PRSPs improve on the previous, structural adjustment approach of the World Bank and IMF in several important respects. For one, developing-country governments are the principal architects of their own development strategies. They are ostensibly free to decide for themselves how to use external aid flows, which in theory should increase national ownership of the plans and lessen the potential for problems caused by lack of country buy-in. PRSPs are also intended to be subject to continual revision and improvement over the years, serving as an umbrella for coordinating the efforts of various agencies in different economic and social sectors. In addition, the PRSP process was designed to promote increased transparency by governments and international agencies alike, as well as to feature meaningful involvement by civil society in the choice of development priorities (Reed 2004:8).
How well is the PRSP approach working in practice? The reviews are decidedly mixed. Assessments have been undertaken by many different actors, including the World Bank and IMF themselves. The consensus seems to be that PRSP processes have somewhat increased transparency, helped sharpen the focus on investments and institutions designed to reduce poverty, and provided greater opportunities for civil-society input and participation in some countries (Reed 2004:9). Some evidence indicates increased expenditures on health, education, and transport (as a percentage of GDP) in PRSP countries (OED 2004:30), and some assessments point to PRSPs as a catalyst for improvements in public financial management (World Bank and IMF 2003:28,32-33).
However, PRSPs have also been heavily criticized for shortcomings inherent in the PRSP approach as well as problems with how the process has actually unfolded in developing countries. Critics say that PRSPs have helped provide general budget support to poor countries without adequate commitments from these countries to specific poverty reduction outcomes, identification of the populations who will benefit from proposed anti-poverty programs, and provisions for monitoring and evaluation of expected outcomes (Reed 2004:9). Others note that, since PRSPs are prerequisites for debt relief and concessional lending, countries have strong incentives to tell donors what they think the donors want to hear rather than what the country is truly committed to doing to help reduce poverty (Tharakan and MacDonald 2004:7). In addition, the initial crop of PRSPs was not very clear about priorities or costs for anti-poverty measures (World Bank and IMF 2003:15,42).
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