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For over 70 countries producing a Poverty Reduction Strategy Paper (PRSP), approved by the World Bank and IMF, is either a condition for getting debt relief, or a condition for receiving concessional loans and some aid. This Panos report examines the progress made so far after 3 years of the Bank and IMFs Poverty Reduction Strategy (PRS) and looks at the arguments about whether it can succeed.

The report first gives an overview of the PRS process which finds that:

• Since their introduction, PRSPs have been widely welcomed as the first serious attempt by the international community to put poverty reduction at the centre of development planning
• They have also been criticised by some non-governmental organisations (NGOs) as being merely a new name for Structural Adjustment Policies (SAPs)

Positive outcome include

• Better dialogue between government and civil society organisations on priorities for government spending
• Increased government commitment in developing countries to poverty reduction generally and to agreed basic factors for helping people out of poverty – generally education, health and rural infrastructure.
• Increased transparency, in which government budgeting and expenditure can be scrutinised by parliaments and public.

However some PRSP critics charge that the whole approach is fundamentally flawed being based on the same premise as SAPs that economic growth is the first step towards reducing poverty and the report notew that even the World Bank and IMF, in their own review of PRSPs earlier this year, admitted that many countries have given little detail about how they expect to achieve the high growth rates needed.

The report is critical of the World Bank and IMF, and governments for not allowing debate and alternative views on these fundamental questions of economic policy. The participation in economic policy-making to which civil society is being invited in the PRSP process is strictly limited.

In order for PRSPs to succeed, the report stresses the need for a strong sense of commitment and “ownership” by governments and people and concludes that so far this sense of ownership is not very strong partly because countries have not paid enough attention to the potential role of the media in informing people and stimulating engagement.

The report draws on specially commissioned research from Lesotho, Ethiopia and Uganda.

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