International Fund for Agricultural Development (IFAD)
International Fund for Agricultural Development (IFAD)
June 2002
Executive Summary
A team comprising Heather Clark of UNCDF/UNDP, Hege Gulli of NORAD, and Douglas Pearce and Alexia Latortue of CGAP conducted a Donor Peer Review of IFAD in Ro me from 17-21 June, 2002. The review is part of a 21-agency initiative launched by UK Secretary of State Clare Short and CGAP to tackle aid effectiveness by using microfinance as a test case.
The Peer Review focused on the internal procedures, practices and processes of IFAD to identify the success factors and constraints that influence the effectiveness of the agency’s microfinance operations. The Rural Finance Advisor provided the team with an orientation to IFAD and organized meetings with around 35 staff members from the five regional divisions, the Technical Advisory Division, Office of Evaluation and Studies, the Finance and Administration Department and UNOPS. The team met with Vice-President Enweze on 20 June and briefed Mr. Klemens van de Sand, several division heads and staff on its initial findings on 21 June.
The Peer Review team found its visit to be timely given the current strategic shift in how IFAD supports rural finance. The team hopes that this letter to management will enrich internal discussions and provide specific ideas of how IFAD can accelerate the implementation of its Rural Finance Policy and move toward better serving the rural poor with financial services. This letter outlines IFAD’s strengths and challenges, and presents a number of specific recommendations for change. A matrix at the end of the letter provides a summary of the key findings and recommendations organized around six strategic areas.
The Peer Review team’s recommendations address the lag between the strategic shift (from credit as an input to financial services for the rural poor) and IFAD’s institutional culture, processes and systems. The team’s suggested actions for change fall into four main categories:
- Achieve Agency-wide Vision and Operational Plan for Rural Finance. IFAD should attain a clear vision across the agency of what rural finance is and how the new strategic shift ca be implemented across the agency.
- Manage for Results. IFAD should obtain better knowledge of its rural finance portfolio, introduce steps to improve quality, and make decisions based on performance regarding project design, partner selection, and project supervision.
- Enhance Technical Capacity and Strengthen the Proactive Role of the Rural Finance Advisor. IFAD should enhance its technical capacity internally (CPMs) and across all partners (consultants, implementing partners, cooperating agencies, and PMU staff) who work on IFAD-supported projects.
- Facilitate Learning. IFAD should promote learning within and across regions, between the field and Rome, and with other donors to encourage innovations in rural finance.
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