Foreign Affairs and International Trade Canada
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Development Markets
Every year, development agencies provide tens of billions of dollars in loans and grants to dozens of countries for a wide variety of development programs and projects. The borrowing countries use these funds to procure the goods, equipment and services they need to design and carry out their development plans.
Note that the borrowing country's executing agency - often a ministry or other government entity - is usually responsible for the bidding and procurement involved in a project, as well as for the project's implementation. The executing agency has to carry out these activities according to the rules and procedures laid down by the donor agency.
Most development funding is provided by three major types of agencies:
Multilateral Development Banks
A multilateral development bank (MDB) is a financial institution set up by a group of countries to provide development funds to national governments. These banks operate globally and have large memberships that include both developed donor countries and developing borrower countries. There are also numerous other MDBs, funds and agencies that provide similar financial aid but are more regional or more specialized.Note that the terms "MDB" and "IFI" are often used interchangeably, although they are not precisely equivalent.
Bilateral Agencies
Bilateral development agencies are institutions set up by individual countries to provide development funding to national governments. The type of assistance and the role played by the donor usually depends on the ability of the borrower to implement a project, while procurement is usually carried out by the borrower's executing agency. In some cases, procurement may be limited to firms from the donor country; this is referred to as tied aid.UN Development Agencies
The United Nations maintains many institutions that provide technical assistance and other forms of development help to countries around the world. The UN system includes a dedicated development agency in the United Nations Development Programme and a number of specialized agencies that undertake developmental work in their sectors of expertise.
