PRSPs Now in Place in a Large Share of Low-Income Countries-IMF Factsheet
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Factsheet
Poverty Reduction Strategy Papers (PRSP)
August 14, 2009
Successful plans to fight poverty require country ownership and broad based support from the public in order to succeed. A PRSP describes the macroeconomic, structural, and social policies and programs that a country will pursue over several years to promote growth and reduce poverty, as well as external financing needs and the associated sources of financing. They are prepared by governments in low-income countries through a participatory process involving domestic stakeholders and external development partners, including the IMF and the World Bank.
Country leadership in setting priorities key to reducing poverty
The PRSP approach, initiated by the IMF and the World Bank in 1999, results in a comprehensive country-based strategy for poverty reduction. The introduction of PRSPs was a recognition by the IMF and the World Bank of the importance of ownership as well as the need for a greater focus on poverty reduction. PRSPs aim to provide the crucial link between national public actions, donor support, and the development outcomes needed to meet the United Nations’ Millennium Development Goals (MDGs), which are centered on halving poverty between 1990 and 2015. PRSPs help guide Fund and Bank concessional lending as well as debt relief under the Heavily Indebted Poor Countries (HIPC) Initiative. They are made available on the IMF and World Bank websites by agreement with the member country.
Core principles of the PRSP approach
Five core principles underlie the PRSP approach. Poverty reduction strategies should be:
country-driven, promoting national ownership of strategies through broad-based participation of civil society;
result-oriented and focused on outcomes that will benefit the poor;
comprehensive in recognizing the multidimensional nature of poverty;
partnership-oriented, involving coordinated participation of development partners (government, domestic stakeholders, and external donors); and
based on a long-term perspective for poverty reduction.
Donors support design of realistic plans and governance reforms
The PRSP approach is by now well established in a substantial number of countries and has been associated with notable advances in country ownership, making poverty reduction more prominent in policy debates, and facilitating more open dialogue. As of end-June 2009, just over 90 full PRSPs have been circulated to the Fund Executive Board, as well as more than 50 preliminary, or “interim”, PRSPs. With PRSPs now in place in a large share of low-income countries, the focus in recent years has been on effective implementation.
The PRSP approach is continually being refined, including through periodic staff assessments. The most recent in-depth assessment was completed by the IMF and World Bank Boards in September 2005. In October 2007, the IMF Executive Board reviewed the role of the Fund in the PRS process and in its collaboration with donors.
Factsheet
Poverty Reduction Strategy Papers (PRSP)
August 14, 2009
Successful plans to fight poverty require country ownership and broad based support from the public in order to succeed. A PRSP describes the macroeconomic, structural, and social policies and programs that a country will pursue over several years to promote growth and reduce poverty, as well as external financing needs and the associated sources of financing. They are prepared by governments in low-income countries through a participatory process involving domestic stakeholders and external development partners, including the IMF and the World Bank.
Country leadership in setting priorities key to reducing poverty
The PRSP approach, initiated by the IMF and the World Bank in 1999, results in a comprehensive country-based strategy for poverty reduction. The introduction of PRSPs was a recognition by the IMF and the World Bank of the importance of ownership as well as the need for a greater focus on poverty reduction. PRSPs aim to provide the crucial link between national public actions, donor support, and the development outcomes needed to meet the United Nations’ Millennium Development Goals (MDGs), which are centered on halving poverty between 1990 and 2015. PRSPs help guide Fund and Bank concessional lending as well as debt relief under the Heavily Indebted Poor Countries (HIPC) Initiative. They are made available on the IMF and World Bank websites by agreement with the member country.
Core principles of the PRSP approach
Five core principles underlie the PRSP approach. Poverty reduction strategies should be:
country-driven, promoting national ownership of strategies through broad-based participation of civil society;
result-oriented and focused on outcomes that will benefit the poor;
comprehensive in recognizing the multidimensional nature of poverty;
partnership-oriented, involving coordinated participation of development partners (government, domestic stakeholders, and external donors); and
based on a long-term perspective for poverty reduction.
Donors support design of realistic plans and governance reforms
The PRSP approach is by now well established in a substantial number of countries and has been associated with notable advances in country ownership, making poverty reduction more prominent in policy debates, and facilitating more open dialogue. As of end-June 2009, just over 90 full PRSPs have been circulated to the Fund Executive Board, as well as more than 50 preliminary, or “interim”, PRSPs. With PRSPs now in place in a large share of low-income countries, the focus in recent years has been on effective implementation.
The PRSP approach is continually being refined, including through periodic staff assessments. The most recent in-depth assessment was completed by the IMF and World Bank Boards in September 2005. In October 2007, the IMF Executive Board reviewed the role of the Fund in the PRS process and in its collaboration with donors.
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