Posted by: Richard Hughes
Speaking at seminar on Bolstering Country Public Financial Management Systems for Efficiency and Delivery, Sanjeev Gupta (Deputy Director of the IMF’s Fiscal Affairs Department) presented the findings of a new IMF research paper entitled Making Public Investment More Efficient. The paper showed that the average country was losing around one-third of the potential benefits from their public investment to inefficiencies in the way in which those investments are managed. Mr. Gupta stressed that the potential development benefits of closing this efficiency gap are significant, saying “The most efficient public investors get twice the growth “bang” for their public investment “buck” than the least efficient public investors.”
Mr. Gupta went onto explain that if government want to realize the full economic and social benefits from public investments, they have to improve the way in which those investments are managed. The IMF’s new paper also found that strengthening public investment management institutions can close up to two-thirds of the public investment efficiency gap.
To help countries evaluate the strength of the public investment management practices and identify priorities for reform, Mr. Gupta unveiled the IMF’s new Public Investment Management Assessment (PIMA). The PIMA evaluates 15 institutions that shape public investment decision-making at the three key stages:
- Planning sustainable investment across the public sector;
- Allocating investment to the right sectors and projects; and
- Implementing projects on time and on budget.
The IMF will be piloting the PIMA over the coming year in close collaboration with the World Bank, Regional Development Banks, and country authorities
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