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 strategic framework demands a sharper focus on development impact, and emphasizes
- private sector participation in infrastructure, capital market development, and agribusiness;
- 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 nonsovereign financing, the proposed recipient must be:
- an entity wholly owned or controlled by one or more private entities;
- an entity, wholly owned or controlled by a sovereign, undertaking commercial activities (subsovereign and other public sector entities);
- an entity, partially owned or controlled by one or more private entities and a sovereign, undertaking commercial activities; or
- a local government or other subsovereign entity (including municipalities and other forms of local government) that can contract and obtain financing independently from the sovereign; provided, in each case, the proposed recipient is:
- established and/or operating in a developing member country, and
- a legal entity that can sue and be sued.