Technical assistance for Bank member countries has been an important part of the Bank’s operations since its early days. It has long been recognized that the transfer of financial resources for investment purposes is a necessary but not a sufficient condition for achieving development. Thus, the Bank has helped to finance several types of complementary activities to ensure that projects are efficiently operated and, beyond that, to promote the development of human resources and the capacity for institutional and economic management in member countries.


Technical assistance for Bank member countries has been an important part of the Bank’s operations since its early days. It has long been recognized that the transfer of financial resources for investment purposes is a necessary but not a sufficient condition for achieving development. Thus, the Bank has helped to finance several types of complementary activities to ensure that projects are efficiently operated and, beyond that, to promote the development of human resources and the capacity for institutional and economic management in member countries.

Francis Lethem and Vincent Riley

Unlike most bilateral and multilateral agencies, the Bank normally does not provide technical assistance as a grant. It has been Bank policy to consider financing technical assistance only when alternative funds are not available, in particular from the United Nations Development Programme (UNDP), with whom the Bank maintains close cooperation. (A major element of this cooperation is the Bank’s administration of an important segment of UNDP-financed technical assistance in fields where it has an operational interest and staff with the requisite knowledge and technical skills to oversee this work.) Borrowers are responsible for implementing Bank-financed technical assistance, and their loan or credit agreements with the Bank provide that they will employ consultants in accordance with procedures laid down in the “Guidelines for the Use of Consultants by World Bank Borrowers and by the World Bank as Executing Agency” (August 1981).

The demand for Bank-supported technical assistance, especially for the development of local capabilities, has grown in recent years as a result of several factors: the expansion and diversification of the Bank’s portfolio of projects; the intensification of institution-building efforts; and the increasing complexity of the Bank’s development work. The Bank’s approach to countries’ needs for technical assistance has been pragmatic. Much of the assistance has been directly related to its operational work, providing support for project implementation and the preparation of subsequent projects, with a growing element for project-related training and institution-building.

The Bank provides four main categories of technical assistance: (1) assistance that it does not staff but finances—through project components, free-standing loans and credits, and the Project Preparation Facility; (2) assistance that it administers, including, for example, the many Bank-executed, UNDP-financed projects; the program of technical assistance to capital-surplus countries, and other reimbursable assistance programs for the preparation and appraisal of projects and for recruiting technical staff needed by borrowers to implement projects; (3) assistance that it provides through its staff during the project cycle, country economic and sector work, and the Economic Development Institute (EDI); and (4) assistance that it extends in cooperation with United Nations (UN) agencies, via the cooperative programs and other special programs (Table 1).

Table 1

World Bank technical assistance in fiscal years 1972, 1976, and 19821

(In millions of U.S. dollars)

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Source: World Bank.

Denotes not applicable.

Bank fiscal years ending June 30.

Figure includes additional category “Supervision/implementation/engineering.” For fiscal year 1982 this category represented about a third of the total.

First Project Preparation Facility approvals were in fiscal year 1976.

Last World Bank technical assistance grant was approved in fiscal year 1976.

Exclusive of technical assistance provided by staff in the course of the project cycle, the technical assistance component of economic and sector work, and other training and ad hoc assistance.

Bank-financed assistance

Lending for technical assistance has increased at an annual rate of about 15 per cent (in real terms) over the past 10 years, while overall Bank/International Development Association (IDA) lending has increased by about 7 per cent. By fiscal year 1982, about US$1.2 billion, or 9 per cent of total lending, was lent for technical assistance. Agriculture, industry, and transportation are the major beneficiaries by sector, and Asia and Africa by region (Table 2).

Table 2

World Bank technical assistance by region and sector, fiscal year 19821

(Amounts in thousands of U.S. dollars)

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Source: World Bank.

Indicates zero.

Bank fiscal year ending June 30.

