The Ugandan PRSP Experience

Meeting with Rick Rowden, RESULTS, 31 May 2002

Co-author of New Strategies, Old Loan Conditions: Do the new IMF and WB loans support countries’ poverty reduction strategies? The Case of Uganda

I. Opening Comments: Rick Rowden

Uganda as flagship – first through PRSP, PRGF, PRSC
Any positives? New avenues for communication between government and civil society
Paper’s objective: To counter claims of IFIs about ownership and participation
Highlight: Ugandan CSOs outraged that structural adjustment conditions intact in WB‘s PRSC / IMF‘s PRGF
PRGF conditions contradict health goals of PRS:
- 4 assumptions limit design of Poverty Reduction Growth Facility:
  1. no analysis of impact of WTO negotiations on poverty goals
  2. that there has been implicit sanctioning of structural adjustment conditions by NGOs
  3. SA leads to higher growth
  4. Higher growth leads to poverty reduction

Under PRGF PER (Public Expenditure Review), IMF has convinced Ugandan MoF to oppose increased donor support to health sector for fear of ‘Dutch disease’ (inflationary pressure)…WHO Commission on Macroeconomics & Health, Jeffrey Sachs amongst those who say this is rubbish…In Kampala, 21 May, Catholic bishop reads Sachs’ letter opposing health cuts, response “electrifying”

Reaction to release of RESULTS paper:

At WB/IMF Spring meetings, Bank and Fund reps, John Page and Masood Ahmed, “not too happy about it”
In following weeks, emerged that…Ugandan Health officials happy that issues were raised…Finance officials divided between sympathetic/resistant…Positive government/CSO response to report finding that privatization without regulation is dangerous

In-country meeting with WB/IMF, (29 May 2002) DFID, UN agencies, NGOs, health and finance officials:

responses of IMF‘s Walter Mahler “quite shallow”
World Bank’s Robert Blake made reference to factual/technical errors but did not refute paper’s main thesis that structural adjustment is moving ahead

Other issues raised in paper:

Labor rights, privatization of agricultural services, transparency issues
21 other WB loans totaling over 1$bn with no scrutiny
Negative impacts of rapid trade liberalization in, for example, oil seed and grains (Uganda had joined with 7 other African countries to call for an assessment of the impact of existing trade reforms pre-Doha)
No institutional learning from SAPRIN, 5 year 7 country study (incl. Uganda), and internal reviews which pointed to negative impacts of structural adjustment lending

II. Selected Q&A

Q: Momentum behind PRSP?

RR: Ugandan Participatory Poverty Assessment Project (UPPAP) done by MoF, comprehensive, conflicted with World Bank household surveys

LH: UPPAP looked at how policies implemented in 27 key districts affected poor…PSIA, part of PRS research, looking at impact of expanding export initiative on poor ex-ante

JM: UPPAP looked more at what people felt about the move in/out of poverty, more qualitative info than the WB household survey

LH: Rosemary McGee (IDS) has said that UPPAP didn’t necessarily contradict household surveys, UPPAP captured specific dimensions of poverty showing that certain groups within the poor may have lost out

Q: Reaction to lack of trade integration impact assessment?

RR: Ugandan opposition MPs grilled MoF officials over failure to realize importance of WTO and impact of trade negotiations on attainment of poverty reduction goals…MoF officials replied that they knew full well the importance of the WTO

SK: PRGF doing some work on trade…some UK officials agree that Bank should be pushed further to consider trade impacts

AW: WB new Integrated Framework involves Diagnostic Trade Integration Studies but is WB appropriate agency to take the lead on this?

Q: Programme for the Modernization of Agriculture? (PMA)

RR: Finance Minister said that Musuveni concerned about PMA impact on small farmers especially in sensitive areas…this was added as an appendix to PMA…Danida and WB as a result insist there is too much intervention in PMA

Q: Disillusionment with HIPC?

RR: Not as much as PRSP…HIPC seen as a “mixed bag”, happy that some funds in Poverty Action Fund (PAF) turned to some substantive benefit…agreed that debt-sustainability ratios out of touch with reality as coffee prices bottom out

III. Discussion re strategizing

AW: Potential pressure points:

PSIA (Poverty and Social Impact Analysis) is pushed by Oxfam and DFID among others as a way to clarify impacts of lending/policy advice
Operational Directive mandating Bank staff how to manage structural adjustment (July meeting in London)
G7, WB/IMF Annual Meetings

BH: DFID feels WB not doing enough to institutionalize PSIA…what are NGOs doing to pressure Bank?

RR: Agree we should encourage institutionalization of PSIA…WB/IMF say they want to do it, but will eventually run into Finance Ministers of G7 and their industrial backers

JM: How are people selected to do PSIA?

BH: Ideal vision-government commissions, national research institutions…reality is that few governments have capacity

PSIA pilot studies commissioned by DFID-teams of international/national researchers…internationals chosen by DFID based on in-country knowledge (Ethiopia has asked DFID to support PSIA)

World Bank PSIA-consultants and members of Bank in-country…key is quality

AW: Institutionalizing PSIA…caution that this must be integral to, not additional to… need more listening in Bank and Fund conditionalities…what impact PSIA when Bank and Fund still have ‘right policies’ in Washington?

CM: Very doubtful of impact of more reports

BH: PSIA is new-explicit link between policy and poverty reduction… “we do think that this is leveraging change and we would hate to see NGOs let up”

RR: NGOs in Uganda calling for PSIA inclusion in PRSP

LH: WB due diligence commitments-in weak states, WB/IMF must take responsibility for poverty impacts of lending…but how to avoid box-ticking tokenism?

MR: Is DFID thinking in parallel of developing national research capacity?

BH: All pilots have specific component of capacity building.

FL: Example of analytical model to contradict WB‘s neoclassical assumptions is ISODEC‘s DEEP in Ghana…question of who conducts analysis and what are its assumptions

AW: Is PSIA a new analysis or accountability tool to justify decided-upon policy?…no appetite in Washington for new mandatory requirements…Bretton Woods Project is holding a meeting on July 2-on the SAP OD and PSIA, including how to push for PSIA institutionalization?

FC: Are poverty indicators in PSIA disaggregated? Traditional indicators de-emphasize the aged

BH: Reason for us to stress multi-disciplinary teams

AW: Did WB set end of May deadline for comments on PSIA Users’ Guide?

BH: Believe comments can be submitted anytime…DFID also accepting comments…possible to lobby for dedicated PSIA discussion-if there’s a poverty analysis Operating Policy then there’s a budget…Country Directors don’t have to pay attention to PSIA if there’s no budget