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This report presents the findings of the mission based on information available as on 28 January 2010. An executive summary and a summary of the indicative performance indicators are presented in section two. The country context and recent developments and reforms in the area of public financial management, which are important for the evaluation, are provided in section three. Section four explains each scoring in detail. Section six concludes and discusses potential next steps.

Debt Markets --- External Debt --- Finance and Financial Sector Development --- Macroeconomic Management --- Macroeconomics and Economic Growth --- Public Debt --- Public Sector Development --- Public Sector Reform --- Risk Management

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The global financial crisis has not only dealt a major blow to the global economy, but also shaken confidence in economic management in the developed world and the economic models that guide it. The crisis has revealed major market failures, especially in the housing bubble and its transmission to the financial system, but also glaring state failures that propagated and exacerbated the crisis. Will the events of the past two years lead to major shifts in thinking about development economics, and should they? This paper assesses that question for several key domains of development thinking, including the market-state balance, macroeconomic management, globalization, development financing, and public spending. On the one hand, changed global circumstances and new awareness of vulnerability should lead to some policy changes, as developing countries take steps to reduce and buffer risks, including risks generated in developed countries. At the same time, the crisis should largely reinforce the Post-Washington Consensus on development that has emerged over the past decade - a world view that aims to achieve private sector-driven growth but sees a facilitating role for the state, promotes engaging with the global economy in ways that advance development, and values pragmatism, experimentation, and evidence-based policymaking over ideology.

Banks & Banking Reform --- Climate Change Economics --- Debt --- Debt Markets --- Developing countries --- Economic development --- Economic Theory & Research --- Efficient market --- Emerging Markets --- Finance and Financial Sector Development --- Financial crisis --- Financial markets --- Financial system --- Global economy --- Global trade --- Globalization --- Human development --- Income growth --- Interest rates --- International bank --- Macroeconomic management --- Macroeconomics and Economic Growth --- Market efficiency --- Market failures --- Market participants --- Monetary fund --- Private Sector Development --- Public spending

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The global financial crisis has not only dealt a major blow to the global economy, but also shaken confidence in economic management in the developed world and the economic models that guide it. The crisis has revealed major market failures, especially in the housing bubble and its transmission to the financial system, but also glaring state failures that propagated and exacerbated the crisis. Will the events of the past two years lead to major shifts in thinking about development economics, and should they? This paper assesses that question for several key domains of development thinking, including the market-state balance, macroeconomic management, globalization, development financing, and public spending. On the one hand, changed global circumstances and new awareness of vulnerability should lead to some policy changes, as developing countries take steps to reduce and buffer risks, including risks generated in developed countries. At the same time, the crisis should largely reinforce the Post-Washington Consensus on development that has emerged over the past decade - a world view that aims to achieve private sector-driven growth but sees a facilitating role for the state, promotes engaging with the global economy in ways that advance development, and values pragmatism, experimentation, and evidence-based policymaking over ideology.

Banks & Banking Reform --- Climate Change Economics --- Debt --- Debt Markets --- Developing countries --- Economic development --- Economic Theory & Research --- Efficient market --- Emerging Markets --- Finance and Financial Sector Development --- Financial crisis --- Financial markets --- Financial system --- Global economy --- Global trade --- Globalization --- Human development --- Income growth --- Interest rates --- International bank --- Macroeconomic management --- Macroeconomics and Economic Growth --- Market efficiency --- Market failures --- Market participants --- Monetary fund --- Private Sector Development --- Public spending

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Active economic policies by developing countries' governments to promote growth and industrialization have generally been viewed with suspicion by economists, and for good reasons: past experiences show that such policies have too often failed to achieve their stated objectives. But the historical record also indicates that in all successful economies, the state has always played an important role in facilitating structural change and helping the private sector sustain it across time. This paper proposes a new approach to help policymakers in developing countries identify those industries that may hold latent comparative advantage. It also recommends ways of removing binding constraints to facilitate private firms' entry into those industries. The paper introduces an important distinction between two types of government interventions. First are policies that facilitate structural change by overcoming information and coordination and externality issues, which are intrinsic to industrial upgrading and diversification. Such interventions aim to provide information, compensate for externalities, and coordinate improvements in the "hard" and "soft" infrastructure that are needed for the private sector to grow in sync with the dynamic change in the economy's comparative advantage. Second are those policies aimed at protecting some selected firms and industries that defy the comparative advantage determined by the existing endowment structure-either in new sectors that are too advanced or in old sectors that have lost comparative advantage.

Achieving Shared Growth --- Comparative advantage --- Comparative advantages --- Debt --- Debt Markets --- Development Economics --- Development strategies --- Economic growth --- Economic theory --- Economic Theory & Research --- Emerging Markets --- Environment --- Environmental Economics & Policies --- Exports --- Externalities --- Externality --- Finance and Financial Sector Development --- GDP --- Gross domestic product --- Growth rate --- Income --- Industrialization --- Macroeconomic management --- Macroeconomics and Economic Growth --- Poverty Reduction --- Private Sector Development --- Structural Change --- Unemployment --- Wealth --- Wealth creation

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Despite the scale of the global financial crisis, to date it has not resulted in a sovereign debt crisis among emerging market countries. Two significant factors in this outcome are the improved macroeconomic management and public debt management in these countries over the past decade. This paper reviews the improvements in macroeconomic fundamentals and the composition of public debt portfolios in emerging market countries prior to the crisis and concludes that the policies and strategies pursued by governments provided them with a buffer when the crisis hit. Nevertheless, with the international capital markets effectively closed for over three months and domestic borrowing in many cases impacted by extreme risk aversion, government debt managers were required to adapt their strategies to rapidly changing circumstances. The paper reviews the impact of the crisis and the responses of debt managers to the drying up of international capital, decreased liquidity in markets, and sharply increased term premia. Three categories of response are identified: (i) funding from other sources to reduce pressure on market borrowing; (ii) adapting funding programs to changes in demand in the different types of securities; and (iii) implementing liability management operations to support the market. Most governments were willing to accept temporarily greater risk in their portfolios, often reversing long established strategies, at a time when financial markets were under stress. These actions contributed to the measures taken by governments to stabilize markets and prevent economies from stalling. Looking to the future, government debt managers will need to consider how they can increase the resilience of public debt portfolios for the uncertain times that lie ahead.

Banks & Banking Reform --- Capital markets development --- Currencies and Exchange Rates --- Debt crisis --- Debt Markets --- Domestic borrowing --- Emerging market --- Emerging market countries --- Emerging market economies --- Emerging Markets --- External Debt --- Finance and Financial Sector Development --- Financial crisis --- Global capital --- Global capital markets --- Government debt --- International capital --- International capital markets --- International Economics and Trade --- Liquidity --- Macroeconomic management --- Market borrowing --- Portfolios --- Private Sector Development --- Public debt --- Public debt management --- Risk aversion --- Sovereign debt