Public Sector Lending

Accounting for almost two-thirds of total, cumulative commitments, Public Sector Lending represents the main pillar of OFID’s operations. Through this window, and as of December 31, 2016, an aggregate US$13,069m had been approved in 1,517 concessional loans to 106 developing countries. In line with OFID’s founding mandate, the lion’s share of these resources has gone to the low-income nations, which continue to receive priority attention, even as the institution has broadened its scope to include more middle-income partners.

All public sector operations are co-financed with the recipient government and frequently with other donors, including the regional development banks, the specialized agencies of the UN, and, in particular, the bilateral and multilateral development agencies of OPEC Member States. In keeping with the principles of the Global Partnership for Effective Development Cooperation, OFID harmonizes its activities with sister and other organizations in order to streamline joint efforts and maximize results. In the interests of sustainability, both capacity building and institution strengthening are integral components of all OFID public sector operations. The projects themselves are demand-driven, based on the strategic priorities of the partner countries. On a cumulative basis, the energy-water-food-nexus—supported by the transportation sector—had attracted 78% of all public sector lending as of end-2016.

Also included under the umbrella of the public sector is OFID’s contribution to the Heavily Indebted Poor Countries (HIPC) Initiative. OFID has supported the Initiative since its inception in 1996, utilizing several mechanisms to provide its relevant share of debt relief to 26 HIPC countries. These include loans worth US$281m that were made available to ease the debt burden of these countries, together with debt restructuring operations.

Activities in 2016


Public Sector Lending accounted for 47% of total commitments in 2016, attracting a total US$615.4m toward 27 projects in 23 countries. With substantial amounts going to the Maldives (US$50m) and Vietnam (US$45m) for transportation projects and to Pakistan (US$50m) for a rehabilitation and reconstruction program, Asia received the largest share, securing US$246.4m (40%) of committed resources. The Africa region received US$179.6m (29.2%), followed by LAC with US$136.7m (22.2%), and Europe with US$52.8m (8.6%).

In keeping with established practice, the sectoral distribution of commitments reflected the priorities of the concerned countries, with almost one-half (49.5%) of the resources going to the transportation sector. Agriculture and energy projects also drew considerable funds, attracting US$106m and US$77.6m, respectively. The remainder was divided among the following sectors: multisectoral (9.4%), education (4.9%), health (4.3%), and water and sanitation (2.1%).

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