Global Donor Platform for Rural Development

Sharpening the Rural Focus of Poverty Reduction Strategies: Context, Lessons and Way Forward
Synthesis Report

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TABLE OF CONTENTS
Preface Acknowledgements 02 03

List of Acronyms

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Executive Summary I. PART ONE: Agriculture for development threats, opportunities A. From benign neglect to renewed attention B. Climate change and global markets: External shocks, internal responses PART TWO: Rural aspects of poverty reduction and national development strategies A. Overview B. Understanding rural poverty C. Role of the state and the challenge of accountability D. Giving a voice to the rural poor E. PRS monitoring F. The challenge of integration: Tensions and trade-offs G. Asserting partners commitment H. Aligning resources with priorities: Ownership, incentives and capacity I. Good practices for PRS rural focus PART THREE: Agriculture and aid effectiveness A. The specificity of the rural productive sector and its implications B. Customising the Paris Declaration and the Accra Agenda for Action PART FOUR: Rural focus of poverty reduction strategies the way forward A. Scaling up and the political economy of PRS B. Key action areas for follow-up

05 09 09 10 12 12 15 16 18 22 22 23 24 27 28 28 29 34 34 35

II.

III.

IV.

CONTENTS

Selected References

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Global Donor Platform studies are joint analyses of its members designed to close identified information gaps and provide a global public good. Platform studies shall inform and guide policy makers and practitioners in the delivery of assistance in agriculture and rural development. As such, Platform publications are not copyright protected. The Platform encourages duplication of its materials for non-commercial purposes. Proper citation is requested at all times. Permission to make digital or hard copies of part or all of this work is hereby granted without fee and without a formal request provided that copies are not made or distributed for profit or commercial advantages and that copies bear this notice and full citation on the first page. Information not owned by the Platform must be honoured and permission pursued with the owner of the information.

Appendices Appendix 1: Origin of the review, its scope and analytical framework Appendix 2: Assessment of rural focus of PRS processes planning, implementation and evaluation synopsis of case studies in Bolivia, Cambodia, Ethiopia, Mozambique and Burkina Faso 46

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Boxes Box 1: Box 2: Box 3: Box 4: Box 5: Box 6: Box 7: Box 8: Box 9: Box 10: Box 11: Box 12: Box 13: Box 14: Box 15: Agriculture and environmental sustainability: Challenges, messages Mozambique: The challenge of balancing accountabilities Poverty traps in Ethiopia Ethiopia eliciting peoples views on poverty and services Poverty reduction strategy papers a participatory breakthrough? The dimensions of participation: Framing questions Budget allocation and actual expenditures on agriculture in Africa Linking PRS with the budget Customising the Paris Declaration for the rural productive sector: Tentative framing questions Key messages on agriculture for development PSIA and controversial rural sector reforms Aligning sector programmes with PRSP Strengthening capacities of farmer organisations for policy monitoring in West Africa Building consensus for land redistribution in Cambodia M&E aspects of PRS implementation at sector and local levels 09 14 15 19 20 21 25 26 30 34 36 37 39 40 43

Graphs Graph 1: Graph 2: Graph 3: Graph 4: Graph 5: Graph 6: Agricultural growth and poverty reduction Rural poverty and ODA to agriculture Climate change, agriculture and growth Subsidies and public investments in India Rural poverty and agricultural production in Latin America and the Caribbean (1990 2005) Budget allocation to agriculture and contribution of agriculture to GDP in Africa (2002 2004 average) 09 10 11 17 17 24

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CONTENTS
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PREFACE
As part of the new aid architecture, Poverty Reduction and National Development Strategies (PRS/NDSs) provide the agreed framework through which to pursue the MDG targets. As the majority of the poor in most developing countries live in rural areas, agricultural development for growth, poverty reduction and environmental stewardship deserves special attention in the PRS and related budget processes at national and sector levels. Previous assessments of the rural dimensions of Poverty Reduction Strategies (PRSs) have brought to light a number of weaknesses in process and content. Several gaps and disconnections have been identified, from poverty assessments to priority setting, and from resource allocation to actual implementation and impact on the ground. With IFAD as the lead agency for a collaborative assessment under the aegis of the Global Donor Platform for Rural Development, this synthesis report examines the root causes of the PRS rural deficiencies, and provides an overview of findings from selected country case studies on the rural productive focus of the PRS process in Africa, Asia and Latin America. The report also incorporates lessons from other relevant country experiences, as well as examples of good practice. Finally, in the context of the debate on the specificities of the agriculture sector and implications on aid effectiveness, the report suggests a number of ways to sharpen the rural productive focus of PRSs. The financial, technical and other contributions from partners and specialised institutions, including feedback from country consultations, inputs and/or peer review of draft reports, are much appreciated (see acknowledgements). The diversity of funding sources for individual studies and the interaction among partners during and after the reviews have provided valuable insights into challenges associated with the implementation of joint activities under the alignment and harmonisation agenda. Findings and messages from this review do not constitute a formal position statement of the Platform or its individual member institutions. The review is intended as a knowledge product, to inform the judgement of decision makers and development practitioners at country level and in the international policy arena. Its lessons and messages remain valid in the context of recent external shocks such as climate change and soaring food prices which call for comprehensive local and international responses.

PREFACE

Christoph Kohlmeyer, BMZ, Chair Global Donor Platform for Rural Development

B. Baldwin, IFAD, Vice-Chair Global Donor Platform for Rural Development

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ACKNOWLEDGEMENTS
The country case studies and the synthesis review on the rural focus of PRS were carried out as collaborative products under the aegis of the Global Donor Platform for Rural Development (the Platform), with IFAD as the lead agency. The principal author of this synthesis report is Cheikh M. Sourang, Senior Programme Manager, IFAD. As overall coordinator of the reviews, C.M. Sourang arranged for the original submission of the study proposal and related consultations and supervised the country case studies. He also drafted the synthesis report with substantive input from ODIs Steve Wiggins, taking into account contributions from case study team leaders and IFAD colleagues including country portfolio managers. The synthesis report was finalised in light of comments received on the draft. As IFAD focal point for the Platform and Chair of the Platform Steering Committee, Brian Baldwin advised on funding arrangements and interactions with the Platform Secretariat and Steering Committee, and commented on the original proposal. Contributions from other IFAD colleagues are also much appreciated, including K. Cleaver for his continuing support and guidance, E. Farmosi, F. Papitto and A. Montes for their assistance with administrative and budgetary matters and formatting, and S. Oystese for inputs at the design stage. For each of the five country case studies, a lead technical agency and a team leader were designated. More specifically: a: ODI collaborated with FES/ILDIS for the Bolivia study by S. Wiggins and C. Toranzo, with funding from IFAD; b: IFPRI led the Burkina Faso study by T. Ngaido and A. Ndiaye with funding from Finland through IFAD, in cooperation with GTZ; c: ODI was contracted by IFAD for the Cambodia study by D. Shields and M. Hobley; d: Noragric, with funding from Norway through NORAD, carried out the Ethiopia study by F. H. Johnsen, and A. Waktola in collaboration with E. Ludi from ODI; and e: An IFAD consultant from Bayreuth University, E. Macamo, carried out the Mozambique study with ODI comments. ODIs engagement with IFAD started at the design stage with inputs from A. Shepherd and L. Cabral to the study proposals and continued through preparation of the synthesis report to which S. Wiggins contributed. GTZs strategic partnership with IFAD throughout the review process has been very valuable, involving staff from headquarters and country offices (M. von Eckert, M. Tertsunen, A. Bahm and H. Janus). Substantive comments on the synthesis report were received from various partners including the World Bank (Q. Wodon and G. Feder on selected country studies; J. Anderson and G. Feder on the synthesis report, on request from M. Cackler and his ARD colleagues, N. Khouri and S. Thapa), the European Union (M. Bielder), the Austrian Development Agency (W. Rabitsch) and the Netherlands (F. van der Wal). C. Langenkamp and D. Gerecke from the Platform Secretariat arranged for feedback from the Platform Steering Committee on the study proposal and subsequent feedback on the draft synthesis from the Steering Committee and Platform member institutions, as well as report editing and graphic design for the final publication.

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ACKNOWLEDGEMENTS
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LIST OF ACRONYMS
AAA AGRA ARD AU CAADP CLSP Accra Agenda for Action Alliance for a Green Revolution in Africa Agriculture and Rural Development African Union Comprehensive Africa Agriculture Development Programme Cadre Stratgique de Lutte contre la Pauvret / Strategic Framework for Combating Poverty (Burkina Faso) German Technical Cooperation International Fund for Agricultural Development International Monetary Fund Monitoring and Evaluation Millennium Development Goals Medium-term Expenditure Framework National Development Strategy Non-Governmental Organisation National Strategic Development Plan (Cambodia) Official Development Assistance Overseas Development Institute Organisation for Economic Co-operation and Development Action Plan for the Reduction of Absolute Poverty (Mozambique) National Agricultural Development Programme (Mozambique) Plan for Accelerated and Sustained Development to End Poverty (Ethiopia) Programme-Based Approach National Development Programme (Bolivia) Project Implementation Unit Poverty Reduction Strategy Rural Producer Organisations Sector-Wide Approaches United Nations United Nations Economic Commission for Africa United Nations Development Group The World Bank World Development Report

ACRONYMS

GTZ IFAD IMF M&E MDG MTEF NDS NGO NSDP ODA ODI OECD PARPA PROAGRI PASDEP PBA PND PIU PRS RPO SWAp UN UN/ECA UNDG WB WDR

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EXECUTIVE SUMMARY
1. Amidst growing concerns about the relatively modest progress made towards the Millennium Development Goals (MDGs) in many parts of the developing world, it is clear that increased support for the rural productive sector is needed. This renewed attention to agriculture reflects the fact that the majority of the poor live in rural areas, and that there is substantial evidence of the tremendous potential that agriculture has for food security and income generation, poverty reduction, correction of gender imbalances, and environmental stewardship. 2. Global threats and external shocks related to climate change and commodity markets call for comprehensive local responses. The unprecedented scope and pace of soaring food and energy prices in 2007/2008 is creating tensions and calls for trade-offs: hard policy choices are facing both donors and partner countries, in pursuit of food, energy and income security, without prejudice to the environment. Proposed response measures include budget support to help countries with the additional burden of subsidies or foregone tax revenues, while the establishment of several new trust funds at various levels is under consideration. While there is a strong case for turning the socio-economic crisis due to high food prices into a unique opportunity to boost agricultural production, preliminary indications from the field point to the risk that higher food prices may not necessarily translate into higher farm-gate prices and improved income for the rural poor. Likewise, recent field assessment missions have confirmed that the inflationary trends associated with high food prices may negatively impact on the quality of service delivery. 3. For the sake of sustainability, short- and medium-term measures in response to soaring food prices and related funding mechanisms need to be considered in the context of Poverty Reduction and National Development Strategies (PRS/NDSs) and associated country-led processes at national and sector levels. While these are meant to provide a mutual accountability framework through which country stakeholders and external partners could pursue the MDG targets, past experience has shown that, for many reasons, the rural focus of PRS/NDSs have tended to be weak. 4. Root causes of these gaps and disconnections in the PRS rural focus have to do with a range of context-specific, as well as generic, factors, including: Quality of analytical underpinnings; Purpose and methods of promoting participation of the rural poor; Political economy of rents and subsidies in the rural productive sector; Role of the state, the feasibility of engagement with the private sector and civil society, and the scope and modalities of related partnerships; Institutional fragmentation of government departments dealing with rural sector issues; Challenge of integrating decentralisation policies with evolving strategic and planning frameworks at national and sector levels; Recurrent issues of ownership, capacity and incentives which affect governments ability to perform their coordination functions and to manage the process of budgeting and public finance; Development partners compliance with the country alignment and harmonisation agenda striking a balance between best international practice in response to the Paris Declaration on Aid Effectiveness on the one hand, and a good national fit, in line with specific country realities and constraints to alignment and harmonisation on the other; and Deficiencies in monitoring and evaluation systems at national and project levels.

EXECUTIVE SUMMARY
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5. Past experience with the first and second generation of Growth and Poverty Reduction Strategies has brought to light a number of good practices, which provide helpful starting points for addressing some of the challenges listed above. These include:

EXECUTIVE SUMMARY
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a: Planning, budgeting and strategy formulation Integrating different planning frameworks into one consolidated document which combines the PRS (previously intended for about 70 of the poorest countries to mobilise concessional financing), the national development plan (for all countries to prioritise domestic resource mobilisation and allocation), and the MDG investment plan; Identifying and making operational the minimal interface between the PRS/NDS and the existing or planned sector strategies (agriculture, rural development, fisheries, environment, etc), decentralisation policies and the related budget processes. b: Policy dialogue, advocacy and capacity building Promoting champions and catalysts (for example, through country-level thematic groups) to sharpen the rural focus of country-led processes; Evidence-based policy dialogue and advocacy work informed by participatory poverty assessments, public expenditure reviews (PERs), and poverty and social impact analysis (PSIA) or other forms of distributional analysis; Supporting representative rural producer organisations. In response to high food prices, and depending on the issue at hand (access to productive assets, inputs, technology or markets, for example), consultations with rural stakeholders would involve representative organisations of natural resource users, rural producer organisations and members or clients of rural finance institutions, with the aim of making a meaningful contribution to the identification of priorities for public action, and the resource allocation process; Strengthening the capacity of rural sector ministries to engage in PRS processes and promoting inter-ministerial coordination; Mainstreaming rural issues in PRS-related debates involving country-level stakeholders and partners such as parliaments, NGOs, the private sector, donor thematic groups, and research and academic institutions; Customised feedback mechanisms tailored to the concerns of country stakeholders including poor rural communities, civil society, the private sector, parliamentarians and donors. c: Innovation and learning Targeted case studies to document successful approaches (such as on rural service delivery) and analytical work (such as on livelihoods pathways); Disseminating success stories in rural poverty reduction to support advocates and convince the sceptics; Piloting innovative interventions for prospective replication and scaling up in the context of harmonised approaches. Some of the promising schemes relate to weather insurance, commodity exchange, biofuel development (with due consideration of issues of land allocation and food security), leasehold forestry, organic farming, microfinance and remittances. d: Monitoring and evaluation Internalising rural benchmarks and indicators in PRS/NDS monitoring; Early tracking of impacts on the ground to test validity of national monitoring systems and inform decisions on resource allocation; Customised country monitoring of aid effectiveness. 6. The principles of partnership and related targets and indicators set out in the Paris Declaration are not sector specific. However, the agricultural sector has particular characteristics that challenge the application of the Paris Declaration commitments. The strong role of the private sector in agriculture is a case in point. The sector is very heterogeneous and diverse with a wide range of stakeholders involved. The limited role of the state is often not well-defined or there is a lack of consensus about it. Sector specificities and challenges, like the need to include farmers and their organisations in planning, implementation and monitoring of sector development, should be central to implementing the Paris Declaration principles. Planning for results and mutual accountability needs to move beyond the government-to-government relationship.

8. The Bretton Woods Institutions and OECD countries have made significant coordination efforts to respond to the Paris Declaration by adopting Joint Assistance Strategies and programme-based or sector-wide approaches. They have made arrangements for delegated cooperation or empowerment of lead agencies to promote country-level dialogue with country stakeholders on thematic issues of common interest. A new UN model of engagement in country-led processes is also under consideration by the UN Development Group, involving a change in culture and perceptions. This also confirms the potential for the UN system to reposition itself in the context of the new aid architecture, including support for improved agricultural performance as a condition for achieving the MDG targets on poverty and hunger. 9. With an eye on the MDG targets, there is growing consensus on what should be done in an ideal world, in terms of policies, institutions and investments, to empower the rural poor to control productive natural assets, and to gain access to technology, infrastructure and services. Innovative approaches have shown that it is possible for rural producer organisations to respond to market signals against a backdrop of liberalisation, decentralisation and globalisation; and for poor men and women to manage risks and vulnerability associated with markets and environmental threats. The WDR 2008 is a powerful amplifier of related messages which need, however, to be customised at country level. 10. A major challenge is to define the ways and means of scaling up the most promising experiments and to build on indigenous knowledge. To achieve large-scale impact there is a need to identify champions and catalysts and to create space to grow. A PRS or NDS and related budget and sector processes will probably remain the agreed framework through which the government and its development partners can best create the required space for replication and scaling up. 11. Consequently, the PRS/NDS and related expenditure frameworks and budget processes at sector level can provide a tremendous opportunity for: Mobilising the appropriate champions; Opening a fiscal space for financing a scaled-up intervention; Securing the necessary political commitments; Resolving the supply and demand sides of the resources-for-results equation, such as for large-scale adoption of new crop varieties, inputs or technologies; Addressing capacity-building issues; Integrating cultural considerations; and Building the required partnerships.

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EXECUTIVE SUMMARY
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7. It remains an open question whether the specificities of agricultural development in particular, and the rural productive sector in general, make it relatively more difficult to comply with the aid effectiveness agenda. Is it easier for the state to plan and deliver infrastructure and services for human capital development (health and education), than to support improved agricultural productivity as a source of food, feed and fuel? How far do sector-specific challenges relate to value chain linkages, livelihoods diversification, risk mitigation and vulnerability management? Does this all point to a need to further customising the targets of the aid effectiveness agenda in recognition of the fact that sector specificities may affect the pace and scope of compliance at country level with the internationally agreed targets?

12. As part of a roadmap for follow up, such good practices can provide the starting point for a more systematic approach for sharpening the rural focus of PRSs, which in turn will build on previous assessments and recommendations by multilateral and bilateral partners to promote growth and poverty reduction in rural areas. Such an approach would revolve around an agenda for research and action along the lines of the six key action areas listed below:

EXECUTIVE SUMMARY
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a: Strengthening analytical underpinnings as a basis for evidence-based policy dialogue and related partnerships: sector expenditure reviews, participatory poverty assessments and distributional analysis, combined with focused analytical work on selected thematic or sector issues such as sources of growth and poverty reduction, climate change and agriculture, food and energy markets would aim at filling knowledge gaps, and informing public policy choice. Project-level good practices and related local policy gains can also be a credible source of evidence to inform policy processes at sector or national level. In terms of knowledge management and innovation, the findings and messages from knowledge products should feed into relevant learning loops, including good practices for public sector priority setting, grassroots initiatives, and publicprivate partnerships. The contextspecific nature of some of these issues will require continuing country-level investigation to illustrate successes and failure, identifying good practices and the conditions needed for replication, and provide the basis for a more focused support to specific country-level processes from development partners. b: Integrated approach to PRS implementation at sector level: there is a need to pay special attention to linking national planning frameworks with agriculture and rural sector strategies and programmes, including PBAs/SWAps or multi-sector approaches to territorial development in the context of decentralisation policies. Likewise, the criteria for defining national components of a regional initiative should reflect considerations of coordination, coherence, complementarities and subsidiarity with regard to country-led processes. c: Institutionalising rural participation: it is essential to give a voice to the rural poor and their organisations in PRS/NDS processes; this includes their participation in the formulation of strategies, prioritisation, influence in resource allocation and monitoring of implementation. An exciting challenge associated with this new situation in many countries will be the use of ongoing or forthcoming PRS and related sector processes as a mutual accountability framework, not only between government and donors but also involving the rural poor and their organisations. This will present the opportunity for a participatory and informed debate on the likely winners and losers from proposed policy measures in response to soaring food prices. d: Identifying and making operational the interface between PRS and regional initiatives (such as the CAADP process in Africa or the Greater Mekong River Basin Initiative in Asia) as well as processes related to intergovernmental negotiations on trade and environment. e: Support to PRS sector monitoring and evaluation as a management tool and an instrument for impact assessment. Linking sector monitoring with national- and project-level results and impact assessment systems will provide the basis for a results-oriented PRS implementation. Arrangements for early tracking of results on the ground are overdue in most countries. This could ultimately affect a credible measure of progress towards the MDGs, the availability of evidence for timely policy change and the redeployment or increased allocation of resources for agriculture. f: Building national capacities as a crosscutting activity targeted at government services, as well as the poor, rural women and men and their organisations relative to the five action areas above with the aim of facilitating replication and scaling up of successful interventions towards agreed MDGs targets. There is a need to build up domestic capacities: for government services to generate, maintain and disseminate institutional memories of analytical work; for specialised institutions to undertake research, grounded on actual field experience, and to explore institutional, financial and policy implications of applying traditional knowledge and replicating and scaling up innovative approaches and project-level policy gains; and for the poor, rural women and men and their organisations to engage in documenting their own livelihoods trajectories and articulating their own vision, targets and expectations.

I. PART ONE:
AGRICULTURE FOR DEVELOPMENT THREATS, OPPORTUNITIES

A. From benign neglect to renewed attention

1. There is renewed interest in agriculture as an engine for growth and poverty reduction (see Graph 1) as well as a means of environmental stewardship (see Box 1). This is based on the realisation that: the vast majority of the poor live in rural areas; agricultural growth has more impact on rural poverty reduction than other sectors; the Millennium Development Goals on hunger and poverty reduction cannot be met unless sufficient emphasis is placed on agricultural development; and agriculture is not only part of the environmental problem, but also part of the solution. Graph 1: Agricultural growth and poverty reduction

Expenditure gains induced by 1% GDP growth in ag. and non-ag.

5 4 3 2 1 0 Poorest 30% Middle 40% Agriculture Non-agriculture Source: World Bank, 2007 Richest 30%

Expenditure gains (%)

GDP growth from agriculture benefits the poorest most

Box 1: Agriculture and environmental sustainability: challenges, messages

Major challenges and uncertainties on the environmental side

> Growing land and water scarcity Agriculture uses 85% of water with growing competition from non-agricultural users > Resource degradation and pollution Land degradation, agricultural chemicals

Message
Reducing agricultures large environmental footprint is an inevitable requirement for success, and providing environmental services one of the contributions of agriculture to development Source: World Bank, 2007

PART ONE
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If we are to meet the challenges associated with the multiple functions of agriculture, a significant amount of resources will need to be devoted to agricultural development. In contrast to the past trends of declining ODA and a dwindling share devoted to agriculture in ODA, a win-win approach to resource allocation between sectors is required. Recognising the positive impact of roads, education and health on the rural productive sector, there is a need for a multi-sector approach to MDG targets, in step with the progressive build up of national capacities. Graph 2: Rural poverty and ODA to agriculture

100 % poor in rural areas % poor in rural areas 80 60 40 20 0 1990 1995 2000 2004 % ODA to ag.

14 12 10 8 6 4 2 0 % ODA to agriculture

PART ONE

Source: World Bank, 2007 2. The MDGs provide the long-term planning context for the mobilisation and allocation of domestic and external resources to combat poverty. Poverty Reduction and National Development Strategies (PRS/NDS) are the agreed medium-term strategic frameworks linked to relevant budget processes through which to pursue the MDG long-term targets. Issues of ownership, capacity, and incentives persist at various levels. This all adds up to a daunting challenge for governments to set priorities for public action to stimulate the rural productive sector as an essentially private sector domain.

