How the World Bank supports projects with global benefits
Commissioned by the German Ministry for Economic Cooperation and Development (BMZ)
How can countries be encouraged to invest in projects that benefit the wider world? The World Bank’s Framework for Financial Incentives (FFI) offers an innovative approach by making financing more attractive for projects addressing climate change, biodiversity loss and other global challenges. This independent assessment, funded by BMZ and implemented by GIZ, finds encouraging early progress and identifies practical ways to strengthen the framework’s reach and effectiveness.
Building on Oxford Economics’ expertise in financing global public goods, this assessment examines the FFI’s early progress. Drawing on project data and consultations with project teams and experts, it explores how projects are selected, how financial support is allocated and where the framework can add the most value.
The FFI helps countries invest in projects that deliver benefits both at home and across borders. For projects financed by the World Bank’s International Bank for Reconstruction and Development (IBRD), it offers additional borrowing capacity, longer repayment periods and financial support that reduces borrowing costs.
Across its first five funding rounds, the framework received 48 applications and approved 33, covering all seven World Bank regions. Climate change was the most commonly addressed challenge. Approved projects generally scored more highly on expected cross-border benefits than rejected projects, suggesting that support is reaching projects with greater potential global benefits.
Feedback from project teams and technical experts is encouraging. They report that incentives have helped ease funding constraints, increase project scale and support more ambitious designs. The framework has also encouraged teams to consider cross-border benefits more systematically and opened discussions with borrowing countries about investments whose wider value might otherwise receive less attention.
The findings also highlight opportunities for further development. Many initial applications involved projects already well advanced in planning, limiting the framework’s scope to strengthen their cross-border benefits from the outset. Earlier engagement, better tools for measuring these benefits and clearer assessments of financing needs could help target incentives more effectively.
The experts behind the research
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Hannah Marie ZickSenior Economist, Continental Europe
Hannah is a Senior Economist in the Economic Footprint and Sustainability team, based in Frankfurt, Germany, where she focuses on bespoke consulting projects for clients across continental Europe. Joining Oxford Economics in 2022, she has worked with several private and public clients such as federal ministries and the EU-Commission. Her expertise spans various fields including policy analysis, finance, construction, manufacturing and creative industries.
She holds a B.Sc. in Economics from Philipps University Marburg and a M.Sc. in Economics from the University of Mannheim. Additionally, Hannah enriched her academic experience with semesters abroad in the UK and Switzerland.
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Stefan GorgelsAssociate Director of Economic Consulting, Continental Europe
Stefan Gorgels is Associate Director for economic consulting services in Continental Europe, focusing on economic impact analysis and econometric analysis. He has a strong academic background in economics and extensive experience in managing consulting and research projects for national and international clients.
Prior to joining Oxford Economics, Stefan was a manager at DIW Econ - the consulting arm of the German Institute for Economic Research - where he managed economic consulting and research projects for a wide range of clients, including companies, industry associations, German government ministries and the European Commission.
Stefan Gorgels holds a B.Sc. in Economics from Maastricht University, an M.Sc. in Economics from the Barcelona Graduate School of Economics and a Ph.D. in Economics from New York University.
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Johanna NeuhoffDirector of Economic Consulting, Continental Europe
Johanna Neuhoff is Director for economic consulting services in Continental Europe. She is an expert evaluating the impact of policy changes, in forecasting and scenario building as well as in economic impact assessments. Her extensive knowledge in the real estate, housing, mobility/transport, and the green economy sector helped her in leading several complex and international consulting projects for public and private clients.
Prior to Oxford Economics, Johanna Neuhoff worked at DIW Econ, the consultancy firm of the German Institute for Economic Research, and two boutique consultancy firms. Johanna Neuhoff holds a Diploma with a focus on social and political sciences in Economics from the University of Potsdam, Germany, and a Master’s Degree in Economics from the University of Milwaukee-Wisconsin, USA, - both degrees with special distinction.
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