PRSPs Emerging Lessons

1
PRSPs Emerging Lessons Issues for Asia

• Asia Programme Managers Meeting
• Delhi, May 21st 2002

2
Origins of the PRSP Idea

• Mixed record on poverty reduction in 1990s
• (Africa, Transition economies, post-1997 Asia)
• Findings on aid effectiveness projects,
• policy conditionality, ownership
• International Development Targets/MDGs
• Multilateral funding for debt relief (HIPC II)

3
Core PRSP Principles

• Country-led/owned based on broad-based
• participation
• Comprehensive macro, structural, social
• Long term perspective
• Results-oriented
• Costed prioritised
• Partnership-oriented

4
Whats new?

• Costed poverty reduction strategy linked to
  macro fiscal framework
• Outcome focused making the links between policy
  results
• Opening-up the policy process to participation
• New incentives, new partnership possibilities
  new forms of aid delivery

5
Relevance in Asia?

• Vast majority of poor people still reside in
  Asia
• Pro-poor policy framework linked to resource
• envelope has broad relevance
• Joining-up macro, structural social policy a
• challenge everywhere
• Donors role secondary to domestic constituencies

6
But context matters

• Important differences between Asia other
• regions and within Asia itself
• Poverty trends history of anti-poverty
• programmes
• Politics, planning and institutions
• Country size and federal states
• Debt, aid dependence experience of IFIs
• Principles rather than Paper or Process

7
Asia Update
I-PRSP (Due)
PRSP (Due)
PRGF/PRSC
Country
Apr-Jun 02 Jan-Mar 03 Jan-Mar 03 Apr-Jun
02 Oct-Dec 02
Oct-Dec 02 July-Sept 02 Apr-June 02 Jan-Mar 03
PRGF/PRSC PRGF PRGF PRGF PRGF PRGF PRGF
Vietnam Cambodia Bangladesh Pakistan Nepal Indones
ia Lao PDR East Timor India China Myanmar? Afgha
nistan?
New PRGF arrangement
8
Global Highlights

• PRSs beginning to provide focus for allocation
• use of domestic external resources
• Policy priorities increasingly backed by
  analysis
• of poverty linked to outcomes
• Some opening of the policy space to broader
• participation by domestic constituencies
• Proto linkages with other reform processes
• (budgets/MTEFs, sector strategies)
• New institutional donor arrangements

9
Ongoing Challenges

• Links to other national planning processes
• Role of MoF vs. other central/line ministries
• devolved authorities
• Feasibility of targets, relevance of indicators,
• appropriate monitoring strategies, risk
  analysis
• Sustaining participatory policy processes
• Donor coordination / alignment of instruments
• Countries under stress/poor performers

10
What does this mean for DFID?

• Active corporate/country level engagement in all
  aspects of the PRS process
• Move towards greater programmatic/budget support
  where PRS processes are strong
• Increasingly separating financing influencing
• Longer term commitments to provision of aid
• Working more multilaterally
• New/different skills

11
Challenges

• Ownership vs. conditionality
• Short term results vs. long term perspective
• Central (federal) vs. provincial (state) level
  working
• Balancing between
• Strengthening poverty impact of policy
• Allowing for flexibility viz. country specifics
• Meeting fiduciary/risk management concerns
• Joining-up with other donors and within HMG