Evaluation of the IMF's Role in Poverty Reduction Strategy Papers and the Poverty Reduction and Growth Facility
Front Matter

Front Matter

Author(s):
David Goldsbrough, Isabelle Mateos y Lago, Martin Kaufman, Daouda Sembene, Tsidi Tsikata, Steve Mugerwa, Alex Segura-Ubiergo, and Jeff Chelsky
Published Date:
September 2004
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    © 2004 International Monetary Fund

    Production: IMF Multimedia Services Division

    Figures: Lai Oy Louie

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    Cataloging-in-Publication Data

    Evaluation of the IMF’s role in Poverty Reduction Strategy Papers and Poverty Reduction and Growth Facility / [prepared by a team headed by David Goldsbrough] — [Washington, D.C.] : International Monetary Fund, Independent Evaluation Office, 2004.

    • p. cm. — (Evaluation report)

    • Includes bibliographical references.

    • ISBN 9781589063679

    1. International Monetary Fund — Evaluation. 2. Developing countries — Economic policy. 3. Poverty. I. Goldsbrough, David John. II. Evaluation report (International Monetary Fund. Independent Evaluation Office).

    HG3881. 5.I58E93 2004

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    Contents

    The following symbols have been used throughout this report:

    – between years or months (e.g. 2003–04 or January–June) to indicate the years or months covered, including the beginning and ending years or months;

    / between years (e.g. 2003/04) to indicate a fiscal (financial) year.

    “Billion” means a thousand million.

    Minor discrepancies between constituent figures and totals are due to rounding.

    Some of the documents cited and referenced in this report were not available to the public at the time of publication of this report. Under the current policy on public access to the IMF’s archives, some of these documents will become available five years after their issuance. They may be referenced as EBS/YY/NN and SM/YY/NN, where EBS and SM indicate the series and YY indicates the year of issue. Certain other documents are to become available ten or twenty years after their issuance depending on the series.

    Foreword

    The role of the IMF in supporting economic reform in low-income member countries has been the subject of considerable scrutiny and criticism over the years. At the end of 1999, the IMF and World Bank adopted a new framework for their support to low-income countries. This framework comprised two key elements: first, country-authored Poverty Reduction Strategy Papers (PRSPs), expected to draw on broad-based consultations with key stakeholder groups; and, second, a vehicle for the provision of IMF concessional lending, the Poverty Reduction and Growth Facility (PRGF), which replaced the Enhanced Structural Adjustment Facility (ESAF). Programs supported by the PRGF were to be derived from a country’s PRSP to ensure that reforms supported by the IMF were country owned and clearly oriented to achieving the joint objectives of poverty reduction and economic growth.

    Although it is still too early to assess the success of the new framework in achieving these objectives, it is time to take stock of progress to date and identify shortcomings that may require course corrections in the design and implementation of the initiative. This is the purpose of this new IEO evaluation, which seeks to strike a balance between measuring progress against initial expectations and against final objectives. In this endeavor, we met two difficulties. First, it appeared that initial expectations about what could be delivered in the short term—by the IMF and by low-income countries alike—were extremely ambitious. Second, yardsticks and benchmarks to assess intermediate progress toward the final objectives appeared to be insufficient, especially with regard to what was expected in terms of country-specific changes in policy processes.

    This evaluation adds to an already extensive body of reviews of the PRSP initiative undertaken internally by IMF and World Bank staff, as well as by donor agencies and nongovernmental organizations, by drawing on the comparative advantage of the IEO, which combines an independent perspective with full access to internal IMF documents, staff, and key decision makers. The evaluation, undertaken in parallel with a similar exercise by the Operations Evaluation Department (OED) of the World Bank (www.worldbank.org/oed/prsp) is based on extensive cross-section analysis of data for countries that had completed full PRSPs as of the end of 2002 and is further informed by a series of in-depth country case studies and surveys of stakeholders in low-income countries.

    Following standard practice, this volume includes, alongside the evaluation report itself, the response of IMF management and staff to the evaluation, as well as the Summing Up of the Executive Board discussion of this report. Executive summaries of the case studies undertaken as background to this evaluation will be published in a separate volume and the full case study reports can be found on our website at www.imf.org/ieo.

