Evaluation of the Fund for Special Operations during the Eighth Replenishment (1994-2010): Part I
The Inter-American Development Bank is unique among the multilateral banks in the sense that it has provided concessional funding for its member countries since its inception, with the institution of the Fund for Special Operations (FSO) in the 1959 Agreement that established the Bank. The objective of this evaluation is to provide the Board of Executive Directors, when the Bank is engaging in a new increase of its capital, with an assessment of the performance of the Bank's concessional lending instrument, the FSO loan program during the period of the Eighth Replenishment (IDB-8: 1994-2010). In this sense, it does not discuss the Intermediate Financing Facility (IFF), nor the non-reimbursable technical cooperation financed with FSO resources. This is a timely exercise, for increases in the Bank¿s capital represent critical moments for replenishing the Fund. The concessional nature of the FSO, lower interest rates and longer amortization period, implies that its resources cannot be obtained from the capital markets, but rather have to come (mostly) from the contributions of member countries, and from the income that can be generated from its loans: from investment liquidity and from the interest collected. This evaluation consists of two papers that, given their content and length, are presented separately. This first paper evaluates issues related to FSO allocation, approval and execution. The second document assesses financial and development results.