B.Climate change and global markets: external shocks, internal responses

3. The global threats and external shocks relative to climate change and commodity markets call for comprehensive local responses. The unprecedented range and pace of soaring food and energy prices in 2007/2008 has created tension and calls for trade-offs: hard policy choices are facing both donors and partner countries, in pursuit of food, energy and income security, without prejudice to environmental sustainability. 4. The changing patterns of consumption associated with improved living standards in large, fast developing countries like China and India, together with a shift to biofuels production to mitigate climate change in industrialised, food-exporting countries, have resulted in higher prices and dwindling stocks, exacerbated by drought, floods and, more recently, speculative moves on commodities markets. Consequently, many governments in Africa and the Middle East, Asia and Latin America and the Caribbean including those visited during this study have recently cut taxes on food imports, banned cereal exports, and subsidised food items in anticipation of, or in response to, food riots. Yet, most of these countries in particular the poorest cannot afford such measures in the medium term. 5. The soaring prices of food, feed and fuel exacerbate tensions in policy dialogue, as developing country governments struggle with issues of resource mobilisation, coordination capacity, social inclusiveness and empowerment of the rural poor as agents of change. External partners themselves still need to confront their own domestic constituencies on policy issues related to the removal of agricultural and biofuel subsidies. These subsidies distort markets and, in a way,

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defeat some of the development objectives, including creation of income opportunities and livelihood diversification for the rural poor, managing international migration and related risks, promoting international growth and fair trade, and reducing inequalities. In terms of harmonisation and alignment, the challenge for governments and donors alike will be to deal with short-term responses providing emergency food assistance or inputs including seeds and fertilisers for the next cropping season without prejudice to the need for coherence and sustainability of proposed policy measures. Graph 3: Climate change, agriculture and growth

Real GDP growth (%)

15 10 5
1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993

Real GDP growth (%)

0 -5 -10

Variability in rainfall (Meter)

3 2 1 0 -1 -2 -3 -4

Ethiopia 1982 2000 Rainfall variation (%)

80 60 40 20
1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999

Rainfall variation around the mean

-20 -40 -60

2000

GDP growth

Source: Mejia, 2008 6. External partners in poorer countries should encourage and support the kind of social protection measures that some of the larger developing countries (Brazil, Mexico, India) have been implementing for a while, with encouraging results. Developing country governments and external partners alike also acknowledge the need for medium- and longer-term measures to boost agricultural productivity, while improving resilience to climate change and variability. 7. There is a strong case for turning the socio-economic crisis due to soaring food prices into an opportunity to make agricultural development a driver for growth and poverty reduction. However, there is no evidence from the field that higher food prices have systematically translated into higher farm-gate prices and improved incomes for the rural poor. Similarly, some field assessment missions including one in mid-2008 assessing the impact of food prices in IFAD project areas in Cambodia have confirmed that the inflationary trends associated with soaring food prices may also have a negative impact on the quality of service delivery. 8. Coordination efforts are underway at the country as well as at the global level, as shown by the recent completion of the Comprehensive Framework for Action by the High-Level Task Force on the Global Food Security Crisis chaired by the UN Secretary-General and bringing together UN agencies and Bretton Woods Institutions. However, it will be of critical importance, for the sake of sustainability, to place the medium- and longer-term responses to high food and fuel prices in the overall context of country-led processes related to PRS/NDS. Governments and partners have come a long way building up the potential of these as mutual accountability frameworks, with mixed results but an overall trend of improvement, as long as stakeholders avoid the trap of over-planning and underimplementing.

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PART ONE
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25 20 15 10 5 0 -5 -10 -15 -20

GDP Growth (%)

Variability in rainfall (Meter)

Zimbabwe 1978 - 1993

II. PART TW0

RURAL ASPECTS OF POVERTY REDUCTION AND NATIONAL DEVELOPMENT STRATEGIES A. Overview
9. While the overall trends in Poverty Reduction Strategies (PRSs) are promising, there remain significant challenges for governments including: integration of various planning and strategic frameworks; striking a balance between internal and external accountabilities; and allocating resources between social and productive sectors (World Bank/IMF, 2005; Shepherd and Fritz, 2006). Several studies (from the World Bank, IFAD, FAO, GTZ and ODI) have focused on the treatment given to rural poverty and the rural economy in PRSs. These identified a series of weaknesses and knowledge gaps regarding the PRS policy content and process. 10. With regards to the policy content of earlier PRS documents, the studies reveal: Gaps and disconnects between poverty diagnostics and the prioritisation of public intervention, target setting and resource allocation; Public expenditure bias of policy interventions with less emphasis on enabling and regulatory measures; Many early PRSPs were drawn on blank political canvas and the links between PRS and other strategies which command stronger national ownership remain unclear; and Poor understanding of linkages and trade-offs between poverty reduction and growth, with a tendency, in many cases, to treat poverty reduction and growth as one and the same thing (growth benefits will eventually trickle down to the poor). In other cases particularly under the first generation of PRSPs there was more emphasis on social sectors than on growth. 11. With regards to the PRS policy process (the design, implementation, monitoring and evaluation of PRSs), previous studies have shown: Little engagement of rural stakeholders, especially the rural poor participation often taking the form of consultation at the diagnosis stage; Limited domestic ownership, particularly by the rural poor; Weaknesses in assessments and diagnostics of rural poverty which tend to treat the poor as a homogeneous group and say little about poverty dynamics and the context-specific needs of the rural poor; Weak links and consistency between PRSs and other policy instruments and frameworks, in particular policy implementation instruments such as Medium-Term Expenditure Frameworks (MTEF) and national budgets. This illustrates a missing link between policy, planning and budgeting under the MTEFs; Insufficient donor alignment and harmonisation around pro-poor policies in the rural productive sectors due partly to the debate on paths to pro-poor growth in these sectors, but also to the considerable challenges of coordination in sectors made up of a diversity of very heterogeneous stakeholders; and Controversial identification of the role of the state in the rural productive sectors characterised by private economic agents (for example, through the establishment of an enabling policy environment and addressing other market failure issues). 12. However, it is encouraging to see consistent improvement in the new generation of PRSs characterised by more assertive country ownership, though significant challenges remain. When moving away from the classical PRSP blue print, it is a daunting task to turn a pro-poor vision into action with targets and indicators, integrate decentralisation policies with national and sector planning, and strike a balance between internal and external accountabilities.

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PART TWO

13. In Bolivia, experience gained from the earlier PRSP (EBRP in Spanish) showed that there is no point in going for a comprehensive approach to poverty reduction when local priorities are much more precise and concrete, and political regimes are highly unstable. Another thing to avoid is inviting participation but excluding key issues from the agenda, and then rewriting the results of the consultation to suit major donors. The new National Development Programme (PND) is a home-grown framework (as opposed to a donor-driven PRS) with indigenous people and the rural poor as the priority, against a backdrop of frustration about access to assets and services. The Bolivian Government is attempting to coordinate donors around thematic groups mesas de coordinacin even during times of social tension and political confrontation. 14. While PND targets and indicators (for impact and process) are still undefined, one of the many challenges is how to put into operation a community-based approach to rural (private) enterprise development? How to ensure effective and sustainable delivery of rural services (technical assistance, rural finance and market linkages) pending agreement on the role of local governments municipios as a potential relay between central administration and local communities? 15. In Burkina Faso, the Strategic Framework to Combat Poverty (CSLP) is a second generation PRS linked to general budget support. Sector thematic groups include agriculture and rural development. There have been significant achievements in soil and water conservation, but the challenge of scaling up needs to be addressed in a systematic manner. 16. In Cambodia, the National Strategic Development Plan (NSDP) is a country-owned (second generation) planning framework guiding the allocation of domestic and external resources, in light of what the authorities call a triangular strategy. The NSDP is a common reference for efforts to establish thematic groups. But aid is fragmented and there is a risk of over-design at the sector level, at the expense of synergies and operational bridges at the local level. Pragmatic solutions are worth exploring in the context of decentralisation policies (based on an organic law) and a change of paradigm from an input/output orientation, to an outcomebased allocation of resources to communities. 17. In Ethiopia, the country-led Plan for Accelerated and Sustained Development to End Poverty (PASDEP) is characterised by the integration of a second generation PRS with the national development plan in the form of an MDG-oriented strategic framework. After validation by the national parliament and sub-national political institutions, the government shared this document with other national actors and used it in negotiations with partners as a basis for General Budget Support (GBS), subsequently re-named the Protection of Basic Services (PBS). 18. PASDEP reflects a long-standing government priority to agriculture, and efforts to address a structural dependency on food aid. PASDEP priorities also illustrate the long-standing debate on the function of agriculture in many developing countries, including the role of the state and the scope for private-sector partnerships in promoting smallholder agriculture as an engine for national growth and rural poverty reduction. One of the significant challenges facing PASDEP like similar frameworks in other countries will be one of integration with sector processes and decentralisation policies.

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Box 2: Mozambique: The challenge of balancing accountabilities The available data suggest that the root-causes of PRS weakness lie in three main areas: 1. Lack of clarity over the proper place of PARPA in Mozambiques planning landscape. While there are moves towards seeing PARPA as a planning instrument, the overall context tends to make the process hostage to the immediate interests of those involved. The government and civil society organisations want to document their commitment to poverty reduction and in this way secure donor support. Donors, in turn, need immediate success to justify their commitment to Mozambique before their own electorates, and the IFIs use the PRS as a way of buffeting the impact of their macroeconomic prescriptions. These interests are not necessarily consistent with the longterm goal of strengthening Mozambiques ability to tackle its social and economic problems. In fact, they seem to be turning the PRS into a massive technical intervention that both stretches the human resources of Mozambique to their limits, and at the same time, insulates poverty reduction from domestic political discussion. 2. Inability to build into policy-making mechanisms that make implementation unavoidable. Both PARPA I, PARPA II and PROAGRI are technically very good documents. The same applies to many sector plans. Yet, in Mozambiques current institutional environment, there appears to be little incentive to implement the policies. Designing policies appears to have become an end in itself. This appears to be the result of weak domestic accountability. Indeed, policy interventions seem to be based on the belief that the services rendered by government reflect priorities established by the government and not by the stakeholders concerned. This turns the latter into recipients of services without any influence over policy formulation. 3. Lack of clarity over the relationship between poverty reduction and economic growth. Generally, poverty is treated as a residual category to be taken care of by economic growth. In other words, poverty reduction appears to be conceptualised as the goal of economic growth and there is little recognition that it can also be a means of achieving that goal. The draft Rural Development Strategy has made significant moves towards this recognition by placing changes in patterns of accumulation in favour of rural growth, at the heart of Mozambiques overall development efforts.

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In order to address these weaknesses, a range of requirements need to be met which concern Mozambique in particular, but are also relevant to the general thinking about PRSs, especially as far as rural development is concerned. The requirements concerning Mozambique are as follows: 1. A stronger integration of PARPA with general planning tools in the country. The challenge is to ensure that poverty reduction is not residual to what different sectors do, but part and parcel of their work. An important step in this direction could be the strengthening of the Technical Secretariat for PARPA in the Ministry of Planning and Development to enable it to centrally collect and collate dispersed information on poverty alleviation activities. 2. A clear focus on rural development. The challenge is not to reduce rural poverty, but to transform the rural economy in a way that turns it into the pivot of major structural changes in the Mozambican economy as plausibly argued for in the draft Rural Development Strategy. An essential condition to meet this requirement may be a stronger commitment to decentralisation which should actually devolve policy formulation to the local level. 3. A greater integration of parliament in decision making over PARPA. The challenge is to ensure that poverty-reducing measures are the result of domestic political debate, and not arrangements between government and donors with the inclusion of civil society representatives. 4. The empowerment of rural communities and individuals to ensure that they are in a position to make effective demands on the political system. This is perhaps the major challenge facing PRS in Mozambique. Domestic demand for accountability and performance is the main test of the soundness of technical interventions. Source: Macamo, 2007

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19. In Mozambique, the PRS rural focus study confirms that poverty-reduction initiatives are enjoying a very special momentum, in the context of the Action Plan for the Reduction of Absolute Poverty (PARPA). Both the government and civil society organisations have put a lot of effort and commitment into poverty-related work. Likewise, the country has taken significant strides towards pursuing agricultural policies likely to have an impact on the livelihood of rural communities. Further initiatives towards helping Mozambique respond to the challenge of poverty reduction and agricultural development that benefit the poor depend on technical support to enhance planning, implementation and M&E capacity. The promotion of internal demand for performance and accountability of state institutions can also contribute here (see Box 2).

B. Understanding rural poverty

20. Depending on the context, the diagnosis of the problem will be different (see for example Box 3), and given complex rural systems, the analysis of problems and their causes will leave room for differences and disputes. In the case of Africa, there are different views on the key problems faced, including lack of appropriate technology, too little demand at the farm gate for farm produce, failures of government policy that discourage private investment and initiative, and failures in markets that discourage investment. 21. Others argue that problems with international trade (including agricultural subsidies in industrial countries) and environmental degradation are the main problems in rural Africa. In particular, there are strong disagreements over markets. Some see the market as a device that allows all, including the poor, to progress even if there are some market failures that require (modest) state action. Others see markets as delivering riches for the rich, poverty for the poor, so flawed that they require considerable state action to control or be replaced.

Box 3: Poverty traps in Ethiopia The interaction of poverty and population pressure with the productive resource base is a crucial mechanism that has perpetuated poverty in Ethiopia. Unprecedented population pressure has resulted in decreasing plot size (average land holdings declined from 0.5 hectares per person in the 1960s to 0.11 in 1999), making an increasing number of households dependent on inadequately small and unproductive plots, more vulnerable to the vagaries of unpredictable rainfall, and rendering some traditional farming practices unsustainable. These households are too poor to leave land fallow or invest in it, leading to a progressive deterioration of their asset base. In the past, moving onto new land absorbed additional population growth, but in many areas, the limits of useable land have been reached, forcing farmers onto fragile lands with lower productivity. Poverty and low investment in human capital present another type of self-perpetuating dynamic. Investing in education may be prohibitive for poor households, due both the direct costs, as well as the fact that all members need to contribute to the family income, including time-consuming tasks such as collecting water and firewood. Even if returns to education are high, the inability to finance that initial investment means that there is under-investment. Without significant increases in productivity, it is difficult to accumulate capital, so returns to unskilled labour are unlikely to grow. Poverty and low education, therefore, reproduce themselves in future generations. (continued on the next page) Source: Johnsen et al, 2007

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Box 3: Poverty traps in Ethiopia (ctd.) Low levels of infrastructure resulting in underdeveloped markets, high transaction costs and coordination failures offer another example of perverse dynamics. The benefits of exchanges cannot be realised and the economy remains trapped in a largely subsistence-oriented structure. Without basic economic infrastructure, returns to private investment may be too low to spur dynamic growth, while the large, lumpy nature of infrastructure costs makes it hard to make the initial investment to break out of this trap. In the rugged and difficult geography of Ethiopia, many remote areas see their potential for dynamic private sector growth and diversification out of agriculture hindered by the lack of basic infrastructure. The low-risk/low return trap. Small farmers, who constitute the bulk of the population, are often trapped in the production of low-risk/low-return food grains. With insufficient cash funds, and unpredictable outcomes, they cannot afford to risk diversifying from subsistence food production into potentially higher-return activities (such as cash crops). Neither dare they spend their limited cash on purchased agricultural inputs, because if they fail either because of crop failure, price collapse, or failure of demand they will have neither the basic food they would otherwise have produced, nor the cash to purchase it, so their families will go hungry. The early-childhood trap. Nutrition offers a similar story, with malnutrition very early in life affecting long-term mental and physical development, so limiting lifetime potential and productivity, and creating a low-income, low-consumption household in the next generation. Source: Johnsen et al, 2007

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22. Available evidence in Bolivia is that country-led processes did not lack the ability to diagnose the countrys problems. On the contrary, there is a coherent analysis of what has gone wrong in the country and what needs to be done. Of course, not everyone will agree that the remedy for poverty is greater state control of the economy, the promotion of collective enterprise in villages, and an apparent marginalisation of private enterprise. But that is a political judgment about the desirability of certain economic configurations. There is major concern about feasibility: it is just not possible to construct an economy without private enterprise, and private investment and initiative will not flourish without some public support and encouragement. 23. Experience across the world suggests that when governments marginalise private enterprise, investors are likely to look elsewhere to invest. Bolivias challenge according to observers is that central government would like to be much more active, but it has limited capacity to do so. Because of political differences, some parts of government may not accept that departmental and municipal governments have capacity that needs to be put to work. They may be even less inclined to accept that NGOs and private enterprise are key actors to work with.

C. Role of the state and the challenge of accountability

24. The role that the state (by default or deliberate choice) is influenced by the combined effects of various factors including but not limited to historic legacies and the development vision, domestic power relationships and external aid dependency. Box 2 provides an interesting illustration of accountability mechanisms in Mozambique which may affect the scope and pace of the PRS rural focus. 25. It is one thing to make a policy decision on what the state should do, but another to devise effective programmes that respect the capacity and political will of the state to do it. Some things are not easy to do such as offering technical assistance that is responsive to farmers demands across a country where their demands vary between regions and between particular categories of farmers. From this perspective, a 2006 OECD/DAC publication on pro-poor growth and agriculture provides an interesting distinction between five rural worlds which facilitate a more refined approach to targeted interventions. Finding solutions to market failures in supply chains that harness the energies of farmers, traders and processors is a lot harder than running a state corporation that replaces the traders and processors (Omamo, 2003).

26. The political economy of subsidies and rents is also an important factor. There are hardly any limits within the available budget to what the state can do to help farmers by subsidising inputs, buying up produce at above-market prices, and protecting domestic markets against competing imports. These are all highly visible ways of helping farmers and gaining political support. Its difficult to avoid the temptation of offering such support. Arguing against support to farmers seems irrational and mean: the concept of the opportunity cost of the resources involved is hard to get into political debates. 27. Substantial budget allocation is not necessarily good for the rural poor. Agricultural subsidies or other measures to boost agricultural production do not necessarily translate to pro-poor investments in public goods, as shown by policies in India (see Graph 4) and Nigeria.

Public expenditures in India

7 subsidies 6 5 % of ag. GPD 4 3 Public Investment 2 1 0 1975 -79 1980-84 1985-89 1990-94 1995-99 2000-02 Source: World Bank 2007 28. Likewise, promotion of agricultural exports through incentives for the private sector does not necessarily result in poverty reduction, as seen in Latin America (see Graph 5).

Graph 5: Rural poverty and agricultural production in Latin America and the Caribbean (1990 to 2005)

70 65 60 Percent 55 50 45 40 35 30 1990 1994 1997 1999 2000 2001 2002 2003 2004 2005
Rural Poverty Extreme Rural Poverty Agricultural Production

120 115 105 100 95 90 85 80 75 70

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Graph 4: Subsidies and public investments in India

D. Giving a voice to the rural poor

29. True representation is key for rural organisations. This in turn depends on: Organisational function, such as advocacy for voice, assets and access, improved service delivery for production, rural finance, market access, common property resources management; Incentives for membership, such as commercial gain or political leverage; and Transparency, integrity and accessibility of the organisations management team towards its members. 30. Sustained support to farmer organisations is a contribution to both democratic processes and poverty reduction efforts. For the sake of country ownership and long-term sustainability, more and more governments and development partners find virtue in promoting stakeholder buy-in to proposed reforms (see Box 4, Box 5, Box 6), instead of external conditionality which governments are willing to observe only as long as there is external funding behind it. 31. The role of representative rural organisations as a conduit for reaching out to the grassroots may also appeal to private sector agents acting out of corporate social responsibility or enlightened commercial interest. 32. Bolivias experience shows that devolution to municipalities can be an excellent way of reviving popular engagement with politics in a situation where most people are disillusioned with central government. It also demonstrates how effectively local government can deal with some services and investments. Giving local governments a share of the national revenue to use as they see fit for local purposes makes a lot of sense. But such actions are unlikely to drive national outcomes. Central management of the macro-economy, reasonably consistent policies, institutional development, and investment in public goods such as roads, health and education require an effective central government. 33. Participation is clearly desirable, but the record shows countries China, Vietnam, Indonesia doing much to reduce rural poverty without significant participation by the rural poor, or indeed by ordinary rural citizens. Mexicos much admired Oportunidades is seen in some quarters as a top-down programme designed and implemented by elites. In Africa, Ghana is said to have had some success in reducing rural poverty in recent times: but how much of that that been through popular participation? More controversially, how much local participation went into Zimbabwes land reform? Some critics suggest many examples of empowering the rural poor are the results of the actions of enlightened elites in national government, NGOs, donors, and sometimes also, private enterprise.

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Box 4: Ethiopia eliciting peoples views on poverty and services The Citizens Report Card (CRC) is a simple but powerful tool to elicit systematic feedback from users of public services on aspects of service quality, which enables public agencies to identify the strengths and weaknesses of their work. The NGO Poverty Action Network of Ethiopia (PANE) conducted a citizen report card survey in 2004/05 to investigate the level of public services under the SDPRP in four sectors: health, education, water and sanitation, and agriculture. They surveyed 3228 households in Tigray, Oromiya, Southern Nations Nationalities and Peoples Region (SNNPR) and Dire Dawa. The findings generally reinforce the messages emerging from the Welfare Monitoring Surveys, and provide some interesting insights for service providers. Drinking Water: Three-quarters of rural respondents depend on non-potable water sources for drinking and domestic purposes. About half of rural respondents reported scarcity. Natural sources need to be improved, since they provide for many people during times of scarcity. About 70% of those using rivers expressed concern about pollution. People feel levels of water supply have improved over the last two years but lack of access to protected water sources remains a key concern for the majority of Ethiopians. There is wide regional disparity in the provision of water sources. Implications for the PASDEP: Efforts to increase water supply in the PASDEP are urgent. Give this sector high priority in the event of limited funding. Target the regions with the lowest water supply. Health and Sanitation: In rural Ethiopia, malaria was reported as the most common illness. Access to medical treatment is a major issue for rural communities. This was most acute in Tigray where 45.5% of patients had to travel more than 10 km to reach a medical facility. The cost of getting treatment was considered high in government facilities and the cost of medicines varied widely between the regions. Very few respondents reported getting contraception advice from government facilities. Less than a third of people in rural areas reported using a toilet, with custom being the major reason. Implications for the PASDEP: Place emphasis on malaria. Aim to achieve universal primary health care coverage. Intensify delivery of contraceptive services. Review the cost of medical treatment and drugs. Promote increased use of latrines through health extension packages. Education: Most childrens schools are within 3 km of their residences. However, in Tigray a third of children travel more than 5 km to school. There is an acute shortage of drinking water in schools, with less than a third of pupils in rural areas being able to access it. The cost of education varies widely across the regions. Standards and norms need to be established. Community involvement in schools is high but more through informal than formal means; and parents said they were highly satisfied with the behaviour of teachers but less so with the standard of buildings. Implications for the PASDEP: Give attention to school construction and facilities. Recognise the communities involvement in schools. Establish minimum standards of schooling. Review the costs across different regions. Agriculture: Government agencies are the main source of information on agriculture for communities. Most support received by farmers is on crop production. Support provided for marketing agricultural products and for providing inputs like seed was quite weak. Most farmers reported that extension agents were available but often they were not accessible. Only 56% of farmers found extension services adequate. Despite the fact that people felt extension services had improved, satisfaction was low with less than a quarter of respondents being completely satisfied. Only 26% of farmers accessed credit. Most farmers used direct marketing, with only 37.5% getting a fair price. More than 50% of farmers reported the loss of cattle or crops. Implications for the PASDEP: Emphasise marketing and extension as vital components of agriculture policy to ensure farmers have access to increased knowledge and a fair price for their goods. Assess extension services to ensure they are accessible for farmers and respond adequately to needs. Develop monitoring systems to ensure the quality of extension services. Insurance schemes may also help farmers mitigate losses. Source: Johnsen et al, 2007

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Box 5: Poverty Reduction Strategy Papers a participatory breakthrough? A 2006 study looked at the situation in four countries: Malawi, Zambia, Uganda and Tanzania. The paper describes various aspects of the PRSP process its antecedents, formulation (from 1999), implementation and reformulation (from 2004). The focus is on the participation of non-state actors, in particular rural producer organisations (RPOs). The depth, scope and level of their participation in the PRSP process is assessed and compared. Malawian rural producer organisations have reason to be very satisfied. The Zambian and Ugandan RPOs have reason to be quite satisfied. The Tanzanian RPOs are very dissatisfied with their participation in the PRSP process. In terms of good experience, the government in Malawi was generally open to non-state participation. Civil society in Zambia was able to mobilise itself and tap into the policy dialogue during early formulation as well as final policy evaluation. Uganda had a participatory set up for monitoring policy implementation. However, there was no in-depth participation by members of any of the rural producer organisations in any country, and civic participation did not reach the level of real joint decision-making. Furthermore, there are no signs that the PRSP has contributed to reducing poverty in the countries studied. Nevertheless, national RPOs report that the PRSP has made governance and policy making more democratic and participatory. The few sub-national RPOs consulted in the Tanzania study did not share this view. From this study, three new issues for follow-up action and research emerge: (1) Rural poverty: Has poverty declined since 1999/2000? As concluded earlier, there is no evidence in any of the four countries that that there has been any substantial reduction in poverty with the coming of PRSP. In particular, we need to establish the changes in the level of poverty in the rural population. (2) Governance: Have new paths towards more participatory governance and policy-making been laid? If so, what lessons can be drawn for RPOs in other countries? (3) The linkage: Have changes in governance, if any, had any impact on policy implementation and the level of poverty?