    David Goldsbrough

    Acting Director

    Independent Evaluation Office

    Evaluation of the IMF’s Role in Poverty Reduction Strategy Papers and the Poverty Reduction and Growth Facility

    This report was prepared by a team headed by David Goldsbrough and includes Jeffrey Allen Chelsky, Martin Kaufman, Steve Kayizzi-Mugerwa, Isabelle Mateos y Lago, Alex Segura-Ubiergo, Daouda Sem-bene, and Tsidi Tsikata. Research assistance was provided by Patricia Yang-Yang Chen and Mowafa Taib, and administrative support by Annette Canizares, Arun Bhatnagar, and Maria S. Gutierrez. Important contributions were also received from Professor Arne Bigsten, Soren Jensen, David Peretz, and Kerfalla Yansane. The report was approved by Montek S. Ahluwalia, then Director of the Independent Evaluation Office (IEO). The evaluation team also benefited considerably from its collaboration with the World Bank’s Operations Evaluation Department team, led by William Battaile, which conducted a parallel evaluation of the World Bank’s role in the Poverty Reduction Strategy Paper process. Final judgments expressed in this report are the responsibility of the IEO alone.

    The assistance of the Economic Commission for Africa in hosting a workshop for stakeholders in January 2004 in Addis Ababa to discuss the preliminary results emerging from the evaluation, and the financial support of the Commonwealth Secretariat, which allowed a number of the participants to attend that workshop, are gratefully acknowledged.

    Abbreviations and Acronyms

    AFR

    African Department (IMF)

    APR

    Annual performance report

    AsDB

    Asian Development Bank

    BWI

    Bretton Woods institution

    CAS

    Country Assistance Strategy (World Bank)

    CDF

    Comprehensive Development Framework (World Bank)

    CG

    Consultative Group

    CGE

    Computable General Equilibrium

    CPIA

    Country Policy and Institutional Assessment (World Bank)

    CSO

    Civil society organization

    DAC

    Development Assistance Committee (OECD)

    DFID

    Department for International Development (U.K.)

    EC

    European Commission

    ESAF

    Enhanced Structural Adjustment Facility (IMF)

    FAD

    Fiscal Affairs Department (IMF)

    FAO

    Food and Agriculture Organization (UN)

    GDP

    Gross domestic product

    HIPC

    Heavily Indebted Poor Country

    IDA

    International Development Association

    IEO

    Independent Evaluation Office (IMF)

    IFI

    International financial institution

    IMF

    International Monetary Fund

    IMG

    Independent Monitoring Group

    I-NGO

    International nongovernmental organization

    I-PRSP

    Interim Poverty Reduction Strategy Paper

    JPR

    Joint Partner Review

    JSA

    Joint Staff Assessment

    LIC

    Low-income country

    LOI

    Letter of Intent (IMF)

    MCD

    Middle East and Central Asia Department (IMF)

    MDGs

    Millennium Development Goals

    MEFP

    Memorandum of Economic and Financial Policy (IMF)

    MFD

    Monetary and Financial Systems Department (IMF)

    MONA

    Monitoring of Arrangements (IMF)

    MTEF

    Medium-term expenditure framework

    NEPAD

    New Partnership for Africa’s Development

    NGO

    Nongovernmental organization

    ODA

    Official development assistance

    OED

    Operations Evaluation Department (World Bank)

    PAF

    Performance Assessment Framework

    PDR

    Policy Development and Review Department (IMF)

    PEM

    Public expenditure management

    PER

    Public Expenditure Review (World Bank)

    PFP

    Policy Framework Paper

    PRE

    Poverty-reducing expenditure

    PRGF

    Poverty Reduction and Growth Facility (IMF)

    PRS

    Poverty Reduction Strategy

    PRSC

    Poverty Reduction Support Credit (IDA)

    PRSP

    Poverty Reduction Strategy Paper

    PRSP-PR

    PRSP Progress Report

    PSIA

    Poverty and Social Impact Analysis

    RES

    Research Department (IMF)

    ROSC

    Report on Standards and Codes

    SOE

    State-owned enterprise

    TA

    Technical assistance

    TOR

    Terms of reference

    UN

    United Nations

    UNDP

    United Nations Development Program

    VAT

    Value-added tax

    WEO

    World Economic Outlook (IMF)

    WHD

    Western Hemisphere Department (IMF)

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