This evaluation addresses Bank efforts to advance two of the Paris Declaration principles—harmonization and alignment (H&A). These are the key tenets of donor coordination falling primarily under the responsibility of donors (including the Bank) and have been considered central to strengthening aid effectiveness. The Bank has made good progress in harmonizing lending and nonlending activities with other donors. It has undertaken some joint strategies with other donors, but the high transaction costs entailed for all parties are often not worth the benefits, whereas coordinated strategies have been a good alternative.

The Bank’s donor coordination activities have generally been effective in reducing transaction costs to governments, building government capacity, and improving the quality of the policy dialogue. The Bank’s internal incentives for H&A are not very strong, but they do play a modest role in promoting coordination. The field presence of Bank staff is important for coordination, although there are costs.