This is a timely evaluation that provides useful lessons and recommendations for Management’s consideration and implementation. The evaluation reinforces management’s position that PBOs should continue to constitute an integral part of the services available to Bank clients. It also points out some of the areas where there is need for improvement. 

Management broadly agrees with the recommendations, and it proposes response actions in the attached Management Action Record.

1. Dissemination of Evaluation Findings

After the evaluation findings were presented to the Development Effectiveness Committee (CODE) on 2 October 2018, the evaluation summary report was published on the Independent Development Evaluation website and a brief presentation of the key findings were made available online and in print. The reports of the two clusters, together with the 10-case study reports, were also published on the website. 

In addition, the evaluation findings were shared at the following events:

  • African Development Fund F-14 Mid-Term Review Meeting on 26 October 2018 in Kigali, Rwanda. 
  • The African Evaluation Association 9th Biennial International Conference on 14 March 2019 in Abidjan, Cote d’Ivoire. 
  • Workshops on “Proceeding of Optimizing the AfDB’s PBOs as Package of Support” on 21 May 2019 in Pretoria, South Africa; on 28 May 2019 in Nairobi, Kenya; and on 26 June in Abidjan, Cote d’Ivoire. 
  • Private sector development learning session on 30 October 2019, in Abidjan, Cote d’Ivoire. 

2. Emerging issues

In 2017, AfDB approved a new lending instrument: results-based financing (RBF). RBF supports government-owned sector programs and links disbursements directly to the achievement of program results. However, due to its recent approval and implementation, this instrument has not yet been evaluated. 

Since the presentation of the findings of the evaluation to the CODE in October 2018, AfDB has taken several actions to implement the main recommendations. 

  • Staff training
  • AfDB staff received training in February 2020 on how to plan and effectively conduct policy dialogue, and on the design of results frameworks for PBOs. 
  • AfDB is developing e-courses for task managers, which will include a module on program-based operations. 
  • Preparation of guides to enhance the quality and effectiveness of PBOs
  • A guide on policy dialogue in the context of PBOs has been prepared and is currently under review and clearance by AfDB’s top management. However, AfDB adopted and implemented during the last quarter of 2020 the Policy Reform Dialogue Matrix (PRDM) which is an innovative instrument that allows to systematically plan, budget, implement and monitor results of the Bank’s dialogue on key policy reforms in each RMC, while promoting linkages with the Bank’s lending and nonlending activities. 
  • Commitments. within the framework of the negotiations for the 7th general capital increase, AfDB undertook to implement all of the recommendations of the PBO evaluation. 
  • Preparation of a new governance strategy. A new governance strategy is being prepared and this will incorporate the lessons learned from the latest PBO evaluation, as PBOs remain an important way for AfDB to deliver governance interventions.  
  • Preparation of a note compiling relevant findings and lessons from evaluations of PBOs. This will be used to inform AfDB’s support to its RMCs in mitigating the economic and social consequences of COVID-19. 

3. Conclusion

The use of the PBO instrument by AfDB increased significantly over the period 2005–2019, leading to calls for caution. In response to these concerns and in order not to compromise its financial stability, AfDB introduced unbreachable limits of 25% of allocations from the AfDF window and 15% of the allocations from the AfDB window, in terms of volume. 

The instrument has demonstrated its relevance, particularly during crisis situations and in support of structural reforms in the PFM, energy, transport, and health sectors. 

Although the performance of the instrument was rated generally satisfactory by two independent evaluations, these evaluations also found that AfDB was still not able realize the instrument’s full potential. PBOs need to be used as a package of support, combining budget support, policy dialogue, and technical assistance. 

Nevertheless, AfDB’s management response to the findings and recommendations of the 2018 evaluation, as well as the actions that have already been taken, should mean that PBOs are used more effectively to meet the needs of AfDB RMCs.