,” representing an overwhelming majority of the ongoing ODA-funded projects in the 2023 portfolio, due to persistent unresolved issues.
According to the latest ODA portfolio review, additionally, there are 10 projects valued at P489 billion that are at risk of becoming problematic, based on NEDA’s alert mechanism (AM) system.
NEDA said 58 of the 77 ongoing Investment Coordination Committee (ICC)-approved ODA-funded projects were assessed with corresponding alert status as of the fourth quarter of 2023, of which 45 were either at level 1 which is the early warning stage or level 2 which is the critical stage.
“Out of the 45 projects identified as problematic in 2023, 22 had been classified as such since 2021. These projects have faced significant delays due to common implementation bottlenecks, such as right-of-way acquisition, procurement issues and compliance with regulatory requirements. These challenges were exacerbated by health and logistical restrictions during the COVID-19 pandemic,” the report said.
“The situation for these ODA-funded projects was further complicated by the government’s limited fiscal space, as resources were reprioritized to address the pandemic. Additional delays were experienced due to inadequate appropriations for loan proceeds, or in some cases, the non-approval of proposed budgets in the national budget starting in 2022 for these ODA-funded projects,” it added.
NEDA undersecretary Joseph Capuno told reporters for some projects, the problem is not about the lack of funds to acquire the related property but the resettlement of occupants.
“So it’s a bit challenging, because they have to agree to be relocated to another place.
Doing that involves also working with other agencies. So even if you have the money, if you don’t arrange the coordination with the other involved agencies, that’s going to be difficult as well,” Capuno said.
The report said the challenges in large-scale development initiatives highlight the need for strategic interventions and enhanced project management practices.
Paul Andrew Tatlonghari, NEDA assistant director, said action letters are sent to agencies in charge of the ODA-funded projects tagged as problematic.
“We ask them for their catch up plans and the issues and the committed actions or remedial measures to address the issues,” Tatlonghari said.
“If they’re nearing the closing of the loan, or they’re already towards the end of the original target completion date, we check those things and make sure that they comply with the latest ICC approval,” he added.
Meanwhile, 26 projects were identified as likely to be restructured this year, which may require ICC action.
With project implementation continuously being hampered by various bottlenecks, implementing agencies cited the need to adjust project parameters due to, among others, time extensions, change in scope and change in cost.
