“Bankable projects are usually designed before they are financed.” A project preparation facility provides grants, technical assistance, and advisory support for the studies and structuring work needed before a project can reach financing. It typically covers feasibility analysis, legal design, environmental review, transaction advice, and procurement planning.
Executive Summary
In development finance, many viable infrastructure ideas stall not because capital is unavailable but because projects are too underprepared to attract it. Project preparation facilities bridge that gap by paying for early-stage work that governments often underfund. They have become especially important for climate, energy, and transport pipelines where weak preparation can delay implementation for years.
The Strategic Mechanism
- Facilities finance feasibility studies, engineering design, safeguards work, and financial structuring before a full commitment is made.
- MDBs and development agencies use them to improve project quality, standardize documentation, and shorten later procurement delays.
- Better preparation helps governments decide whether a project should be publicly financed, privately financed, or blended.
- The facility model also creates a pipeline of investable projects rather than one-off transactions.
Market & Policy Impact
- Stronger preparation raises the odds that infrastructure projects reach financial close.
- Governments can screen out weak projects before committing large capital budgets.
- Private investors are more likely to engage once legal and technical due diligence is complete.
- Climate and energy-transition pipelines benefit when early-stage design costs are pre-funded.
- Preparation support can improve procurement integrity and reduce renegotiation risk later.
Modern Case Study: Global Infrastructure Facility and Project Pipeline Development, 2015-2024
The World Bank-hosted Global Infrastructure Facility illustrates why project preparation matters in practice. From 2015 through 2024, the facility supported governments and MDB partners in developing infrastructure pipelines across transport, energy, water, and urban sectors by financing upstream advisory work before major capital commitments were made. The underlying problem was not simply a lack of money; it was a shortage of well-structured projects that could withstand technical, legal, and environmental scrutiny. With projects often valued in the hundreds of millions or billions of dollars, preparation funding represented a relatively small share of total cost but had outsized influence on whether financing could eventually move. Governments, MDB staff, and private investors used this preparatory layer to improve feasibility, allocate risks, and clarify procurement pathways. The strategic payoff was a larger stock of bankable projects rather than repeated delays caused by weak early-stage design.