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Source: Braathen, 2006

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Box 6: The dimensions of participation: framing questions The agreed list of criteria for satisfactory participation is centred on the three main dimensions of participation: depth, scope and level of participation (Fung and Wright, 2003). The sub-dimensions are explored by the following questions: Depth of participation: Who is involved and who influences policy formulation? To what extent were marginalised or disadvantaged groups within the rural producer organisations (RPOs) included in the PRSP processes through the current arrangements for civil society participation? Did the process include any in-depth studies or group work? What measures did the RPOs themselves take to deepen participation?

Level of participation: What factors determine the degree of participation capacity, location, vision or interests? How could the participation process be institutionalised by defining the roles and responsibilities of each actor? How could the voices of the poor be better reflected in the policy debate and policy making? How could rural stakeholders participate in the PRS policy formulation and implementation process? McGee and Norton (2000) suggest that a ladder of participation could be used as a tool to evaluate PRSP processes. The ladder consists of four steps: i) information sharing; ii) consultation; iii) joint decision-making; and iv) initiation and control by stakeholders. At what level in the decisionmaking process was RPO participation included? Was RPO participation limited to consultation or comments given on an individual basis, or did RPOs take part in deliberations and as such influence proposals through work groups and committees? To what extent did RPOs participate up to the authoritative decision-making level (veto rights in the adoption of the final paper)? On which issues (see scope)? Did/do RPOs participate in the follow-up process and implementation of the Poverty Reduction Strategy, through institutionalised consultation or participatory monitoring? Have there been advancements or set-backs during the process? If little or no satisfactory participation was found, the research should attempt to establish an explanation or a set of reasons for why there was a lack of participation. Was it due to internal factors the capacity or information/access to information, and/or general organisational weakness? Or was it due to external factors, which we could categorise as politics of participation decisions by designers and managers of the PRSP, or priorities of participation made within the larger social structure of civil society itself? Source: Braathen, 2006; Shepherd and Fritz, 2006

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Scope of participation: What is the type of involvement of rural stakeholders (including state agencies, NGOs and the private sector corporate, smallholders, rural micro-enterprises, etc.) in PRS processes? What is the range of social and economic issues and services that RPO representatives dealt with in the participatory process? Did they participate solely in agricultural issues, or did they also deal with general policies (macroeconomics), crosscutting issues (such as HIV/AIDS and gender concerns) or other sector-specific policies (microeconomics). Was there any expansion during the process, and was this due to initiatives taken by the RPOs?

E. PRS monitoring
34. A comprehensive review of PRS monitoring in 12 countries (Bedi et al., 2006) proposes a helpful paradigm revolving around two concentric circles: an inner circle of activities that take place largely inside the public administration and that ensure the production of data on asset of priority PRS indicators and an outer circle of connections between the monitoring system and key points in the policy-making cycle and the democratic process. In light of this review, recommendations are made for an incremental approach, gradually building on existing elements, clearly defining relationships, incentives and activities, identifying decisionmaking processes including budget processes, tailoring outputs to client needs, and allowing for improvements based on experience. 35. While such a common sense approach is most welcome, the rural productive sector presents a major complication in terms of design and transaction costs due the multiplicity of private actors as main protagonists outside the sphere of public administration. This is compounded by a deep legacy of urban bias, leaving the rural poor out of what should be participatory PRS monitoring and learning loops that link national and sector strategies and related resource allocation and implementation processes. Box 12 (Aligning sector programmes with PRS) and Box 15 (M&E aspects of PRS implementation at sector and local levels) illustrate this challenge. 36. It appears from PRS rural focus case studies and from current experience elsewhere that a considerable amount of time has been devoted to planning and setting up systems and procedures, rather than to expediting actual implementation on the ground and early tracking of results. Monitoring systems are overly sophisticated or have deficiencies in terms of feedback and learning loops between national or sector policy processes and local livelihoods strategies. 37. Part of the problem may be that there are no well-accepted indicators to track rural welfare. There is a lack of outcome-based rather than input- or activity-oriented approaches to resource allocation from central to sub-national government levels, linked to demand-driven service delivery mechanisms. However, given the many uncertainties about the links between inputs, outputs, effects and impact, it is hard to push for results-based budgeting in agriculture. 38. In Cambodia, the adoption of customised systems for routine country-level monitoring of the Paris Declaration on Aid Effectiveness now makes it possible to identify donor preferences, potential for partnerships and issues for early follow up (Royal Government of Cambodia, 2007). Learning from this example and internalising rural benchmarks and indicators in PRS/NDS monitoring could add significant value to customised country monitoring systems.

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F. The challenge of integration: Tensions and trade-offs

39. Different country approaches provide interesting illustrations of the challenge to governments of integrating various planning frameworks (MDG investment plans, national development plans and PRSs) at the national level and between national and sector levels (agriculture and rural development). In some countries (such as Bolivia), a home-grown national development strategy or plan has superseded the older PRS process. Other countries (such as Ethiopia and Burkina Faso) have also shown significant movement away from the previous generation of PRS although with a less dramatic departure to generate a document that combines the requirements of classical PRS, national planning documents as well as MDG planning frameworks. The introduction of decentralisation policies has complicated these integration processes even more and, when the learning curve is too steep, serious tensions may arise in terms of ownership and sustainability.

G. Asserting partners commitment

40. Donors are also increasingly receptive to the message that governments need space and time (see Box 2 on Mozambique) to perform balancing acts between internal and external accountabilities as highlighted in the WB/IMF 2005 review of PRS implementation. The Bretton Woods Institutions (BWIs) and OECD countries have deployed significant coordination efforts to respond to the Paris Declaration in the context of Joint Assistance Strategies and programme-based or sector-wide approaches. Arrangements have been made for delegated cooperation and/or empowerment of lead agencies to promote country-level dialogue with national stakeholders on thematic issues of common interest. 41. A new model of engagement of the UN system in country-led processes is also under consideration by the UN Development Group, involving a change in culture and perceptions. This also confirms the potential for the UN system to re-position itself in the context of the new aid architecture, including support for improved agricultural performance as a condition for achieving the MDG targets on poverty and hunger. 42. The BWIs previously perceived as unduly driving or influencing the PRS processes will now receive PRSs just for the information of their Boards rather than for formal approval as a precondition for assistance. Joint Staff Assessments are changing into Joint Advisory Notes to allow for candid progress reviews by WB/IMF staff. 43. The World Bank has adopted an operational policy which encourages poverty and social impact analysis (PSIA) or its equivalent, as a basis for its prospective support to policy reforms that may have distributional impact. As part of an initiative by a group of partners including the WB, GTZ, DFID and many others to promote PSIA, two significant learning events were hosted by IFAD in 2004 and 2006 and attended by the BWIs, UN, OECD/DAC and bilateral donors, to take stock of progress in PSIA and agriculture policy in PRSP countries. The issue of integration was also discussed. However, continuing efforts are needed to internalise ex-ante and ex-post policy impact assessments in what government and partners do, and to harmonise approaches and make them more participatory. 44. A 2008 UNDG study on the role of UN country teams in the PRS process noted that the MDG process, the Paris Declaration and the One UN reform enable the UN to play a critical role at country level and in the international policy arena. This scenario is contrasted with the current situation, the mixed feelings in some quarters about the PRS process is noted, and the new imperative for the UN to engage in a more proactive and systematic manner in PRS and related country-led processes is stressed. 45. Bilateral donors have shown increasing interest in the Paris Declaration and have made significant efforts to comply with its principles and more recently in the Accra Agenda for Action, albeit with mixed results at country level. As the PRS provides a basis for donor business planning, the pressure to move forward with country strategies and funding targets may in some cases send wrong signals from both bilateral and multilateral agencies to some governments about the resource = results equation. 46. At country level, the anxiety of both departments of finance and their donor counterparts to expedite PRS adoption and implementation may, in some cases, have jeopardised the quality of the process of synchronising development planning and budgeting. The integration of planning frameworks at national and sector levels with decentralisation policies may also have been adversely affected (see Box 2 on Mozambiques experience).

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H. Aligning resources with priorities: Ownership, incentives and capacity

47. Making the budget process more responsive to agreed priorities is more easily said than done, the final decision being dictated by considerations of political economy. Political announcements at the regional level (Maputo and Sirte Declarations) or the global level (Rome Declaration) have provided encouraging signals of the level of government concern about agriculture. However, these declarations may not have been enough to trigger increased budget allocations (see Graph 6 and Box 7) and actual decisions (tax cuts and subsidies) of the kind that recent rises in food, feed and fuel prices have triggered. 48. African governments follow up to the Maputo Declaration allocating 10% of the national budget to agriculture shows a mixed picture, illustrating issues of ownership, incentives and capacity. Targets are yet to be achieved (see table below). Observations of budget processes at the individual country level and the national choice of priorities (Senegal, for instance, allocates 40% of its budget to education) show that the combined effect of the long-term government view of economic development and short-term internal political imperatives will prevail over non-binding external commitments. Proportion of countries complying with the 10% Maputo Declaration 2002 Compliance Cluster < 5% 5% 10% > 10% 53.33 33.33 13.33 61.29 25.81 12.90 2003 2004 2005 2006 2007

Percentage 59.38 21.88 18.75 60.00 16.67 23.33 58.62 20.69 20.69 57.14 23.81 19.05

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Graph 6: Budget allocation to agriculture and contribution of agriculture to GDP in Africa (2002 2004 average)

Allocation to agricultre Contribution of agricultre to GDP 50 45 40 35 30 25 20 15 10 5

Simbabwe Mozambique Cameroon Zimbabwe Swaziland Ethiopia Senegal Burundi Mauritius Tanzania Uganda Niger Gambia Gabon Sudan Benin Kenya Tunisia Chad

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Percent

Box 7: Budget allocation and actual expenditures in Africa Graph 6 shows that the contribution of agriculture to national GDP in Africa is much higher than the share of the government budget allocated to agriculture. The average budget allocation to agriculture for the 19 countries studied over the 2002 2004 period was 5% whereas the average contribution of agriculture to the GDP for these countries over the same period was 29%. These figures show a large shortfall in allocations to a sector that contributes so much to the national GDP. The literature shows that compared to developed countries, agricultural spending as a percentage of agricultural GDP is extremely low in developing countries. In developed countries, it is usually more than 20%, while in developing countries it averages less than 10%. Agriculture is the largest sector in many developing countries in terms of its share of GDP and employment. More importantly, the worlds poor live in rural areas and depend on agriculture for their livelihoods. Therefore, agricultural expenditure is one of the most important government instruments for promoting economic growth and alleviating poverty in rural areas and countries. Source: UNECA 49. A further complication is the fact that about only half of the originally allocated budget to agriculture is actually spent, hence the decision to base the tracking system on actual expenditures rather than earmarked budgets. 50. Linking PRS with the budget raises issues of ownership, capacity and incentives as illustrated by a 2007 World Bank series of case studies (see Box 8) including Burkina Faso which concludes that while both the PRS and budget offer scope for enhanced domestic accountability, fractures in planning and budgeting systems pose obstacles for donors and national governments. The following challenges emerge from the WB case study countries: the prioritisation of plans and coordination between planning and budgeting units; the creation of incentives to formulate realistic budgets and execute them as planned; the expansion of ownership of the PRSP at the sector level; the development of a multi-annual perspective in strategic resource allocation; and the integration of reporting mechanisms (World Bank, 2008). 51. According to the World Banks 2007 study, there is a typical pattern of asymmetrical ownership which, if applied to the rural sector, would mean that rural stakeholders have, at best, an opportunity to participate in the PRS and sector strategy process whereas deliberations and decisions on the budget are left to the government and parliament. 52. Ethiopia and Mozambique (which are part of the PRS rural focus study but are not included in the World Banks 2007 study) offer two interesting illustrations of asymmetric ownership. In Ethiopia, the PASDEP which simultaneously represents the PRS, the MDG investment plan and the national development plan has been subject to an intensive two-week debate between relevant government departments and parliament, which was preceded by a series of stakeholder consultations at national and local levels (see also Box 4). In contrast, the Mozambique PARPA review points to a relatively limited involvement of parliament and suggests, as a corrective measure, that a stronger commitment to the decentralisation process may provide an opportunity for debate with rural stakeholders and local government (see also Box 2).

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Box 8: Linking PRS with the budget Four lessons, in particular, can be gleaned from the positive and negative experiences of country case studies (comprising a sample of nine low-income countries Albania, Burkina Faso, Madagascar, Malawi, Mali, Mozambique, Rwanda, Tanzania and Uganda and four higher-income countries that are internationally considered to be successful reformers in public financial management and service delivery Australia, Chile, Republic of Korea and South Africa. Lesson 1: Focus on strengthening and harmonising existing processes and adopt a gradual approach to reform. The enhancement of the policy-making function of the budget in line with PRS priorities often requires a flexible approach to PRS design, building on existing processes and tailoring interventions to the local context and realities. An increased focus on results requires not only technical capacity but also a change in culture and thinking. Experience in the case-study countries shows that successful budget reform processes tend to start simply, evolve gradually, and be framed within an integrated approach to public financial management reform. Lesson 2: Build support from within, through high-level ownership of policies, a challenge function within the executive and clear sector roles. Intra-governmental accountabilities, starting at the political (cabinet) level, can be a powerful tool in promoting reform and have so far not achieved sufficient attention. Initiatives that may help to catalyse the improvement of core policy processes and internal accountability include: Introducing or reforming cabinet committee structures, to strengthen high-level political ownership and a challenge function within the executive. IStarting with the budget. Successful reform efforts have focused on core policy processes, and on turning budgets into more policy-oriented tools, rather than starting from long-term plans and turning them into annual budgets. IIntroducing a strategic phase in the budget process to ensure that there is a stage, before the preparation of detailed operational budgets, at which sector managers and the cabinet review high-level policy priorities and their impact on high-level, inter-sectoral resource allocation. IDeveloping sector-level policy processes. While the PRS should be seen as a mechanism for developing high-level policy priorities, sector ministries and institutions should be charged with establishing processes to elaborate sector policies and budgets and review policy implementation, and their roles should be clearly defined. Lesson 3: Foster incentives for integration: Target reporting to decision-making processes. Reporting instruments best serve their purpose when they are instigated by, and remain linked to, particular decision-making processes involving specific actors who are likely to demand and use the information. Providing easy access to quality information helps decision makers to monitor policy implementation and take corrective measures. Lesson 4: Keep it simple .A strengthened results orientation within the budget need not require sophisticated technical solutions. As the case studies show, comparatively simple budget reforms can significantly improve the budgets responsiveness to policies. Structuring a Poverty Reduction Strategy paper in a more budget-friendly manner, for example by sector, would facilitate the interface with the budget by involving sector agencies in elaborating policy priorities and establishing the resource implications. It could expand ownership and boost incentives for integration of a greater number of key stakeholders, thereby strengthening domestic accountability.

PART TWO

Source: World Bank, 2008

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I. Good practices for PRS rural focus

53. In light of experience with the implementation of PRSs, a number of good practices have been identified. These are intended as starting points for addressing some of the challenges discussed earlier. They include: a: Planning, strategy formulation and budgeting I: Integrating various planning frameworks into a consolidated document which combines the PRS (previously intended for about 70 of the poorest countries to mobilise concessional financing), the national development plan (for all countries to prioritise domestic resource mobilisation and allocation), and the MDG investment plan. Past examples or caricatures of uncoordinated approaches were characterised by loosely concerted efforts resulting in parallel plans including: Technocrat-driven PRS papers prepared with donor encouragement to ministries of finance as part of the earlier social sector-oriented HIPC legacy with conditionality; MDG investment plans spearheaded by other partners to ministries of planning with no predictable resources behind them; and Home grown, typically 5-year national plans based on domestic resources and anticipated external funding, but processed by governments and parliaments without link age of priorities to budgets. Governments and partners have come a long way and now agree on the use of PRS/NDS as a common medium-term framework towards achieving long-term MDG targets. Yet there is still some way to go in synchronising development planning and budgeting, and completing public management reforms to allow full reliance on government planning, budget execution and reporting systems. II: Identifying and making operational the minimum interface between the PRS/NDS and the existing or planned sector strategies (agriculture, rural development, fisheries, environment, etc), the decentralisation policies and the related budget processes. b: Policy dialogue, advocacy and capacity building I: Promoting champions and catalysts (through country-level thematic groups, for example) to sharpen the rural focus of country-led processes. II: Evidence-based policy dialogue and advocacy work informed by sound analytical underpinnings including diagnostics (such as growth studies and sector impact studies), distributional analysis, public expenditure reviews (PER) and poverty and social impact analysis (PSIA). III: Supporting representative rural producer organisations. IV: Strengthening the capacity of rural sector ministries to engage in PRS processes and promoting inter-ministerial coordination. V: Mainstreaming rural issues in PRS debates with parliaments, NGOs, the private sector, donor thematic groups, etc. VI: Feed-back mechanisms tailored to respond to the concerns of country stakeholders including poor rural communities, civil society, the private sector, parliamentarians and donors. c: Innovation and learning I: Targeted case studies to document successful approaches (on rural service delivery, for example) and analytical work (for instance, on livelihoods pathways). II: Disseminating success stories (in rural poverty reduction) to support the advocates and convince the sceptics. III: Piloting innovative interventions for prospective replication and scaling up in the context of harmonised approaches. Some of the promising schemes relate to weather insurance, commodity exchange, biofuel development, leasehold forestry, organic farming, microfinance and remittances.

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d: Monitoring and evaluation I: Internalising rural benchmarks and indicators in PRS/NDS monitoring. II: Early tracking of impacts on the ground (to test the validity of national monitoring systems and inform decisions on resource allocation). III: Developing customised systems for routine country-level monitoring on the Paris Declaration. Cambodias customised database is an example of good practice, which allows for an analysis by development partner or by sector, and an identification of topics for concerted follow up as deemed appropriate. For example, a comparative overview provides interesting information on donors partnership performance and the potential for delegated cooperation; donors attention to specific performance indicators, such as technical cooperation or a programme-based approach (PBA); and on the integration of project implementation units (PIUs) by partner and by sector.

III. PART THREE:

AGRICULTURE AND AID EFFECTIVENESS A. The specificity of the rural productive sector and its implications
54. In contrast with the health and education sectors which are about the provision of services and infrastructure for human capital development defining the role of the state is a greater challenge in the rural productive sector in a PRS context. PRS deals with priorities for public action whereas agriculture and rural development is essentially a private sector domain, where actors make decisions on the basis of perceived market signals and available incentives systems (policies, institutions and investments) relative to productive assets and access to technology, infrastructure and services (see Global Donor Platform, 2008). This specificity of the rural productive sector has far reaching implications. 55. No wonder that the design and implementation of PBAs in agriculture and rural development are more of a challenge than in the health and education sectors where it is relatively more straightforward to set quantitative or qualitative targets and indicators (see Global Donor Platform, 2007). This also seems to apply to other PRS pillars, including analytical foundations and stakeholder participation, which tend to involve more complex processes because of the variety of situations in agriculture and rural development. 56. The frequently fragmented responsibilities in the rural sector often due to domestic political dynamics with separate departments dealing with agriculture, water, forestry, livestock, rural development, and so on makes institutional coordination particularly difficult. It is assumed that improved aid effectiveness will require increased use of government planning, budgeting and reporting systems. Consequently, enhancement of public financial management systems and related capacity building is a critical part of the reform agenda in the five case study countries as well as in most PRS countries. Both the challenge of institutional coordination and capacity building were recognised during deliberations at the 2008 international conference on aid effectiveness including a roundtable on agriculture that led to the Accra Agenda for Action. Meanwhile, it is not quite clear to what extent the relatively slow progress in establishing agricultural SWAps or equivalent programmes with budget support or pooled funding has affected the overall level of resource commitment and its allocation to the sector. 57. Acquired experience with the design and implementation of PBAs would suggest that targeted interventions at the local level could add value and credibility to central-level planning processes and systems development. On the other hand, there has often been an uncoordinated pursuit of individual sub-sector strategies and programmes and projects by separate departments concerned with the rural sector. This has often taken precedence over the elaboration of a consistent narrative to support rural advocates and convince the sceptics including budget holders about the indispensable contribution of agriculture and rural development as a source of growth and poverty reduction towards national MDG targets. This challenge was also noted at the 2008 Accra deliberations on agriculture mentioned above.

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PART THREE

B. Customising the Paris Declaration and the Accra Agenda for Action
59. The 2005 Paris Declaration sets forth the basic principles for aid effectiveness: ownership, alignment, harmonisation, managing for results, and mutual accountability. These principles were reiterated under the 2008 Accra Agenda for Action (AAA), with special emphasis on ownership, partnerships and results. We will assume that there are specific challenges to the promotion of the rural productive sector in the PRS context compared to health and education. In this case, it would be worth examining the extent to which such specificities may affect the scope and pace of compliance with the aid effectiveness agenda, and the approach to a possible customisation of this agenda to further reflect the exigencies of agriculture and rural development. 60. This challenge was discussed in the agriculture paper at the 2008 Accra High Level Forum, although to no great depth. Some of the tensions and trade-offs related to the principles of the Paris Declaration are therefore elaborated below with a rural productive sector lens, followed by a series of tentative framing questions (see Box 9). These were formulated, as work in progress, as part of IFADs efforts to enhance its compliance with the harmonisation and alignment agenda, in the framework of its country opportunities and strategy programmes (COSOPs). Ownership 61. The notion of ownership implies that donors are prepared to strengthen the countrys planning and implementation capacities, with government in the driving seat and with other country stakeholders, including poor rural women and men and their organisations, involved in priority setting and monitoring processes. An attempt to comply with this principle has led to significant delays or slippages in the formulation and implementation of sector strategies for agriculture and water (Cambodia) or rural development (Burkina Faso, Mozambique). Findings and recommendations from agriculture-related inputs to the Accra process and the AAA (Paragraphs 7 and 12 14) are consistent with the need for participatory monitoring. 62. The definition of targets and the selection of indicators seem to be relatively more straightforward for programmes in health and education as infrastructure and services for human capital development than in agriculture. However, the relative scope and pace of compliance with the principle of country ownership will vary between countries and sectors, as a function of development vision or ideology, aid dependency and aid fragmentation, institutional dispersion, donor commitment and national or sector coordination capacity, domestic resources and external financing opportunities (ODA, foreign direct investment, remittances and decentralised cooperation).

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58. As a consequence, there tends to be: Greater aid fragmentation in the agriculture and rural development sector, in spite of or exacerbated by the double squeeze experienced until recently of a ARDs declining share of declining ODA volumes; A relatively larger number of project implementation units (PIUs) and higher transaction costs associated with the country-level alignment and harmonisation agenda in response to the Paris Declaration according to Cambodias latest report on aid effectiveness, agriculture and rural development have more PIUs than all other sectors together; and A proliferation of uncoordinated service delivery modes (involving government or NGO staff, village volunteers, private service providers, etc.) with the associated risk of diluted impacts, as well as the recurrent challenges of linking innovation, knowledge management, partnership building and scaling up.

