April 12, 2017

Government at a Glance: Latin America and the Caribbean 2017

Government at a Glance

Carlos Pimenta [1] and Maria Veronica Cetrola Raven [2]

For most countries in Latin America and the Caribbean (LAC) increasing growth and improving social equity are key objectives. To achieve these goals, it is essential to have, not only good governance and good public policies, but also efficient public management. The publication Government at a Glance Latin America and the Caribbean 2017 (available in both English and Spanish) is the product of a joint effort between the Inter-American Development Bank (IDB) and the Organization for Economic Co-operation and Development (OECD). It provides internationally comparable data on government activities and their results in the OECD and 15 LAC countries (Argentina, Brazil, Haiti, Chile, Colombia, Costa Rica, Ecuador, El Salvador, Jamaica, Mexico, Panama, Paraguay, Peru, the Dominican Republic and Uruguay). This dashboard of key indicators aims to help LAC governments and citizens better understand and benchmark their country’s practices and performance against regional peers and OECD Countries.

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April 07, 2017

Coordinating the Planning and Budgeting Functions of Government

AFW2 Logo

Posted by Ashni Singh[1]

Clique aqui para a Versão Portuguesa.

The IMF’s Regional Technical Assistance Center (RTAC) for Anglophone West Africa and Cabo Verde (AFRITAC West 2) recently convened a workshop to discuss the challenges of improving coordination between the strategic planning and budget preparation functions of government. with the aim of achieving better alignment between policy priorities and fiscal resource allocation.

The workshop was held during March 6-10, 2017, in Cabo Verde, and was declared open by the host country’s Minister of Finance, Olavo Correia. The closing ceremony was addressed by AFRITAC West 2’s Center Coordinator Lamin Leigh. The event was also supported by two of the IMF’s other RTACs, those for Francophone West Africa (AFRITAC West) and Southern Africa (AFRITAC South). It attracted high level participation from the macro-fiscal, planning, and budget directorates of the ministries of finance, as well as the ministries of planning and national planning agencies where they exist, from all five Anglophone West African countries as well as five Lusophone African countries.[2]

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April 05, 2017

Improving Cash Management in West Africa

AFRITAC West

Posted by Jean-Pierre Nguenang[1]

The IMF’s Fiscal Affairs Department (FAD) and its Regional Technical Assistance Center in Abidjan (AFRICTAC West, AFW) recently organized a seminar on “Ensuring Active Cash Management to Finance the State Budget in Member Countries of AFW”. 39 participants from the ten member countries of AFW[2] included representatives from directorates in charge of procurement, budget management, cash and debt management, as well as a regional institution in charge of the securities markets (Agence Union Economique et Monétaire Ouest Africaine- UEMOA-Titres). In his opening speech, Mr. Adama Coulibaly, Director of Cabinet of the Ministry of Economy and Finance of Côte d’Ivoire, welcomed the participants and emphasized the central role of cash management for fiscal consolidation efforts in the region.

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March 29, 2017

Harnessing the Power of Accrual in Managing Public Finances

Accrual

Posted by Guohua Huang[1]

On March 6, 2017 the International Monetary Fund (IMF), the World Bank Group (WBG) and the International Public Sector Accounting Standards Board (IPSASB) co-organized a seminar on Transparency and Beyond: Harnessing the Power of Accrual in Managing Public Finances, in Washington DC. Christopher Towe, Deputy Director of the IMF’s Fiscal Affairs Department, noted that the seminar brought together key stakeholders, including standard setters, producers, and users of government financial statements. It facilitated a debate on various perspectives, opportunities, and challenges in the adoption of accrual accounting by governments, and the way forward.

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March 27, 2017

Fiscal Rules and Fiscal Councils: New Data Just Out!

Fiscal rules and councils 

Posted by Victor Lledó[1]

Fiscal rules and fiscal councils have been increasingly recognized as important tools to promote sound fiscal policies.[2] By constraining discretion and fostering transparency, they enhance fiscal discipline and make fiscal policy more predictable. In particular, fiscal rules can help governments establish fiscal targets that support fiscal sustainability, while fiscal councils help ensure those targets are realistic.

Together, they can raise the financial and reputational costs of deviating from the announced targets. In doing so, they help prevent excessive fiscal deficits and unstable debt dynamics. Fiscal rules and fiscal councils also contribute to improve fiscal behavior over the business cycle and encourage better risk management as building buffers in good times makes space to conduct countercyclical policies in bad times and to absorb the realization of fiscal risks. Healthy and resilient public finances, in turn, give policymakers the room needed to serve other objectives, including economic efficiency and growth, as well as achieving a more equitable distribution of income.

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March 21, 2017

A Conversation with Carolina Renteria

Richard and Carolina

Posted By PFM Blog Administrator 

Carolina Renteria has recently taken over from Richard Hughes as Chief of the PFM1 Division in the IMF’s Fiscal Affairs Department. In this article, which is extracted from a longer conversation with Richard Allen, Carolina describes her previous career, and the fresh approaches and perspectives she plans to bring to her work in FAD.

