Pity the Finance Minister: Issues in Managing a Substantial Scaling-Up of Aid Flows

Peter Heller

No 2005/180, IMF Working Papers from International Monetary Fund

Abstract: Substantially scaling up of aid flows will require development partners to address many issues, including the impact of higher aid flows on: the competitiveness of aid recipients; the management of fiscal and monetary policy; the delivery of public services; behavioral incentives; and the rate of growth of the economy. Other issues will include the appropriate sequencing of aid-financed investments; balancing alternative expenditure priorities; the implications for fiscal and budget sustainability; and exit strategies from donor funding. Donors will need to ensure greater long-term predictability and reduced short-term volatility of aid. The international financial institutions can play a critical role in helping countries address these scaling-up issues.

Keywords: WP; country authorities; expenditure program; recipient government; private sector; exchange rate; monetary policy; Foreign Aid; Fiscal Policy; Dutch Disease; Aid donors; recipient country; government program; financial support; Aid flows; Budget planning and preparation; Real exchange rates; Global (search for similar items in EconPapers)
Pages: 37
Date: 2005-09-01
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Citations: View citations in EconPapers (34)

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