Financing Local Development in Myanmar: Arrangements, Outcomes and Options for Improvement

In: http://hdl.handle.net/11540/11345

Abstract

Progress toward achieving many of the goals under the five pillars of the Myanmar Sustainable Development Plan (MSDP) is closely linked to the quality of government spending on local infrastructure and services. In order to achieve these goals, this spending needs to be: Effective: both adequate and aligned to the varying needs and priorities of different localities; Efficient: making best use of scarce budgetary resources to maximum output and impact; Equitable: allocated across both communities and territorial jurisdictions in a manner that is fair, and which responds to varying local needs and resources; Sustainable: kept at consistent annual levels, and ensures that assets created are operated and maintained to generate services and benefits over the long term ; Transparent and accountable: budget allocation decisions should be clear to all and not arbitrary. Achieving the necessary quality of spending along these dimensions depends on many factors – the quality of general governance and the quality of public financial management, but also critically depends on the nature of the mechanisms in place to finance local spending. This report therefore: examines the arrangements for this financing, and their practical consequences for government spending at state/region and township levels; identifies any current or potential future problems in these arrangements; and suggests areas where improvements and reforms might be made.