Box 9: Customising the Paris Declaration for the rural productive sector: Tentative framing questions Since the Paris Declaration on Aid Effectiveness is sector-blind, it may be helpful to develop some guiding questions for consideration by partners in the agriculture and rural development sector. These are listed below, together with examples of starting points to progressively adhere to the harmonisation and alignment agenda at country level. The framing questions below were developed in the context of IFADs efforts to enhance the quality of its Results-Based Country Strategic Opportunities Paper (RB-COSOP). Ownership: Developing countries must exercise leadership over their own development policies and plans (AE indicator 1). To what extent do the process and content of Country Strategy Papers (CSP) reflect the donors respect for the countrys leadership and help strengthen the countrys capacity to exercise it in the agriculture and rural development sector involving all relevant stakeholders? Examples of donor support include: rural poverty assessments and sector studies feeding into the Poverty Reduction Strategy (PRS) or National Development Strategy (NDS) and sector strategies; facilitating the participation of the rural poor including those in marginal areas and their organisations in the consultation processes, encouraging government leaders and engaging beneficiaries in the definition of strategic objectives, components of the country programme.

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Alignment: Donors must base their support on the countrys own development strategies and systems (AE indicators 2 to 8). To what extent are the donors strategic objectives consistent with the priorities as set forth in the countrys medium- or long-term strategic or planning framework and relevant strategies for agriculture and rural development? To what extent are the target outcomes and milestone indicators of the donors country strategy in line synchronised, for instance with the time horizon of the PRS/NDS or relevant sector strategies? Is the donor using the countrys procurement systems? Other alignment indicators relate to the portion of aid on-budget and the use of technical assistance: this is less of a problem for lending agencies, while the level of compliance in terms of grant policies and other instruments (bilateral grants, vertical funds) is variable. Given the challenge for some governments of integrating their various planning and strategic frameworks at national and sector levels, and for partners of synchronising their business plans with country-led processes, the goal is to define what is good enough and not the development of the perfect plan. Harmonisation: Donors must coordinate their activities and minimise the cost of delivering aid (AE indicators 9 and 10). The 2010 targets for Aid Effectiveness relate to the adoption of PBAs (66%); joint donor missions (40%); and joint country analytical work (66%). Related framing questions include: To what extent can donors to the agriculture and rural development sector deliver their assistance through a programme-based approach? Do they undertake country strategy design and country programme missions on a joint basis? How much of the donors country analytical work (such as economic, thematic and sector analysis) is done on a joint basis? Does the country programme including pipeline proposals require a new Project Implementation Unit (PIU)? To what extent can the newly established PIU be considered as parallel to, or part and parcel of, existing national structures? Are there implications in terms of coordination between the hosting line ministry and the decentralised implementation structures at subnational levels? Is there a plan for capacity building and mainstreaming the PIU functions into existing national structures? Answers to these questions should take into account options for the division of labour, delegated cooperation, and potential risks of an orphan sector or country, as a result of cherry picking by the donors. (continued next page)

Box 9: Customising the Paris Declaration for the rural productive sector: Tentative framing questions (ctd.) Managing for Results: Developing countries and donors must orient their activities to achieving the desired results (AE indicator 11). Is the donor supporting poverty monitoring processes at national or sector levels? To what extent is the donors results framework (targets, milestone indicators and policy/institutional objectives) consistent with the quality of the M&E system at sector and project levels? Given the recurrent institutional weaknesses at (rural) sector level, adequate arrangements for M&E and knowledge management would inform the donors engagement in evidence-based policy dialogue. Mechanisms for early tracking of results in the rural productive sector would be helpful. Mutual Accountability: Donors and developing countries are accountable to each other for achieving development results (AE indicator 12). Is the annual review of the country strategy paper linked to a process of mutual assessment of progress involving government and donors in countries where such a mechanism exists? Are civil organisations (including the rural poor) involved for the sake of transparency and accountability to citizens? Are the relevant analytical tools being used to this effect? As an entry point to promoting mutual accountability processes, rural development partners may draw lessons from aid effectiveness surveys. They may consider supporting the substantive participation of organisations of the rural poor in the joint review of the relevant country programme performance, using the results of the annual reviews of their country strategy papers and business plans as an input to consultative group meetings, roundtable discussions, and results-and-resource processes. Source: Sourang, 2008 IFAD work in progress

Alignment 63. The alignment of the agenda for the rural productive sector with national priorities as set forth in the NDS/PRS should be assessed both in terms of content and timeframe, to ensure adequate budget allocation and policy support in pursuit of pro-poor agriculture and rural development objectives. However, as shown in Part Two of this report (an overview of experiences with rural aspects of NDS/PRS), serious gaps and disconnects may exist between various planning and strategic frameworks at national or sectoral levels and territorial development plans in the context of decentralisation policies. This is compounded by the time lags and slippages which, for various reasons, affect the pace and content of formulation and approval of these strategic frameworks, as well as the related medium-term expenditure frameworks (MTEF). 64. The AAA recognises the need to assist countries in exercising ownership of their NDS/PRS while the Comprehensive Framework of Action in response to the food price crisis recognises the importance of working within country-led processes. Yet, many agricultural development programmes will, for a while, have to face the challenges of synchronising NDS/PRS with related budgetary and policy processes. This is partly due to the variety of tensions and tradeoffs faced by governments in response to external shocks linked to climate change and variability, other environmental threats and market conditions including soaring or volatile food prices. This is compounded by additional constraints connected with donor lending programme targets at regional or corporate level.

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65. The 2006 Survey on Monitoring the Paris Declaration recognised the lack of consensus on doing away with parallel Project Implementation Units (PIUs) as well as the related disincentives that may exist at both government and donor level. The donor community is yet to reach a shared understanding on the role of PIUs and parallel PIUs. In the case of specialised institutions like IFAD, the creation of a new PIU linked to an existing line ministry may be due to the demands of targeted interventions. The PIU issue also came up in the context of International Development Association replenishment. Hence, the need for an early examination by interested donors of the rationale and implications of establishing a new PIU in terms of recurrent costs and crosssector coordination, as well as integration with any existing decentralisation policies, taking into account the call under the AAA for the use of country systems. 66. The proliferation of PIUs for agricultural projects as in Cambodia where the agriculture and rural developments sectors account for more PIUs than all other sectors put together may also have to do with the limited number of SWAps in this sector. However, a more in-depth review would help understand the correlation if any between the number of PIUs in a donors portfolio and the related share of agriculture in that portfolio.

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Harmonisation 67. On the first of the harmonisation indicators relative to PBAs, it is worth noting that partners are actively engaged in agricultural SWAps in several countries in eastern and southern Africa which reflects the fast moving harmonisation agenda in these countries and these can be expected to spread to Asia, Latin America and West Africa. 68. Donors performance against this indicator is constrained by a number of factors including: mixed results from past experience; the coordination challenges resulting from the institutional fragmentation characteristic of the rural sector (with separate ministries for agriculture, water, environment, forestry, fisheries, community development, etc); and limiting factors to the expansion of SWAps in agriculture as essentially a private sector domain, in contrast to health and education in developing countries where priorities for public action appear to be easier to define, coordinate and implement around one government department. 69. It is therefore no accident that there are fewer SWAps in agriculture and rural development than in other sectors. This, in turn, may limit progress made on related issues such as predictable financing, reducing the number of PIUs and uncoordinated technical assistance. The Global SWAp Study (Global Donor Platform, 2007) provides a detailed discussion on SWAp challenges and opportunities. 70. There is as yet no consensus on the best delivery modalities for a PBA (see the OECD 2006 Survey on Monitoring the Paris Declaration). Consequently, there is a case for multilateral and bilateral agencies with a history of engagement in agriculture and rural development to bring their experience to bear, in the context of recent deliberations (including the Accra High Level Forum) and future consultations on progress with the Paris Declaration and the Accra Agenda for Action. In other words, there is a significant specificity in agriculture and rural development, and a variety of circumstances which determine the multiplicity and complexity of options and trade-offs. These may well justify the need to design and implement targeted, project-type interventions subject to adequate linkages with a PBA, if it exists, and relevant sector-wide processes. 71. Turning to the other harmonisation indicators, there is a high transaction cost for governments and partners associated with the proliferation of stand-alone missions (10,453 in 34 countries in 2005) and with single donor studies. The calls for enhanced harmonisation efforts for a concerted delivery of the agenda set forth under WDR 2008 may result in increased pressure on donors. They increasingly feel the need to optimise their country presence, to look more systematically at options for delegated cooperation or silent partnerships, and to rationalise or coordinate field missions for country strategy papers, project design and implementation support, and country analytical work.

72. However, it is clear that division of labour will continue to be a thorny issue for some time. Related options for partnerships and delegated cooperation will be pursued in the context of the UN Development Assistance Framework, thematic donor working groups and other mechanisms for in-country harmonisation. However, in line with the consultations related to agriculture at the Accra High Level Forum, harmonisation efforts will not be pursued at the expense of alignment. Managing for results 73. The AAA stresses the importance of impact for the poor, transparency and accountability. Yet, it is not easy for project design teams to identify a causal chain between the interventions of a single agency and the anticipated impact in terms of incomes and food security. This is compounded by the challenge for project management teams to establish effective and manageable M&E systems that enable the aggregation or extrapolation of project-level data for a timely assessment of country programme impacts. 74. While the debate on contribution vs. attribution is open-ended, it can be expected that the wider adoption of PBAs will enhance the donors notion of shared risks and shared responsibilities, and hopefully alleviate the pressure and associated transaction cost of reporting on individual donor impacts. 75. Donors and country partners working in a PBA/SWAP context, have expended a great deal of and perhaps too much time and effort focusing on formulating strategies and setting up systems and procedures at central level. It is high time that those donors interested in supporting agriculture and rural development allocated an adequate amount of resources to grassroots interventions, based on comparative advantage, and contributed to the early tracking of results from the field, through appropriate adjustments to project-level M&E systems and partnerships with specialised institutions. This would provide credible input to evidencebased policy making and facilitate a more realistic target-setting process at sector and national levels. Mutual accountability 76. Experience with the new generation of PRS/NDS have shown their potential to act as mutual accountability frameworks through which governments and partners can pursue the demand and supply sides of the results-for-resources equation and related changes in the approach to conditionalities. 77. Partners decisions on the amount, pace and channel for the allocation of external resources may be influenced by the actual performance of public finance management or internal political developments as in Tanzania, Malawi, Uganda, Ethiopia and Bolivia. The AAA also stresses the importance of transparency and accountability between governments, partners and citizens. 78. Depending on the degree of aid dependency and the governments pro-rural-poor orientation, it is a major challenge to strike a balance between external donors expectations and the need to engage, in a more pro-active manner, the rural poor as economic actors and a major party to the PRS/NDS process as a multi-partite accountability framework. 79. Given the diversity of the situation in the rural productive sector, participatory poverty assessments (PSIA and PER) have turned out to be powerful accountability tools, as well as working to engage the rural poor in the priority setting and budget process. This, in turn, depends on the mainstreaming of rural poverty issues in parliamentary debates, and the capacity of the rural poor to organise themselves around specific common interest groups (such as rural producer groups) that wield influence on central or local government policy processes.

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IV. PART FOUR:

RURAL FOCUS OF POVERTY REDUCTION STRATEGIES THE WAY FORWARD

PART FOUR

A. Scaling up and the political economy of PRS

80. With an eye on the MDG targets, there is growing consensus on what should be done in an ideal world, in terms of policies, institutions and investments, to empower the rural poor to control productive natural assets, and access technology, infrastructure and services. Innovative approaches have shown that it is possible for rural producer organisations to respond to market signals against a backdrop of liberalisation, decentralisation and globalisation, and for poor men and women to manage risks and vulnerability associated with markets and environmental threats. The WDR 2008 is a powerful amplifier of related messages (see Box 10) which need, however, to be customised at country level. 81. A major challenge is to define ways and means of scaling up (in a less-than-perfect world) the most promising experiments and to build on indigenous knowledge. To achieve largescale impact, there is a need to identify champions and catalysts and to create space to grow (Hartmann and Linn, 2007). Poverty Reduction or National Development Strategies (PRS/NDS) are the agreed framework through which government and its development partners will pursue the national MDG targets. 82. Consequently, the PRS/NDS and related expenditure frameworks and budget processes at sector level have great potential. They provide a tremendous opportunity for mobilising the appropriate champions, opening a fiscal space for financing scaled up interventions, securing the necessary political commitment, resolving the supply and demand sides of the resources-for-results equation, addressing capacity building issues, integrating cultural considerations, and building the required partnerships. Box 10: Key messages on agriculture for development Five main messages from World Development Report 2008 Accelerate growth in the agriculture-based countries (sub-Saharan Africa) through a productivity revolution in smallholder agriculture. Address the disparity problem in transforming countries: promote a comprehensive approach to shift to high value agriculture, extend the productivity revolution to lagging regions, decentralise economic activity to rural areas, and help some people move out of agriculture. Reduce agricultures large environmental footprint; urgently address climate proofing the farming systems of the poor; and promote agricultures provision of environmental services. Recognise multiple pathways out of poverty: commercial smallholders, workers in agriculture and the rural non-farm economy, and migrants. Provide opportunities to improve the livelihoods and food security of subsistence farmers and unskilled farm workers. Improve local, national and global governance for agriculture Source: World Bank, 2007 83. A review of experience with the rural dimensions of the PRS confirms the relevance of an ongoing shift in paradigms, related to participation vs. political development, country ownership vs. external conditionality, and political economy vs. a technocratic approach to PRS processes. Experience implementing the latest generation of PRSs raises a number of questions, as summarised in the conclusions from the Mozambique case study, along the following lines: What is the relationship between participation and domestic political development? In the long run, ad hoc arrangements such as donor-induced forums for dialogue between government and civil society, cannot replace a vibrant political sphere which creates conditions for socioeconomic progress through creative tension and has the freedom to make mistakes as part of its learning process.

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B. Key action areas for follow-up

84. As part of the pathway for follow up, these starting points could contribute to a systematic approach for sharpening the PRS rural focus, with an agenda for research and action in six key action areas: Strengthening analytical underpinnings; Implementing PRSs at sector level; Institutionalising rural participation; Linking PRSs with regional or global initiatives; Supporting PRS sector monitoring and evaluation; and Building national capacities. 85. These action areas which in turn build on previous assessments and recommendations by multilateral and bilateral partners to promote growth and poverty reduction in rural areas are discussed below. Strengthening analytical underpinnings 86. Focused analytical work on selected thematic or sector issues including sources of growth and poverty reduction, climate change and agriculture, food and energy markets would aim at filling knowledge gaps, and informing public policy choices. 87. Diagnostics and distributional analysis should be carried out on a regular basis or as required by specific country circumstances, and disseminated as an input to evidence-based policy making. A reasonable menu of diverse but complementary analytical tools during PRS processes would include: Poverty assessments to understand the scope and dynamics of poverty and to sharpen the targeting processes in the light of opportunities and constraints; Poverty and social impact analysis (PSIA) to anticipate winners and losers from prospective reforms and make adjustments in light of experience. See also Box 11 on PSIA and controversial rural sector reforms and Box 14 on Building consensus for land redistribution in Cambodia; Agricultural or rural public expenditure reviews (PER) to help align public resources with public goods; and Participatory evaluations to document which approaches have worked on the ground, and which ones have not and why. 88. The extent to which public expenditure reviews (PERs) and poverty and social impact analysis (PSIA) are participatory exercises is sometimes subject to debate, taking into account time and resource constraints. These are potentially powerful tools for participatory policy making and mutual accountability. However, the use of these tools is both a sensitive and time-consuming exercise as experienced with the land PSIA in Cambodia and agricultural PERs in Ethiopia and Nicaragua.

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How can genuine country ownership and internal accountability replace the excessive influence of external conditionalities? There is a pressing need for concerted international action to address the adverse effects of external policies (on agricultural subsidies, for example). At the same time, at country level, a participatory stakeholder debate on the root causes of poverty including conflicts and power relationships, issues of assets and access for the rural poor can encourage decision makers to design pro-poor policies and actually implement them in a sustainable manner. How can Poverty Reduction Strategies refocus away from a strictly economic and technical approach to a political one? As the PRSP where the last P stands for process rather than paper deals with priorities for public action, that is, what the government should do and how it should do it, special attention should be paid to the question: in whose interest? (See Box 2).

Box 11: PSIA and controversial rural sector reforms A comprehensive review of experience with PSIA in the agricultural sector shows that all the reforms subjected to PSIA were politically sensitive due to the size of the reform and the perceived large distributional impacts. Controversy around the proposed reforms was of three general types: (i) uncertainty about the significance and magnitude of distributional impacts; (ii) disagreements about the relative weights placed on distributional outcomes (and trade-offs between equity and efficiency outcomes) by different actors; and (iii) questions about the overall efficiency gains of the reform. Issues of regional equity can be particularly sensitive politically. This is a form of horizontal inequality, frequently associated with political conflict, and can be a major feature in promoting violent conflict. The cases indicate that it is often necessary to pay particular attention to the impact of reforms on residents in remote rural areas. Historically, agricultural policies (subsidised or government-controlled marketing, or pan-territorial pricing, for instance) have supported the spread of productive activities to non-economic, often distant, locations. Marketing reforms which reduce the states role may have an especially powerful impact on these remote producers. Social policy mechanisms, such as safety nets, may be needed to soften the impact of change. It is notable that the remote groups are least likely to have a strong voice in the policy debate. An effective PSIA can, however, provide a voice that isolated groups may not have had. Remoteness was a concern in the Zambia, Benin, Chad, Malawi and Mongolian PSIAs. It can be concluded that the motivation for engaging in a poverty and social impact analysis needs to be well understood and transparent to stakeholders, in order to influence the design, results and impacts of a proposed reform. There are indications that an inherent interest in equity concerns (rather than economic efficiency or fiscal concerns) provides a better platform for governments to enhance the public support base for the reforms. A PSIA undertaken in that context would have an enhanced likelihood of resulting in open policy deliberation. The complexity of stakeholder interests bearing on many agricultural policy issues means that a PSIA process, if well managed, can provide a forum for generating consensus around a reform agenda. Depending on the level of rural isolation, the transaction costs of organising and lobbying for rural residents can be quite high. Compounded by entrenched rural interests and concentrated power among a limited number of interest groups, reforms can be stalled. The level of suspicion towards both the private sector and the state in markets reinforces the need for consensus and broad dissemination in the PSIA process. Source: World Bank, 2006 89. In terms of future research topics, continuing investigations in light of issues raised under the first three parts of this report could fill knowledge gaps and inform the policy process in a number of areas including: Contribution of participatory processes to poverty reduction outcomes, progress and limits in participatory governance and impact on pro-poor policies; Evaluation of the effectiveness of implemented pro-poor policies in terms of their actual contribution to the overriding poverty reduction objective; Understanding the links and trade-offs between poverty reduction and growth which would provide a basis for dealing with context-specific issues at the rural level and address both poverty reduction and growth concerns; Assessment of the potential contribution of non-state actors to poverty reduction, and how these could link up with PRS processes where the priorities for public action are set; Rationale, issues and options for biofuel development in the context of country-led PRS and related reform processes, the globally driven increases in food and energy prices, and the new opportunities and threats for agriculture to provide food, feed and energy in the context of volatile food prices and competing demands on agricultural land; and finally, Examining the extent to which such specificities may affect the scope and pace of compliance with the aid effectiveness agenda, and the prospective customisation of this agenda to reflect the exigencies of the agriculture and rural development further, as already suggested in Part Three of this report.

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PART FOUR

90. In terms of knowledge management and innovation, the findings and messages from knowledge products should feed into relevant learning loops, including good practices relating to public sector priority setting, grassroots initiatives, and publicprivate partnerships. The context-specific nature of some of the issues discussed above will require continuing countrylevel investigation to illustrate successes and failure, identify good practices and the required conditions for replication, and provide the basis for a more focused support to specific country-level processes by development partners. Implementing PRS at sector level 91. Special attention should be paid to linking national planning frameworks with the agriculture and rural sector strategies and programmes including PBA/SWAps where applicable, or multi-sector approaches to territorial development in the context of decentralisation policies. As noted in a review of issues and options for promoting the rural productive sector in a PRSP context (Shepherd and Fritz, 2006), the PRSP itself provides an opportunity to build coherence across productive sectors; however it is not a substitute for each of the productive sectors within such a framework developing clear sector strategies. The coherence and alignment between the two is an iterative process. The box below is a useful way of structuring this idea. Box 12: Aligning sector programmes with PRSP

Poverty Reduction Strategy

Sector Policy and Strategy

Broad and Deep Consultative Process

Medium Term Expenditure Framework, Budget

Implement Donors Aligned with Govt Systems

Sector Medium Term Expenditure Plan, Budget

Implement

Poverty Monitoring Framework

Sector Performance Monitoring System

Source: Shepherd and Fritz, 2006 Both PRSP and sector programmes use very similar instruments in their processes, as Box 12 shows. In principle, the PRSP should draw from sectoral policies, whilst sectoral strategies should elaborate on how the objectives set out in the PRSP will be achieved. The MTEF should guide the overall allocation of internal and external resources in the country, whilst the sectoral medium-term expenditure plan shows how the sector intends to allocate its resources to the achievement of its strategy goals. Similarly the sectoral performance measurement framework should feed into the overall poverty monitoring systems. (Box and comments: Williamson, 2005, cited in Shepherd and Fritz, 2006).

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Allocate

Allocate

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92. There is still much room for improvement in the linkage among national-, sector- and project-level processes. National- and sector-level processes tend to capture the attention of central governments and donor agencies when (a) defining strategic and planning frameworks such as PRSP, PBA/SWAps, and (b) setting up systems, like budget support or pooled funding, and the related process indicators. There are concerns, however, that the critical but very time-consuming processes at national and sector levels often take place at the expense of other equally important aspects of aid effectiveness which critically start at the local level of intervention, such as: Pro-actively encouraging cost-effective and demand-driven service delivery on the ground, involving government, NGOs and the private sector, and allowing the rural poor and their organisations to promptly respond to external opportunities or threats. This will depend on: Creating a space for innovation within the harmonisation and alignment agenda at country level, with a view to the possible scaling up of project-level policy gains or replication of successful livelihood trajectories, through national- or sector-level partnerships and additional resource mobilisation or reallocation of funds. Examples include weather insurance policies for poor rural farmers in drought-prone areas of Ethiopia, and a village-based animal health system in rural Cambodia as a potential building block for a bird flu preparedness strategy and action plan. Sustaining the learning loop between successive generations of PRSs/PBAs and the findings from an early tracking of results on the ground, either from the mainstream livelihood support activities or innovative interventions (see Box 12). Institutionalising rural participation 93. Several studies have underscored the importance of participation at various stages of the PRS process: diagnostics, planning, resource allocation, implementation, monitoring and feedback. Support to farmer or other producers organisations may contribute to (a) democratic processes voice of the voiceless, (b) poverty reduction efforts stakeholder ownership, or (c) sustainability of pro-poor policy reforms beyond the external conditionality period. 94. Past experience (see Part Two of this report) suggests that there is much room for multistakeholder partnerships (among governments, development partners and the private sector) to support rural organisations as natural resource users and service providers. The type of support to rural organisations should be context specific, depending on whether they are membership-based or advocacy- or service-oriented. The support could range from capacity building (see Box 13) and knowledge networking and advocacy, to involvement in the formulation and review of country cooperation frameworks, programme design and implementation, policy dialogue based on stock taking and ex-ante policy impact assessment, and monitoring and evaluation. In addition, it would be wise for partners to identify mechanisms for institutional profiling and assessment of whether they are currently or potentially representative, and to provide for regular feedback from grassroots organisations, either on the quality of service delivery or the effectiveness of advocacy.

