Credit IMF
Credit IMF
Credit IMF
Credit IMF
It is widely recognized that public investment spending plays a major role in driving economic growth. The latest Interregional Seminar on Public Investment Management included the participation of 21 African countries and more than 70 officials. The seminar concluded that the challenge is not to increase the volume of investment projects, but rather to ensure better quality.
Although well-designed legal frameworks for public investment management (PIM) are in place, their effective implementation remains a challenge.
PIMA and C-PIMA assessments indicate that institutional frameworks are generally sound but their implementation remains incomplete. PIMA scores are significantly higher for institutional frameworks than on their effectiveness. Many public investments still enter the pipeline without completed feasibility studies or assurance of their socioeconomic impact. Cost overruns in execution remain frequent. The conclusion is clear: the central challenge is no longer the mobilization of resources, but their efficient use.
PIPs must evolve into a true strategic compass rather than just a catalog of projects.
In many countries, the public investment program (PIP) is structured as an extensive list of projects that lacks sufficient assurance of the viability of the public investment and alignment with their objectives. This leads to an over-programming that weakens the credibility of the PIP. The message is clear: a credible PIP should select a reduced number of projects that are better prepared and more realistic to ensure their completion and impact.
The seminar devoted a module to the integration of public investment execution into annual and multiyear programming. The emphasis was on the protection of ongoing projects to avoid the abandonment of public investments and the creation of "white elephants". Participants agreed that priority should be given to completing ongoing projects and securing their financing in the budget.
Operating costs need to be better calibrated and captured to avoid making them a hidden cost.
Many completed projects experience rapid deterioration after commissioning due to insufficiently secure operating budgets. A well-constructed but poorly maintained asset ceases to be an investment and becomes a liability. The seminar highlighted the principle of the total cost of ownership, which consists of evaluating a project over its entire operational life. Although the PIMA framework currently suggests this approach, it was emphasized that it must become a strict entry condition: one cannot decide on an investment project without budgeting for the costs necessary to ensure the asset's longevity and durability.
The climate dimension must be strengthened.
C-PIMA scores remain unsatisfactory: the integration of climate into project appraisals remains limited, with an average score of 1.0 out of 3.0. While climate strategies and risk management plans exist, climate analysis is rare when faced with policy trade-offs. There is therefore a need to institutionalize a "climate filter" throughout the public investment cycle, from project planning and selection to commissioning and ex-post evaluation.
Determining fiscal space for investment projects remains a challenge.
In several countries, fiscal space for public investment is nonexistent. This is not due to a lack of resources, but because past unpaid commitments have already consumed future margins. Without commitment authorizations (AEs) and payment appropriations (CPs), it becomes impossible to know what has been committed. Surprisingly, some countries are neglecting the tool that protects investments from cash flow pressures. AE/CP are not a technical luxury: they determine the amount of available fiscal space, and are not a mere accounting fiction.
A scenario through practical exercises recreated the reality on the ground.
The participants worked on concrete cases, such as the calculation of the total cost of ownership of a road infrastructure over twenty years or the assessment of the sustainability of a hospital PPP. These scenarios provided useful methodological lessons and concluded that multiple operational responses can coexist under severe constraints.
Although PIM information systems face emerging risks, they are not always integrated with expenditure information systems.
Platforms covering the entire PIM cycle are promising tools: they improve traceability, reduce duplication, and facilitate the creation of audit trails. However, there are two major risks: the emergence of new silos from platforms that are not fully integrated with budget management systems, and dashboards filled with unreliable data that can give a misleading impression of control. Additional issues are related to cybersecurity and data integrity.
Conclusion.
The seminar did not attempt to formulate simple answers, but to establish a shared diagnosis among 21 countries. In the short term, the path to fiscal space and sustainable development does not lie through the expansion of budgets, but through better management of existing public investments. There is already a strong array of existing tools, for example PIMA and C-PIMA. The challenge is ensuring sufficient institutional discipline to close the gap between established rules and actual practices.
