Saturday, June 23, 2007

Money Back Guarantee

Prof. Cabanilla used to work for the Japan Bank for International Cooperation (JBIC). His job was to check if the loan is used for the purposes stipulated. In short, he makes sure that money is being spent. Now, that's a great job.

Prof. says that a project usually encounters three problems during its life cycle-- getting the source of funding, project development, and inefficiency in implementation and monitoring.
There are plenty of good projects that have been junked because of those challenges.

He cited a project that he handled back when he was still with JBIC. There was a plan to provide every town with telephones. It would be a costly undertaking, as the necessary infrastructure would have to be set up first. That was ten years ago. By the time the funding was released, the proliferation of mobile phone technology and the relative simplicity of the infrastructure network it required, have made the project irrelevant and outdated. Prof. actually had to go return the money to JBIC.

Imagine going through all that trouble to borrow money, only to give it back. With interest, of course.

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