Box 13: Strengthening capacities of farmer organisations in policy monitoring in West Africa The West African Network of Rural Producers (ROPPA) has undertaken a study on the implementation of new agricultural policies at country and sub-regional (ECOWAS) level and their integration in Poverty Reduction Strategies. A review of agricultural policy instruments helps provide ROPPA with a better grasp of user-friendly analytical tools to articulate their own views and strengthen their advocacy role and formulate (alternative) proposals as deemed appropriate. To this effect, ROPPA has sought assistance from the West Africa Rural Multi-donor Hub in the form of external expertise to the participatory elaboration of a methodological guide for retrospective and prospective analysis of the role and place of family farms in the context of pro-poor agricultural policies. Internal and regional expertise is outsourced from CIRAD and IRAM, the IMPACT Network, and researchers from universities and research institutions in the region as identified by the Hub and ROPPA. This is part of the development of institutional relationships between farmer organisations and research institutions, involving other partners such as IDRC and OXFAM. Source: Multi-donor Hub, West Africa, 2008 95. Against the background of coordinated efforts to respond to soaring food and fuel prices in 2008, the proposed measures included budget support to help countries compensate for the additional burden of subsidies or foregone tax revenues, while the establishment of several new trust funds at various levels is being considered. Recent evidence (OECD/FAO, 2008) suggests that developed countries and economies in transition account for the great bulk of the food supply response. On the other hand, recent arrangements in many developing countries in Africa (such as Sudan and Madagascar), Asia (such as Pakistan) and Latin America (such as Brazil) to grant agricultural land concessions for private sector exploitation have raised both expectations for increased domestic supply and serious concerns about access to land for the rural poor.

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Box 14: Building consensus for land redistribution in Cambodia The Cambodia PRSP recommends that social concessions be used to distribute vacant state lands to poor households. A comprehensive land reform package was proposed under the hypothesis that social land concessions and legal entitlement to land will have an impact on alleviating rural poverty and increasing economic productivity by allowing rural households to use idle land productively and as collateral for capital investment. In Cambodia, the political sensitivity to changes in land policy was not fully appreciated by many donors before the start of the land reform programme. If land reform had been poorly managed, this political sensitivity could have led to national crises. Many [others] were aware of the power of land allocation in supporting the central governments authority. However, only a detailed analysis of social relations underscored the importance of this dimension. The high degree of sensitivity to land issues may have reduced the ability of the PSIA to push the envelope and suggest controversial elements of the reform. Thus, political sensitivity affected the scope of recommendations. The PSIA occurred at a time when land concession was of high importance to the government, civil society, the public and donors. Because of this high public interest, the PSIA aimed to make more information about the potential impacts of the land reform available, so that public discussions could be based on factual evidence. A great deal of attention was given to stakeholder dialogue throughout the entire process of the PSIA. These classes of impact on the reform process are not mutually exclusive; in some instances, the proposed policy did not change, but the PSIA created an enhanced dialogue among stakeholders, built on a series of consultations with a wide range of stakeholders. The process benefited from a strong governing committee, which included the Ministry of Land Management (MLMUPC) and the Agri-Business Institute Cambodia (a local research NGO), and external financial and technical support from GTZ and Oxfam UK, which was perceived as broadening the perspective and contributed to wider acceptance of the research results. The consultations included the following steps: The research concept was discussed in a workshop attended by MLMUPC, donors and consultants in Phnom Penh, soliciting final feedback for fine-tuning the approach. As a capacity building measure, field research teams included a large number of government staff from different line ministries to be involved in a potential land distribution programme. Research results from the different sub-studies were shared among research partners for comments and then distributed for wider discussion. In May 2004, a one-day workshop was conducted to share findings and recommendations from the PSIA. Nearly 100 participants representing different national and decentralised government institutions, donors and NGOs attended the workshop. The lively debates provided new insights and focus for finalising the PSIA recommendations. The consultations helped to identify common ground for discussion among stakeholders and strengthened mutual trust. This again revealed new information and suggestions for implementing the reform: The continuous involvement of NGOs, paired with research results led to the proposal that NGOs can play a major role in a larger scale social concession programme whose implementation would certainly overstretch the capacities of government institutions. Engagement of commune councils and informal local groups helped to create important operational relationships for the land concession programme and to lay the foundation for a participatory process in a World Bank project, which the PSIA team initiated. Research findings further revealed that it was much more difficult than expected to find and release suitable land for distribution, and that this process itself will take strong political commitment from government institutions to proceed with the reform. But the inclusive process of the PSIA helped bring these issues into public debate and to build alliances for moving the land distribution agenda; this enhances the likelihood of the reform proceeding with public support. Source: Groetschel, Chanty, 2004.

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96. Against the background of coordinated efforts to respond to soaring food and fuel prices in 2008, the proposed measures included budget support to help countries compensate for the additional burden of subsidies or foregone tax revenues, while the establishment of several new trust funds at various levels is being considered. Recent evidence (OECD/FAO, 2008) suggests that developed countries and economies in transition account for the great bulk of the food supply response. On the other hand, recent arrangements in many developing countries in Africa (such as Sudan and Madagascar), Asia (such as Pakistan) and Latin America (such as Brazil) to grant agricultural land concessions for private sector exploitation have raised both expectations for increased domestic supply and serious concerns about access to land for the rural poor. 97. An exciting challenge associated with these new developments in many countries will be to use the ongoing or forthcoming PRS and related sector processes as a mutual accountability framework. This would involve not only governments and donors but also the rural poor and their organisations, as an opportunity for a participatory and informed debate on prospective winners and losers from proposed policy measures. Depending on the issue at hand (like access to productive assets including land and water, technology or markets) consultations with rural stakeholders would include representative organisations of natural resource users and rural producers, and members or clients of rural finance institutions, with the aim of making a meaningful contribution to the identification of priorities for public action and resource allocation. Linking PRS with regional or global initiatives 98. Regional initiatives such as the Comprehensive Africa Agricultural Development Programme (CAADP) have the merit of keeping the agricultural agenda on the table for regional consultation. However, effective implementation of the CAADP will depend on the priority given to agriculture at the national level. Given that conditionality does not work, perhaps evidenced-based advocacy (best practice, cost of inaction, relative impact of agricultural growth on poverty reduction) may have a greater influence on the decision of budget holders, besides inevitable cases of arbitrage based on political power relationships. 99. Internalising the components of a regional initiative at country level raises the issue of subsidiarity, which also means that the main conduit for addressing mainstream country priorities should be in the context of the PRS and related sector strategies and budget processes. There is, however, a need to address cross-border issues on policies, institutions, investments and capacity building, critical to the achievement of national priorities but which cannot be resolved in the context of a single country programme, hence the need for (sub)-regional cooperation. In the light of experience with PRS implementation at country level, a logical entry point for any regional initiative to add value to national process should involve the identification within relevant PRS and sector processes of challenges to agricultural development requiring a (sub)-regional approach. These challenges could include harmonisation of public policies (on subsidies, for instance), infrastructural development, trade and market linkage issues, nomadic pastoral systems, management of shared ecosystems, migratory pest control, and so on. 100. These considerations may provide a basis for identification of entry points for relevant (sub)regional and global initiatives to add value such as knowledge networking or capacity building in conjunction with other relevant regional or sub-regional initiatives spearheaded by intergovernmental or regional integration organisations. 101. The World Development Report (WDR) 2008 and the CAADP framework could provide a unique opportunity to cast new light on emerging issues or recurrent problems. They could provide clues on how to address, in a systematic manner, agricultures challenges and the potential to meet food, feed and fuel requirements in an environmentally sustainable manner and to contribute to alleviating poverty, risk and vulnerability management, including adaptation to climate change and variability, food security and market linkage in the context of regional integration.

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102. Making operational the WDR 2008 findings and recommendations may require identifying, at country level, those WDR elements relevant to specific country circumstances and organising a debate with relevant thematic groups, as a basis for customised follow up in the context of country-led processes. 103. Similarly, the CAADP roundtable process scheduled for 2008 and 2009 could offer a forum for applying CAADPs pillars to particular country cases, provided the pillars are properly customised and adapted to add value to ongoing country-led processes at PRS and sector levels. For example, an adapted CAADP framework could provide an opportunity to mobilise new donors to help address issues of infrastructure, private sector partnerships and (sub)-regional harmonisation of public policies for seeds and fertiliser supply, bearing in mind the intrinsic difficulties faced in these areas by programme-based approaches in the agriculture sector. 104. It would also make sense if the new drivers of rising food and energy costs demand for biofuels, climate change and the changing food consumption patterns in China and India were pro-actively factored into the evolving CAADP process. Interestingly, in some countries partners are considering proactive measures to follow up on the recommendations of food price assessment missions in the framework of ongoing country-led processes and related thematic programmes and working groups. 105. Likewise, the Alliance for a Green Revolution in Africa (AGRA), the Africa Enterprise Challenge Fund (AECF) and more recently, the JICA/AGRA/FARA-promoted Coalition for Rice Development in Africa (CARD), have opened new windows of opportunity for publicprivate partnerships, with focused growth and poverty reduction objectives and significant financial resources and convening capacities. It would be helpful to identify the interface and synergies between the strategic thrusts of these initiatives and the relevant country-led processes, for example, combining policy reforms on land and water with the injection of new resources for private investment. Other relevant initiatives should also be kept in mind, such as those aimed at improving the rural investment climate and lowering the bar for the rural poor to take advantage of new opportunities in terms of access to technology, markets and finance. To this effect, interested governments may wish to encourage AGRA, AECF and CARD promoters to engage with relevant thematic working groups, as a basis for prospective identification of sector specific constraints and opportunities for partnership. 106. Last but not least, the existing platforms at the regional level (in Africa, Asia and Latin America with support from donors or regional integration institutions) as well as at global level (such as the Global Donor Platform for Rural Development) could also play a important role in knowledge sharing and capacity building, based on the principle of subsidiarity. Support to PRS sector monitoring and evaluation 107. As discussed in Part Two of this report, PRS monitoring provides a management tool and an instrument for impact assessment. Linking sector monitoring with national- and project-level results and impact assessment systems will provide the basis for the implementation of a results-oriented PRS. 108. The 2006 ODI/IFAD review notes that, different from social sectors, the international environment matters a great deal for the development of productive sectors and likely and/or foreseeable developments need to be considered (terms of trade, commodity price volatility, regional/international growth prospects, changes in regulation in export market countries, etc.). The capacity to monitor and to evaluate international developments, and to feed this into the national planning process may be weak and may require more attention also from donors. (Shepherd and Fritz, 2006). Arrangements for the early tracking of results on the ground are overdue in most countries, which may ultimately affect the credible measurement of progress towards the MDGs, the availability of evidence for timely policy change and the redeployment or increased allocation of resources for agriculture.

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109. The criteria for defining the national components of regional initiatives should reflect considerations of coordination, coherence, complementarities and, most importantly, a principle of subsidiarity with regard to the country-led processes. This approach would, for example, make sense with interventions in Cambodia in the context of the Greater Mekong Sub-region Initiative, as well as in the context of current efforts to customise the CAADP framework to the specific conditions of African countries where a CAADP roundtable process is under consideration. In both cases, special attention should be paid to identifying opportunities for cross-fertilisation towards a progressive harmonisation of approaches to monitoring and evaluation systems at country and sub-regional levels.

Box 15: M&E aspects of PRS implementation at sector and local level PRSPs are today being increasingly operationalised and articulated through sector (such as SWAps) and territorial development strategies and plans. The inherent iterative nature of policy and strategy development calls for articulated donor support for the PRS process, built upon the implications and options arising from a broad range of framing questions. Support to PRSs is not just about policy dialogue, but also about operationalising PRSs at sector and local level, building farmer institutions and the capacity to engage in policy dialogue, bringing evidence on rural poverty into the policy process, and in some cases even helping to support improved monitoring of rural poverty.

Policy Process ex-ante consistency among indicators

PRSs setting policy and strategic framework

M&E of Outcomes ex-post consistency among indicators

Sector Objectives through policy and strategic framework

Sector Action Plans

Sector-specific impacts

Impacts on overall goals

Review of the PRSs

Territorial Objectives through policy and strategic framework

Territorial Action Plans

Territorial specific impacts

Aim of specific programmes

Programmes

Programmes impacts

Source: Sourang et al, 2007 Building national capacities 110. As a cross-cutting activity related to the five action areas listed above, targeted capacity building will facilitate the replication and scaling up of successful interventions towards agreed MDGs targets. As a cross-cutting activity, there is a need to build domestic capacities for: Government services to generate, maintain and disseminate institutional memories of analytical work; Specialised institutions to undertake research, based on actual field experience, and to explore the institutional, financial and policy implications of applying traditional knowledge and replicating and scaling up innovative approaches and project level policy gains; and Poor rural women and men and their organisations to engage in documenting their own livelihood trajectories and articulating their own vision, targets and expectations.

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SELECTED REFERENCES
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SELECTED REFERENCES
Bedi, T., Coudouel, A., Cox, M., Goldstein, M and Thornton, N., 2006. Beyond the Numbers: Understanding the institutions for monitoring poverty reduction strategies. World Bank, Washington, DC. Available at: http://go.worldbank.org/PPTOO2V1P0 Braathen, 2006. A participatory pathbreaker? Experiences with poverty reduction strategy papers from four south African countries. NIBR Working Paper 2006:122, Norwegian Institute for Urban and Regional Research, Oslo, Norway. Cord, L., 2002. Chapter 15: Rural poverty in: Klugman, J. (ed.), A sourcebook for poverty reduction strategies. Washington, DC. pp. 65121. Available at: http://go.worldbank.org/RJRQF1BL50 De Ferranti, D., Perry, G.E., Lederman, D., Valds, A. and Foster, W., 2005. Beyond the city: The rural contribution to development. World Bank, Washington, DC. Available at: http://go.worldbank.org/HRS8VDZ7U0 Global Donor Platform for Rural Development, 2007. Formulating and implementing sector-wide approaches in agriculture and rural development: A synthesis report. Bonn, Germany. Available at: http://www.donorplatform.org/component/option,com_docman/task,doc_view/gid,614/Itemid,98/ Global Donor Platform for Rural Development, 2008. Agricultural sector experiences in implementing the Paris Declaration on Aid Effectiveness. Bonn, Germany. Available at: http://www.donorplatform.org/component/option,com_docman/task,doc_view/gid,734 Groetschel, Andreas, Chanty, Srey, 2004. PSIA and Cambodias Land Reform Program: A joint exercise of IMAP, Oxfam, GTZ, WB, and Agri-Business Institute Cambodia. PowerPoint presentation at the conference PSIA and Agricultural Policy in PRSP Countries. Rome, Italy, September 2004 GTZ, 2007. Sondage val sur la dimension rurale du CSLP au Burkina Faso. Eschborn, Germany. Hartmann, A. and Linn, J., 2007. Scaling up: A path to effective development. 2020 Focus Brief on the Worlds Poor and Hungry People, IFPRI, Washington DC. Available at: http://www.ifpri.org/2020Chinaconference/pdf/beijingbrief_linn.pdf, IFPRI Johnsen, F.H., Ludi, E. and Waktola, A., 2007. Rural focus of PRS: The case of Ethiopia. International Fund for Agricultural Development, Rome, Italy. Le Monde, 2008. Le nouvel avenir de lagriculture by E. le Boucher. Paris, 3 March Mejia, A., 2008. Consolidated Planning - Balancing Investments and Policies. World Bank, Washington, DC. Available at: http://siteresources.worldbank.org/EXTWAT/Resources/ 4602122-1213366294492/5106220-1213804320899/1.0Introductory_Remarks_by_Co-Chairs.pdf Macamo, E., 2007. Rural focus of PRS in Mozambique. International Fund for Agricultural Development, Rome, Italy. Ngaido, T., 2007. The rural focus of poverty reduction strategies in Burkina Faso: A case study. International Food Policy Research Institute, Washington, DC OECD, 2006. Survey on Monitoring the Paris Declaration. Paris. Available at: http://www.oecd.org/document/52/0,3343,en_2649_3236398_36162932_1_1_1_1,00.html OECD/DAC, 2006. Pro-poor growth: agriculture. Paris. Available at: http://www.oecd.org/dataoecd/9/60/37922155.pdf

OECD/FAO, 2008. Agricultural Outlook 2008-2017. Paris. Available at: http://www.fao.org/es/ESC/common/ecg/550/en/AgOut2017E.pdf Omamo, S.W., 2003. Policy research on African agriculture: Trends, gaps, and challenges. ISNAR Research Report no. 21, The Hague, Netherlands. Royal Government of Cambodia, 2007. The Cambodia Aid Effectiveness Report. Phnom Penh, Cambodia. Available at: http://www.phnompenh.um.dk/NR/rdonlyres/FECB6484-6392-4F1F9C62-F4A5A2DB0B6F/0/AidEffectivenessReportMay2007.pdf Shepherd, A. and Fritz, V., 2005. Key issues in sharpening the rural production focus of poverty reduction strategy processes: Literature review for IFAD. ODI, London. Shields, D. and Hobley, M. Poverty reduction strategy rural focus: a Cambodia case study. International Fund for Agricultural Development, Rome, Italy Sourang, C.M. et al, 2007. Enhancing IFAD engagement in PRS and country-led processes. International Fund for Agricultural Development, Rome, Italy. Toranzo Roca, C. and Wiggins, S., 2007. Poverty reduction strategies and rural development. Case study: Bolivia. International Fund for Agricultural Development, Rome, Italy World Bank, 2003. Reaching the rural poor: a renewed strategy for rural development. Washington, DC. Available at: http://go.worldbank.org/3NNIH771P0 World Bank, 2004. A review of rural aspects of PRSPs and PRSCs, 2000-2004. Washington, DC. Available at: http://www.hubrural.org/pdf/wb_review_rural_dev_in_prsp_prsc.pdf World Bank, 2006. Stakeholders, power relations, and policy dialogue: Social analysis in agriculture sector poverty and social impact analysis. Washington, DC. Available at: http://go.worldbank.org/JT7UCFWAI0 World Bank, 2007. World Development Report 2008: Agriculture for development. Washington, DC. Available at: http://go.worldbank.org/ZJIAOSUFU0 World Bank, 2008. Linking the PRS with National Budgets, Washington, DC. Available at: http://siteresources.worldbank.org/INTPRS1/Resources/3836061106667815039/PRS_Budgets_GuidanceNote.pdf World Bank/IMF, 2005. 2005 Review of the poverty reduction strategy approach: Balancing accountabilities and scaling up results. Washington, DC. Available at: http://siteresources.worldbank.org/DEVCOMMINT/Documentation/20651869/DC2005-0017(E)-PRSReview.pdf

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APPENDIX 1:
ORIGIN OF THE REVIEW, ITS SCOPE AND ANALYTICAL FRAMEWORK
1. A review of the rural focus of Poverty Reduction Strategy (PRS) processes in Africa, Asia and Latin America was carried out in 2006/2007 with IFAD as a lead agency, following a decision by the Global Donor Platform for Rural Development to sponsor knowledge products in this area. This included PRS Country Case Studies and a SWAP Global Review Study, for which IFAD and FAO, respectively, were selected as lead agencies. The need for country case studies to fill knowledge gaps was originally identified as a follow up to previous stock-taking activities which showed gaps and disconnects between poverty assessments, PRSP priority setting and donor resource allocation. These activities included a series of WB desk reviews (2004, 2005) on rural aspects of Poverty Reduction Strategy Papers (PRSPs) and Poverty Reduction Strategy Credits (PRSCs) and an ODI literature review commissioned by IFAD (2006) and funded by DFID. 2. Selected countries for the PRS case studies included Bolivia, Burkina Faso, Cambodia, Ethiopia and Mozambique. Overall, the country case studies have provided an opportunity to test and validate a number of assumptions to varying degrees, depending on country circumstances; and to update lessons about the root causes of the gaps and disconnects in PRS rural focus including weak analytical underpinnings, institutional fragmentation, inadequate participation, weak monitoring systems and limited institutional capacity.

FRAMEWORK OF ANALYSIS: THEMES AND GUIDING QUESTIONS

Themes Understanding the context: What are the root causes of the identified weaknesses in PRS policies and policy processes? What are the available evidence and narratives regarding: - determinants and dynamics of poverty; - linkages and trade-offs between poverty reduction and growth policies; - contribution of the rural productive sectors to pro-poor growth; - role of the state and non-state actors in driving pro-poor growth, in particular in the rural productive sectors. How are the evidence/narratives generated? Are the evidence/narratives contested? How and by whom? Who is involved and who influences policy formulation? What is the type of involvement of the rural stakeholders (including state agencies, NGOs and the private sector corporate, smallholders, rural micro enterprises, etc.) in PRS processes? What factors determine the degree of participation capacity, location, vision or interests? What factors determine the choice of poverty reduction policy priorities evidence, interests, inertia? What evidence is used for decision making - what are the quantitative and qualitative analytical underpinnings of policy decisions? What is the balance between expenditure-focused and enabling/regulatory policy interventions? What explains the lack of consistency of policies in PRSs and other sector policy plans, strategic frameworks and instruments?

APPENDIX 1

1.Evidence and narratives on pro-poor growth

2. Participation in PRS processes

3.Policy formulation, strategy development and prioritisation of public actions under PRS

4. PRS Policy and strategy implementation

Why have policy priorities in poverty reduction not been implemented as outlined in the strategy? What factors determine the translation of policy priorities into practice (resource availability and allocation, investment and service delivery)?

5.PRS Monitoring and evaluation, and feedback for policy/strategy formulation

46

To what extent are the selected policies contributing to poverty reduction? Is policy evaluation being carried out? Does M&E feed into policy formulation? What are the challenges to policy monitoring and evaluation in the rural productive sectors (considering, for example, the importance of exogenous factors in sectors such as agriculture)?

3. The case study process and deliverables include: (a) fine-tuning of the overall methodology, short listing of countries, design of terms of reference, budgeting and team composition; (b) country data analysis, stakeholder interviews, report writing and country feedback; and (c) synthesis report writing, peer review, finalisation and dissemination. Country specific findings along the lines of a common analytical framework are summarised in a synoptic table attached as Appendix 2. The main text of this synthesis report draws from these as well as several other relevant sources. 4. A forward-looking approach was adopted (see the analytical framework), seeking answers to two overarching questions. First, what are the root causes of the identified weaknesses in PRS processes, in particular with regards to the limited participation of rural stakeholders and to the observable gaps and disconnects between poverty assessments and the prioritisation of policies, public action and resource allocation? Second, how could PRS processes be strengthened to improve long-term development impact? 5. Against the backdrop of current concerns about aid effectiveness and external shocks associated with climate change and soaring food prices, this synthesis report draws from findings of the country case studies as well as other relevant sources. It focuses mainly on aspects of PRS process including good practices for potential replication and key action areas for follow up. At the same time, it also touches on issues of PRS content usually context specific and provides concrete country examples only for illustration and teaching purposes, given that the existing literature already provides a generic discussion on substantive elements of poverty reduction and rural sector strategies.

Looking forward: How could PRS policies and policy processes be strengthened to improve long-term development impact?

What additional evidence and/or alternative narratives are worth exploring, with the view to sharpening the pro-poor orientation of growth policies? How could access to evidence be promoted and debate generated on the context-specific issues of relevance to rural poverty reduction and growth?

How could the participation process be institutionalised by defining the roles and responsibilities of each actor? How could the voices of the poor be better reflected in the policy debate and policy making? How could rural stakeholders participate in the PRS policy formulation and implementation process?

