Development Finance Institutions and Infrastructure: A Systematic Review of Evidence for Development Additionality

Abstract

This systematic review was commissioned to address the following questions: 1. What is the evidence of the impact of DFI support (including PIDG support) for private participation in infrastructure (PPI) on economic growth and poverty reduction? 2. What conclusions can be drawn from this evidence to help DFIs better target their investment to maximise their impact on economic growth and poverty reduction? The review focused on the value-added, or 'additionality', that DFIs might create with respect to growth and poverty, where additionality is defined as impact beyond that which would have occurred without DFI participation. Phase 1 examined publicly available evidence in the academic and grey literatures, as well as DFIs' own material. Phase 2 examined internal project evaluations for a group of five major DFIs, based on negotiated terms of access. Participating DFIs are: the IFC (International Finance Corporation), KfW (German development bank), The UK Government's Development Finance Institution (previously Commonwealth Development Corporation - CDC), AsDB (Asian Development Bank) and FMO (The entrepreneurial development bank of the Netherlands). In each case, the researchers were granted access to previously confidential documents. In total, more than 400 documents were reviewed, coded and analysed, roughly half in each phase of the review. Chapters 1 and 2 of the report describe the objectives and background to the review. Chapter 3 describes the methods used, and chapter 4 outlines the search results and give details of included studies (both phases). Findings of Phase 1 are covered in chapters 5-7 and findings of Phase 2 in chapter 8. Chapters 9-12 cover the limitations of the review; conclusions and recommendations; a commentary on M&E and impact assessment; and references