By Judith Ugwumadu | 15 April 2014
Public financial management efforts in Lebanon are to receive another boost after the World Bank agreed to provide a $5.2m loan to improve transparency and spending efficiency.
The funds will also be used to strengthen the capacity of Lebanon’s Ministry of Finance in fiscal policy analysis and debt management. Lebanon’s central bank and its Courts of Accounts will also benefit.
The loan finances Lebanon’s Second Financial Management Reform Project, which builds on an ongoing bank-supported operation that helping develop a comprehensive reform strategy at the Ministry of Finance over a five-year period (2013-17).
‘High levels of debt, large fiscal deficits, and lack of fiscal space for public investments are major constraints to Lebanon’s economic growth,’ said Ferid Belhaj, director of the World Bank’s Mashreq department.
‘The Ministry of Finance has embarked on many notable structural reforms including public financial management. The reform agenda is supported by several donors and activities are being coordinated to optimise synergies and to take full advantage of all partners’ added values and areas of specific expertise.’
Reform will be introduced to a number of line ministries in the areas of budget preparation, commitment controls and liquidation procedures. Procurement-related reforms would be led by Lebanon’s Central Tender Board and the Institute of Finance will manage training implementation.
Joey Ghaleb, a senior public sector specialist at the World Bank, said the project would adopt a bottom-up approach, allowing civil servants to provide sound technical input to decision -makers and thus improving policy making.
‘A strong emphasis will be placed on building the capacity of relevant staff to lay the groundwork for much needed structural reforms in public financial management which will materialise when the legislative and executive gridlocks are removed.’
In February, the European Union launched a 28-month €2.8m ‘twinning' project to improve PFM in the small Middle Eastern country. Specific aims focused on improving revenue forecasting, budget preparation and internal controls.
