What is the MDTF

The Multi-Donor Trust Fund (MDTF) for Khyber Pakhtunkhwa (KP), Newly Merged Areas and Balochistan was formed in August 2010 as a financing mechanism to mobilize resources from development partners to restore infrastructure, improve public services and livelihoods, and address factors that contributed to destabilization in the region. Since 2017, the MDTF continues to support Balochistan and KP, including the Newly Merged Areas that officially became part of KP’s provincial jurisdiction – a milestone in advancing state citizen trust.

The projects implemented under three program pillars – Policy Reform and Governance, Growth and Job Creation, and Service Delivery – in partnership with the federal and provincial governments of Balochistan and KP, along with development partners and technical teams of the WB. To date, the MDTF has benefited more than 6.24 million individuals, including beneficiaries at the community level, business owners and civil servants.

Beginnings of the MDTF

In 2009, a Post Crisis Need Assessment (PCNA) was undertaken in the north western border areas of Pakistan to develop a peace building strategy, both pragmatic and sequenced, in order to create conditions for sustainable development. Militants exploited frustrations resulting from decades of weak governance, corruption and wide-ranging socio-economic deficits in Newly Merged Areas and KP. Years of instability shaped the crisis, displacing populations and aggravating high levels of vulnerability among communities in Pakistan and Afghanistan.

Khyber Pakhtunkhwa and Balochistan Multi-donor Trust Fund was established in August 2010 as crisis-response financing mechanism to support recovery and address [governance] factors that contributed to the crisis. The MDTF was the first forum for development partners, state actors and citizens to put forth a comprehensive reconstruction and sustainable development strategy to restore infrastructure, services and livelihoods, and reduce the potential for renewed crises. The MDTF was jointly funded by Australia, Denmark, the European Union, Finland, Germany, Italy, Sweden, Switzerland, Norway, Netherlands, Turkey, the United Kingdom, and the USA, and is administered by the World Bank in Pakistan.

Development Partners

Khyber Pakhtunkhwa and Balochistan Multi-donor Trust Fund is jointly funded by the governments of Australia, Denmark, the European Union, Finland, Germany, Italy, Sweden, Switzerland, Norway, Netherlands, Turkey, the United Kingdom, and the United States. Together, donor partners committed a total of US$274 million, and requested the World Bank to administer the MDTF in accordance with Bank applicable policies and procedures. MDTF resources continue to help the region recover from the crisis and reduce the potential for renewed crises.

How we build state-citizen trust?

The primary goal of the MDTF is to enhance trust between the government and citizens across the three geographical areas. Towards this goal, MDTF projects are designed across three complimentary themes that together strengthen state-citizen trust: good governance, livelihood development and improvements to public service delivery. As such, the portfolio is structured and implemented under its three program pillars: (I) Policy Reform and Governance; (II) Growth and Job Creation; (III) Service Delivery.

The MDTF portfolio focuses on three key result areas:

  • Enhanced transparency and accountability in public service delivery, and effective resource management;
  • Enhanced productivity and job creation (through entrepreneurship and skilled labor);
  • Improved livelihoods and access to basic services.
How we build state-citizen trust

Pillar I: Policy Reform and Governance

A key step towards enhancing citizen state trust has been an improvement of the efficiency of the core government departments for better service delivery and an increase in transparency and accountability. Key activities in this regard include increasing Government capacity for revenue mobilization, public investment management and accountability, and public financial management.

Pillar II: Growth and Job Creation

The MDTF has further strengthened the state citizen trust by fostering job creation and growth by supporting small- and medium-sized enterprises (SMEs), improving livelihoods at the community level, especially for the women and youth. Projects under Pillar II target economic growth and key sectors to stimulate job creation, such as preparing KP for a digital world.

Pillar III: Service Delivery

Improving service delivery has also been a key focus of MDTF for building citizen-state trust. Projects under Pillar III place emphasis on community drive development in order to improve access to basic services, enhance community buy-in and increase confidence in the state.

Cross-Cutting Themes

Gender Mainstreaming

Projects supported under MDTF Round II are being implemented with a distinct focus on gender-inclusive development. A Gender Review was undertaken in May 2017 to mainstream gender in projects financed under the MDTF. One of the recommendations of the review was for each project to develop concrete and measurable Gender Action Plans (GAPs) and take a targeted approach in carrying out project activities to narrow the gender gaps. Furthermore, all outcome level results indicators are designed to measure progress for both male and female beneficiaries. This has encouraged the projects to collect and report gender-disaggregated data of beneficiaries for every activity.

Youth Empowerment

Youth engagement is a major focus of MDTF projects with the goal to empower youth by providing them income-generating opportunities. Training development and vocational skills are key elements to strengthen youth economic empowerment. Since 2017, the SADP Project set up 28 Youth Internship Programs and 21 Vocational Training Programs, allowing the rural youth to learn vital livelihood skills.