Financial resources expected from development partners (grant or loan funding) have already been factored in the macro-fiscal framework used for working out spending limits and do not therefore constitute an additional source of funds available for spending.
-enhance and develop an analytical framework for each macroeconomic sector,including real, monetary, external (balance of payments), and fiscal;
- based on (ii), develop an analytical macro model to produce a macroeconomic
outlook;
-upgrade the computable general equilibrium model of the Indonesian economy, previously built in FPO to quantify economywide effects of introducing SJSN programs and improved labor market flexibility;
-work with the international macroeconomist to refine the budget model to assess the
macroeconomic risks affecting the budget;
-work with the social security policy specialist to develop pension models and
analyze the fiscal impact of social security reform
Obsessive-compulsive disorder: cost template
Depression: costing template
Tuberculosis: costing template
Hypertension - costing template
Bipolar disorder: costing template
Anaemia management in chronic kidney disease: costing template
Familial breast cancer: costing template
Urinary incontinence: costing template
Dementia: costing template
Obesity: costing template
Heavy menstrual bleeding: costing template
Antenatal and postnatal mental health: costing template
Four commonly used methods to increase physical activity: costing template
Brief interventions and referral for smoking cessation: costing template
Prevention of sexually transmitted infections and under 18 conceptions: costing template
Conduct disorder in children - parent-training/education programmes: Costing template and report
Acutely ill patients in hospital: costing template
Head injury: costing template
Attention deficit hyperactivity disorder (ADHD): costing template
Prostate cancer: costing template
Asthma (uncontrolled)- omalizumab: Costing template
Psoriasis - infliximab: Costing template
Head injury: costing template
Stroke: costing template
Irritable bowel syndrome: costing template
Urinary tract infection in children: costing template
Economic growth has recently slowed across much of the world economy following stronger-than-expected performance during the first quarter of 2008. The net result is likely to be that on a year-over year basis, global real GDP growth for 2008 will be only slightly below the 3.8 percent forecast last April. For 2009, however, growth now looks likely to decelerate to slightly below 3.5 percent rather than accelerate to 4 percent.
Meanwhile, the broad upsurge in commodity prices of earlier this year has been largely if not completely reversed. In particular, the price for light sweet crude has fallen back from a peak of almost $150 per barrel to about $100 per barrel but is still above the $80 per barrel price of late 2007. Recent sharp declines in commodity prices will help to bring down headline inflation rates, at least for a while, although core inflation rates will likely remain uncomfortably high in a number of countries. In some emerging-market countries, where policies have remained lax, inflation will continue to be a critical problem.
Thus, looking to the rest of 2008 and to 2009, the world economy will experience mild stagflation. World real GDP growth (on the basis of the International Monetary Fund’s World Economic Outlook [WEO]) will be significantly below the 4¾ percent average annual rate achieved from 2004 through 2007 but meaningfully above the 2½ percent rate that marks the borderline of global recession.1 World consumer price inflation (measured on a 12-month basis) will fall below the recent high of over 6 percent but remain above 4 percent through 2009. Economic policies, therefore, will generally face the dual challenges of ensuring that inflation returns to acceptable rates within reasonable time horizons and of guarding against unnecessarily deep and prolonged slowdowns in output growth.
In essence, we are in heated agreement. Multi-year forward estimates/ceilings are useful -- call them what you will.
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IMF Survey online: What's your background and what attracted you to the Fund?
On where I come from: I crossed the ocean from France in 1973 to start a PhD in economics at the Massachusetts Institute of Technology (MIT). I intended to specialize in development but, soon after I arrived, I realized development economics, as a field, was barely alive, and the action was in macroeconomics.
I shifted, and wrote my thesis under Stan Fischer and Bob Solow. I have been working on macroeconomics ever since, at Harvard from 1977 to 1982, and at MIT since then. I still have very much of an interest in the macroeconomics of low-income countries, and I look forward to engaging with the issues faced by the low-income members of the IMF.
On why I came to the IMF: What has always turned me on most is to look at a complex set of facts, find a conceptual structure to make sense of it, write down a simple formal model which captures it, and then see where it takes me, policy implications and all.
