Agricultural Development Banks: Ignore them, Close them or Reform them?
Agricultural development banks (AgDBs) have been identified as being among the main culprits undermining rural finance and development. Historically, they did so on behalf of their government. Donors provided funding and technical assistance. For extended periods of time, neither their performance nor their impact were properly monitored. When donors finally did evaluate their support to AgDBs and other development finance institutions, many virtually eliminated their assistance. In recent years, there has been a tendency to ignore AgDBs in programs of rural and microfinance systems development.
In this Editor’s Note Hans Dieter Seibel challenges us to either close or reform AgDBs but not to ignore them. He looks at the positives and negatives or AgDBs and outlines a planning framework for reforming them.