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Abstract
The Poverty Reduction and Growth Facility (PRGF) is the instrument used by the IMF to provide support for countries in the implementation of their poverty reduction and growth strategies, as identified in their Poverty Reduction Strategy Papers (PRSPs). The core objective of the PRSP approach is to arrive at policies that are more clearly focused on growth and poverty reduction, in which the poverty reduction and macroeconomic elements of the program are fully integrated, and that embody a greater degree of national ownership, thereby leading to more consistent policy implementation. Key requirements in the design of the PRGF programs that support this approach are an understanding of the effect of program measures on vulnerable groups—particularly the poor—and designing measures to mitigate any negative effects. Poverty and Social Impact Analysis (PSIA) is, in turn, a critical instrument for pursuing this goal. In this regard, IMF staff is expected to draw on PSIAs carried out by other institutions (such as the World Bank) and donors in addressing distributive concerns in PRGF-supported programs. To this end, the IMF established a small in-house capability on PSIA to facilitate the integration of PSIA into PRGF-supported programs. The group has only four full-time positions, so its activities are designed to leverage expertise and available resources both inside and outside the IMF. In limited cases, the group also conducts PSIAs in areas that are central to the work of the IMF and where no other analysis is available. The goals of the PSIA group are to assist mission teams to
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