Most of the Bank’s technical assistance is directly related to the implementation of its projects and is financed by project components. In the early years, assistance typically emphasized engineering services for the design and construction phases of capital-intensive projects. More recently, the Bank has financed other types of technical assistance, including project-related training, feasibility studies, and a variety of other studies to improve the organization and management (especially the financial management) of the borrower’s institutions, or to support sectoral policies in such areas as pricing, marketing, tariffs, and industrial incentives as a basis for future investments in the sector.

The Project Preparation Facility, which was established in 1975, is one of the most recent examples of the Bank’s pragmatic approach to assistance. It advances funds up to $1 million per project, primarily to poor countries, for financing preparatory work on projects—whether small, individual tasks to fill gaps in project preparation or additional support for the entity responsible for preparing or implementing the project—when other alternatives, such as UNDP financing, are not feasible or readily available. Advances are repaid by the borrower, normally by refinancing through the project loan or credit.

By the end of June 1982, 255 advances had been made in 60 countries for a cumulative total of nearly $106 million. Since $42 million of this had been refinanced, total outstanding advances were $64 million. Additional advances can be made as long as the outstanding advances under this Facility do not exceed $99.5 million, the limit currently set by the Bank’s Executive Directors.

The Bank’s assistance also aims at providing or enhancing the specialized skills and knowledge and fostering the attitudes needed for a particular sector or project. This may involve training national staff locally, in a training institution or on the job, or abroad through professional visits to other countries. An example of the latter is the professional visits for senior irrigation staff from India, which have been organized over the last few years. More than 60 per cent of the projects financed annually by the Bank include some training of national staff. By sector, agriculture, transportation, and power are the major beneficiaries, and Africa is the main region receiving this form of assistance.

Where technical assistance needs are too extensive and diverse to include in a project loan, the Bank may make a separate loan. For instance, “free-standing” technical assistance loans have been made when preinvestment studies and advice are needed to accelerate the pace of project generation in a particular country and to develop projects and national expertise in new sectors (such as petroleum, mining, or large industrial investment); when national economic planning is involved; and where borrowers need to call on additional expertise to help them achieve the objectives of structural adjustment loans. Since the establishment of the Project Preparation Facility, fewer separate loans for engineering assistance have been made.

Bank-administered assistance

Since 1975, the Bank has had a special arrangement for providing technical assistance to oil exporting, capital surplus countries, which are not Bank borrowers but which nevertheless face considerable development problems. When the volume of technical assistance reaches a level of one staff year in a fiscal year, full incremental costs to the Bank of all further technical assistance (even if the level of assistance subsequently drops below one staff year in a fiscal year) are reimbursed to the Bank by the recipient country. Until the threshold of one staff year per fiscal year is reached, however, the Bank bears the cost of the technical assistance provided. Assistance on this “reimbursable” basis has gone to Iran, Kuwait, the Libyan Arab Jamahiriya, Oman, Saudi Arabia, the United Arab Emirates, and Venezuela. It has included (1) technical reviews of feasibility studies, proposals, or bids; (2) studies regarding development issues, such as manpower or labor market studies and critical skills surveys, executed by Bank staff or consultants; (3) more general advice on technical and policy issues; and (4) training of national staff, such as in project appraisal and implementation seminars. Specialist services may be supplied through the secondment of Bank staff—these have, for instance, provided advice in national economic planning—or by the Bank assisting in the recruitment of specialists who have, for example, helped to design a mass literacy program and conduct a survey of essential skills.

The World Bank’s Economic Development Institute

The activities of the Economic Development Institute (EDI) have grown since its inception in 1955. Its major function is to help developing countries improve the management and direction of economic expansion. The major vehicle for this purpose is a program consisting of courses and seminars held in Washington, DC as well as in the developing countries. The participants are senior officials from the developing countries who help in policymaking and implementation and who should, in the course of time, occupy top management positions in their respective countries.

Eugene Black, the President of the Bank when the EDI was set up, defined its approach and purpose in this way: the EDI “will be working in a field … where there are few established doctrines or generally acceptable rules. It will therefore use, as its tools, discussion and pooling of experience rather than formal courses of instruction or the elaboration of a theoretical groundwork. The approach will be essentially practical and pragmatic…. Since the basic objective of the Institute will be the sharing of development experience, great emphasis will be placed on the contribution of the participants themselves…. The Bank itself expects to benefit from the cross-fertilization of ideas at the Institute.”

