IFI governance

Background

Development policy financing retrospective: Emerging findings and lessons

16 April 2015 | Minutes

 

Sponsor: Operations Policy and Country Services (OPCS), World Bank

Panelist: Linda Van Gelder (Director, Operations Policy and Country Services, World Bank), Edward Mountfield (Manager, Operations Policy and Country Services, World Bank), Chair: Edith Jibunoh (Adviser, External and Corporate Relations, World Bank)

Linda Van Gelder – background

  • Every 3 years, this is the 4th (used to be called Development Policy Lending.)
  • Focus on environmental and social aspects + long term trends.
  • IEG is also contributing through ‘learning products’

Edward Mountfield – detail

  • Covers 165 loans – most in Africa by number of operation no, but most in Europe and Central Asia by value.
  • Peaked in 2010 (over 40% – due to crisis) fell to >25% in 2013 – FY 2014 >30%
  • Prior Actions (conditionality):
    • Most in public sector governance, followed by financial and private sector and trade policy (other areas much smaller.)
  • Measurement is against conditionality and the expected results of that conditionality.
  • FY2014 – added a risk rating to their analysis, with Systematic Operations Risk-rating Tool (SORT) – introduced Oct 2014.
    • 9 categories of risk (environmental and social is one of the nine)
  • Findings (review by ‘independent experts’)
    • Prior Actions social effects in short term (direct impacts)
      • 80% = neutral
      • 16% likely positive
      • 3% likely negative with PSIA
      • 1% likely negative without PSIA
        • Many were linked to reducing fuel subsidies.
      • PA environmental effects in short term (direct impacts)
        • 83% none
        • 9% positive effects
        • 1% significant negative effect
        • 6% can’t say.
      • Parallel piece of work to try to map out the causal train between prior actions and final results.

 

Jesse Griffiths, Eurodad

  • Counting conditions – what about ‘non-binding’ but nonetheless influential conditions?
    • Prior actions have come down to about 8 per loan (were 10 in last review 2010)
    • Database is publicly disclosed and they unbundle actions.
    • Non-binding: No more benchmarks. Triggers are only counted when they become prior actions.
  • Sensitive conditions, such as economic policy conditions – attempting to identify these?
  • Credibility- can there really by 80% with no social impact?
    • Most of the conditions are not possible to identify short term direct impacts for e.g. review this law or change that policy.

 

Presentation on the Bank’s initial findings of DPF review