Financing partners cofinance with ADB through two modalities: project-specific cofinancing (PSC) and trust funds. To cofinance individual projects, programs, or technical assistance, partners can tap PSC. They can also create a trust fund or contribute to an existing trust fund administered by ADB.
ADB’s financing partners provided over $4.3 billion in sovereign cofinancing in 2022. The lion’s share of this amount, reaching over $4.2 billion, was coursed through 59 PSCs. The remaining 2%, about $91.9 million, was committed through trust funds.
Project-Specific Cofinancing
Project-specific cofinancing refers to partner contributions, whether in grants and loans, intended to support a specific ADB project. When ADB administers the project, it signs a cofinancing agreement with the financing partner. When ADB and a partner collaborate on the project but the contributions are not coursed through ADB, they typically sign a memorandum of agreement.
Trust Funds
Trust funds are ways for partners to fund projects and provide technical assistance to support ADB’s country strategies with member countries. These trust funds can be single- or multi-donor channels that ADB can be a trustee for or administer. Some of these trust funds stand on their own, and others are under financing facilities that focus on a specific sector or theme.