Participants in the seminars and courses include officials from ministries of finance and planning, development agencies, development banks, central banks, and other relevant government agencies. Since the Institute was established, more than 11,000 senior officials have participated in its programs—more than 6,000 of them in overseas programs. In fiscal year 1981 alone, 370 senior officials participated in its Washington programs and more than 900 in its overseas programs (Table 1); in the late 1950s, participants numbered only 50 to 60; there has thus been a twentyfold expansion in the number of participants since then.

Table 1

Geographical distribution of EDI participants in courses and seminars, fiscal year 19811

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Source: World Bank, Economic Development Institute.

Excludes one Washington, DC seminar; one regional seminar; and four participants from the United States. Also excludes all participants in the technical assistance courses and seminars.

Figures in brackets represent per cent of total number of participants.

This expansion reflects the increasing diversity as well as location of the Institute’s programs and the shortening of their duration from about 6 months to about 6–8 weeks for courses for middle management levels and 2–3 weeks for its seminars for the very senior management levels.

The EDI programs have evolved in a logical pattern. Initially, they started with a general course on economic development. But by 1962, it was realized that developing countries needed some expertise in the preparation and evaluation of projects. Since 1963, the development and conduct of courses in project and sector analysis and evaluation techniques has been the dominant feature of the EDI’s great growth period. The sectors covered include agriculture and integrated rural development; industry and development banks; infrastructure projects, like transport, water supply, sewerage, and power; and urbanization and social projects like education, population, health, and family planning.

At the same time, there was a sharpening of the focus of the development course, which in its changed form emphasized management aspects and was renamed the National Economic Management Course in 1973. The Institute also broadened the scope of its development banking courses and initiated regional seminars on finance and development in India and the Philippines—to be held in fiscal year 1983.

With the recognition of the importance of management in the success of projects, project management courses were initiated in the late 1970s. Meanwhile, with two decades and more of experience gained from running public sector enterprises, officials in developing countries felt very keenly the lack of adequate organizational and managerial capability to operate public utilities, public sector social projects, and public sector enterprises. These topics are on the agenda of the EDI for 1983 and 1984. The Institute has, from its inception, stressed the organization and management aspects of development.

It has also stressed the need for overseas regional and national programs. The first move overseas came about in 1959 with a program in the West Indies and was followed in 1964 with a program in India. Since then, the EDI has been spreading its work around the globe, concentrating, since 1972, on organizing overseas programs in cooperation with entities that could carry them on by themselves afterwards, helping other institutions provide such training through training their teachers and by providing them with teaching materials. The emphasis is on regional and national programs with cofinancing arrangements and on centers and institutions that are capable of running, after an initial period of EDI assistance, similar training programs on their own. The EDI has been able to identify institutions in countries like India, Pakistan, and the Philippines that can serve as regional and national centers and are well-equipped to conduct EDI-type programs on their own. The Institute’s assistance to these bodies has been gradually diminishing and now takes the form of only technical assistance.

Currently, the overseas programs are a multiple of the number of Washington programs, and are expanding. The Institute’s activities in Washington and abroad in 1981 give an idea of the range and scope of material covered in the programs (Table 2). In the same year 42 seminars and courses were cosponsored by the Institute with different regional and national institutions and United Nations agencies; 9 were held in Africa, 6 in Egypt, 18 in Asia (Thailand, India, the Philippines, Bangladesh, and Pakistan), 4 in Latin America (Brazil and Mexico), and 2 in Spain. Topics ranged from development banking (in the Ivory Coast, Brazil, India, and the Philippines) and development policy analysis relating to investment decisions (in India) to the design and execution of urban projects (in Senegal and Kenya) and rural development projects (in Senegal, Cameroon, the Philippines, Mexico, and Brazil).

