The Development Potential of Regional Programs : An Evaluation of World Bank Support of Multicountry Operations

This evaluation was financially supported by Norad's Evaluation Department.

Regional cooperation in integrating the supply and distribution of power helps small economies increase their access to reliable, lower-cost energy. Cooperation among neighboring states is vital to control the spread of diseases such as malaria and HIV/AIDS and to manage the 60 percent of the world's freshwater that derives from shared river systems.

But it is a complex task to design regional programs so that they assign benefits and costs equitably among participating countries and to effectively coordinate country and regional activities during implementation. These challenges explain why regional programs account for less than 3 percent of all international development support.

This evaluation, which assesses World Bank support for regional development programs over fiscal years 1995-2005, finds that a majority of the programs evaluated have been or appear likely to be effective in achieving most of their development objectives. Even stronger results could be achieved if regional program support were better developed as an international development practice. These findings are based on evaluations of 19 regional programs and a review of the Bank's total portfolio of some 100 regional operations.

Successful regional programs require consensus among participating countries on the distribution of program benefits and costs and strong country voice in governance arrangements. They also need to clearly delineate and link national and regional institutions and mobilize adequate packages of grant, credit, and loan financing for the extended preparation and implementation typically required to achieve regional program objectives.

The World Bank has played an important role in promoting and supporting regional programs. The potential contribution of regional programs is likely to grow as the cross-border dimensions of health, infrastructure, environment, and trade facilitation take on ever-increasing significance. A stronger Bank role, if underpinned by a shift to a more strategic approach, could help countries realize this increasing potential of regional cooperation.