Developing Macro-Fiscal Forecasting Frameworks in East Africa

Posted by Bryn Battersby and Eric Lautier[1]

Macro-fiscal departments (MFDs) play a crucial role in the budget cycle. They prepare the macroeconomic narrative for the government and they develop the macroeconomic forecasts that are used as parameters in the forecasts of revenue, expenditure, and financing. Sometimes the MFD is also directly responsible for revenue forecasting and, less frequently, debt sustainability analysis. The work of an MFD should anchor the budget and the medium-term fiscal framework, establishing credibility in both the budget forecasts and the supporting macroeconomic narrative.

Why Governance Reforms Are Critical to Economic Recovery in the Republic of Congo

Posted by Concepcion Verdugo-Yepes[1]

On July 11, the IMF Executive Board approved a US$448.6 million arrangement under the Extended Credit Facility (ECF) for the Republic of Congo (RoC). While program negotiations were long and complex, the authorities made decisive progress in 2018 and early 2019 with fiscal consolidation and the implementation of a large package of structural reforms, including two rounds of prior actions to improve governance and transparency. Previous capacity development activities carried out by the IMF were key to identifying issues that are reflected in the RoC’s governance strategy, which was published in June 2018.

High Time for Green Budgeting

Posted by Murray Petrie[1]

In a previous PFM blog I discussed the urgent need for stronger mechanisms of environmental stewardship. This article discusses the closely related topic of ‘green budgeting’.

Green budgeting refers to use of the budgetary system to achieve improved environmental outcomes (OECD 2018). Some of the environmental impacts of fiscal policy are positive. Examples include funding for environmental protection, R&D spending on green technologies, environmental regulation, the collection, monitoring, reporting of environmental data, and research on how to conserve the environment.

Better Stewardship can Avert Environmental Catastrophe

Posted by Murray Petrie[1]

The twin climate change and environmental degradation crises show emphatically that current approaches to environmental stewardship are failing miserably. Action is urgently required in three inter-related areas:

1. Mandatory environmental target setting and the integration of these targets into governments’ medium-term strategic planning and fiscal policy.
2. National ‘State of Environment’ reporting.
3. Green budgeting - the use of the budgetary system to improve environmental outcomes. 
   

Valuing Government Debt

Posted by Tim Irwin[1]

How should government debt be valued?

Three answers are common: face value, market value, and amortized cost. But, as this paper argues, none of these answers leads to reliable indicators of the burden of the debt.

Moving Forward with Fiscal Federalism in Nepal

Posted by Franck Bessette¹

Nepal is known mainly for being the birthplace of the Buddha and the seat of the highest summit on Earth, Mount Everest. The country has also become the laboratory of one of the most ambitious state restructuring operations of our time. Nepal is being transformed from a very centralized administration to a federal one, comprising the federal government, seven provincial governments and 753 municipal governments. These reforms stem from the new Constitution of 2015 and were analyzed in an earlier blog article. Almost two years after Nepal’s national and subnational elections, what is the situation? As it turns out, achievements have been quite remarkable and far from the chaotic outcomes that some experts predicted. In summary:

Mozambique’s Fiscal Risk Unit is Open for Business

Posted by Camilo Gomez Osorio[1]

The achievements of the Fiscal Risk Unit (FRU) of Mozambique’s Ministry of Finance over the last two years are impressive.[2] A previous PFM blog article  described the background. While working to reduce the risk exposure of public finances and bring a medium-term perspective to the budget process, the Unit has also opened a dialogue with civil society on the management of fiscal risks and improving fiscal transparency. It is fair to say that the FRU is open for business!

Mali Commercial Banks set to Operate the Treasury Single Account

Posted by Serge Ramangalahy, Benoit Taiclet and Benoit Wiest[1]

A recent PFM Blog by Matthieu Sarda explained why the implementation of a treasury single account (TSA) is recognized as a core PFM reform in the eight West Africa Economic and Monetary Union (WAEMU) countries.[2]  The article focused on how the TSA was introduced in Niger, and the challenges that were faced. The story now extends to Mali.

Les Banques du Mali s’impliquent pour la réussite du Compte unique du Trésor

Posté par Serge Ramangalahy, Benoit Taiclet, et Benoit Wiest [1]

Dans un récent post, Matthieu Sarda expliquait combien la mise en œuvre d’un compte unique du Trésor (CUT) était, pour les pays de l’Union Economique et monétaire de l’Ouest Africain (UEMOA), au cœur de la réforme de la gestion des finances publiques.  L’article de Matthieu était centré sur les réformes en cours au Niger. Ce nouveau post aborde maintenant le cas du Mali.

OECD Good Practices on Performance Budgeting

Posted by Ivor Beazley[1]

Performance budgeting involves a shift in the focus of budgeting, away from management of inputs and towards a focus on the results of spending and the achievement of policy objectives. This represents a profound change in the character of the budget process, from a traditionally closed domain of budget specialists, focused on the numbers, to a more accessible, transparent and multi-disciplinary exercise, with greater involvement by the center of government, line ministries, the legislature and citizens.