European Capacity Building Initiative

Devolved Access Modalities (Review Draft)

Exhibit 1. In the Honduras Rural Infrastructure Project, the World Bank used the Honduran Social Investment Fund (FHIS) and existing administrations to fund a wide-range of small rural infrastructure projects. Detailed project selection was done by local administrations, subject to review by the national-level FHIS, and the FHIS provided oversight of financial management, procurement, and safeguards and disbursed funds received from the World Bank on a quarterly basis to the local administrations based on the approved budgets.

Exhibit 2. The Kecamatan Development Program (KDP) in Indonesia emphasized block grants for local governments through a highly decentralized program. Grants of between $50 and $150,000 were provided to groups of 20-50 villages to develop and implement small-scale infrastructure, social, and economic activities that were chosen within the communities themselves. Each district, or Kecamatan, conducted a competition for funds among villages and oversaw disbursements. The KDP was funded by a combination of World Bank lending and contributions from the Government of Indonesia, as well as Dutch, Japanese, and other, multi-donor trust funds.

Exhibit 3. The US Millennium Challenge Corporation (MCC) provides large, multi-year programs of investments­called “compacts”­that are developed by the country and managed by a domestic agency(s). The MCC emphasizes (1) competitive selection among countries based on historic performance indicators, (2) predictable, multi-year funding, and (3) rigorous measurement and evaluation of impact. Countries qualify for the MCC based on independent and transparent measures of good governance. The MCC then invites the governments of selected countries to propose a set of specific investment activities consistent with national priorities, and typically the decisions about these investments are made at the level of national ministries and are well-defined with the “compact” document.

Exhibit 4. Policy Based Funding is a general approach that emphasizes policy and institutional reforms supported by unrestricted funding to a government. The World Bank’s Policy Loan to Morocco for “Inclusive Green Growth,” for example, provided a $300 million loan following the government’s approval of certain energy efficiency standards and price adjustments to refined petroleum products.

Exhibit 5. The Global Climate Change Alliance (GCCA) provides funding to increase capacity in the most vulnerable developing countries through a variety of modalities, one example being their recent €28 million contribution to the Bangladesh Climate Change Resilience Fund (BCCRF). The BCCRF is a multi-donor trust fund overseen by a board and management committee of senior Bangladeshi government officials and ministers that includes donor and civil society representatives. While the World Bank currently serves as interim trustee and secretariat, a domestic BCCRF secretariat is being set up to take over those activities.

Exhibit 6. In order to illustrate the use of QP payments with results measured at a macro level with a fixed-price transaction methodology, this Exhibit summarizes a model put forward by Müller et al. (2013) which uses proposals developed by the Center for Global Development to enhance the modalities used in the Norwegian International Forest Climate Initiative

FC Publication Date: 
09 February 2014
FC Publication: 
Laurel Murray