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Development Finance & Policy

Peer Review on Policy-based Financing in Development Banks

On behalf of KfW, we conducted a peer review to compile and analyse lessons learnt from policy-based financing (PBF) operations of five development banks: AfDB, ADB, AFD, IDB, and the World Bank. The review focused on the sectoral and thematic orientation of PBF portfolios, the types of reforms supported, and the design of disbursement triggers.
Our work included a quantitative portfolio analysis, examination of policy matrices, and interviews with representatives of the peer institutions. Findings were synthesised into a comprehensive report and presentation, outlining global trends and lessons for KfW’s own engagement in policy-based financing.

Financing Food Systems Transformation

Bank and the sustainability think tank TMG to develop a comprehensive conceptual and financial cooperation framework for Food Systems Transformation (FST). The project aims to guide KfW’s strategic engagement within German Development Cooperation and with international partners, helping translate the complex FST agenda into actionable implementation pathways.

Funded by the BMZ the project combines research, peer learning, and strategic design. It began with a kick-off workshop in Rome, followed by a literature and discourse analysis, peer review of 24 organizations -including MDBs, PDBs, private banks, NGOs, and philanthropic actors -and the co-creation of a Financial Cooperation Concept for FST.

To ensure practical applicability, Guidance Documents were developed to support KfW in identifying financing partners, investment opportunities, and instruments for systemic change. These include analyses on potential partners for FST and on investing in land rights as a foundation for transformation. The findings inform both KfW’s FZ Future Process and BMZ’s broader reform agenda, contributing to a stronger, more coherent approach to financing sustainable food systems.

Conceptual Study on Results-based Financing Approaches

To support the expansion of its financial instruments, KfW commissioned a study on results-based financing (RBF) policies and practices of bi- and multilateral development partners. The study examined institutional contexts, design features, appraisal mechanisms, and lessons learnt from existing RBF approaches, where payments are contingent upon verified results rather than inputs or activities.

Our work included analysing donor experiences and guidelines, mapping funders of RBF projects, and compiling findings into a report. The study provided KfW with a structured overview of existing approaches and operational practices to inform future application of results-based financing.

You can read the study here.

Supporting the creation of the Blue Action Fund

To address a global funding gap in marine conservation, we worked with KfW to establish the Blue Action Fund, a trust fund supporting NGOs in Africa, Latin America, and Asia. Our role included shaping the strategy, operational framework, and governance structure.

We facilitated stakeholder workshops, developed key manuals, and supported the launch of the first call for proposals. Today, the Fund is a leading platform providing critical financial support for marine and coastal protection worldwide.

➡ Learn more: www.blueactionfund.org

Designing a Regional Migration Fund for the Horn of Africa

We assisted the German government and IGAD in designing a Regional Migration Fund to address displacement and migration challenges. Through consultations with communities and governments, we identified priorities in economic opportunities and inclusive infrastructure.

Our design study defined governance and operational frameworks, later validated in multi-stakeholder workshops. Formalised in an Aide Mémoire between IGAD and KfW, the Fund is now moving toward operationalisation.