Thimphu, 11 September 2020: The United Nations Development Programme (UNDP) and Asian Development Bank (ADB) have signed a Statement of Intent to initiate a joint effort that seeks to strengthen Bhutan’s capacity in macroeconomic forecasting and modelling.
The agreement was recently signed by UNDP Resident Representative Azusa Kubota and ADB Country Director Kanokpan Lao-Araya.
Under the agreement, UNDP and ADB will collaborate with an economist in the UN Resident Coordinator’s Office (UNRCO) in providing technical and financial support to the joint initiative.
The initiative is led by the Department of Macroeconomic Affairs of the Ministry of Finance and will work closely with the National Statistical Bureau and other government agencies represented in the Macroeconomic Framework Coordination Technical Committee (MFCTC) on the initiative.
The UNDP-UNRCO-ADB support includes analyzing current approaches, mapping data availability and needs, and identifying a new model to complement existing government methods. The initiative primarily aims to develop a macroeconomic forecasting and modelling model that will enable the government to:
- Simulate the relationships and interactions between different sectors of the economy;
- Estimate economy-wide impacts of shocks, including scenarios related to the impact of COVID-19;
- Model the multi-dimensional effects of different policy actions; and
- Adapt simulations to changes in assumptions and circumstances.
The partnership is historic for both UNDP and ADB as this is the first collaboration between the two organizations at a country office level.
“We are very pleased to join hands with ADB as countries around the world are faced with unprecedented economic challenges during this development crisis,” UNDP Resident Representative Azusa Kubota said.
“ADB brings profound knowledge and expertise and has experiences in supporting the Royal Government for many years in Bhutan. Through our partnership, we are hopeful to bring useful and timely support.”
‘As long-standing partners in supporting development progress in Asia and the Pacific, we are very pleased to take forward this partnership at the country level,” said Kanokpan Lao-Araya, Country Director of Bhutan Resident Mission (BHRM), ADB.
“This joint support in the critical area of macroeconomic forecasting and modelling will help the Royal Government of Bhutan inform policy options in response to the COVID-19 pandemic. We look forward to leveraging UNDP’s long-term support to Bhutan in policy dialogue and capacity building in a range of areas.”
UNDP’s support to this initiative is a part of its COVID-19 Response and Recovery Project titled Towards a Smarter, Greener and More Resilient Recovery through Innovation in Bhutan” funded by the Government of Japan. And ADB’s support will come through its Technical Assistance to the Ministry of Finance titled ‘Strengthening Policy Formulation and Implementation’.