By Stefan Koeberle, Jan Walliser, Zoran Stavreski

Price range aid has develop into an more and more very important software within the context of a partnership-based method of improvement tips. in comparison to conventional modes of reduction supply, it offers larger state possession, lowered transaction bills, larger donor coordination, scaling up of poverty relief and probably better improvement effectiveness. This booklet provides a well timed and helpful assessment of key thoughts, matters, reports and rising classes appropriate to funds help. It presents an summary of crucial features, expectancies and issues concerning price range help, key layout and implementation concerns, in addition to a few functional reviews. The members contain govt representatives from constructing international locations, best educational students, bilateral improvement businesses and improvement practitioners from overseas monetary associations, together with the realm financial institution and the overseas financial Fund. They current a variety of perspectives on key concerns corresponding to the alternative of tools, alignment of price range aid with nation courses, predictability, and coordination and conditionality. The authors draw their insightful research at the modern examine and evaluate paintings, in addition to the large useful adventure with funds aid. This e-book can be of significant curiosity to practitioners in aid-recipient nations and foreign monetary associations, bilateral organisations and civil organisations occupied with funds aid.

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Additional info for Budget Support as More Effective Aid?: Recent Experiences and Emerging Lessons

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Budget support involves the channeling of donor funds to a partner country using its own budget system, in support of the country’s own development programs linked to national or sector policies. The value added of budget support consists in the combination of an increase in the volume of discretionary funding that can be used for development purposes with a policy dialogue linked to the effective implementation of the recipient’s broader development strategy. In principle, there is no need to earmark funds for specific budget expenditures.

Disillusion with traditional conditionality has given way to an emphasis on the need to strengthen the mutual accountability between donors, and recipients achieve greater predictability of funding, harmonize donor support, and reduce transaction costs for recipient countries. 1 • Greater emphasis on country ownership, systems, and capacity. 2 By departing from a narrow project intervention that is often based on physical impacts in a geographically confined area, the budget support approach recognizes the critical importance and benefits of countrywide and sectorwide development perspectives that are based on country-specific policy programs and institutions.

18 Outcome Orientation Budget support is conducive to a results-based approach. Its effectiveness needs to be measured in terms of budget outputs (more predictable budget financing, more efficient public spending, stronger budget process, stronger intragovernment relations and accountability), and outcomes (enhanced capacity for poverty reduction, environment conducive to private sector development and growth, better delivery of public services) relative to government policy objectives. While donors and governments generally recognize the virtues of a results-based approach, its implementation faces significant challenges.

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