Prosperity Initiative originated from a bamboo project partnership between Oxfam Hong Kong (OHK) and the International Finance Corporation (IFC).

In 2004, the International Finance Corporation (IFC) began work on a bamboo supply chain project in Thanh Hoa Province, Viet Nam. This project, initiated by the IFC's Mekong Private Sector Development Facility (MPDF) linked bamboo farmers through the supply chain of bamboo flooring to the international retail chain, IKEA.

In 2006, Oxfam Hong Kong and IFC leveraged this experience and jointly coordinated a bamboo sector feasibility study in Viet Nam, Lao PDR and Cambodia. The study involved 14 organisations and consultants working in the three Mekong countries and China. This work demonstrated the poverty impact potential that the bamboo sector could achieve if the sector developed in the Mekong region over the coming decade.

This feasibility study developed into a joint IFC-OHK collaboration project to assist the development of the sector. PI was formed initially as a project under OHK to host this work. In October 2007, PI formally spun-off from OHK to become an independent organisation to promote bamboo and others sectors. 

Since 2007, Prosperity Initiative has received project funding from IFC, SDC, Oxfam America, Oxfam Hong Kong, Irish Aid, UNIFEM, and the World Bank for a series of market development projects in the Mekong region.