How could the knowledge built on rural poverty and its dynamics be fed into the policy debate and formulation as well as into strategic planning and development? How could the available knowledge and evidence on the potential contribution on the rural productive sectors to poverty reduction be made accessible to policy makers and be used to influence policy prioritisation and strategy development? How could consistency and alignment between different policy instruments be promoted? How could a feedback mechanism between M&E and policy decision-makers be established and vice-versa? How could integration between national (PRSs) and relevant sector strategies be facilitated? What is the evidence for good practice and what is the scope for replicating it? How could inter-institutional communications (policy makers, planners, budget holders) be strengthened? How could the links between policy priorities and implementation instruments (MTEF and national budgets) be strengthened How could the policy decision-making process be speeded up to ensure success? What is the evidence for good practice and what is the scope for replicating it? How could ownership and participation of non state actors i.e. civil society, private sector be ensured? Where could demand for policy monitoring and evaluation come from? How could this demand be strengthened? Who should provide for the evaluation of public sector policies? How could neutrality and accuracy be ensured? What role is there for civil society organisations? What is the evidence for good practice and what is the scope for replicating it?

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APPENDIX 2:
Assessment of rural focus of PRS processes Planning, implementation and evaluation synopsis of case studies in Bolivia, Cambodia, Ethiopia, Mozambique and Burkina Faso

Bolivia
1. Evidence and narratives on pro-poor growth
ELEMENTS AND ISSUES What are the available evidence and narratives regarding: determinants and dynamics of poverty Population habitation poverty widespread and deeper in rural than in urban areas; Geography within the rural areas, population in highlands are poorer than those in lowlands; Ethnicity indigenous population have more and deeper poverty because most live in the highlands; Access to resources particularly land and credit; Gender women suffer more deprivation economically and socially; Economic growth and nature narrow-based economic growth (gas/oil & large-scale commercial farms in lowlands), with limited direct employment opportunities and few linkages to the rest of the economy, has limited impact on poverty and tends to exacerbate income disparity; Urban growth linkage to rural economy tends to have positive effect on rural poverty.

APPENDIX 2
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linkages and trade-offs between poverty reduction and growth policies In the period 1989 1997 (period of macro-economic policy reforms) when GDP per person grew by 10%, national poverty fell from three quarters to two-thirds. Extreme poverty fell even more from 60% to 40%. In rural areas, poverty is positively affected but with less impact. Rural poverty fell from 90% to 84%, i.e. by only 6%; extreme rural poverty fell by 18%. Public investments in agricultural and rural development after the major land reform of the 1950s were heavier in the lowlands of the east than in the highlands, contributing to economic stagnation in the highlands. The period 1980s 2000 saw a focus on macro-economic stability policies including market liberalisation driving agriculture and rural development; decentralisation (popular participation law 94, and decentralisation law 95); infrastructure development (roads and irrigation), participatory technology generation & dissemination, human resource development (health/education), security of tenure, and value chains. These policies benefited commercial agriculture but of little effect on smallholder agriculture. The recent government (2005/2006), made poverty alleviation and inclusiveness its central objectives that drive policy. Strategy is one of increased state control over gas and minerals, with increased processing within country to develop industrial links; plus boosting small-scale production in agriculture and other sectors. contribution of the rural productive sectors to pro-poor growth Land reform in highlands in 1950s improved access to land by the poor but with little additional support, hence impact on poverty is minimal. In the lowlands public investment in roads and provision of credit stimulated farming, especially by large-scale producers. This led to a regional economic boom in the lowlands, but with few benefits for the highland economy. Hence growing disparity between regions.

Bolivia (ctd.)
role of the state and non-state actors in driving pro-poor growth, in particular in the rural productive sectors The period 1985 2004 reflected active participation by the state in the social sector while the private sector played key roles in commercial sectors. Debt relief conditions under HIPC I & II, promoted decentralised governance and transfer of increased resources (20% of national budget) to local government. All the resources released from debt relief under HIPC II were allocated to local government. However, due to lack of experience and capacity, some local governments cannot make effective use of the resources immediately. Recent policy foresees major and direct intervention of the state in rural productive sectors, and increased participation by smallholders particularly the indigenous population constituting the poorest segment.

How are the evidence and narratives generated? Although Bolivia does not lack studies of its development issues, monitoring and evaluation of public programmes is not systematic, and learning from experience and institutional memory is limited. The current government draws from various ideas about socialism and indigenism locally and from abroad it cannot be ascertained whether they are based on empirical evidence. Assumptions about the cultures of indigenous people have influenced the strategy of development and poverty alleviation favouring the collective enterprise approach as against the independent private entrepreneur.

Are the evidence/ narratives contested? How and by whom? There are opposing camps challenging the policy/strategy approach. Two main camps are pronounced. The govt of the left and centre supported by the disadvantaged, the peasants and workers of the western highlands who prefer a centralised government and state-led approach, with control of the economy. The conservatives right wing government supported by the well-to-do people, and urban based private enterprises, above all in Sta Cruz, who prefer decentralised government with limited government intervention in the economy. There is also the debate on the allocation of resources particularly from gas and oil. How much of the revenues should be allocated to the lowland, the source of the gas, and how much should be allocated for the national good, and in particular to help the poorest and marginalised people (indigenous) of the western highlands.

PROPOSALS FOR IMPROVEMENT What additional evidence and/or alternative narratives are worth exploring, with a view to sharpening the pro-poor orientation of growth policies? PRS processes have suffered from frequent changes of government, a situation that does not permit continuity of policy and strategy; Dialogues undertaken for PRS have proved useful as outcomes have provided the base for consensus on policy and strategy decisions; The dialogue need however to be built into political processes to influence policy and strategy; Over-bearing influence of the donors should be reduced to promote national ownership; Problems of harmonisation of PRS with MDG and NDP exist and should be resolved; Harmonisation of discussions at various levels and maintenance of logical relations between fora.

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Bolivia (ctd.)
How could access to evidence be promoted and debate generated on the context-specific issues of relevance to rural poverty reduction and growth? Evidence and lessons from implementation experience need to be fed back into policy and strategy making bodies through provision of progress and monitoring & evaluation reports to them; Information from studies and surveys should be made available widely as they can prove very useful in policy and strategy making and programme targeting.

2. Participation in PRS processes

ELEMENTS AND ISSUES Who is involved and who influences policy formulation? The first PRS (2001) built on the popular participation promoted by government decentralisation to municipal level 1990/95, and the National Dialogue (1997) employed to prepare the development plan 1997 2002. However, linking PRS to debt relief, marginalised popular participation and led to the dominance of donors. Thus first PRS (2001) was used mainly for debt negotiation and focus mainly on social policies and put less attention on production. The second PRS (2004) was also produced through popular participation and focused both on social policy as well as the rural productive sector. Due to political instability, neither PRS was implemented. The present govt (2006) has jettisoned the PRS process and focused on developing a medium-term development programme (2006 2010) using the traditional government system but focusing on poverty reduction and social inclusion giving emphasis to the indigenous population. Thus while there has been popular participation in the process of policy and strategy development, the government bureaucrats and donors have the major influence in policy formulation.

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What is the type of involvement of the rural stakeholders (including state agencies, NGOs and the private sector corporate, smallholders, rural micro enterprises, etc.) in PRS processes? The first PRS, even though influenced by donors, was driven by local participants, including the grassroots, and this gave it local ownership. However, because the output reflected mainly donor views, implementation was problematic. Nevertheless all parties gained: government got debt relief; and the municipalities have the debt relief resources directly allocated to them. The second PRS, due to donor insistence, and assistance conditionalities, followed the process of popular dialogue and focused on economic actors smallholders, small-scale entrepreneurs, economic organisations, and liaison committees that work with group organisations of small producers. Due to govt change, the PRS document was not published but the results of the dialogue were published and showed a strategy focusing on problems of poverty and social exclusion, following a decentralised process. The present government discarded the PRS process but made use of the strategy resulting from the second PRS dialogue. The current government, thanks to its clear electoral majority, assumes the responsibility of the populace and does not see the importance of continuing with popular dialogue.

What factors determine the degree of participation capacity, location, vision or interests? Major factors determining the degree of participation are: government attitude and interest, donors influence, organisation and capacity of economic operators.

Bolivia (ctd.)
PROPOSALS FOR IMPROVEMENT How could the participation process be institutionalised by defining the roles and responsibilities of each actor? Due to political instability, the PRS process has not been institutionalised. The PRS process discontinued as a negative reaction to previous governments policies and donor influence.

How could the voices of the poor be better reflected in the policy debate and policy making? Strengthening the democratic process; Development of rural unions as the champion of the rights of small-scale producers; Focusing popular discussions on specific concrete issues that will drive poverty focused policies and strategies; Local government since the mid 1990s has become a way to channel local political inclusion. The process is uneven and municipalities need support to promote good experience and correct errors.

How could rural stakeholders participate in the PRS policy formulation and implementation process? Organisation and strengthening of the traditional system of unions of small producers; Support to decentralised governance; Social inclusion of particularly the indigenous population in policy and strategy discussions.

3. Policy formulation, strategy development and prioritisation of public actions under PRS
ELEMENTS AND ISSUES What factors determine the choice of poverty reduction policy priorities evidence, interests, inertia? The government ideology and attitude, the experiences and preferences of government institutions; Political pressures that leave little room for considering policy options, and for consideration of lessons from the past; Resources available to government; Experience through interaction with the rural population; Donors interests.

What evidence is used for decision making what are the quantitative and qualitative analytical underpinnings of policy decisions? Views from public dialogue; Bolivia has not implemented any of its PRSs due to political instability, therefore analysis of past experiences has no influence on policy decisions; Detailed information on the Bolivian economy is lacking. As noted, evaluation of previous government actions is at best patchy, at worst absent. Decision-makers are thus under-informed when making policy; The above did not necessarily matter under the governments seen before 2006, since so much was the politics of patronage, rather than looking to use state resources effectively; The government of Pres Morales since early 2006 has been hampered in its planning by lack of detailed information.

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Bolivia (ctd.)
What is the balance between expenditure-focused and enabling and regulatory or policy interventions? No balance between expenditure-focused and enabling regulatory or policy interventions; The PND 200610 stresses public spending, with less on regulation and policy. That said, PND sets out a stronger role for the state in the economy than before, with more public ownership and influence over key economic sectors, above all gas and minerals.

What explains the lack of consistency of policies in PRSs and other sector policy plans, strategic frameworks and instruments? Instability in government; Weak institutional capacities; Lack of information and evidence of impact of sectoral programmes on poverty; Lack of information on data and analysis that impact on policy decisions; Weak monitoring and evaluation and lack of confidence in M&E results.

PROPOSALS FOR IMPROVEMENT How could the knowledge built on rural poverty and its dynamics be fed into the policy debate and formulation as well as strategic planning and development? Review operations and identify which information and data have an impact on policy makers; Strengthen M&E system and make results available from different programmes available to policy makers.

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How can the available knowledge and evidence on the potential contribution of the rural productive sectors to poverty reduction be made accessible to policy makers and be used to influence policy prioritisation and strategy development? Promotion of integration between the PRS strategy and sectoral programmes The PND 2006/10 presents a reasonably well integrated strategy. The main challenge lies in turning the vision into feasible operating plans; Development of mutual trust between the govt administration and politicians. In 2006 there was evidence of energetic and committed work throughout central government; Difficult question, since to answer this well would require considerable understanding of how knowledge in Bolivia is generated and diffused; In general, there seem to be plenty of centres producing studies of development issues. The challenge would be to synthesise this information in forms useful to policy-makers. At the same time, gaps in knowledge need clear identification with a strategy to fill them.

How could consistency and alignment between different policy instruments be promoted? Promotion of a systematic, comprehensive integration of assessments of the problems of poverty and development; As stated, the PND 2006/10 does have an integrated vision for the development of the country. The challenge is to find ways to make the ideas operational.

Bolivia (ctd.)
How could a feedback mechanism between M&E and policy decision-makers and vice-versa be established? Dissemination of M&E reports; Capacity building; A key issue is neutrality and credibility. Key problem is how to promote centres whose work is accepted by most decision-makers.

How could integration between national PRSs and relevant sector strategies be facilitated? Improvement in collaboration between govt institutions. Not sure how much this is currently a major problem: the situation has improved considerably since early 2006 and the arrival of the new government.

What is the evidence on good practice and what is the scope for replicating it? Grassroots participation can contribute to consistent PRS strategy and policy and can be a process for building consensus; Too little evaluation of development experiences: more needs to be done to evaluate systematically and rigorously, so that Bolivian policy making can make best use of Bolivian experience.

4. PRS Policy and strategy implementation

ELEMENTS AND ISSUES Why have policy priorities in poverty reduction not been implemented as outlined in the strategy? Government instability; Politicising the civil service; Differences of opinions within govt particularly coalition govt; Lack of transparency; Lack of coordination between policy-making and political process; Pressure on govt from different economic operators; NB: almost all of the above problems apply to governments prior to the current government.

What factors determine the translation of policy priorities into practice (resource availability and allocation, investment and service delivery)? Resource availability and allocation; Capacity for implementation; Stability in govt; Before 2006, the political system operated largely based on patronage in public jobs, in allocating property rights, and other favours to vested economic interests. When not dispensing patronage, governments were mainly engaged in dealing with political crises stemming from popular protests.

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Bolivia (ctd.)
PROPOSALS FOR IMPROVEMENT How could inter-institutional communications (policy makers, planners, budget holders, etc.) be improved? Improvement in the functioning of the civil service; Strengthening the political system; Reconciliation of polarised position; Current needs (late 2006) include establishing effective working relations between government and the donors.

How could the links between policy priorities and implementation instruments (MTEF and national budgets) be strengthened? Institutional strengthening at all levels; Budget allocation in line with policy priorities; Key issue is to take the visions of the PND 2006/10 and find effective programmes that work on the ground. For example, the Comunidades en Accin/Communities in Action programme has excellent objectives, but can it be made to work in the field? How able and willing will government be to learn from initial experiences and modify the programme accordingly?

How could the policy decision making process be speeded up to ensure success? Decentralisation of governance; Dialogue between the stakeholders in policy and strategy making.

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What is the evidence on good practice and what is the scope for replicating it? Balance between rural, social and productive sector development; Direct targeting of the poor policy of social inclusion; Grassroots participation in the PRS process as an instrument for building consensus; Experience with decentralisation has been promising. But more needs to be done to learn; lessons and replicate the better experiences.

How could ownership and participation of non state actors, i.e. civil society, the private sector, be ensured? Promotion of private sector and civil society organisations participation in policy and strategy development through timely provision of information, giving enough time to consider and discuss issues; Improved communication between govt and private sector; Strengthen the capacities of rural organisations.

Bolivia (ctd.)
5. PRS Monitoring and evaluation, and feedback for policy and strategy formulation
ELEMENTS AND ISSUES To what extent are the selected policies contributing to poverty reduction? Evidence that exists shows that selected policies have shown little progress in poverty reduction, and agricultural and rural development; Not only is this the case, but also it is not clear why agricultural and rural development policies; carried out in the highlands since the mid-1980s seem to have had so little effect.

Is policy evaluation being carried out? Does M&E feed into policy formulation? Monitoring and evaluation is not systematic and complete. Too many programmes are implemented with few lessons learned. Thus lessons of experience have not influenced policies.

What are the challenges to policy monitoring and evaluation in the rural productive sectors (considering, for example, the importance of exogenous factors in sectors such as agriculture)? There is no monitoring system for the PRS, since none of the developed PRSs has been implemented; The main challenge is setting up a policy monitoring and evaluation system; In agriculture, the challenge is in defining the problem and focus, and credible analysis approach; In the absence of an M&E system, there are different views of what is going wrong.

PROPOSALS FOR IMPROVEMENT Where could demand for policy monitoring and evaluation come from? How could this demand be strengthened? Until recently, there was no demand for M&E since political demand is on allocation of resources and not on performance. Currently, demand is weak, as there is the fear of negative evidence. There is also the problem of neutrality of the evaluators.

Who should provide for the evaluation of public sector policies? How could neutrality and accuracy be ensured? Could civil society organisations play a role? While there are non-governmental centres that have some capacities few if any have a critical mass to carry out a comprehensive evaluation; Independence of many of the institutions are also in doubt; Possibilities include a research centre PIEB which is well regarded; or UNDP which has legitimacy as a UN agency.

What is the evidence on good practice and what is the scope for replicating it? No good practice on M&E.

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Cambodia
1. Evidence and narratives on pro-poor growth
ELEMENTS AND ISSUES What are the available evidence and narratives regarding: determinants and dynamics of poverty Govt policy/strategy for resource allocation and corruption; Geography highland dwellers are worse off than those in low-land areas; Habitation Rural people poorer than urban dwellers; Access to common property particularly land, forestry, fisheries and irrigation; Gender women suffer more deprivation; Age old people without family support, and youth who inherited poverty; Poor access to quality education, and cost of education; Poor infrastructure; Social exclusion; Weak/corrupt legal system; High household dependency; Voice poor involvement in decision making process; Crisis/hazards natural and social/political; Household dynamics; Poor understanding of the nature of poverty and defining measures in the right sequence preventive, protective and productive; Lack of coincidence views making it difficult to shape political discourse for poverty-reduction agenda; Employment opportunities, and access to financial services. linkages and trade-offs between poverty reduction and growth policies Ability of macro-economic policy to influence poverty requires a clear classification of poverty: the poor capable of accessing opportunities and moving out of poverty; and those without the capacity to access opportunities to move out of poverty. The latter group requires move than policies/strategy based purely on growth. Such policies need to be complemented by other strategies to develop their human capacities and protect them against shocks. This group includes dependent poor, physically challenged, and old people without family support; Govt. policy/ strategy increasing vulnerability allocation of resources land, fisheries, forestry and irrigation has increased landlessness from 13% in 1999 to 20% in 2004; Growth policy must include means for the distribution of policy gains to impact on poverty Past economic growth has not led to significant poverty reduction. However, there is no information on the degree of vulnerability created by policies. contribution of the rural productive sectors to pro-poor growth Rural productive sector growth contributes insignificantly to pro-poor growth due to poor definition of property rights, poor infrastructure, low-level of human capital, weak govt institution/political structure dependence on patronage, low agric diversification (90% growing rice); No direct linkage between agric sector growth and sustained improved livelihood; Small producer sub-sector has low productivity but has better benefit distributive mechanism; Agricultural-led poverty reduction may not work under the present conditions due mainly to poor land reform. A combination of agricultural development and rural micro-enterprise development is required. However, this will need to be complemented by human resource development and social protection measures.

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Cambodia (ctd.)
role of the state and non-state actors in driving pro-poor growth, in particular in the rural productive sectors Role of state in driving pro-poor growth is ambiguous; International NGOs in combination with local NGOs and local govts have played major roles in resource allocation and promoted pro-poor growth; Powerful people with political influence have attracted resources to themselves and captured rents arising from natural resource exploitation, and have denied the poor access to these benefits.

How are the evidence and narratives generated? The poverty analysis of the National Strategic Development Plan was obtained from the household survey data of 2004, Cambodia socioeconomic survey, World Bank participatory Poverty Assessment, and case studies in four districts; Donors conducted studies to fulfil their own poverty reduction planning process.

Are the evidence/ narratives contested? How and by whom? The evidence and narratives have not been contested.

Evidence on relational nature of deprivation to improve the visibility as the extreme poverty in policy and operation; Evidence on differentiation of extreme poor and to enhance policy targeting; Information on access to opportunities particularly by the socially marginalised and those in extreme poverty; The need for multiple policy approach to poverty alleviation.

How could access to evidence be promoted and debate generated on the context-specific issues of relevance to rural poverty reduction and growth? Decentralisation of government using commune councils as planning frameworks; Promotion of the participatory planning process to empower communities to demand their rights; Attention to representation and building capacity of groups and individuals to have a voice in the process of policy and strategy development, and planning and budget committees. The poor and the women tend to be excluded now; Build data and evidence, and understanding of the causal relationship between policy and outcome, and engage wider public debate; Promote the role of the media in enlightening the emerging middle classes and political elites Allocate more resources to enlighten the political decision makers at the commune level as against the present focus on senior civil servants.

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PROPOSALS FOR IMPROVEMENT What additional evidence and/or alternative narratives are worth exploring, with a view to sharpening the pro-poor orientation of growth policies?

Cambodia (ctd.)
2. Participation in PRS processes
ELEMENTS AND ISSUES Who is involved and who influences policy formulation? Both formal and informal processes of policy formulation are important since the formal institutional framework is in its infancy; Stakeholder engagement at different levels but participation is uneven. Primary stakeholders include poor rural women, men and children without any organisation for effective participation. Secondary stakeholders; civil society organisations, business organisations, central government, local govt, and donors with major influence in policy formulation.

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What is the type of involvement of the rural stakeholders (including state agencies, NGOs and the private sector corporate, smallholders, rural micro enterprises, etc.) in PRS processes? Limited involvement of the rural poor due to tight schedules and poor communication; poor information on dissemination and civil society participation is the weakest and is declining due to lack of instruments to express community identity and interest. NGOs funded by donors claim to speak for the Cambodian poor; NGOs are genuinely consulted in the PRS process through workshops, and review of drafts Limited participation by unions and farmers organisations and other civil society organisations The role of communities in policy formulation has not been set out; The power and process for policy decisions are concentrated in the central administration and cabinet, parliament and the private sector were marginally involved in PRS process and this accounts for a lack of coherence in the rural Poverty Reduction Strategy; Donors participation is problematic due to different policies and procedures, and this make harmonisation of policies and strategies difficult and creates problems for govt compliance.

What factors determine the degree of participation capacity, location, vision or interests? The rural poor in the real sense have not been engaged in the PRS process. Those living in remote areas are disadvantaged. There was social exclusion for some ethnic groups; Political marginalisation meant that the rural poor have been marginalised in the policy process Absence of representative indigenous organisations; Lack of data on the indigenous social-economic situation meant that policy has not reflected their particular needs; Language the use of English excludes the participation of many locals.

PROPOSALS FOR IMPROVEMENT How could the participation process be institutionalised by defining the roles and responsibilities of each actor? Apply structured changes based on the evolving local govt structure, and party political process Reduce uneven power structure; Transform the PRS process from an instrument of reporting to external donors to a system of national planning; Harmonise and coordinate the process of PRS development; Improve the capacity of the poor to participate.

Cambodia (ctd.)
How could the voices of the poor be better reflected in the policy debate and policy making? Enshrine the PRS processes within the structures of Cambodian society; Move the PRS process into the formal political process involving the national assembly and its members, using the decentralised political structure to deepen engagement.

Engage political and traditional systems to empower local and rural people in decision making and improve accountability; Improve the capacity of the rural poor to participate in the debate and review of PRS documents; Address the problem of language and communication; Set out the mandate and roles of parties in setting objectives and priorities and in making decisions.

3. Policy formulation, strategy development and prioritisation of public actions under PRS
ELEMENTS AND ISSUES What factors determine the choice of poverty reduction policy priorities evidence, interests, inertia? Evidence from studies on past development efforts; Need to address the short- and long-term development issues with a focus on poverty; Available resources and capacity for implementation; Donors influence.

What evidence is used for decision making what are the quantitative and qualitative analytical underpinnings of policy decisions? There are shortages of studies for decision making most decisions are made based on development paradigms and neighbouring countries and donors influence.

What is the balance between expenditure-focused and enabling and regulatory or policy interventions? No balance between regulations and expenditure.

What explains the lack of consistency of policies in PRSs and other sector policy plans, strategic frameworks and instruments? The urgency to develop mandates, laws and policies; Limited capacity and experience to undertake the needed tasks; The democratic political system that does not allow technicians, bureaucrats and politicians to establish a common platform.

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How could rural stakeholders participate in the PRS policy formulation and implementation process?

Cambodia (ctd.)
PROPOSALS FOR IMPROVEMENT How could the knowledge built on rural poverty and its dynamics be fed into the policy debate and formulation as well as strategic planning and development? Establishment of strong M&E system; Information dissemination; Use of a decentralised government structure.

