IDG assisted USAID in providing the Kenyan government and its people with new and financially viable vehicles to support economic growth through the Deepening Financial Development Project (DFDP). The project supported the efforts outlined in the 2010 Constitution of Kenya where 47 county governments were enriched to develop financial tools to support the development of basic service infrastructure by identifying opportunities to leverage sovereign debt and create investments for private investors. The project worked in partnership with USAID’s Financial Inclusion for Rural Microenterprises (FIRM) Program, supporting increased financial intermediation in energy health, and education, among other sectors.
IDG’s objectives under the DFDP included:
- Working with FIRM to advise on the structure, design, and implementation of county investment planning, including quick wins and viable long-term options for county governments to leverage financing.
- Supporting Nairobi County in configuring a debt management strategy to include county bond issues (including FIRM and other donor or private-sector assistance).
- Supporting the USAID Mission and FIRM to advance the national loan guarantee program with the National Economic and Social Council in the Office of the President.
- Developing a strategy of engagement for USAID to expand debt and equity fund mobilization to support the devolved government.
IDG’s assessment helped identify the gaps in the new regulations put into effect by the devolved government in Kenya which hindered the effective implementation of FIRM. IDG also provided recommendations to help USAID and other donors design and modify their Kenya programs to strengthen the capacity of the counties to plan, finance, build, and manage infrastructure projects in geothermal, wind, biogas, solar, and hydro within a devolved government context. IDG focused on solutions that were innovative, technically realistic, and financially feasible.