A Few Strings Attached
Nations seeking debt relief through the International Monetary Fund and World Bank’s Highly Indebted Poor Countries Initiative must prepare a Poverty Reduction Strategy Paper. The World Bank’s guidelines for doing so include well-meaning yet mind-numbing conditions that poor nations will be hard pressed to fulfill. Consider the following advice in the World Bank’s Poverty Reduction ...
Nations seeking debt relief through the International Monetary Fund and World Bank's Highly Indebted Poor Countries Initiative must prepare a Poverty Reduction Strategy Paper. The World Bank's guidelines for doing so include well-meaning yet mind-numbing conditions that poor nations will be hard pressed to fulfill. Consider the following advice in the World Bank's Poverty Reduction Strategy Sourcebook:
Nations seeking debt relief through the International Monetary Fund and World Bank’s Highly Indebted Poor Countries Initiative must prepare a Poverty Reduction Strategy Paper. The World Bank’s guidelines for doing so include well-meaning yet mind-numbing conditions that poor nations will be hard pressed to fulfill. Consider the following advice in the World Bank’s Poverty Reduction Strategy Sourcebook:
Governments must "assess not only the appropriateness of the proposed poverty reduction spending program, but also of planned nondiscretionary, and discretionary nonpriority, spending… [and] the distributional and growth impact of spending in each area…. [P]olicymakers should evaluate the extent to which government intervention in general, and the public spending in particular, can be justified on grounds of market failure and/or redistribution.… [P]olicymakers should consider the extent to which both technical assistance and the private sector can play a role in improving the delivery of [public] services."
If they still have time on their hands, government officials should also "analyze the main sources of risk and vulnerability of the population and… identify the population groups most affected by these risks. Once the groups and their characteristics are identified, the role social protection can play, alongside interventions in other sectors and at the macro level, can be investigated…. The second step is to determine which of the identified groups are covered by existing social protection programs and policies, and to assess the effectiveness of these instruments individually and in combination. Special attention should be paid to the compatibility of the policy context and the expenditure programs, the specific objectives of each intervention, their effectiveness at achieving these objectives, and their cost-effectiveness in delivering the observed outcomes." Moreover, policymakers in poor nations must also "integrate gender analysis into poverty diagnosis and… ensure that participatory consultation and planning processes are specifically designed to give voice to all sectors of society — women and men, as well as different age, ethnic, and cultural groups."
William Easterly is a professor of economics at New York University and the author of The White Man's Burden: Why the West's Efforts to Aid the Rest Have Done So Much Ill and So Little Good.
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