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How can the available knowledge and evidence on the potential contribution of the rural productive sectors to poverty reduction be made accessible to policy makers and be used to influence policy prioritisation and strategy development? Use of a decentralised planning platform; Collection, analysis and dissemination of agricultural and rural development information,

How could consistency and alignment between different policy instruments be promoted? Promotion of consultation among different government institutions.

How could a feedback mechanism between M&E and policy decision-makers and vice-versa be established? Coordination of sectoral strategies and policies.

How could integration between national PRSs and relevant sector strategies be facilitated? Alignment of PRS and National Development plans; Incorporation of the PRS process within political and institutional system of govt.

What is the evidence on good practice and what is the scope for replicating it? Establishment of technical working groups to facilitate coordination of policies and strategies.

4. PRS Policy and strategy implementation

ELEMENTS AND ISSUES Why have policy priorities in poverty reduction not been implemented as outlined in the strategy? Weak government capacity, aid dependence, and conflicts in donor policies; Delay in civil service reform reform to develop a responsive and accountable civil service, decentralisation and de-concentration of processes; Influence of strong political groups who determine policy choices, and undertake the less formal process of implementation; Discretion of senior civil service during implementation to change priorities.

Cambodia (ctd.)
What factors determine the translation of policy priorities into practice (resource availability and allocation, investment and service delivery)? Level and nature of ownership of process and document PRS is seen as donor imposed and as an additional burden on govt officials working on another strategic planning framework; Conflicting donor approaches and policies which create difficulties for policy consensus, coherence and change; Failure to harmonise the national planning process with the decentralised structures so that lower level input feeds into upper level inputs. This disconnect also hampers feedback; Disconnect between needs particularly in the remote areas and resource allocation due to poor communication. Provincial investment fund (PIF) has been established to target the poor in remote areas to address this problem; Weakness in harmonising key elements of policy and budgeting processes.

PROPOSALS FOR IMPROVEMENT How could inter-institutional communications (policy makers, planners, budget holders, etc.) be improved? Removal of fragmentation of services and putting in place a coordination mechanism between agricultural and rural development related institutions; Put in place a mechanism for focusing expenditure on pro-poor policies.

How could the links between policy priorities and implementation instruments (MTEF and national budgets) be strengthened? Establishment of a link between activities listed in the PRS action plan and the expected impact on poverty; Prioritise action plan in terms of poverty impact or available funding; Link PRS actions to budget; Separate new actions from ongoing actions; Define cooperation and coordination mechanism between related agricultural development institutions to achieve reductions in poverty.

How could the policy decision making process be speeded up to ensure success? Reduce conflict between those ministries with control over valuable resources and those dependent on donor funds; Promote an integrated framework; Capacity building.

What is the evidence on good practice and what is the scope for replicating it? Building systems that target the most vulnerable groups and provide access to development opportunities and resources is important for building a route out of poverty particularly extreme poverty; Education and health development strategies provides a good opportunity for reaching the poor by identifying the poor households to be exempted from fees, and providing mechanism for their support through the use of Equity Funds; Pro-poor policy without monitorable operational processes and building of the poor capacity to take advantage of opportunities will not lead to the desired results; Targeted subsidies can be an effective pro-poor policy provided measures are put in place to prevent elite capture. This policy will require a change in the structural relations between the poor and the elites.

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Cambodia (ctd.)
How could ownership and participation of non state actors, i.e. civil society, the private sector, be ensured? Defining a clear system and giving reasonable time schedule for discussing activities of PRS and specification of stakeholders roles; Improvement in legal framework and enforcement; Improving the capacity of civil society particularly the organisations representing the rural poor.

5. PRS Monitoring and evaluation, and feedback for policy and strategy formulation
ELEMENTS AND ISSUES To what extent are the selected policies contributing to poverty reduction? In health and education, selected policies are contributing to poverty reduction. This is not the case for agriculture and rural development where elites have captured the benefits and the poor are marginalised.

Is policy evaluation being carried out? Does M&E feed into policy formulation? No system yet for policy evaluation, nor is there a M&E arrangement to feed lessons of experience into policy formulation.

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What are the challenges to policy monitoring and evaluation in the rural productive sectors (considering, for example, the importance of exogenous factors in sectors such as agriculture)? Poor donor coordination and use of external resources by donors to carry out studies responding to their needs, thereby generating indicators which are not comparable, and promoting inefficient use of financial resources for data collection and capacity building; Lack of systematic development of national capacities both at the National Institute of Statistics and line ministries; Unclear responsibilities between Ministry of Economics and Finance; and Ministry of Planning making cross-institutional coordination difficult; No institution building at the local level to collect and use performance data; Lack of sectoral strategy linking performance to budget; The value of data and performance evaluation is limited where it is not acceptable to provide bad news to the leadership. In such an environment M&E becomes a high risk for the staff.

PROPOSALS FOR IMPROVEMENT Where could demand for policy monitoring and evaluation come from? How could this demand be strengthened? In the absence of a complete planning framework, and monitoring system and the negative attitude of the leadership to bad news, demand for policy monitoring and evaluation can only come from external pressure, as now is the case.

Cambodia (ctd.)
Who should provide for the evaluation of public sector policies? How could neutrality and accuracy be ensured? Could civil society organisations play a role? Institutions which are independent of planning and implementation such as the National Institute of Statistics can bring neutrality and objectivity into policy monitoring and evaluation; Participatory M&E systems by rural poor organisations can enhance the role of civil society.

What is the evidence on good practice and what is the scope for replicating it? No good practice on M&E.

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Ethiopia
1. Evidence and narratives on pro-poor growth
ELEMENTS AND ISSUES What are the available evidence and narratives regarding: determinants and dynamics of poverty Govt policy/strategy with regard to resource allocation; Occurrence of disasters drought, flood, civil war, and external shocks (rapid decline in commodity prices); Household characteristics; Household dependency rate; Gender; Type of crops grown (export crop growers less prone to poverty); Infrastructure and social services; Policy changes liberalisation, promotion of commercial agriculture; Family assistance; Capacity to access opportunities. linkages and trade-offs between poverty reduction and growth policies

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Economic growth has to reach 6 7% pa to impact poverty; Agricultural productivity improvement impacts positively on poverty 10% increase in farm yield reduces poverty by 7%; Social services education, health and water translate directly into poverty reduction; Differentiation of vulnerability and targeting have impact on poverty through capacity building and asset creation (productive safety net programme). contribution of the rural productive sectors to pro-poor growth The multiplier effect of agricultural sector is estimated at twice that of the industrial sector, thus focusing on agricultural sector promotes pro-poor growth; Agriculture sector accounts for 40% of GDP, 90% of exports, 85% of employment and 90% of the poor (WB); matters immensely in poverty reduction and growth; Evidence shows that despite increased allocation to agriculture and intensification of technical services in the period 1993 2003, agriculture accounted for only 0.3% on average of budget allocations, and grain production per capita has continued to decline. Thus continuing past policies will not result in acceptable growth and poverty reduction. Policy shift towards market driven diversification and commercialisation is required, i.e. transformation from subsistence to commercial/market oriented agricultural policies; The impact of agricultural sector growth on poverty reduction require a diversification of policy prescription taking note of different agro-ecological features and their potential, regional profiles of poverty incidence, and economic opportunities. role of the state and non-state actors in driving pro-poor growth, in particular in the rural productive sectors Redistribution of land and granting of long leases has a strong impact on pro-poor growth and reduces income inequality; In general terms, govt role seen as intermediary except where it has a comparative advantage setting regulatory frameworks and standards, financing infrastructure, acquiring technologies where this is beyond the private sector capacity, and selected support to commercialisation; The private sector is to drive pro-poor growth whether in smallholder sector, or modern sector to provide needed off-farm employment.

Ethiopia (ctd.)
How are the evidence and narratives generated? Regular assessment of the poverty situation through annual progress report of PRS; Special studies and survey Household Income Consumption and Expenditure (HICE) and Welfare Monitoring Survey (WMS) and participatory poverty assessment; Research on poverty and determinants at lower level-kebele and waredas.

Are the evidence/ narratives contested? How and by whom? There is general agreement on the extent and depth of poverty there is no contention on the overall picture that poverty levels are unacceptably high; There is a deep difference in perception of the role of smallholders as drivers of sustained economic growth, between government and certain development partners. The govt sees the smallholder farmers as champions of development. Certain donors hold that while smallholders are experts on survival, they are not an engine of growth, therefore resources allocated to smallholders should be allocated to other productive sectors.

PROPOSALS FOR IMPROVEMENT What additional evidence and/or alternative narratives are worth exploring, with a view to sharpening the pro-poor orientation of growth policies? To raise productivity, fragmentation should be halted; Farmers need to raise productivity and diversify operation towards high-value crops or non-farm activities; The need for systematic effort to collect evidence on successful and sustainable intensification and diversification.

How could access to evidence be promoted and debate generated on the context-specific issues of relevance to rural poverty reduction and growth? Improvement in open communication on development issues between government and donors; Promotion of informal forum of central government, local government, political parties including opposition parties, donors, NGOs, and international organisations to discuss development and poverty reduction issues in a frank, friendly and open manner.

2. Participation in PRS processes

ELEMENTS AND ISSUES Who is involved and who influences policy formulation? National consultation across regions and city administrations; Civil society organisations, business communities and donors; Cabinet chaired by the Prime Minister; Parliament.

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Ethiopia (ctd.)
What is the type of involvement of the rural stakeholders (including state agencies, NGOs and the private sector corporate, smallholders, rural micro enterprises, etc.) in PRS processes? NGO participation brought the focus on key issues, including gender, children and youth, education, pastoralism, HIV/AIDS and the empowerment of decision making; Civil society organisations created their own structure to exchange views on different issues; Rural poor were represented by NGOs.

What factors determine the degree of participation capacity, location, vision or interests? Capacity in terms of organisation, staff and finance; Perception as to the importance and benefits of PRS; Information on the process and role of stakeholders.

PROPOSALS FOR IMPROVEMENT How could the participation process be institutionalised by defining the roles and responsibilities of each actor? Defining roles of stakeholders particularly government and private sector; Establishment of a stakeholder forum to facilitate debate.

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How could the voices of the poor be better reflected in the policy debate and policy making? Involvement of a consultative forum; Identification of the true representatives of the rural poor and involving them in the policy and strategy debate; Improvement of rural poor capacity to participate in policy making process.

How could rural stakeholders participate in the PRS policy formulation and implementation process? Development of a forum at local level regional and wareda; Promotion of organisations of the rural poor and improvement in their capacity through training.

3. Policy formulation, strategy development and prioritisation of public actions under PRS
ELEMENTS AND ISSUES What factors determine the choice of poverty reduction policy priorities evidence, interests, inertia? Preponderance of population in agriculture and the poor in the rural areas; Economic importance of agriculture; Government interest and political framework; Donors influence; Evidence from socioeconomic surveys.

Ethiopia (ctd.)
What evidence is used for decision making what are the quantitative and qualitative analytical underpinnings of policy decisions? Welfare monitoring survey; Annual progress review of PRS; Participatory poverty analysis; Household income consumption and expenditure; MDG needs assessments; Different research findings; Participatory consultation process; Trade integration study.

What is the balance between expenditure-focused and enabling and regulatory or policy interventions? PASDEP emphasised expenditure-focused policy interventions; Limitation of capacity at local level may however hinder effective implementation.

What explains the lack of consistency of policies in PRSs and other sector policy plans, strategic frameworks and instruments? PASDEP is taken as the basic planning document that guides sector development activities. Therefore, there are no inconsistencies or contradictions between PASDEP and sector plan and policies.

PROPOSALS FOR IMPROVEMENT How could the knowledge built on rural poverty and its dynamics be fed into the policy debate and formulation as well as strategic planning and development? A good monitoring system and focused studies providing feedback into the policy-making process; The information provided appears to have been considered in policy debate and formulation of strategic planning and development.

How can the available knowledge and evidence on the potential contribution of the rural productive sectors to poverty reduction be made accessible to policy makers and be used to influence policy prioritisation and strategy development? While progress monitoring is good, there is weakness in performance evaluation. This should be improved and results made available to decision makers at different levels of governance.

How could consistency and alignment between different policy instruments be promoted? PASDEP and the overall National Development Plan, incorporates sector policy, strategy and plans. Thus there are no inconsistencies and misalignment between different policy instruments; PASDEP is mainstreamed with the Ethiopian institutions and political process, and prepared within the national planning framework, inconsistencies will therefore be minimised; Studies can however, be carried out to identify any inconsistency and misalignment for improvement of the process as may be needed.

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Ethiopia (ctd.)
How could a feedback mechanism between M&E and policy decision-makers and vice-versa be established? Submission of performance reports to executing ministries, agencies, cabinet and parliament for review.

How could integration between national PRSs and relevant sector strategies be facilitated? Improvement of the existing system to permit sector plans and policy reviews to ensure consistency and appropriate reflection in PRS.

What is the evidence on good practice and what is the scope for replicating it? Existence of a good monitoring and evaluation system; Coordinated institutional structure; Parliament and cabinet involvement.

4. PRS Policy and strategy implementation

ELEMENTS AND ISSUES Why have policy priorities in poverty reduction not been implemented as outlined in the strategy? Where targets have been set and are consistent with socio-cultural economic environment, they have been implemented as planned.

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What factors determine the translation of policy priorities into practice (resource availability and allocation, investment and service delivery)? General agreement on the policies by the stakeholders; Specification of components and targets needed to respond to policies; Participation of implementing agencies in determining programme and targets.

PROPOSALS FOR IMPROVEMENT How could inter-institutional communications (policy makers, planners, budget holders, etc.) be improved? Information on planning and development issues of general concern should be specified and provided to all govt institutions; Formalisation of consultation among agriculture and rural development institutions.

How could the links between policy priorities and implementation instruments (MTEF and national budgets) be strengthened? Linkage between policy priorities and implementation instrument is not a problem as all parties are involved in the process of planning and policy setting.

Ethiopia (ctd.)
How could the policy decision making process be speeded up to ensure success? Timely finalisation and distribution of PRS documents; Timely submission of progress reports; Capacity building in M&E and reporting; Integrating reporting process more firmly in the planning and budget calendar.

What is the evidence on good practice and what is the scope for replicating it? Direct targeting of the poor; Involvement of the political system; Good programming M&E process.

How could ownership and participation of non state actors, i.e. civil society, the private sector, be ensured? Development of fora for planning at different levels of governance; Capacity building of rural poor organisations.

5. PRS Monitoring and evaluation, and feedback for policy and strategy formulation

Evidence from evaluation including those from WB and IMF confirm that policies have contributed to poverty reduction but more so in social services (health education and infrastructure). Impact from the productive sector is less significant.

Is policy evaluation being carried out? Does M&E feed into policy formulation? M&E system exists but focuses more on inputs and outputs and less on outcomes, and impact of policy changes on poverty reduction; M&E reports are submitted on an annual basis to a multi-stakeholder forum for discussion. Development partners also review such reports and are part of the information used for debt relief and development resource allocation. NGOs and the private sector are not regularly involved in the review and there is the need to distribute the report widely to NGOs, private sector institutions, and civil society organisations; Need for better collaboration between data producers, and users, and improved exploitation of data to influence policy and strategy.

What are the challenges to policy monitoring and evaluation in the rural productive sectors (considering, for example, the importance of exogenous factors in sectors such as agriculture)? Finding ways to better include the private sector and civil society organisations in M&E system; A better definition of high-quality policy indicators; Making poverty-related studies more widely available; Including indicators which are relevant for agriculture and rural sector impact monitoring; Improvement in resource allocation.

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ELEMENTS AND ISSUES To what extent are the selected policies contributing to poverty reduction?

Ethiopia (ctd.)
PROPOSALS FOR IMPROVEMENT Where could demand for policy monitoring and evaluation come from? How could this demand be strengthened? Government and development partners; Private sector, NGOs, civil society organisations; Demand can be strengthened through wide distribution of reports and regular discussion by a forum of stakeholders.

Who should provide for the evaluation of public sector policies? How could neutrality and accuracy be ensured? Could civil society organisations play a role? Experienced institutions independent of govt should be engaged for evaluation at mid-term and at terminal stages. Govt, NGOs, donors and civil society organisations should develop the TOR; Recruitment of service providers by tender will enhance quality and promote neutrality.

What is the evidence on good practice and what is the scope for replicating it? Case studies on rural focus of Poverty Reduction Strategy processes to identify the root causes of weakness in the PRS process and to suggest ways to strengthen PRS processes; Involvement of administration and political systems in the M&E process; Establishment of a feed back mechanism to influence policy and strategy development; Promotion of institutional collaboration through a stakeholder forum; Experience of Ethiopia can be shared through workshops to promote replication; M&E systems at the national level can be replicated at local levels regional and waredas.

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Mozambique
1. Evidence and narratives on pro-poor growth
ELEMENTS AND ISSUES What are the available evidence and narratives regarding: determinants and dynamics of poverty Studies household survey carried out by National Institute of Statistics; sectoral studies, and M/E of PARPAI main determinants include: Household dependency rates; Gender; Education; Agricultural productivity; Government policies; Economic growth; Dynamic: reduction in poverty in rural areas faster than in urban areas. linkages and trade-offs between poverty reduction and growth policies PARPA I & II assumed economic growth is a precondition for poverty reduction; Evidence shows that relationship between economic growth policies are of a general nature; Commercial agriculture grew faster than family farm sector; Proportion of marketable surplus declined between 2004 and 2007; Export crops production has higher rate of growth; Certain donors make pursuance of pro-poor policies support to education, health, water and sanitation and other crucial infrastructure conditions for assistance, i.e. ranking social services higher than productive programmes; Support to creating enabling environment governance, justice, decentralisation, capacity building, financial management, technical support services, and regulatory framework results in less resources flowing to direct intervention in production sector. contribution of the rural productive sectors to pro-poor growth In the period 1993 2003, agricultural sector was the major stable contributor to Mozambiques GDP (IMF); Rural productive sector makes a major contribution to growth in general and in particular pro-poor growth. role of the state and non-state actors in driving pro-poor growth, in particular in the rural productive sectors The govt growing strategy calls for pro-poor growth focusing on raising agricultural productivity, market improvement and creating opportunities for non-agricultural income; The govt supports family agriculture as a pro-poor strategy; Govts major policy thrust is the creation of enabling environment; Private sector is to take the lead in commercial agriculture and related services.

How are the evidence and narratives generated? Evidence and narratives are generated through household surveys of the National Institute of Statistics, and sectoral reports/studies; Poverty data are of a general nature, broken down into operational units at sector level.

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Mozambique (ctd.)
Are the evidence/ narratives contested? How and by whom? The evidence is contested by the civil society groups, which since 2004 have been producing disaggregated data to bring out gaps between macro economic indicators of growth and their failure to impact on the livelihood of individuals at local level.

PROPOSALS FOR IMPROVEMENT What additional evidence and/or alternative narratives are worth exploring, with a view to sharpening the pro-poor orientation of growth policies? Apart from the general information on poverty obtained from macro data, there is a need to sharpen the system for poverty data collation; The need to define poverty in such a way that allocates part of the responsibility to the state; Involvement of civil society organisations in policy discussion with IMF and WB; Carrying out focused studies on the relationship between poverty and various aspects of the economy; political and social life; Improvement of institutional coherence and consolidation of poverty data.

How could access to evidence be promoted and debate generated on the context-specific issues of relevance to rural poverty reduction and growth? Carrying out focused poverty studies; Involvement of civil society organisations in policy monitoring and evaluation; Encouraging participation of civil society organisations in macro and micro policy decisions affecting poverty strategic development; Make poverty information relevant to public dialogue; Placing poverty alleviation issues at the centre of the relationship between policy makers and stakeholders or beneficiaries; Decentralised poverty dialogue.

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2. Participation in PRS processes

ELEMENTS AND ISSUES Who is involved and who influences policy formulation? Both PARPA I & II were not approved by parliament; Civil societies were consulted on the assumption that they represent the poor. This assumption has not been proven and there is the feeling that due to their obligation to govt and donors they may not represent the poor; No true participation but only consultation with civil society organisations bordering on co-option since most policy decisions have already been taken by government and donors before their involvement.

Mozambique (ctd.)
What is the type of involvement of the rural stakeholders (including state agencies, NGOs and the private sector corporate, smallholders, rural micro enterprises, etc.) in PRS processes? The govt represented by MOPD and MoF as the key player; The private sector and civil societies are consulted or co-opted but there is no true participation; Poor peasants are represented by civil society organisations based in Maputo National Union of Peasants, General Coop Union, Rural Mutual Assistance Organisation. These organisations views differ and reflect their different interests in policy issues; Donors enjoy considerable influence on govt which is resented by most civil society organisations. The IFIs (IMF/WB) set the rules. PARPA must be consistent with the macro-economic policy agreed with IMF/WB and not the other way round. The other donors take positions based on their countrys policy; They also make compliance with IMF/WB macro-policy and commitment to poverty reduction as a condition for support. These donors see PARPA not only as a condition arising from the HIPC initiative but also as a performance criterion to judge the effectiveness of their assistance. Thus, they focus on outputs and indicators and less on outcome of assistance.

What factors determine the degree of participation capacity, location, vision or interests? Rural poor are weakly involved in the PRS process. Most are represented through advocacy civil society groups; The weak participation of the rural poor is said to be a reflection of Mozambiques dependence on external assistance. Thus, the PRS document must be consistent with macro-economic policy and provide justification for assistance by major aid givers. Participation in this context becomes a technical rather than a political issue; The rural poor have limited capacity to participate in policy debate and decision; Remoteness of the rural poor from decision-making centres.

PROPOSALS FOR IMPROVEMENT How could the participation process be institutionalised by defining the roles and responsibilities of each actor? Defining roles of stakeholders particularly government and private sector; Establishment of a stakeholder forum to facilitate debate.

How could the voices of the poor be better reflected in the policy debate and policy making? Involvement of a consultative forum; Identification of the true representatives of the rural poor and involving them in the policy and strategy debate; Improvement of rural poor capacity to participate in policy making process.

How could rural stakeholders participate in the PRS policy formulation and implementation process? Development of a forum at local level regional and wareda; Promotion of organisations of the rural poor and improvement in their capacity through training.

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Mozambique (ctd.)
3. Policy formulation, strategy development and prioritisation of public actions under PRS
ELEMENTS AND ISSUES What factors determine the choice of poverty reduction policy priorities evidence, interests, inertia? Evidence from household surveys, sector objection, strategy and data on agriculture and rural development, poverty studies of civil society organisations and WB PSIA; External pressure and interests IMF, World Bank, other IFIs, and bilateral donors; Civil society organisations, the private sector through poverty observatory forum; Inertia of rural poor due to weak capacity and lack of institutional framework to participate; Government ideology and active constituency.

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What evidence is used for decision making what are the quantitative and qualitative analytical underpinnings of policy decisions? The evidence used for decision making derives from the: studies of National Institute of Statistics (household surveys) which are macro in nature, sector statistics, civil society groups; Poverty studies by donors in particular WB PSIA; Views collected from consultation with the private sector and civil society groups.

What is the balance between expenditure-focused and enabling and regulatory or policy interventions? General budget support approach of donors has improved the balance between expenditure focused and enabling regulatory policy interventions; The PRSP annual progress report produced by the Ministry of Finance, helps not only to monitor progress but to also identify concrete actions for poverty alleviation, and the level of funding required, and this promote expenditure focused policy interventions.

What explains the lack of consistency of policies in PRSs and other sector policy plans, strategic frameworks and instruments? Poor institutional coherence and limited involvement of the political process (parliament) in the PRS process; Weak coordination of sector programme and linking programme to Poverty Reduction Strategy. Sector programmes tend to be pro-growth rather than pro-poverty alleviation; Monitoring and evaluation system and reports tend to respond more to the need of donors; The focus is on promoting the overall balance of expenditure and the enabling regulatory policy is weak; A budgetary process which does not emphasise local demand through parliament or civil society organisations for improved budget policy and management of public finances; Regulatory environment seems to respond more to donor influence on policy and strategy development; Policy and strategy making tend to be influenced by a focus on mobilisation of external resources; Poor understanding of the links between PRS and the agriculture and rural development strategy and resource allocation.

