that venture capital investments typically have high rates of failure in which only one or two investments earn high returns for every ten investments made. It states further that market practice assesses a fund’s performance on a portfolio basis against its peers of the same vintage, not on a stand-alone basis. The positive effects on private sector development of IFC investments in venture capital funds confirm that this type of financing can be an important mechanism for fostering innovation, entrepreneurship, and growth of private enterprises. IFC will continue to operationalize lessons of experience in innovation and entrepreneurship to further enhance overall outcomes. We agree with all six interrelated recommendations. The recommendation to develop a World Bank Group strategic framework in innovation and entrepreneurship provides an overarching platform for operationalizing the other five recommendations. Management will take a comprehensive view in developing specific approaches to operationalizing all of the report’s six recommendations as part of formulating a Bank Group strategic framework for innovation and entrepreneurship.
MIGA Management Comments The Multilateral Investment Guarantee Agency (MIGA) welcomes the IEG evaluation report of the World Bank Group support for innovation and entrepreneurship activities and finds it important and useful. It comes at a time of increased emphasis on synergies across the World Bank Group under the broad rubric of one World Bank Group. Given MIGA’s mandate to facilitate the flow of productive cross-border investments into developing countries, the projects supported through its guarantee operations play a key role in the acquisition and transfer of technology as well as knowledge that is at the heart of innovation and entrepreneurship. This IEG evaluation has done a good job of capturing the contributions of MIGA-supported projects that promote innovation and entrepreneurship. The evaluation findings are based on 18 MIGA projects that supported innovation and entrepreneurship, and as correctly noted in the IEG report, do not provide a robust sample for statistical analysis. However, management appreciates the effort made in the report to draw meaningful insights from these projects. In this regard, management notes that it would have been useful to include the evidence presented in IEG’s (2012) Country Program Evaluation on Afghanistan, which includes a MIGA project (one of the 18) and illustrates well the complementarities of the World Bank Group in the information and communication technology sector (http://ieg.worldbankgroup.org/content/dam/ieg/afghanistan/afghan_eval _full.pdf; for example, Box 5.2: Synergies Among World Bank Group Institutions).
An Independent Evaluation | Management Response
xxix