Cost Sharing and Expenditure Eligibility: Policy Implementation Review

Abstract

The Asian Development Bank (ADB) reviewed its policy on cost sharing and expenditure eligibility in 2005 as part of the Innovation and Efficiency Initiative. 1 The objectives of that initiative were to improve ADB's business model, as well as its ability to align services, products, and practices with client priorities and market trends. The policy introduced a series of changes to enable ADB to (i) align ADB’s policies with borrowers’ expenditure requirements; (ii) harmonize with other development partners; and (iii) ensure consistency across its lending instruments. 2. The 2005 policy proposed that ADB would review its implementation experience 3 years after effectiveness.2 This paper reviews the implementation of the policy from 2006 to 2009, drawing on the experience of ADB, its developing member countries (DMCs), and other development partners.