Public Financial Management for PRSP - Deutsches Institut für ...
Public Financial Management for PRSP - Deutsches Institut für ...
Public Financial Management for PRSP - Deutsches Institut für ...
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<strong>Public</strong> <strong>Financial</strong> <strong>Management</strong> <strong>for</strong> <strong>PRSP</strong> Implementation in Malawi<br />
4.1 Why Malawi?<br />
Malawi was a particularly interesting choice <strong>for</strong> a case study because PRS<br />
implementation, decentralisation and re<strong>for</strong>ms of the PFM system are all currently<br />
being carried out simultaneously in the country. It there<strong>for</strong>e reflects<br />
well the current dynamics in much of sub-Saharan Africa and developing<br />
countries elsewhere. Lessons drawn from this case analysis are thus likely to<br />
be relevant in other comparable situations. In addition, conducting this study<br />
in Malawi in early 2005 was particularly interesting due to the specific history<br />
of PFM re<strong>for</strong>ms in the country. Gross irregularities and massive overspending<br />
under president Muluzi’s government led a number of donors to<br />
suspend development assistance in 2001. In 2004, however, a new president<br />
was elected, who was initially given considerable credit by the international<br />
donor community <strong>for</strong> appearing to be strongly committed to policies aiming<br />
at fiscal stability and austerity. Malawi, there<strong>for</strong>e, provided a particularly<br />
interesting case to study the role of political commitment and other potential<br />
factors <strong>for</strong> <strong>for</strong>mality and quality of PFM practices in sub-Saharan Africa.<br />
Box 7:<br />
The Malawi Poverty Reduction Strategy Paper<br />
Malawi prepared its first <strong>PRSP</strong> in 2001/2002. The Malawi Poverty Reduction Strategy<br />
(MPRS) was based on four strategic pillars:<br />
1. Sustainable Pro-Poor Economic Growth – economically empowering the poor<br />
by ensuring macroeconomic stability, access to credit and markets, skills development<br />
and employment generation.<br />
2. Human Capital Development – ensuring the poor have the health status and<br />
education to lift themselves out of poverty<br />
3. Improving the Quality of Life <strong>for</strong> the Most Vulnerable – providing sustainable<br />
safety nets <strong>for</strong> those who are unable to benefit from the first two pillars.<br />
4. Good Governance – ensuring that public and civil society institutions and systems<br />
protect and benefit the poor.<br />
In addition, there were four issues cutting across these pillars: HIV/AIDS, Gender,<br />
Environment, Science and Technology.<br />
While <strong>PRSP</strong>s are considered key documents in joint ef<strong>for</strong>ts by governments and<br />
donors to achieve sustainable development in many countries, the Malawian <strong>PRSP</strong><br />
German Development <strong>Institut</strong>e 45