Many low-income country governments hire contractors to carry out large infrastructure projects, as they often lack the capacity to implement these themselves. At 14.5% of GDP, low-income countries have the highest share of public procurement in their economies (World Bank 2017). At the same time, low-income countries often have limited capacity to oversee public projects, which can result in low-quality infrastructure and leakage of public funds.
In 2015, Kenya’s President Kenyatta launched the Last Mile Connectivity Project (LMCP), whose goal was “to connect one million new customers to electricity each year” and achieve universal household electricity access by 2020. The USD 500 million program — one of Kenya’s largest public programs, financed largely by international aid agencies — would extend Kenya’s low voltage network to every household located within 600 meters of more than 13,000 sites nationwide. The program also sought to reduce red tape. The old process of applying for electricity — often requiring months of paperwork — would be replaced by a system where Kenya Power contractors initiate connections, with minimal effort from households.
Concerns around corruption are widely thought to threaten the quality, cost, timeliness, and equity of the construction process, and contribute to significant leakage The LMCP is just one example of many infrastructure projects financed by international agencies. To prevent corruption and improve construction quality, such projects are often accompanied by stringent conditions over how local implementing agencies are to use these funds. But do donor conditions actually improve infrastructure quality on the ground? And, could additional independent monitoring improve accountability?