Posted by Celeste Kubasta and Raju Sharan[1]
In February 2021, a workshop on the IMF’s Public Investment Management Assessment (PIMA) tool and the new PIMA Climate Change Module was conducted virtually through the Fund’s South Asia Regional Training and Technical Assistance Center (SARTTAC).[2] The workshop brought together 66 participants from all SARTTAC member countries: Bangladesh, Bhutan, India, Maldives, Nepal and Sri Lanka. Three countries in the region, Maldives, Sri Lanka, and Bangladesh, have conducted PIMA’s in 2016, 2017, and 2018, respectively.
Prior to the workshop, a survey was conducted on participants’ views of public investment management in their countries. The responses indicated that:
- The countries are especially strong on the planning framework and planning processes. This includes good coordination within the central government and between central government and subnational governments.
- The implementation of infrastructure projects is generally less developed due to weak control mechanisms and frequent challenges with the availability of funds to implement and complete projects.
- COVID-19 has created additional challenges by putting many new projects on hold, delaying implementation of ongoing projects, and reprioritizing spending resulting in capital expenditure reductions.
Participants noted that PIM is anticipated to be important during the post-COVID recovery phase, to help boost economic growth and employment generation. As a result of the pre-workshop survey, a session was dedicated to the topic.
The workshop outlined the PIMA framework. It provided presentations and group exercises on aspects of the framework, including project appraisal, budget comprehensiveness, medium-term planning and budgeting, project monitoring, and public procurement. Country examples of good practices on specific topics were highlighted in presentations and discussion. To deepen understanding, participants were given homework on practical public investment topics, including cost/benefit analysis, budgeting for investments, project monitoring, and a sample tool for countries to use in reviewing alternative scenarios for infrastructure investment. Workshop sessions were held on how to design and implement PIM reforms, and critical factors for success.
Participants noted that most countries in the region are undertaking reforms related to improving PIM, with the most frequent topics being fiscal rules, national and sectoral strategies, multi-year budgeting and budget comprehensiveness. At the same time, the need to improve understanding of public investment and training on the topic was emphasized. PIMA self-assessment was noted as a tool that can increase understanding and awareness.
Finally, the workshop spent the last day on the new PIMA Climate Change (CC) module, which is currently being tested and piloted by the IMF. This session discussed the important links between climate change and infrastructure, the issues the CC module will cover, and the benefits to countries from undertaking a PIMA CC assessment.
The participants were also provided with materials prepared by the IMF, including documents covering infrastructure spending during the COVID crisis. For more information on IMF documentation and activities on public investment management, go to https://infrastructuregovern.imf.org/content/PIMA/Home/PimaTool.html.
[1] PFM Advisors in the South Asia Regional Training and Technical Assistance Center (SARTTAC) in Delhi, India.
[2] The workshop was opened by Mr. Dhani Ram Sharma, Joint Secretary, Ministry of Finance, Government of Nepal, who is responsible for public investment activities in his country. Facilitators included Raju Sharan and Celeste Kubasta (SARTTAC), Nicoletta Feruglio, Eivind Tandberg and Suphachol Suphachalasai (Fiscal Affairs Department, IMF), and Dick Emery (IMF expert).
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