Asian Development Bank to host OECD meeting, Manila, Philippines, 6 June 2011

The OECD Task Force on Public Financial Management is looking at ways to strengthen developing countries’ public financial management and their ability to receive and manage foreign aid.

Representatives from over 40 countries and international organisations around the world met to address one of the major barriers to economic growth in the developing world: inadequate public financial management systems. 

The international community recognises that a greater share of foreign assistance must flow through, and be managed by, the aid-receiving countries themselves. This is a necessary measure to increase the efficiency and effectiveness of foreign aid dollars.

“Strengthening Public Financial Management is critical to enhance governance and accountability, so that countries can achieve their goals of reducing poverty, accelerating economic growth, and providing better services to their citizens. The challenge for the international development community lies on supporting PFM systems not only to account for donor funds, which in many cases represent only a fraction of government budgets, but for overall public finances.” Anthony Hegarty, Chief Financial Officer, World Bank and co-Chair of the Task Force on Public Financial Management

This group represents developed and developing countries, leading aid and development agencies, civil society organisations, and parliamentarians. Its aim is to strengthen the capacity of developing countries to manage public finances, particularly foreign aid. Meetings such as this provide an opportunity for countries around the world to exchange information, share best practices, and review progress in utilising, assessing and strengthening their own public financial management systems. 

Recent statements by US President Barack Obama, UK Prime Minister David Cameron, and the G8 leaders signal a renewed focus on foreign assistance programmes. This gives the Task Force meeting in Manila heightened significance, as members expect to arrive at a consensus on how to strengthen existing partnerships for increased accountability, transparency, and effectiveness of developing nations’ public financial systems. 

This consensus, along with other recommendations produced during the meeting, will be presented as key inputs to the upcoming High Level Forum on Aid Effectiveness which will take place in November in Busan, Korea.  The Busan meeting is anticipated to be a watershed event in the international community’s increasingly interconnected work on aid and development.