News Brief: IMF Welcomes Senegal's Poverty Reduction Strategy Paper
December 19, 2002
The Executive Board of the International Monetary Fund (IMF) today welcomed Senegal's Poverty Reduction Strategy Paper (PRSP). Senegal's most recent PRGF-arrangement was approved in April 1998 (see Press Release No. 98/15) under the former Enhanced Structural Adjustment Facility (ESAF). The last disbursement under Senegal's expired PRGF arrangement was made on April 5, 2002 (see News Brief No. 02/28).
The Poverty Reduction and Growth Facility (PRGF) is the IMF's concessional facility for low income countries. PRGF-supported programs are expected to be based on country-owned poverty reduction strategies adopted in a participatory process involving civil society and development partners and articulated in a Poverty Reduction Strategy Paper (PRSP). This approach is intended to ensure that PRGF-supported programs are consistent with a comprehensive framework for macroeconomic, structural, and social policies geared to fostering growth and reducing poverty.
In commenting on the Board's discussion on Senegal's PRSP, Eduardo Aninat, Deputy Managing Director and Acting Chair, stated:
"Senegal's Poverty Reduction Strategy Paper has been prepared with broad public participation. It constitutes a sound basis for the country's fight against poverty and for concessional financing from the IMF.
"The PRSP is consistently organized around themes of wealth creation, human development, and macroeconomic stability, and sets out the authorities' plans for implementation. The priority actions and measures proposed address the main issues facing the various sectors, and adequate emphasis is given to improving public expenditure management. The PRSP sets clearly-defined goals for poverty reduction in the medium to long run in the areas of education, health, nutrition, access to drinking water, gender-related income disparities, and rural/urban income disparities. These, along with indicators of economic growth will facilitate monitoring of the implementation of the poverty reduction strategy.
"A number of elements of the PRSP require more elaboration, however. A major challenge will be to agree upon and to implement the detailed steps of the strategy, with particular focus on the impact on the well-being of the poor. The poverty reduction strategy also needs to be embedded into a credible and realistic macroeconomic framework to enhance the confidence of investors. Particular care should be taken to base the strategy on realistic expectations with regard to private investment and the public administration's absorptive capacity. These issues ought to be addressed in the first annual progress report on the implementation of the poverty reduction strategy," Mr. Aninat said.