RA: Carolina, could I start by asking you to briefly summarize your professional career so far? What skills and expertise do you bring to your new job in FAD?

CR: I come from Colombia, worked for 10 years in PFM areas as Senior Advisor to the Fiscal Council and Budget Director in the Ministry of Finance, and as Director of the National Planning Department (equivalent to being Minister of Planning). That experience gave me a very broad view of how the functions of planning, budgeting, and public finance relate to each other. For example, when I was Budget Director, we introduced a medium-term expenditure framework in Colombia for the first time. As advisor to the Fiscal Council, we were responsible for the calculation of fiscal rules and the consolidation of fiscal data. Later, I became Executive Director for Colombia at the World Bank and, from 2013-2016, I was Lead Economist in Africa for the World Bank’s macro-fiscal global practice. During this time I provided technical assistance (TA) on public investment management and other fiscal issues. My Bank experience gave me an opportunity to expand my regional knowledge, and also to assess and understand the varying levels of institutional capacity in the countries of sub-Saharan Africa.

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March 15, 2017

A New Path to Improve FMIS Performance

FMIS

Posted by Gerardo Uña[1]

In a previous blog article, I spelled out some of the reasons why the performance of FMIS systems in developing countries around the world has been generally disappointing. These reasons include the lack of well-crafted conceptual design, sufficiently strong leadership by the ministry of finance, financial and technical capacities within the government, secure financing, good project management, adequate testing of the systems before they are implemented, and a feasible maintenance strategy. In this second article, I consider the question of whether there is an alternative path for implementing FMIS that would be more cost-effective, and could lead to improved results.

Looking back historically, we can see that the implementation of FMIS went through two main phases. In the first phase, from about the early-1980s until the mid-1990s, the dominant approach was to implement a comprehensive IT system that supported core PFM business processes, including budget preparation and execution, cash management, accounting, and debt management. In addition, “peripheral” functions such as public procurement, payroll, and asset management also used the same technological platform. This approach broadly replicated the so-called Enterprise Resource Planning (ERP[2]) systems that were widely used in the private sector to support companies’ resource management business processes.

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March 09, 2017

How to Assess FMIS Performance

FMIS

Posted by Gerardo Uña[1]

Financial Management Information Systems (FMIS) are comprehensive systems that support the preparation and execution of the budget, accounting and financial reporting, and many other public financial management (PFM) functions. They are used to integrate budgetary, accounting, treasury, and public debt management processes, and to generate a country’s in-year fiscal reports and annual financial statements. As well as producing timely, relevant, and reliable financial data, well-designed FMIS can play a critical role in improving the quality of public expenditures and fiscal transparency.

After three decades of FMIS implementation across different regions, such as Latin America, Africa and Asia, many countries have initiated a process of modernization to improve the functionalities, coverage, and integration of their systems. However, the cost and implementation challenges of these reforms have been very large, leading to disappointing results in many cases. For these reasons, countries are looking for new ways of designing FMIS that make the best use of modern technology to integrate functions and processes efficiently and cost-effectively.

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March 07, 2017

Public Finance Professionals: Guardians of the Purse

ICAEW_logo

Posted by Susanna Di Feliciantonio[1]

Public money matters. How governments manage it should be an issue that concerns all of us. In recent years, the debate has tended to focus on fiscal sustainability issues, as well as the role of financial reporting and public sector accounting. But improved public financial management cannot be achieved through improved reporting alone. Ultimately, it is public finance professionals who are at the heart of the system – and ICAEW (the Institute of Chartered Accountants in England and Wales) wanted to know how they feel about how well they are doing.

ICAEW recently commissioned a series of in-depth research interviews with selected senior finance professionals in ten EU member states, large and small, older and newer. We asked them to reflect on the public finance functions they operate, the challenges they face, and the changes that are taking place. The public finance ecosystem in Europe is a varied one, yet it is clear that professionals from the Czech Republic, Estonia, France, Germany, Greece, Italy, the Netherlands, Poland, Romania and Sweden face similar issues and challenges.

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March 02, 2017

Bringing a Political Economy Analysis to USAID’s TA Programming

USAID_Political_Economy

Posted by Corinne Rothblum, Steve Rozner and Jay Totte[1]

Over the past decade bilateral and multilateral donors including DFID, the Dutch, SIDA and the World Bank have undertaken political economy analysis (PEA) with the goal of informing their programming strategies and approaches.  Building on their methodological tools and experience, in 2014, USAID began testing its own  PEA framework, which is organized around four core themes: foundational factors, rules of the game, ‘here and now’, and dynamics. To date, USAID missions in over a dozen countries have used the PEA framework to examine issues in sectors ranging from health to biodiversity to governance. USAID/Washington staff provide technical support and offer headquarters field-based workshops that explore how to use the PEA framework and other approaches to embed ‘thinking and working politically’ in USAID program design and implementation.

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