Regional technical assistance centers have gradually evolved to play a major role in IMF technical assistance. These centers, which are largely donor financed, have become important vehicles for helping countries carry out economic reforms.
Their objective is to assist countries in designing and implementing their poverty reduction and broader developmental strategies and help countries integrate into the world economy.
For example, they help strengthen public financial management, and so improve governance and transparency, facilitating donors’ use of budget support instruments. They help improve tax and customs administration, providing an environment that is more conducive to investment and growth, increasing the resource envelope for poverty reducing spending and reducing the opportunities for corruption. At the same time, such reforms facilitate trade and enable countries to take better advantage of the forces of globalization.
Each center is staffed with resident advisors whose mix of expertise reflects the technical assistance needs of the group of countries they serve. The centers are close to the countries they serve and flexible in their delivery of services, making them well placed to handle reform implementation issues on a day-to-day basis.
Resident advisors at regional centers are able to develop deep knowledge of the circumstances and needs of the countries, including cross-cutting and regional issues, and provide intensive and constant follow-up on assistance delivered.
As beneficiary countries have phrased it: “They are just a phone call away” and will accompany the government all the way in implementing economic reforms, including overcoming practical obstacles by working through the nitty-gritty details and putting together the nuts and bolts.
Economies of scale
Regional centers can naturally exploit economies of scale. Neighboring countries typically have similar economic structures and assistance needs, and a regional approach enables more help to be delivered at lower cost. An added benefit is that regional centers can promote the sharing of reform experiences between countries, allowing officials to adopt tried and tested best practices while minimizing reform risks. Last but not least, they can be excellent vehicles to furthering regional harmonization and integration efforts of the beneficiary countries. Quite deliberately, the groupings of beneficiary countries of most regional centers mirror those of relevant regional organizations with whom the centers can work on coordination of economic policies and harmonization of standards, while integrating these into their work with country authorities.
Using the regional center as a vehicle for their regional integration efforts was the dominant motivation of the countries requesting help from our recently opened center for Central America, Panama, and the Dominican Republic. They had long realized that the region would fare better through deeper economic integration and collective insertion into the global economy. The center is set to support the countries’ push for integration, including, for example, their plans for a regional customs union, free trade agreements with other regions, and regional aspects of banking supervision and regulation.
One of the strongest features of the regional centers is their governance structure, which integrates all stakeholders. All regional centers are guided by steering committees comprising representatives from donors, beneficiary countries, and other international agencies. This helps promote aid coordination and ownership of reforms, in line with the objectives of the Paris Declaration on Aid Effectiveness. These steering committees provide strategic guidance for the centers’ work plans, through a consultative process that helps build shared ownership of the assistance delivered.
As my colleague Antoinette Sayeh confirmed in her recent post, countries like the regional centers because they are close and have an inclusive governance model. At their request, and given the positive feedback by all stakeholders, we are seeking to scale up the regional approach to technical assistance by expanding the scale of operations of many of the existing centers and by opening new centers: in addition to the new center for Central America that opened in 2009, further plans include a new center in Central Asia and two additional ones in Africa.
When complete, the 10 regional centers will cover 102 countries, including all of sub-Saharan Africa.
Filed under: Africa, Asia, concessional lending, Economic Crisis, International Monetary Fund, Latin America, Low-income countries | Tagged: budget support, Globalization, policy coordination, poverty reduction, regional integration, technical assistance |