Table 2

Topics of EDI courses and seminars, Washington, DC and overseas, fiscal year 19811

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Source: World Bank, Economic Development Institute.

Indicates zero.

Excludes courses and seminars for which EDI’s participation is limited to provision of training materials and some faculty support.

EDI programs and its training materials are in English, French, and Spanish. The materials are based on studies of the development experience of a large number of countries, made in the World Bank as well as elsewhere. These materials are used in the EDI programs as well as in the programs of other training institutions in the developing countries. More than 1,000 requests a month were received for such materials as case studies, course notes, and EDI Seminar Papers during 1981.

In 1976, more than 15 years after his retirement as President of the Bank, Mr. Black felt: “… the gamble we took in establishing EDI was one of the best things we did to help our member countries over the long run. Even by the time I left the Bank you would meet these people who had been there from all over the world, and they always wanted to tell you about what they had done at EDI and hear about what it was like now. When I went up to EDI, I always learned a lot from talking with the participants. We learned from them and may be they learned something from us, and I hope that’s the way it still is.”

The EDI has thus pioneered training programs that tend to meet the felt and perceived needs of the developing countries. The Institute’s importance for developing countries is comparable to that of the resource transfer made by the Bank. Through it, the Bank has set in motion a self-sustaining, self-reinforcing process of learning, which emphasizes the need for continuing adaptation of objectives, strategies, and techniques to the emerging problems and promises of socioeconomic development.

V.V. Bhatt

For the aims and objectives of the EDI and the evolution of its activities, please see EDI/20 published by the EDI (World Bank, Washington, DC, 1978). To order, see inside front cover.

The Bank also provides reimbursable assistance for the preparation and appraisal of agricultural and rural development projects to be financed by the International Fund for Agricultural Development (IFAD).

When invited, the Bank may serve as executing agency for particular UNDP-financed technical assistance projects in which it has an operational interest and where it has the knowledge and technical competence to administer the project properly. These may range from aid for national planning efforts, agricultural research, and transportation studies to the assessment of investment and assistance needs in the energy sector.

At the end of fiscal year 1982, the Bank was executing agency for 132 projects, with UNDP financing totaling about $168 million. About a quarter of the UNDP projects for which the Bank acts as executing agency are cofinanced with other external sources. In certain cases, borrowers use the proceeds of a Bank loan or credit as the source of cofinancing.

Assistance in recruiting and placing technical staff in borrowing countries is also provided by the Bank in certain cases when local administrative talent is in short supply. These staff may be employed under contract to the Bank but financed from other sources, or they may be Bank staff members who are seconded to work directly for a government and are expected to return to the Bank.

In recognition of the special technical assistance needs of the countries in Eastern and Western Africa, the Bank created (1) the Agricultural Development Services in 1965 to provide a team of agriculturalists with unique experience with African smallholder agriculture and (2) the Agricultural Projects Management Unit in 1973 to fill the pressing need for project managers and agricultural generalists and specialists, arising from the greatly increased Bank lending program for agriculture, particularly in Nigeria. About 200 staff are currently employed under these arrangements.

Assistance by Bank staff

Assistance is provided by Bank staff at all stages of the project cycle—through sector analysis, to help identify projects; advice on the scope of project preparation work, the sources of expertise available, and possible gaps in preparation; and further advice during project appraisal and implementation.

Further professional collaboration takes place as part of the Bank’s country economic work program, which has shifted its focus from monitoring a country’s economic performance to becoming an ongoing dialogue on development strategies, sectoral priorities, and public investment programs, as well as on measures to alleviate poverty, develop institutions, and promote human resource development.

In addition to this assistance, a new program was created in 1982 for nonreimbursable technical assistance to governments, primarily in sub-Saharan Africa, which request Bank staff as technical assistance advisers.

