Evaluation of Japan’s ODA to the Republic of Indonesia (Brief Summary)Interview with a local community of Banda Ache CityEvaluators (Evaluation Team)Chief Evaluator: Hiroshi Sato, Chief Senior Researcher, Institute of Developing Economies, Japan External Trade OrganizationAdvisor: Shunsuke Rai, Associate Professor, Meiji Gakuin UniversityConsultant: Kokusai Kogyo Co., Ltd.Target PeriodMarch 2008 - December 2018Evaluation PeriodJune 2018 - March 2019Field Survey CountryThe Republic of IndonesiaNote: The following was prepared by ODA Evaluation Division based on the report provided by the evaluation team.Full text is available here:https://www.mofa.go.jp/policy/oda/evaluation/FY2018/pdfs/indonesia.pdf10 Background, Objectives, and Scope of the Evaluation Japanese ODA for Indonesia, a sole member of the G20 among ASEAN countries, is indispensable not only for development and social stabilization of Indonesia but for Asian countries, including Japan. In the past ten years, there have been substantial changes for economic development of both Japan and Indonesia, such as revision of the Development Cooperation Charter and establishment of new JICA, which is organizational restructuring of Japan’s ODA implementation system. This study will evaluate overall ODA for Indonesia, including its policies and results. Its main objectives are to draw lessons and make recommendations for effective planning and implementation of future ODA to Indonesia as well as to provide accountability to Japanese citizens by widely disseminating evaluation results. Brief Summary of Evaluation resultsDevelopment Viewpoints(1) Relevance of Policies (Rating B: Satisfactory) Japanese ODA policies for Indonesia is highly consistent with the National Medium-Term Development Plan (PRJMN2005-2009 and PRJMN2010-2014), covering Indonesia’s needs. In addition, the following high relevance was confirmed: 1) Japan’s comparative advantages, including high-quality infrastructure development and environmental technologies based on experience, and 2) consistency with global development issues as well as information sharing and collaboration with other donors. The intention of the Development Cooperation Charter, that is to strengthen cooperation with other Japanese organizations, should be clearly stipulated in the Country Assistance Policy, although various collaborations are actually being conducted.(2) Effectiveness of Results (Rating A: Highly Satisfactory) Japan has significantly contributed to addressing poverty reduction and economic development in Indonesia by providing a substantial amount of ODA. Japan’s ODA has also contributed to increasing Indonesia’s presence in global society. This study has confirmed that Japan’s ODA for the following six sectors has been highly effective: “economic infrastructure development,” “business environment improvement,” “correction of disparities and local development,” “disaster management,” “climate change and natural environment preservation,” and “response to issues in the Asian region and international society.”(3) Appropriateness of Processes (Rating C: Partially Unsatisfactory) Concerning the structure of ODA implementation, there is frequent communication, including All Japan Meetings, between relevant organizations during implementation, and it was confirmed that efforts were made consistently from policy formulation to implementation. However, there were few written records available to assess the functions and effectiveness of activities performed by the country-based ODA Task Force. Regarding the appropriateness of policy formulation, comprehensive policy dialogue between Japan and Indonesia has not been held since FY 2014, although several political meetings on ODA were organized at higher official and sector levels. As for the process of implementing ODA, Japan’s ODA has achieved excellent outcomes, however monitoring and evaluation at the program and higher policy levels hardly exists and it was difficult to confirm the degree of Japan’s contribution to achieving Indonesia’s development goals and addressing issues.Diplomatic Viewpoints(1) Diplomatic Importance Indonesia and Japan are both maritime nations and share fundamental values such as democracy, the rule of law, and the multilateral trading system. Further, the importance of strong reciprocity is widespread in Indonesia. Therefore, supporting Indonesia’s economic infrastructure and the development of its business environment contributes to promoting investment and economic activity by Japanese companies in Indonesia as well as stabilizing imports of resources to Japan. Support for Indonesia’s disaster management and climate change policies builds international confidence in Japan, as well as fulfills Japan’s international commitments as a country of advanced disaster risk management. Assisting Indonesia’s responses to issues in Asia and global society contributes to building peace and social stability not only for both countries but also for the ASEAN region as a whole.(2) Diplomatic Impact ODA projects, such as public-private partnership, have created opportunities for Japanese companies to start business activities in Indonesia. It was also confirmed that ODA projects and collaboration between public and private relevant organizations contributed to the improvement of the business environment. As for impact generated by ODA as a whole, the ODA facilitated the negotiations for the Economic Partnership Agreement between Japan and Indonesia (JI-EPA), as an important diplomatic card. As for another diplomatic impact, the results of opinion surveys for Japan was confirmed to show that economic activity in the private level contributing to building trust for Japan. Recommendations(1) Clarifying Importance of Strengthening Cooperation with Relevant Organizations in Japan’s ODA Policies to Indonesia The private sector in Indonesia is playing a significant role in development and it is expected that it will play more in the future. Therefore, it is desirable to adopt an ODA policy for Indonesia that oversees the activities of relevant organizations. It is recommended that further reinforcement of cooperation be promoted by stipulating its importance in Japan’s development cooperation policy for Indonesia.(2) Monitoring Contribution of Japan’s ODA towards Achievement of Indonesia’s Development Objectives It is highly recommended that a new way of program monitoring should be developed, particularly focusing on to what degree Japan’s ODA has contributed to addressing the development issues and to achieving the development goals of Indonesia. It is proposed that progress and achievement of a new Japan’s ODA project, when the new project can be positioned under a specific Indonesia’s program with measurable targets and goals, will be measured towards the targets and goals set under Indonesia’s program.(3) Strengthening the Function of the country-based ODA Task Force Country-based ODA Task Force should be held periodically, engaging wider stakeholders who can contribute to formulation of Japan’s development cooperation policy for Indonesia.(4) Resuming a Comprehensive Policy Dialogue between Indonesia and Japan Discussions are required to share understanding of Indonesia’s needs and expectation on Japan’s ODA, in formulating and reviewing the development cooperation policy. It is recommended that comprehensive policy dialogue should be resumed between both countries to summarize results of various discussions.
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