The Difference Between ADB-Funded and Locally Funded Infrastructure Projects: What it is for Samar Roads?

Samar's roads, particularly the Maharlika Highway (AH 26), are currently in poor condition, with an estimated 60% of the roads classified as needing urgent rehabilitation. These deteriorating roads are not just an inconvenience—they pose serious risks to motorists, contributing to an increase in road accidents, higher vehicle maintenance costs, painting a depressed reputation, and affects tourism, among many other impact. Many residents have voiced their frustrations, and the roads have earned unfortunate nicknames such as "hellish roads" and "moon craters," reflecting widespread discontent.

Recently, it was announced in a congressional hearing that the Department of Public Works and Highways (DPWH) is in discussions with the Asian Development Bank (ADB) to fund the comprehensive rehabilitation of the Maharlika Highway. However, the expected start of construction is not until 2027, leading to questions and concerns from local communities and leaders. Why is this critical project being delayed, and why is the government seeking ADB funding for it?

ADB vs. Locally Funded Projects: Key Differences

When comparing ADB-funded infrastructure projects to those funded locally (such as through the General Appropriations Act or GAA), several important differences emerge. These differences can significantly affect the outcomes of projects, including their quality, timelines, and long-term sustainability.

1. Project Planning and Design

• ADB-Funded Projects: ADB projects are characterized by rigorous planning and design processes. Before any construction begins, extensive feasibility studies, environmental impact assessments, and social impact evaluations are conducted. These projects also involve consultations with stakeholders, including local communities, to ensure that the project aligns with the needs and priorities of the area.
• Locally Funded Projects: In contrast, locally funded projects may not always undergo such thorough planning. The planning process can be expedited due to immediate political or economic pressures, potentially leading to designs that do not fully account for long-term sustainability or community needs. Additionally, there can be instances where project designs are influenced by considerations other than technical merit, which might compromise the overall quality.

2. Procurement and Contracting

• ADB-Funded Projects: Procurement under ADB-funded projects follows strict guidelines aimed at ensuring transparency, fairness, and competition. Contracts are typically awarded through competitive bidding processes open to both local and international firms. These processes help minimize the risks of conflicts of interest or undue influence, ensuring that contractors with the appropriate expertise are selected.
• Locally Funded Projects: Locally funded projects may have varying procurement processes, which can be influenced by local dynamics. While some projects follow transparent and competitive procedures, others may encounter challenges such as the involvement of "dummy contractors" or expectations of "SOPs" (standard operating procedures, a euphemism for kickbacks). These practices, if present, can lead to the selection of contractors who may not prioritize the quality of the work, potentially compromising the project’s outcomes.

3. Monitoring and Evaluation

• ADB-Funded Projects: ADB places a strong emphasis on monitoring and evaluation throughout the project lifecycle. This includes regular progress reports, independent audits, and post-completion evaluations to ensure that the project meets its objectives and delivers value for money. The rigorous oversight mechanisms reduce the likelihood of mismanagement and ensure that issues are promptly addressed.
• Locally Funded Projects: Monitoring and evaluation practices in locally funded projects can vary widely. Some projects may have robust monitoring mechanisms, while others might suffer from insufficient oversight, which can lead to delays, cost overruns, or subpar construction quality. In some cases, the lack of stringent monitoring might allow for inefficiencies or financial discrepancies to go unnoticed. Some may have simulated monitoring activities which may be true only in documents; monitoring reports are doctored.

4. Financing and Budgeting

• ADB-Funded Projects: ADB provides loans or grants with specific conditions, including detailed financial planning and strict adherence to budgetary controls. The funding is usually disbursed in tranches based on the achievement of pre-defined milestones, ensuring that the project progresses as planned and that funds are used efficiently.
• Locally Funded Projects: Locally funded projects may face different financial controls, depending on the source of funds and the implementing agency's policies. In some cases, budget management may be less stringent, potentially leading to misallocation or inefficiencies. Additionally, there is a perception that in some locally funded projects, financial resources might be diverted to non-essential expenses, which can affect the project’s completion and quality.

5. Community Engagement and Social Impact

• ADB-Funded Projects: ADB requires comprehensive community engagement, ensuring that projects have broad support and that any potential negative impacts are mitigated. This often involves setting up grievance mechanisms and ensuring that benefits are equitably shared among stakeholders.
• Locally Funded Projects: While locally funded projects may also engage with communities, the extent and effectiveness of this engagement can vary. In some instances, community concerns may not be fully addressed, leading to dissatisfaction or resistance, particularly if stakeholders feel that project benefits are not distributed fairly or that their input is overlooked.

Implications for Samar’s Roads

Given these differences, it becomes clearer why the DPWH has opted to pursue ADB funding for the Maharlika Highway rehabilitation. The scale and complexity of the project, coupled with the need for rigorous oversight and high standards, make ADB an attractive partner. However, this decision also highlights the challenges faced by locally funded projects in Samar, where issues like project delays, inconsistent quality, and concerns about the integrity of the procurement process have been recurring topics of discussion.

Why the Long Wait?

Many residents and local leaders in Samar have expressed disappointment with the projected 2027 start date for the Maharlika Highway rehabilitation. The need for immediate action is clear, as the condition of the roads continues to deteriorate, affecting the daily lives of thousands of people. However, DPWH has explained that the technical studies and preparatory work required for such a large project take time, and that ADB’s rigorous processes ensure that the project will be well-planned and sustainable in the long run.

Moving Forward: A Balanced Approach

The rehabilitation of the Maharlika Highway is a critical project for Samar, and while the timeline may not be ideal, the involvement of ADB offers hope that the project will be implemented effectively. By addressing the technical, financial, and social aspects of the project in a comprehensive manner, ADB can help ensure that Samar’s roads are not just repaired, but transformed into infrastructure that supports economic growth and improves the quality of life for residents.

In the long term, it is also important for locally funded projects to learn from the best practices employed by international institutions like ADB. This includes improving planning processes, strengthening procurement practices, and ensuring that projects are closely monitored and evaluated to maximize their impact. By fostering greater collaboration between local and international institutions, the Philippines can work towards improving its infrastructure and ensuring that regions like Samar receive the attention and investment they need to thrive.

Through a transparent and well-coordinated approach, the road to a better future for Samar is possible—one that involves a balance of local initiative and international support, ultimately benefiting the people who rely on these crucial infrastructure projects.

(Article is AI enhanced)