Public Investment Management Bottlenecks in Low-income Countries

Khaled Eltokhy, Nicoletta Feruglio, Kezhou Miao, Arturo Navarro and Eivind Tandberg

No 2024/232, IMF Working Papers from International Monetary Fund

Abstract: This paper uses principal component analysis (PCA) to identify bottlenecks to effective public investment management in LIDCs. The paper describes the current state of affairs regarding public investment and public investment management in LIDCs, drawing on the results of IMF Public Investment Management Assessments (PIMAs). PCA is used to analyze which public investment institutions are likely to be most important for investment efficiency estimates across the countries covered by PIMAs so far. Drawing on alternative input data, we identify five PIMA institutions that are systematically highly correlated to estimates of public investment efficiency in LIDCs and are likely to be high priorities in many PIM reform processes: Project management, Project appraisal, Procurement, Availability of funding, and Project selection. This does not mean that these five are the only important institutions – this will depend on country circumstances. The practical steps to strengthen PIM in LIDCs are elaborated in a separate How-to-Note.

Keywords: Public Financial Management; Low Income countries; Public Investment Management; Public Investment Management Assessment; Public Investment Efficiency; priority Pima institution; efficiency frontier; management in LIDCs; IMF Public Investment Management Assessments; investment efficiency; Public Investment Management Assessment (PIMA); Public investment spending; Post-clearance customs audit; Infrastructure; West Africa; Global (search for similar items in EconPapers)
Pages: 31
Date: 2024-11-01
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