Mozambique (ctd.)
PROPOSALS FOR IMPROVEMENT How could the knowledge built on rural poverty and its dynamics be fed into the policy debate and formulation as well as strategic planning and development? Encourage debate and reflection on the relationship between PRS and long-term development;v Rethink the conceptual framework and structure of PRS, seeing poverty reduction as a precondition of growth and not the goal of growth; Strengthen the capacity of govt at all levels to participate in the PRS process including monitoring and evaluation.

How can the available knowledge and evidence on the potential contribution of the rural productive sectors to poverty reduction be made accessible to policy makers and be used to influence policy prioritisation and strategy development? Improve monitoring and evaluation and progress reporting process and ensure report circulation within govt, the private sector and civil society organisations.

How could consistency and alignment between different policy instruments be promoted? Improvement of alignment of sector strategy and programmes with the PRS; Formal involvement of the parliament in the PRS process; Promotion of decentralisation and strengthening capacity at the district, province and community level to plan and monitor implementation of agriculture and rural development.

How could a feedback mechanism between M&E and policy decision-makers and vice-versa be established? Strengthen the government capacity for monitoring and evaluation, and expand the circulation of M&E and annual progress reports prepared by MoF; Involvement of cabinet and parliament in PRS implementation and evaluatio;n Promotion of increased involvement of civil society groups in monitoring and evaluation of poverty studies; Involvement of poverty observatory in review of M&E, and annual progress reports.

How could integration between national PRSs and relevant sector strategies be facilitated? Improvement in using the sector strategy and programmes as building blocks of PRS; Decentralisation and improvement of planning capacity at District and Provincial levels; Improvement and decentralisation of the budget system, and alignment of budget allocation to policy priorities.

What is the evidence on good practice and what is the scope for replicating it? Donor coordination and general budget support that seeks to align resource allocation to policy priorities; A good monitoring and evaluation and progress reporting system which permits contributions from civil society groups; Efforts at institutional improvement to promote focus on rural development; The replication of national.

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Mozambique (ctd.)
4. PRS Policy and strategy implementation
ELEMENTS AND ISSUES Why have policy priorities in poverty reduction not been implemented as outlined in the strategy? Weak harmonisation of resource use, partly caused by different approaches to resource allocation As PARPA is not implemented as a programme, there is no PRS matrix for monitoring and evaluation; The sector programmes are the basis of operation; The joint annual review by GOM and donors laid emphasis on disbursement of funds and not on outcomes as reliable indicators are not defined.

What factors determine the translation of policy priorities into practice (resource availability and allocation, investment and service delivery)? Compliance with macro-economic bench marks set by IMF, as other financiers use this for allocation of financial assistance; Dependence on external resources ODA share of budget was 48% in 2005, and it is projected at 25% by 2010; Institutional coherence and capacity; Local resource availability and allocation. Low internal resource availability meant a reduced freedom to translate policy priorities into practice, and make govt less accountable to the population.

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PROPOSALS FOR IMPROVEMENT How could inter-institutional communications (policy makers, planners, budget holders, etc.) be improved? Technical assistance to strengthen institutions and promote institutional linkages and collaboration; Coordination of collection and collation of all relevant information on poverty alleviation measures institutionalising this responsibility in the Rural Development Unit of Ministry of Planning and Development.

How could the links between policy priorities and implementation instruments (MTEF and national budgets) be strengthened? Strengthening the capacity of stakeholders the recipients of services to respond to implementation in such a way as to influence policy priorities; Decentralisation and giving local authorities the capacity and power to respond to local demand; Budget decentralisation and resource allocation in line with policy priorities and population targets.

How could the policy decision making process be speeded up to ensure success? The existing system of institutional collaboration and dialogue during planning, policy and strategy development should also be employed during implementation; Strengthening implementation capacity of GOM.

Mozambique (ctd.)
What is the evidence on good practice and what is the scope for replicating it? Good collaboration between govt and donors in policy and strategy development; Institutional consultation and dialogue during planning; Willingness of govt to involve civil society groups and the private sector in the PRS process; Replicating existing processes at national level at local level.

How could ownership and participation of non state actors, i.e. civil society, the private sector, be ensured? Promote participation of civil society groups in discussions of macro-policy framework with IMF/WB; Govt to emphasise regulatory policy framework, monitoring and evaluation while devolving practical implementation on the private sector; Decentralisation and strengthening the institutional capacity at local level to plan and implement.

5. PRS Monitoring and evaluation, and feedback for policy and strategy formulation
ELEMENTS AND ISSUES To what extent are the selected policies contributing to poverty reduction? It is difficult to identify which policies contribute to poverty reduction. However, the overall policies have shown a positive impact on poverty reduction; PARPA II contained a general statement of policy and strategy without a clear and definite specification of actions to be taken to impact on rural production, and how this will translate to poverty reduction.

Is policy evaluation being carried out? Does M&E feed into policy formulation? The Ministry of Agriculture has a monitoring and evaluation system and has been using it in a consistent manner. Every year, it publishes its report. Also, since 2002 the Ministry has carried out an agricultural survey to measure adoption rate and impact of improved practices. Further, it undertakes performance evaluations which check whether the priority actions listed in the Economic and Social Plan have been carried out; The MoF carries out annual progress reports on the PARPA and this is a subject of annual review by GOM and donors; Civil society groups also carry out and circulate poverty studies which are widely circulated among members of the poverty observatory; Policy evaluation carried out annually by GOM and donors focuses on outputs and disbursements and not on outcomes, and essentially it is meant to judge the extent of compliance to conditions of assistance and to determine qualification for further assistance; The review of civil society (poverty observatory) focuses on implementation performance and not on policy evaluation.

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Mozambique (ctd.)
What are the challenges to policy monitoring and evaluation in the rural productive sectors (considering, for example, the importance of exogenous factors in sectors such as agriculture)? The challenge of the evaluation system is to make information provided relevant for policy evaluation, but the first requirement is to spell out policy thrusts in PARPA; Agricultural development policy and strategy are stated in PROAGRI, but evaluation carried out by the Ministry of Agriculture target operational performance and results produced cannot be attributed to stated policies as other exogenous factors come into play. There is a challenge to better integrate PROAGRI, PARPA and rural development strategies; PROAGRI has a mechanism for financial management to measure disbursement, but which cannot measure impact on agricultural production and peoples livelihood; There is the challenge of resolving the debate on whether rural development should focus on family farms or commercial agriculture so that institutional framework for policy evaluation can be determined. A decision either way may not be necessary but there will be a need for better integration of PROAGRI and rural development strategies and other sector strategies having a bearing on the agricultural sector to provide a better context for policy intervention which will form the basis for policy monitoring and evaluation.

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PROPOSALS FOR IMPROVEMENT Where could demand for policy monitoring and evaluation come from? How could this demand be strengthened? Demand for policy monitoring and evaluation can come from civil society groups and donors; Such demand can be strengthened by a clear articulation of poverty reduction policies and strategies, and effective involvement of civil society groups in the PRS process including policy evaluation.

Who should provide for the evaluation of public sector policies? How could neutrality and accuracy be ensured? Could civil society organisations play a role? The government agencies MoF, MoA and the National Institution of Statistics can provide policy evaluation services but will need strengthening; Private sector institutions and civil society groups can provide policy evaluation services with more independence and neutrality; Rural stakeholders should be strengthened not only to demand services, but also to evaluate the impact of such services.

What is the evidence on good practice and what is the scope for replicating it? Decentralisation accompanied by more financial autonomy for districts provides good evidence in good practice, as financial decentralisation makes policy respond to local requirements and immediate concerns of local people; The requirement to get sector strategy and programme to respond to PARPA policies; Involvement of civil society groups in monitoring process; Separation of agriculture and rural development provided there are measures to ensure coordination of strategy and policy.

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Burkina Faso
1. Evidence and narratives on pro-poor growth
ELEMENTS AND ISSUES What are the available evidence and narratives regarding: determinants and dynamics of poverty Evidence on pro-poor growth was derived from three national priority surveys carried out in 1994, 1998 and 2003 by different groups; and two surveys (May June 2004, May June 2005) by National Project for Territory Management. Other studies were also available investigating the linkage between poverty and growth, nature of poverty and dynamics; Determinants of poverty type of enterprise engaged in agriculture provides the main source of growth, and the type of crops impact on poverty reduction. Export crop (cotton) farmers reduce their poverty level more compared with food crop farmers; correct analysis of options and strategies; better targeting of the poor; environmental vagaries, gender; participation of the poor in PRS process; the technical capacity of the poor; good governance; and creating wealth. linkages and trade-offs between poverty reduction and growth policies Evidence shows a mixed result of linkages between poverty reduction and growth. A number of studies showed that in the period 1994 98, growth was not pro-poor, while in 1998 2003, growth was pro-poor. Inconsistencies in study analysis may be due to failure to take account of variability in rainfall which is an important factor in poor household vulnerability in Burkina Faso; rural urban migration in relation to weather (drought and non-drought years) also affects mobility of poverty. Overall (1994 2003) evidence has shown no linkage between growth policies and poverty reduction. contribution of the rural productive sectors to pro-poor growth Rural productive sectors particularly agriculture, livestock, fisheries and water are found to contribute to pro-poor growth. Government and NGOs have targeted interventions to poor regions, however, there is no disaggregated data at departmental level to evaluate the importance of these targeted interventions. Evaluation of priority options and projects have not been carried out to evaluate whether investing in poor regions yields higher returns and lift more out of poverty than in the average in poor and rich regions. role of the state and non-state actors in driving pro-poor growth, in particular in the rural productive sectors Non state actors, i.e. civil society, rural poor groups, NGOs and traditional/religious groups play key roles in driving pro-poor growth particularly in the rural productive sector. However, the role of the state is still dominant but interventions in such areas as subsidies are not considered as important by the rural stakeholders. The state is found very important in water and social sector health, education.

How are the evidence and narratives generated? Through surveys and studies by government National Institute of Statistics and Demography; the private sector, multilateral/bilateral agencies; and monitoring and evaluation reports of projects.

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Are the evidence/narratives contested? How and by whom? Evidence and narratives have been contested by researchers through studies and surveys which showed counter results. Identification of important factors outside policies which impact on poverty reduction;

PROPOSALS FOR IMPROVEMENT What additional evidence and/or alternative narratives are worth exploring, with a view to sharpening the pro-poor orientation of growth policies? Additional evidence and alternate narratives worth considering weather vagaries, vulnerability of the poor, non-monetary instruments, urban-rural migration in relation to the weather, employment opportunities, development of instruments for evaluating successful options that can feedback into the system, promotion of participation of all stakeholders in PRS processes to provide a public voice particularly in the poor region, contributing to building capacity, creation of awareness in the average poor region, and supporting project implementation and eradicate poverty in the rich regions.

How could access to evidence be promoted and debate generated on the context-specific issues of relevance to rural poverty reduction and growth? Improvement in monitoring and evaluation capacity, improved participation in PRS process by stakeholders, decentralisation and meetings between different groups to harmonise sector strategies, policies and programmes, development of frameworks for dialogue.

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2. Participation in PRS processes

ELEMENTS AND ISSUES Who is involved and who influences policy formulation? Participation and influences on policies by different groups have been encouraged (producers groups, the private sector, civil society, NGOs, administrative and territorial groups, cooperatives, traditional leaders, religious leaders, village committee for territory management, national assembly, economic and social council), however, the PRS process is still top-down whereby the administration play the major role in the formulation and validation of PRSP.

What is the type of involvement of the rural stakeholders (including state agencies, NGOs and the private sector corporate, smallholders, rural micro enterprises, etc.) in PRS processes? Stakeholders participate at all stages: formulation, validation, implementation, and monitoring and evaluation; however the administration and NGOs groups are the ones which have the majority of their members participate in the process. Data suggests that womens involvement was more centred on representing their groups than expressing their concerns or contributing directly to the selection of options or formulation of policies. In general, representatives of groups do not reflect their groups concerns and needs, and contribute little to the PRS process. The poor from poor and rich regions are not involved in the development of the M&E system.

Burkina Faso (ctd.)

What factors determine the degree of participation capacity, location, vision or interests? Factors influencing the degree of participation include interests, as participation provides the opportunity to voice group concerns; improvement of capacity that increases awareness of the PRS process; involvement of stakeholders in the PRS process to propose alternative policies, raise awareness, and creation of a structure that will facilitate stakeholders dialogue, provision of information on PRS.

PROPOSALS FOR IMPROVEMENT How could the participation process be institutionalised by defining the roles and responsibilities of each actor? Burkina Faso has introduced innovations to improve and institutionalize participation by setting up fora for dialogue between donors, government, and stakeholders. The following are notable: Ministerial monitoring and evaluation committees to feed lessons of experience into the PRS process; sectoral and thematic committees to ensure coherence of sectoral policies within PRSP and promote private sector participation; national consultation that validates regional and national reports, and provides framework for dialogue between government development partners, private sector and civil society to harmonise technical and financial support for the implementation of PRSP programmes, and also provides feed back from implementation to the PRS process; regional consultative committee to provide specific regional information and promote consultation among stakeholders; civil society forum to endorse the PRSP programme; national workshop to validate the PRSP; and consideration and approval by the national assembly and Economic and Social Council to harmonise PRS with development policy and link to financing instruments.

How could the voices of the poor be better reflected in the policy debate and policy making? Deepening the decentralised processes, capacity building of rural poor organisations to better reflect their concerns and influence strategies and policy for poverty reduction, and set project priorities in PRSP, encouragement of women to effectively participate in all the processes of PRS development; get them to influence decision making processes. Development of the framework for dialogue, use of participatory approache.

How could rural stakeholders participate in the PRS policy formulation and implementation process? Rural stakeholders should fully participate in all the stages of PRSP formulation, validation, implementation and monitoring and evaluation; capacity building, improvement of communication and information, and financial support are key.

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Burkina Faso (ctd.)

3. Policy formulation, strategy development and prioritisation of public actions under PRS
ELEMENTS AND ISSUES What factors determine the choice of poverty reduction policy priorities evidence, interests, inertia? Interests the poor hold that they should be the main players in the process through involvement by creating a forum to foster stakeholder dialogue; evidence through a strengthened implementation and monitoring and evaluation capacity; autonomy or empowerment, particularly for women.

What evidence is used for decision making what are the quantitative and qualitative analytical underpinnings of policy decisions? Lessons of experience from projects in diverse areas technical, institutional and policy. The PRSP process gained from understanding the performance of introduced approaches and has used the results in elaborating PRSP to reduce transaction costs and mainstreaming successful options. Thus PRSP has been articulated around four axes accelerated equity-based; growth, guarantee that the poor have access to basic social services, expansion of employment opportunities and income generating activities for the poor, and promotion of good governance.

What is the balance between expenditure-focused and enabling and regulatory or policy interventions?

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Agricultural project database shows that the government and its development partners have allocated resources based on national priorities natural resource management, water, agriculture and livestock; however, interventions differ in accordance with regional poverty status. The balancing out of interventions across regions promotes overall growth and could produce valuable information on the different effects of these interventions on income gains and poverty reduction. Analysis of intervention by sector shows a clear targeting on poor regions which is consistent with the PRS approach.

What explains the lack of consistency of policies in PRSs and other sector policy plans, strategic frameworks and instruments? Limited ex-ante and ex-post studies to assess the contribution of different options to growth and poverty reduction. Such information would have aided targeting options with a clear impact on the poor. Weak identification of approaches to better target different types of poor households and interventions to be implemented.

PROPOSALS FOR IMPROVEMENT How could the knowledge built on rural poverty and its dynamics be fed into the policy debate and formulation as well as strategic planning and development? Involvement of all stakeholders in the whole PRS process to facilitate the selection of the priorities of different groups; creating a forum for dialogue amongst different stakeholders when it comes to decisions on options and strategies.

Burkina Faso (ctd.)

How can the available knowledge and evidence on the potential contribution of the rural productive sectors to poverty reduction be made accessible to policy makers and be used to influence policy prioritisation and strategy development? Involvement of all stakeholders in the PRS process through appropriate consultation processes. In Burkina Faso, these include regional consultations to reinforce ownership of the strategic framework by the different stakeholders, organisation of harmonisation meetings between different institutions of the government to align sectoral policies with PRSP axes; carrying out synthesis workshops to integrate regional strategies and policies and assess the pertinence of proposed monitoring indicators; information to financial and technical partners enabling them to provide suggestions on design improvements, recommendations for implementation, and contribution to M&E plans and indicator selection; holding broad civil society forum to enhance ownership; national workshop to validate the PRSP; submission to the National Assembly for approval and appropriation of finance.

How could consistency and alignment between different policy instruments be promoted? Promoting consultation processes involving all stakeholders; use of sectoral committees for synchronisation of policies, strategies and programmes; working through the political system and national institutional arrangements.

How could a feedback mechanism between M&E and policy decision-makers and vice-versa be established? Development of a framework for dialogue between stakeholders using participatory approaches; promoting the PRS process; establishment of M&E committees; development of a communication strategy; promoting forum of dialogue between stakeholders and people involved in M&E and policy decision makers; and creating an inclusive and participatory approaches to make better use of M&E results for policy formulation.

How could integration between national PRSs and relevant sector strategies be facilitated? Ensuring involvement of all stakeholders in the PRS process; following appropriate consultation processes; establishment of frameworks for dialogues; use of sectoral committees for policy/strategy synchronisation.

What is the evidence on good practice and what is the scope for replicating it? Involvement of all stakeholders in the PRS process; respect of priorities set by stakeholders in programme and project design; promotion of participatory processes; enhance the quality of participation. The experience of Burkina Faso can be replicated through a decentralised system of developing PRSP.

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Burkina Faso (ctd.)

4. PRS Policy and strategy implementation
ELEMENTS AND ISSUES Why have policy priorities in poverty reduction not been implemented as outlined in the strategy? Lack of involvement of stakeholders; incoherence between PRS and sector policy and strategy; poor information; defective communication mechanisms; lack or adequate financing; diversion of resources to other ends; and inadequate implementation capacity.

What factors determine the translation of policy priorities into practice (resource availability and allocation, investment and service delivery)? Development of various types of frameworks for dialogue among and between stakeholders; ensuring financial requirements for implementation of priority actions; existence of mechanisms for strengthening links between strategic priorities and implementing instruments; respecting and implementing identified priorities; taking into consideration stakeholders objectives and improving their implementation capacity.

PROPOSALS FOR IMPROVEMENT How could inter-institutional communications (policy makers, planners, budget holders, etc.) be improved?

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Involvement of political system in the PRSP processes; maintaining information flow to, and communication with, development partners, the private sector and civil society.

How could the links between policy priorities and implementation instruments (MTEF and national budgets) be strengthened? Create frameworks for dialogue; establishment of committees to search for appropriate solutions to problems associated with PRSP development and implementation to ensure arbitration between different institutions, and harmonise sector policies/strategies; consultation between government and development partners, private sector and civil society to help mobilise financial resources and evaluate achievements; and establishment of a secretariat for coordination of economic and social programmes, produce and disseminate reports, and provide information on implementation of PRSP programmes and projects.

How could the policy decision making process be speeded up to ensure success? Involving beneficiaries in the policy-making process; reduction of administrative and financial transaction costs for implementing the process; simplification of the PRS process; improving the decentralisation process to enable local institutions and the rural poor to contribute to policy and strategy development and implementation.

Burkina Faso (ctd.)

What is the evidence on good practice and what is the scope for replicating it? Promoting coherence and alignment between sector policies and strategies and PRSP; capacity building and raising awareness; ensuring good technical expertise and good M&E system; involvement of all stakeholders in the PRS processes; establishment of structures of PRSP implementation; strengthening communications and cooperation between institutions and stakeholders.

Creating forum for dialogue; dissemination of information on PRSP; involvement of all stakeholders in PRS processes; respect of priorities set by stakeholders; ensure capacity strengthening of rural poor groups; developing framework for dialogue that permits stakeholders to intervene; use participatory approaches, synthesise all sectoral strategies.

5. PRS Monitoring and evaluation, and feedback for policy and strategy formulation
ELEMENTS AND ISSUES To what extent are the selected policies contributing to poverty reduction? Evidence shows that selected policies have contributed to poverty reduction targeting resources to regions on the basis of poverty classification, enterprise selection and support on the basis of beneficiary priority; and following a decentralised system; and improved process management.

Is policy evaluation being carried out? Does M&E feed into policy formulation? Burkina Faso has given priority to policy evaluation and has put in place a system to feed results into policy formulations Key elements for feedback have been identified as: developing frameworks for dialogue between stakeholders, using participatory approaches, promoting PRS process, settingup M&E committees; and having a communication strategy.

What are the challenges to policy monitoring and evaluation in the rural productive sectors (considering, for example, the importance of exogenous factors in sectors such as agriculture)? Establishment of a clear strategy for strengthening the capacity of civil society and private sector in M&E to help them seize the different opportunities provided by the PRS framework; involvement of all stakeholder groups in the development monitoring; and development of delivery systems or strategies for mainstreaming successful experiences.

PROPOSALS FOR IMPROVEMENT Where could demand for policy monitoring and evaluation come from? How could this demand be strengthened? Beneficiaries; financial institutions; administrative authorities; technical services; and all stakeholders. Demand for M&E can be strengthened by establishment of clear accountability, greater involvement of different stakeholders, decentralisation of the M&E system; strengthening the capacity of stakeholders; harmonisation of indicators to foster dialogue between different stakeholders; establishment of monitoring and evaluation committee; and raising awareness of stakeholders.

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How could ownership and participation of non state actors, i.e. civil society, the private sector, be ensured?

Burkina Faso (ctd.)

Who should provide for the evaluation of public sector policies? How could neutrality and accuracy be ensured? Could civil society organisations play a role? Evaluation of public sector policies should be led by government but with close consultation with and involvement of financial institutions, civil society and the private sector. Neutrality and accuracy can be promoted by transparency and accountability of projects; involving all stakeholders; developing a framework for dialogue; promoting participatory approaches for policy monitoring and evaluation; involvement of external structures; avoiding politicising of projects. Roles of civil society organisations include data collection, data analysis, management of M&E systems, feeding back M&E results into the PRS process; advocacy, ensuring transparency; guiding decision makers, carrying out policy monitoring and evaluation, and supporting and advising decision makers.

What is the evidence on good practice and what is the scope for replicating it? Capacity of M&E system to determine successful options, actions and programmes that could be replicated; involvement of stakeholders; defining a clear M&E system; creating frameworks for stakeholder dialogues development of good governance; orientation of actions in PRS process; and a combination of options and processes.

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Prepared by Cheikh M. Sourang (IFAD)

The views presented in this paper are those of the authors and do not necessarily represent the views of the Global Donor Platform for Rural Development or one of its member organisations. Published by Global Donor Platform for Rural Development, c/o Federal Ministry for Economic Cooperation and Development (BMZ) Dahlmannstrae 4, 53113 Bonn, Germany Layout Iris Christmann, Wiesbaden, Germany Paper Printed on special 9Lives photo paper (PaperLinx), certified according to FSC June 2009

Global Donor Platform for Rural Development

www.donorplatform.org

Contact: Secretariat of the Global Donor Platform for Rural Development, c/o Federal Ministry for Economic Cooperation and Development (BMZ) Dahlmannstrae 4, 53113 Bonn, Germany Email: secretariat@donorplatform.org Website: www.donorplatform.org Publication date: June 2008

Photo credits Patrizia Tilly - Fotolia.com, Jochen Binikowski/PIXELIO, Wolfgang Hoyer/PIXELIO, Kappdesign/PIXELIO, Re.Ko/PIXELIO