News Brief No. 02/21

News Brief: IMF Executive Board Completes Reviews of Poverty Reduction Efforts in Poor Countries

March 15, 2002

On March 8, 2002, the Executive Board of the International Monetary Fund (IMF) completed a review of the Poverty Reduction Strategy Paper (PRSP) approach to the challenge of reducing poverty in low-income countries (see Public Information Notice No. 02/31). The World Bank's Executive Board completed its review of the PRSP on March 12, 2002.

The PRSP approach was adopted in concert with the World Bank in 1999 to help low-income countries and their development partners strengthen the impact of their common efforts on poverty reduction. The central message emerging from this review is that there is broad agreement among low-income countries, civil society organizations, and their development partners that the objectives of the PRSP approach remain valid and that the PRSP process can improve joint efforts aimed at poverty reduction.

The IMF Board also completed a parallel review of the Fund's concessional lending window for low-income countries, the Poverty Reduction and Growth Facility (PRGF) (see Public Information Notice No. 02/30). The PRGF was established in late 1999 to replace the Enhanced Structural Adjustment Facility (ESAF) as the Fund's main concessional lending instrument; PRGF-supported programs are to integrate the objectives of poverty reduction and growth more fully into their design and base it on the national poverty reductions strategies set out in PRSPs.

Launched in early August 2001, both reviews have been open and inclusive, drawing on contributions from developing countries, donor agencies, international organizations, and civil society organizations, as well as analyses by IMF and World Bank staff. The focus of the reviews has been on assessing progress to date and examining ways in which the development impact of these programs might be improved (see News Brief No. 01/69 and News Brief No. 01/70, August 3, 2001). Staff studies prepared for both reviews are posted on the IMF's internet site, http://www.imf.org/external/np/prgf/2002/list.htm.