As a catalyst for private investments, ADB provides direct financial assistance to private sector projects. While ADB’s participation is usually limited, it leverages a large amount of funds from commercial sources to finance these projects.
Projects must also have clear development impacts and/or demonstration effects that go beyond the benefits captured in the financial rate of return.
The Private Sector Operations (PSO) strategic framework demands a sharper focus on development impact, and emphasizes
- private sector participation in infrastructure and capital market development,
- broadening of country and sector reach,
- wider use of credit enhancement and other instruments, and
- strategic alliances with other development agencies.
Who is eligible?
To be eligible for ADB assistance, the proposed recipient of ADB’s nonsovereign financing:
- must be established or operating in a developing member country (DMC);
- can be either a privately-held company, a state-sponsored company, or a subnational government;
- must be able to contract and obtain financing independently from the sovereign; and
- must be able to sue and be sued.