Mobilising Capital for Local Development Funds: A Longitudinal Case Study in Leveraging Millions to Billions

In the 1990s, UNCDF created the local development fund (LDF) approach. These Funds generated billions of dollars for the development of many least developed countries. The LDFs significantly contributed to fiscal decentralisation and the expansion of local fiscal space and local fixed capital formation – two prerequisites for economic transformation.  

This publication presents the findings of a comprehensive longitudinal case study of the effects of LDFs on the local and economic development in ten country cases (Bangladesh, Benin, Bhutan, Guinea, Lesotho, Mali, Nepal, Solomon Islands, Tanzania and Uganda). The paper gives insights into the enabling environment for intergovernmental fiscal transfers to local governments and analyses the contributing factors in the model’s success in highly centralised countries through designing, piloting, and testing. 

For more information and access to the UNCDF publication, please click here.