JICA-RI and DIE Held Joint Workshop on General Budget Support

The joint workshop was divided into two sessions. Session 1 focused on the macro-level impacts of general budget support, and Session 2 introduced case studies in African countries.

In Session 1, JICA-RI senior research fellow Mitsuaki Furukawa and research associate Junichiro Takahata presented findings from their research on the effectiveness of general budget support from a macro-level perspective. DIE research fellow Svea Koch followed with a presentation titled "EU Budget Support and the Coordination Challenges (or Failures) between the European Commission and European Member States."

Their analysis revealed that general budget support did neither increase government health spending nor improve health indicators by boosting efficiency of government health spending. Meanwhile, when focusing exclusively on low-income countries, the research team confirmed its positive influence on the health budget. Yet, it was unclear as to how much increased government health spending contributed to the improvement of health indicator. This showed the effectiveness of general budget support limited.

In Session 2, Furukawa and DIE economist Stefan Leiderer shared case studies of budget support in Tanzania and Zambia, respectively.

Furukawa presented the details of budget support in Tanzania, with special focus on the timing of disbursement from a donor. He specifically paid attention to the fact that late disbursements negatively affect the delivery of planned public services. This was a problem already pointed out by Tanzania's central government and local governments. Further, he listed other problems including overall capacity of local government such as shortage of staff. He concluded by stressing the importance of complementarity between budget support and other aid modalities such as project assistance.

Though aid scheme preference is changing from project aids to general budget support in Europe especially, there exist very few studies that have comprehensively analyzed the aid effectiveness of general budget support. JICA-RI contributes to the promotion of the understanding on this topic by conducting a research project "Role of Budget Support in the Development Aid Regime." This study looks into how general budget support affects delivery of public services and various indicators, and examines the bottlenecks of the scheme in developing countries.