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PFM in Fragile and Conflict-Affected States : Striving Against the Odds

In March 2023, 12 Haitian PFM professionals – mainly public accountants from the Treasury but also budget officials, debt management officials, a revenue forecaster and an internal auditor – attended a five-day workshop on cash management. The event was organized by the IMF’s Caribbean Regional Technical Assistance Centre (CARTAC) and the Fiscal Affairs Department. A key objective of the IMF is to strengthen capacity of fragile and conflict-affected states (FCS) in this and other areas.[1]

 Haiti shares common features of FCS that other similar countries face. There are difficulties in providing public goods; there is rising inequality and grievances against the state; and increased risks of violence. This is Haiti’s reality.

 Despite these challenges, the Haitian delegation flew Haiti’s flag high. Their attire, demeanor and commitment perfectly masked the situation at home. There was a strong appetite to learn new techniques, such as how to apply the IMF’s new cash forecasting analysis tool. They are the gladiators of Haiti’s PFM system, in a coliseum of uncertainty and insecurity.

 Uncertainty and insecurity are the reality that public servants in Haiti face daily. A question asked by one participant sums this up perfectly: “How do we perform effective budgeting and cash management when we live in a country where we could get up one morning to find that the conflict has escalated or there has been a natural disaster? Anything can happen. How do we apply the principles we are learning in a country that is not stable? How do we plan for these uncertainties and risks?”

 How should staff of the Treasury, the finance ministry, and other civil servants deliver public services in an environment where the entire government infrastructure is teetering precariously on the edge of a failed state precipice?

 The answer seems simple, but it is not. Staff compartmentalize. They put the turmoil out of their minds. They block out everything else, leaving any news – good or bad – for later, after the work is done – or at least they try. One participant said: “A community that is considered safe today can be unsafe tomorrow.” If staff are living in such an environment then, likewise, cash management and other areas of PFM will face uncertainty, tremendous risks, and a very short time horizon.

 How do we humanize PFM when providing technical assistance to fragile states such as Haiti? How do we address the psycho-social needs of staff who have to execute critical tasks such as cash and debt management, in such an uncertain and risk-laden context? Unfortunately, these questions are often overlooked. Staff must perform their day-to-day work while having to contend with concerns regarding safety and security. Against this background, what is the priority: cash management – keeping a country’s finances afloat – or self-preservation?

 Professionals working in FCS are no different from their counterparts in other developing countries. The Haitian team raised familiar questions about liquidity management, sub-accounts of a Treasury Single Account, how to treat reserves, the role of the central bank, the political economy of cash management, the impact of dollarization on cash management, the role of the ministry of finance in core treasury functions, and many other issues.

 However, in Haiti, as in other FCS, PFM is under-resourced. Haiti’s security situation has impacted many areas that are important for capacity building: knowledge transfer; training; peer-to-peer engagement; and in-country technical assistance. For this reason, it is important to provide opportunities for continuous and ongoing learning. That includes bringing Haitian staff to other countries in the region for knowledge exchange and peer learning. But this can raise challenges, even in the Caribbean. Most countries, for example, have a visa requirement, even for professional development. In Haiti’s case, these challenges were overcome, but obtaining the required permissions came right down to the wire.

 Haiti, like other FCS, needs resources but, even more so, it needs advocates who understand the various challenges and are committed to bringing these challenges to the forefront. Haiti needs to find innovative solutions to building capacity, as well as a forum where practitioners with common concerns and experiences can collaborate and motivate each other.

 Haiti is a CARTAC member country.  Despite the challenging security situation, Haiti needs to receive as much support as possible. Cash management in Haiti and other FCS is not just a technical or administrative issue; it is also a human issue.


[1] See IMF Policy Paper “IMF Strategy for Fragile and Conflict-Affected States (FCS)” The IMF Strategy for Fragile and Conflict-Affected States.

Haiti, like other fragile states, is searching for innovative solutions to build capacity ….