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 Among the three dimensions of municipal management—planning, finance, and service provision— finance yielded successful results. The Bank should continue to support tightened municipal financial management, own-revenue raising by municipalities, and municipalities being brought to local credit markets when appropriate conditions are present. |
| | Project documentation that routinely reports basic data about each client (municipality name, population, and MDP investment) is vital to developing a better understanding of the scope of MDP esults. |
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Wholesale MDPs have yielded better outcomes than retail MDPs over the past decade, but more analysis is needed. Retail MDPs might perform better if they incorporated more of the winning elements of wholesale MDPs, such as performance-based incentives and a focus on finance. |
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More frequent use of cost-benefit or cost-effectiveness analysis would help MDPs’ municipal clients select the best investments and achieve outcomes efficiently. IEG found that only half of MDPs use such tools, with the best coverage in the Sub-Saharan Africa Region. |
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For M&E to succeed in MDPs, it has to be useful and not unduly burdensome to municipalities themselves, and it must keep a focus on achieving results, particularly for the poor. Strong M&E can also help reduce the expense of cost-benefit analysis by providing some of the data needed to estimate ERRs. |
| | Private financing of municipal services can be encouraged through better analysis of local financial markets and deeper understanding of demand to help municipalities gain the trust of private investors. |
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There is little evidence that stronger municipal management benefits the poor. MDPs need to give much more attention to poverty reduction in defining their objectives, showing how the poor would benefit from municipal investments and how services would improve through stronger municipal management. |
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74% of completed MDPs were rated "Satisfactory" or better. |
|  From fiscal 1998 to 2008, the Bank committed $14.5 billion, 3.4 percent of its total lending, to 190 MDPs. The projects have assisted nearly 3,000 urban municipalities—about 15% of all those in developing countries, more than a third of which are in the Latin America and the Caribbean Region.
The level of MDP support to an individual municipality has varied enormously, from tailor-made technical assistance and significant investment funding to training just a few municipal staff. Up to 345 million people—IEG’s estimate for the entire population of the 3,000 participating municipalities— might have benefited.
MDPs by region
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 IEG Ratings for Bank-Financed MDPs
IEG reviewed 190 municipal development projects around the world for this evaluation.
For a list of the municipal projects and information on each project, including IEG ratings, click here. |
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