The Bank is also called upon to provide governments or intergovernmental institutions with ad hoc technical assistance. For instance, the Bank’s Legal Department has assisted multilateral organizations such as regional development banks and national development institutions in countries belonging to the Organization of Petroleum Exporting Countries (OPEC), particularly during their formative years. The Bank’s Operations Evaluation Department has helped governments to develop monitoring and evaluation functions. Other departments of the Bank have provided assistance to governments in such fields as records management, cartographic sciences (especially Landsat satellite imagery), and computing systems.

Besides the EDI, which offers formal training for senior government officials (see box), the Bank organizes training seminars in such fields as the procurement of goods and services, and new techniques resulting from its research.

Cooperation with other agencies

Technical assistance is also provided in cooperation with UN specialized agencies, primarily through cooperative programs established with the Food and Agriculture Organization (FAO), the United Nations Educational, Scientific and Cultural Organization (UNESCO), the World Health Organization (WHO), and the United Nations Industrial Development Organization (UNIDO). These programs have been intended primarily to increase the number and improve the quality of proposals for Bank financing in agriculture, education, water supply and sewerage, and industry. The Bank and the partner agency work together, through a unit located in the partner agency, in helping governments to identify and prepare projects suitable for Bank financing and, once a project is financed, in supervising its implementation.

The Bank meets 75 per cent of the direct costs of a work program agreed periodically with the partner agency; the latter meets 25 per cent, plus certain overhead and indirect costs.

Recently, additional programs of cooperation with bilateral agencies have emerged. For instance, France is financing the cost of short-term French specialists requested by the Bank for sector work and for advising on the structural adjustment of member countries’ economies. Norway is providing up to about $1 million per year in grant funds to help prepare projects for consideration by the Bank.

Some lessons of experience

By and large, the technical assistance with which the Bank has been associated has been effective. One reason is that the assistance is usually linked to investment projects; another may be that, since member countries have to borrow for most of thi assistance provided and are responsible for arranging and implementing it, they are more likely to ensure that it is really needed, its objectives are feasible, the proposed consultants are suitable, and the national staff can benefit from the training provided.

A recent review of Bank-financed technical assistance suggests that one of the most important factors in its success is the spirit in which the various parties concerned—member countries, project designers, Bank staff, and experts or consultants—approach the assignment: it should be a joint effort undertaken in a spirit of partnership. The major findings of this review are summarized below.

Success depends on both the recipient of the assistance and the Bank agreeing that the available local and expatriate personnel are not adequate to address the problem. It also depends on agreement on the project’s proposed technology and institutional design, given the local capabilities and the country’s short-term and longer-term development objectives, including its development strategy for the sector’s labor force.

There should be a commitment to the technical assistance at both the political and the technical levels. The Bank’s experience shows that commitment can be increased by promoting the use of qualified local consultants, organizing professional tours to study the experience of more advanced developing countries, making various arrangements to reinforce and/or develop local capabilities, and involving the borrower and the recipient agency in determining the type of assistance provided.

Before doing a more detailed design, the goals and expected results of the assistance need to be identified specifically and realistically. The need to determine feasible goals for what can be achieved in a single project and the need to phase the assistance over time to build from one phase to the next should be considered. The experience with project-related technical assistance shows that it is also important to agree on a balance between assistance for physical investments (which the borrower is more likely to want) and assistance for institutional or policy improvement (to which the Bank may attach equal importance, though the state of the art may be less certain).

The terms of reference for the assistance should be clear about objectives and the tasks to be performed, with the time frame, work plan, and costs estimated as accurately as possible. However, particularly for institutional and policy studies, which must take account of often complex behavioral and cultural factors, the terms of reference should not be overly detailed. This allows prospective consultants to prepare more detailed proposals themselves—a process that can verify not only their technical competence but also their sensitivity to local conditions, their suitability as trainers, and their ability to associate with competent national specialists.

The assignment of nationals as counterparts without specific duties to expatriate specialists has generally produced disappointing results. This could be remedied by ensuring that both national and expatriate staff have meaningful tasks, work together as a team, and learn from each other. Ultimately, though, the effectiveness of training usually depends upon the ability of the project manager to make the best use of his or her team. A striking fact that emerged from the review was that all the successful cases had an outstanding project manager.

