Evaluation of Blending

The EU has contracted ADE to undertake a strategic evaluation of its new Blending instrument. The term refers to “blending grants with loans” or with other financial instruments. Since 2007 the EU has set up for this purpose a series of regional investment facilities. They aim at a strategic use of a limited amount of grants to mobilise larger amounts of financing from partner financial institutions (FIs), and thereby enhance the development impact of investment projects. The objective of this evaluation was to provide an independent assessment of blending as a new aid delivery instrument for the EU, with a view to inform future EU choices on blending. The scope of the evaluation is the overall EU support through the following facilities, over the period 2007-2014. They covered a broad range of sectors, from energy to transport, water/sanitation, banking/finance for SMEs, and environment. • EU-Africa Infrastructure Trust Fund (ITF); • Neighbourhood Investment Facility (NIF); • Latin American Investment Facility (LAIF), • Caribbean Investment Facility (CIF), • Investment Facility for Central Asia (IFCA), • Asian Investment Facility (AIF) • Investment Facility for the Pacific (IFP). The main financial institutions leading blending projects are EIB, EBRD, AFD and KfW. Others include AfDB, IDB, AECID, Lux-Dev, PIDG and CEB. A total of 12 countries are being visited. Challenges of the evaluation: • Blending represents a significant departure from previous EU support modalities (broad instruments, for instance budget support and thematic instruments) into project financing, with technics and concepts that have traditionally been the domain of financial institutions (cost/benefit analysis, economic and financial rates of return, etc.). • Blending is a recent and a young instrument for the EU. • Blending has arisen because of interactive developments in three constituencies: the EU, financial institutions, and beneficiaries, with perspectives that may diverge. • Blending focuses on complex projects, with multiple objectives.


Project Details
Country WORLDWIDE
Start date 2015.01.12
End date 2016.07.12
Client EC
Sector EVALUATION
Sub-sector Instrument/Channel
Ref. ADE A456-005