I remember the thrill of going on trips with Rudi Dornbusch in the early 1980s, being exposed to an avalanche of facts, and then seeing Rudi make sense of it all, often demolishing received wisdom (and some of its high priests) in the process. I had the same thrill later, when looking at transition in Eastern Europe, or unemployment in Western Europe, or Chinese macroeconomic policy.
For somebody with my preferences, this job is, in many ways, a dream job. Think about how complex the current crisis is, and the challenge of making sense of it all. I am not sure I can. Indeed, I am not sure anybody can. But it is sure fun to try. And, maybe, in doing so, help make the world economy a better place.
The TA provided the Government with the general MTFF and MTEF models, together with detailed explanatory notes on the basic concepts and workings of the models. The Excel-based spreadsheet MTEF has also been converted into a database model (in Access software), which is a simpler, more standardized, and better tool for data management of large cumulative annual data. A strategy and manual for implementation of a government-wide MTEF was likewise submitted to the MOF.
The MTEF is an analytical tool that would assist the Government in budget preparation. The methodology used for developing MTEF has been the baseline/forward estimates approach. It means that as a first step, government expenditures are projected over the medium term (typically 3 years) on the basis of existing expenditure levels. The projection is adjusted for projected inflation and pay increases, projections of the numbers of beneficiaries of public services9 and commitments for future spending that have already been made by the Government.
As a second step, and at the start of a new budget preparation cycle, ministries and agencies can request the MOF for additional funding in order to reduce underfunding of existing policies or to fund new policies. Such requests have to be fully justified. If approved, the baseline/forward estimates are adjusted accordingly. The MTEF is a moving process: every year, the MTEF is rolled forward 1-year and reprioritized.
Indicative MTEFs for the education and health subsectors (that is, primary education and expansion of rural health infrastructure) were developed and presented to the Government. The basis of the MTEFs is the cost of implementing sector programs (at the subsector level) over the medium term according to existing government policies at existing service levels (i.e., the baseline). The MTEF and the procedures for updating and revising it are firmly anchored in the budget preparation process and the overall spending ceiling (derived from MTFF), which lays out the parameters for budget preparation….
TA 4627 also developed a budget preparation model that included a revised budget calendar, revised content of the budget circular, and new budget request templates.
More importantly, the TA provided useful advice on the revisions to the draft Budget Law, the draft Implementation Decree, the budget nomenclature system and chart of accounts, and budget preparation procedures...
The outputs generated by TA 4627 were effectively used to inform the Lao PDR’s fiscal planning and budget policies. Institutional measures were also recommended to ensure more effective capacity for managing the MTFF and MTEF. In particular, the TA continued capability development that includes appreciation and applied skills in basic macroeconomics (and basic economics in general) and in basic principles of public expenditure management. Similarly, the need for interagency coordination with respect to the macroeconomic framework was identified, and it was suggested that this could be developed through the establishment of a formal committee process.
Given the gains achieved by TA 4627, a follow-through TA amounting to $1.1 million funded under the Asian Development Bank’s TA Special Fund will be initiated in 2008 for a more extended implementation of the models developed under the TA across line
Overall Assessment and Rating: The TA was highly successful in providing the methodological foundation for the MTFF and MTEF aimed at strengthening LAO PDR's budget management processes, (and the subsequent adoption of the MTEF). This was viewed as a positive response to the weaknesses in expenditure planning. The flexibility in TA implementation enabled having the budget basics in place to facilitate future implementation of an MTEF as a basic tool for fiscal planning. TA’s efforts culminated in encapsulating MTEF in the Implementing Decree of the Budget Law, the legal framework for the strategic management of the Budget. The TA also contributed to the drafting of the associated implementing decree and the study of policy options to reform the fiscal transfers system.
Major Lessons: One of the key lessons learned in the implementation approach and progress in Lao regarding the introduction of MTEF is to be flexible and respond to government’s requirements during implementation. The pace of implementation of a project needs to take into account the institutional environment. In Lao PDR, the institutional environment mitigates against a rapid pace of project implementation. Basic skills building should ideally precede implementation of projects such as this one, and an assessment of existing institutions and their capacity is a crucial first step. In the absence of an experienced national fiscal management specialist, a full-time international consultant should be on site. To conclude, the potential for implementing planning and budgeting reforms is there, but the implementation process is likely to remain slow and must take into account progress in reforms in other elements of public finance management, institutional constraints and the need for basic skills development.
