Improving Public Investment Management in the Caucasus, Central Asia, Mongolia, and Pakistan

Building effective and efficient public infrastructure is at the heart of delivering services for citizens, achieving the Sustainable Development Goals, fueling the recovery from the pandemic, and contributing to a greener and digital future. However, on average, countries lose over one-third of the potential benefits from infrastructure investment due to inefficiencies. This explains why strengthening public investment management has become an increasingly important part of the IMF’s capacity development work on public financial management.

On January 24-27, the IMF's Caucasus, Central Asia, and Mongolia Regional Capacity Development Center (CCAMTAC) and Fiscal Affairs Department organize a regional workshop on strengthening public investment management, with the support of the Infrastructure Governance Facility – an IMF-Japan Capacity Development Partnership – for representatives of government agencies from CCAMTAC countries and Pakistan.

Effective public investment management is crucial for fiscal performance, macroeconomic stability and economic growth. And it is also necessary for effective budget preparation, budget execution, fiscal risks management, and all other aspects of public financial management. 

In order to help governments manage public investment in a more effective way, the IMF developed the Public Investment Management Assessment (PIMA) tool. 

71 countries have undertaken PIMAs globally so far, including five in CCAMTAC's region (Armenia, Georgia, Kyrgyz Republic, Mongolia and Uzbekistan).

During the workshop, several country representatives shared their insights: Uzbekistan presented its experience with PIMA and the actions it has taken to implement its recommendations; Georgia addressed Public-Private Partnerships; and Armenia outlined its approach to budgeting for capital.

Greening Public Investment

Making public investment greener is also a very urgent need. Ensuring that public investment contributes to the achievement of countries’ climate goals for adaptation and mitigation makes public investment management even more important. This is why the IMF developed the Climate-PIMA, which was launched in December 2021.

The tool, based on the PIMA itself, helps countries strengthen the management of public investment specifically from a climate perspective. The IMF is looking forward to working with interested countries to apply this tool.

The workshop also addressed other aspects of public investment management, such as: project appraisal and selection processes; project planning, selection and the budget process; capital budgeting; institutional and legal frameworks; Public Private Partnerships; and more.

Building on 30 years of public financial management capacity development work in the region

Effective Public Financial Management plays a major role in advancing a country's economic growth and development. The IMF has been implementing capacity development activities on public financial management in the Caucasus, Central Asia, and Mongolia region for about 30 years, which reflects the strong commitment of economic institutions in beneficiary countries. Ministries of economy and finance have been engaging with the IMF with increasing depth and sophistication.

Building on this effort, strengthening public financial management is now a major priority of the recently created IMF Caucasus, Central Asia, and Mongolia Regional Capacity Development Center, CCAMTAC, the newest addition to the IMF's global network of regional centers created in February 2021 with the following member countries: Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyz Republic, Mongolia, Tajikistan, Turkmenistan, and Uzbekistan.

Global Partnerships benefitting the Region

The IMF thanks the development partners and donors of CCAMTAC (Asian Development Bank, China, Korea, Poland, Russia, and Switzerland), Kazakhstan (host country of CCAMTAC), Japan (supporting the Infrastructure Governance Facility),and the European Union (which co-funded the development of C-PIMA and some of its pilots, together with other partners such as Japan) for their support to enhanced public financial management in the region.

Useful links:

• Website of the Caucasus, Central Asia, and Mongolia Regional Capacity Development Center
• IMF Infrastructure Governance website

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