IFI governance


Regional programmes do not address underlying reforms: evaluation

2 July 2007

versión en español

In April, the Independent Evaluation Group (IEG) released its first-ever review of the Bank’s support for regional programmes, covering the period 1995 – 2005. It found that while the majority of programmes achieve their objectives, they often do not address underlying policy reforms, are weakly linked to national assistance strategies, and that incentives and procedures encouraging regional cooperation are lacking.

The Bank’s role in regional programmes will be a talking point in the ongoing IDA negotiations, while both this and the role of the Bank in so-called ‘global public goods’ will be a central discussion in the upcoming strategic review led by chief economist Francois Bourguignon.

Regional programmes are defined as those that intend to accomplish one or more development objectives in three or more countries involving cooperation or integration among the participating countries. Support for these programmes over the period studied amounted to $1.7 billion, or less than one per cent of total Bank funding. It is concentrated in Africa, in a few sectors (environment, infrastructure, health and finance) and heavily dependent on grant financing. The evaluation looked at 19 regional programmes selected to mirror the Bank’s portfolio.

The Bank developed a framework to prioritise its engagement in global and regional programmes in 2005. This came in response to a scathing IEG review of its global programmes which faulted the Bank’s selection of projects, its governance, management and financing of programmes, and its performance (see Update 44). However the IEG complains that this new framework “does not take account of diverse conditions in the different regions in setting those priorities”.

The evaluation finds that:

  • While programmes designed to create assets (knowledge, infrastructure, financial and other services) have “typically been successful”, they have failed to address the broader policy environment to use and maintain the assets created. Not surprisingly, country ownership is better where work is undertaken with the involvement of national institutions rather than “external experts”. Strong borrower commitment was found in only 8 of 13 regional programmes examined.
  • Only one-quarter of the 262 country assistance strategies (CAS) for countries involved in regional projects mention the regional programmes in which the country is involved. Of 19 regional programmes, only 6 were included within the strategic objectives of the CASs of participating countries. Country directors have not ensured that country operations take into account regional implications of country operations where there are significant cross-country externalities.
  • Current grant mechanisms “do not provide the Bank with a coherent way to support regional programmes”. Reforms to risk mitigation, monitoring and evaluation, legal frameworks and staff guidance are needed to help countries realise the development potential of regional cooperation. Meanwhile, existing regional efforts are being hampered by “significant problems” in donor coordination.

Missing from the evaluation are questions about how to best match accountability mechanisms to regional programmes. While civil society observers might concur with the need for more cross-border approaches to solving development problems, there are also concerns that, especially in the case of infrastructure development, regional mega-projects draw lines of accountability even further away from citizens.

Bank management broadly agreed with the evaluation. However, they pointed out that a recent increase in support for regional activities was not captured by the review. They pushed back against IEG recommendations to strengthen the regional programme framework and link with country assistance strategies, arguing for flexibility to support regional activities “when opportunities arise”. Bank incentives and capacities are to be strengthened following recommendations, and “discussions are ongoing” to extend the Paris Declaration on donor harmonisation to include regional programmes.

Kissing the hand that feeds

The IEG has not escaped the increased attention which the Wolfowitz scandal (see From Zoellick to Wolfowitz) has brought. A number of commentators have proposed the reform or abolishment of the IEG. Editors at the Wall Street Journal went furthest, arguing that “despite its name, the group, which is supposed to provide independent assessments of the effectiveness of Bank projects, is staffed by Bank employees who have every incentive to kiss the hand that feeds them.” Director Vinod Thomas defended the IEG in a press release saying that a “totally external group” would not be “relevant in the application of evaluative lessons”. With interest from both US civil society groups and members of congress, this issue may become a hot topic on the sidelines of this year’s IDA discussions.

In May, the IEG released its evaluation of the Bank’s support to the transport sector (see at issue). Upcoming evaluations include those on IFC development results, support to middle-income countries, and agriculture in sub-Saharan Africa.