March 28, 2018

This Development Finance Assessment (DFA) was commissioned by the Ministry of Finance (MoF) of Nepal, with support from the United Nations Development Programme (UNDP), the Asian Development Bank (ADB), and the United Kingdom Department for International Development (DFID).

The DFA was undertaken during the period from September 2016 to September 2017. The DFA team was comprised of two international consultants and one national consultant, with the International Economic Cooperation Coordination Division (IECCD) of the MoF as the team’s designated focal point.

The DFA methodology was developed by the UNDP Bangkok Regional Hub, the Secretariat of the Asia Pacific Development Effectiveness Facility (AP-DEF), in response to demand from countries for support in managing the increasingly complex landscape of development finance. The Third International Conference on Financing for Development, held in Addis Ababa in July 2015, opened discussions on how to mobilize the unprecedented amounts of financial resources that will be required to achieve the Sustainable Development Goals (SDGs) by 2030. The Addis Ababa Action Agenda, agreed to at the Conference, assumes that countries will use their own national development strategies and plans to respond to the SDGs and calls for the adoption of Integrated National Financing Frameworks (INFFs).1 The DFA methodology supports governments to use the concept of an INFF to help strengthen policies and actions for mobilizing different types of finance for sustainable development in a given country context.

An INFF is the system of institutional structures, policies and strategies that a government has in place to mobilize and utilize finance offered effectively and efficiently to achieve national development goals.2 The conceptual model of an INFF, which is shown in Figure ES1, includes six building blocks: (1) Leadership that facilitates policy and institutional coherence; (2) A clear vision for results; (3) An overarching financing strategy; (4) Specific financing policies to mobilize and govern the use of different types of finance; (5) A monitoring and evaluation framework; and (6) An enabling environment for accountability and dialogue.