What has been the impact of PRSPs in Africa?

Most African countries have gone through two Poverty Reduction Strategy Papers (PRSPs) in order to receive foreign aid from Western donor agencies and international financial institutions. Most discussion of PRSPs have focused on the participatory nature of the process that produced these policy documents or whether their content is pro-poor enough. Little attention has been devoted to the impact of these strategies on policy implementation. What has been the impact of PRSPs on the implemented policy actions of African governments?

This is the question posed in an article published recently in Third World Quarterly (Vol. 31, No. 5, August 2010) by DIIS Project Senior Researcher Lindsay Whitfield. It is answered by drawing on the experience of Ghana.

The article shows that the PRSP agenda has had a limited impact in Ghana. PRSPs did increase the allocation of resources to social services. The existence of the PRSP and implementation of key policy actions agreed between donors and the NPP government were conditions for accessing debt relief. The PRSP also provided a rationale for the provision of general budget support. The introduction of general budget support increased the level of resources available to the Ministry of Finance, but it also introduced new joint government–donor processes and a new way of formulating conditions for the disbursement of aid monies. What the PRSP agenda did not do was strengthen the existing national policy-making processes, which were in disarray. Nor did the PRSP documents guide what was formulated and implemented at the ministry level. Thus, while the PRSP approach did have an impact, its effects were largely limited to restructuring the aid system and did little to move forward a strategy of long-term poverty reduction through economic transformation or rebuilding the public administration.

The political coalitions, organisational structures and productive sector policies needed to push forward an agenda of economic transformation do not come easily - as the global historical record shows. In Ghana the constraints posed by chronic macroeconomic instability, donor agendas leveraged through financing, pressure to win elections, the internal dynamics of the ruling party, weaknesses of the public administration, and lack of collaboration between the state and industry appear formidable. This is not a determinist or path-dependency argument. Although the state elite faces great incentives to maintain the status quo and disincentives to change, there is cause for optimism. Most of these constraints are internally generated and thus the possibility of change from within exists. However, it is clear that the PRSP approach has not helped to ameliorate these constraints and has sometimes exacerbated them.

The article is based on research carried out under the Elites, Production and Poverty collaborative research program (2008-2011) based at DIIS. An earlier version of the article was published as DIIS Working Paper 2009-15.