Independent Evaluation of AfDB's Program Based Operations (2012-2017)

The Independent Development Evaluation (IDEV) of the African Development Bank (AfDB) has conducted an evaluation of the Bank’s Program Based Operations (PBOs) for the period 2012 to 2017.

PBOs, also known as budget support, are instruments that the AfDB uses to provide funds directly to a country’s treasury in support of the national budget. Additionally, PBOs are expected to support general economic and financial or sector-specific reforms in the country. The Bank approved PBOs worth USD 10.2 billion during the period under review. This evaluation assesses how the Bank has used PBOs, since the PBO Policy was approved in 2012, and derives lessons and recommendations to help the Bank to use the PBO instrument more effectively in the future.

The evaluation finds that PBOs remain relevant and useful instruments for the AfDB and its clients, and their performance is broadly satisfactory. They are, however, challenging to design and manage effectively. The evaluation finds shortcomings in their implementation. It also finds that the Bank has insufficiently invested in its own institutional infrastructure to obtain maximum value for money from the instrument.

Key recommendations to the Bank are that it should:

• Update or complement the PBO guidelines in order to appropriately reflect the Bank’s response to the 2017 G20 principles on coordination with the IMF and to provide detailed guidance to staff.
• Fully enforce the provisions of the PBO Policy.
• Design future PBOs with a focus on medium-term support to a limited number of reform areas.
• Back PBOs with appropriate and timely expertise and capacity support.
• Reflect in practice the vital role of policy dialogue in PBOs.