The terms of reference may also need to specify whether the assistance should be given by individual specialists or by a consulting firm. Experience has indicated that individual specialists seem more appropriate for longer term, advisory assignments and for those assignments where large groups of specialists are not required or would be too conspicuous, especially in a politically sensitive environment. Individuals may also be more effective in convincing a hesitant recipient of the genuine need for assistance. Consulting firms seem preferable where a team approach is required and also where complementary skills are needed, supported by professional and administrative experience. In certain cases administrative specialists are responsible for handling all logistical aspects of the assignment to ensure that their technical colleagues can devote their full attention to professional matters immediately upon arrival.

Ingredients for success

The Bank’s experience suggests that technical assistance and training components of projects, as well as institutional measures to retain trained staff, are best if they are designed in concert and not separately. The best results seem to be obtained when a separate consultant is reponsible for implementing the training activities, preferably consisting of periods of field work, within the country or overseas, alternating with formal training. Training of local staff prior to the arrival of expatriate specialists can contribute to a more effective transfer of knowledge and experience. The exposure of local managers to some of the training provided to their staff also seems to enhance its application after the expatriates have completed their assignment.

Selection procedures for both local and expatriate staff are important. They should ensure the recruitment of a competent, well-motivated, and compatible assistance team. When a government lacks trained local staff because of the low level of public salary scales, compared with the private sector, or when the government policy discourages the hiring of more civil service staff to work on development projects, it may call upon local consultants to supplement its own staff. This was successfully done with irrigation projects in Indonesia. In certain cases it may be desirable for expatriate consultants to assist in the selection of local staff, especially for training.

Regarding expatriate consultants, the recipients of the assistance should be aware of the advantages and disadvantages of large firms and the respective merits of recruiting individual experts through UN organizations or individual contracts. Besides technical expertise and familiarity with the policies and objectives of the borrower and the Bank, there is now a consensus that expatriate consultants or advisers—including those from other developing countries—should have the “right personality.” They should be adaptable, and possess the ability to communicate with those of other cultures. Those hired to train should also have pedagogical ability—something that is forgotten with surprising frequency. Several bilateral agencies that have cooperated successfully in the implementation of Bank-financed projects select their national specialists not only through interviews but also through psychological tests. Developing countries are encouraged under Bank-financed projects to interview candidates or to give them short-term initial appointments as an opportunity to demonstrate their technical competency, training skills, and social and cultural sensitivity.

The role of Bank staff can be crucial at all stages of providing technical assistance, by verifying the commitment of all parties, assisting in designing the terms of reference, and ensuring that appropriate administrative and logistical arrangements are made and that the proposed selection procedures will allow the member country to assemble a team of well-qualified and motivated expatriate and local personnel. Above all, Bank staff can contribute to the success of a project by facilitating communication among the various parties to maintain mutual trust. They should also ensure that the terms of reference provide for regular monitoring of progress on the assignment and allow for any changes in the assigned tasks that may become necessary. Bank staff also ensure that the tasks set for the assistance are not overly ambitious and are phased so as to allow the recipient’s staff to learn by doing, thereby developing confidence in their own capabilities and experiencing success in handling increasingly difficult assignments.

The Bank’s technical assistance is expected to continue expanding to meet the requirements of its member countries faced with increasingly complex issues of development and economic management. While the needs of the more advanced developing countries for technical assistance will decline and are likely to be limited to cases involving sophisticated technology, policy studies, energy planning, or environmental improvement, the other developing countries will have a growing need for support. This is particularly true where there are serious weaknesses in the public and private institutions on which successful project planning and implementation depend. Thus, the Bank’s assistance will increasingly concentrate on helping to strengthen management capabilities in the developing countries in public administration and on supporting local research capacity, particularly in agriculture. These activities will supplement the Bank’s continued assistance in project preparation and sectoral planning.

Finance & Development, December 1982
Author: International Monetary Fund. External Relations Dept.