and regional procurement advisers work together to schedule CPARs based on country needs and regional priorities. These staff are also responsible for the quality of individual CPARs. CPAR guidelines include a section on quality and emphasize the need to base the analysis on a strong analytical framework and rigorous empirical evidence; they also refer staff to the internal quality section of the Quality Assurance Groups questionnaire on economic and sector work. As with all such work, task managers must make provisions for quality assurance, including peer reviews, when planning CPARs.

CPAR guidelines describe in detail the main steps for developing initiating concept memorandums and for conducting review meetings and peer reviews. They also explain how to ensure adequate staffing and resources and define the dual purposes of the exercise: analyzing a countrys procurement system with a view to proposing concrete measures for improvement and identifying risks to the Banks loan portfolio.

The Bank encourages governments to involve a wide range of stakeholders in the preparation of CPARs, to disseminate CPAR findings to these stakeholders, and to involve them in the design of follow-up action plans. Governments are also encouraged to circulate draft CPARs widely before giving their reactions. World Bank policy is that CPARs are publicly disclosed unless governments object.

CPAR guidelines consider the follow-up phase critical to determining the reports impact. They stipulate that the Bank and the government should agree before launching a CPAR that its findings will form the basis for remedial actions in the case of significant deficiencies. The review should lead to agreement on the actions to be taken, a timetable for implementation, and responsibilities for executing the program, and these three elements should be incorporated in the CAS. Procurement reform typically involves activities such as adjusting the legal framework, strengthening institutions, providing training, and improving records management. The action plan should be monitored by the government and donors using performance indicators for the public procurement system; CPAR guidelines give examples of suitable indicators.

IMF REPORTS ON THE OBSERVANCE OF STANDARDS AND CODES OF FISCAL TRANSPARENCY

The IMF adopted a Code of Good Practices on Fiscal Transparency in 1998 and approved an updated version in March 2001 (see IMF 2001). The code is based on several key requirements for transparency:

Government roles and responsibilities should be clear, including the legal and administrative framework for fiscal management.

The government should provide the public with complete information on its past, present, and projected fiscal activities.

Budget preparation, execution, and reporting should be conducted in an open manner.

Fiscal information should meet international standards for data quality and be subjected to independent assurances of integrity.

The code describes the principles and practices that governments should follow to meet these requirements. Guidance on implementation of the code is provided by a manual on fiscal transparency and by a questionnaire that helps gauge country practices relative to the standards of the code. Reports on the Observance of Standards and Codes (ROSCs) have been developed as part of a World Bank-IMF initiative to promote standards and codes. ROSCs provide information on implementation of standards to assist the IMFs regular surveillance (Article IV) consultations with member countries.

The report on fiscal transparency-the Fiscal ROSC-has two main components. The first is a description of country practices relative to the good practices defined for each of the 37 elements of the code. The second is a staff commentary, giving the IMFs overall assessment and recommending possible improvements. Completion of a Fiscal ROSC is voluntary. Once a government decides to participate, it fills out the questionnaire. Based on the answers and on discussions with the authorities, IMF staff prepare a draft ROSC, which is discussed with the authorities before being finalized. This approach strives to stimulate government ownership of and interest in the process and its results.

Participation in a Fiscal ROSC helps national authorities identify weaknesses. Government approval and publication demonstrate commitment to increasing fiscal transparency. Published results are useful for preparing and updating other fiduciary instruments used by donor agencies. They may also be used by the IMF and the Bank in the development of their lending and technical assistance programs.

A Fiscal ROSC is a carefully targeted instrument with a very specific focus, as reflected in the detailed instructions in the manual on fiscal transparency. The manual emphasizes that a Fiscal ROSC should be limited to fiscal transparency issues and should not deal with the efficiency or effec-

tiveness of fiscal management (though this stipulation is not always strictly observed in practice). Fiscal ROSCs should, however, refer to relevant laws and indicate the extent to which these laws are observed.

To the extent possible, the IMF coordinates the preparation of Fiscal ROSCs with that of CFAAs and other World Bank products. Most coordination has involved the exchange of information on mission schedules and the exchange of draft reports for comment. In addition, some experimental missions have been conducted involving coordinated field work (as in Bangladesh and Mauritania).

If country authorities agree, the final assessments of Fiscal ROSCs are made publicly available on the IMF Website. By July 2003, 59 Fiscal ROSCs had been completed-meaning that they had been finalized with the authorities and sent to the IMF Board-and 52 had been published on the Website.

The section of Fiscal ROSCs containing the IMF staff commentary identifies priorities and offers recommendations for improving fiscal transparency. Fiscal ROSCs usually do not develop action plans, though they have occasionally done so with participation from country authorities. Where transparency weaknesses appear to have significance for IMF programs or IMF country policy analysis, improvements in these areas may be included in program conditionality. Improving transparency in the agreed areas often requires addressing underlying institutional weaknesses over the medium to long term. The IMF or other agencies may provide technical assistance to address transparency and underlying institutional weaknesses.

Once a Fiscal ROSC is completed, IMF policy is that brief updates should be undertaken as part of regular surveillance consultations. These updates are also published on the IMF Website. Thus Fiscal ROSCs allow for continual monitoring of countries implementation of the fiscal transparency code. In addition, it is envisaged that Fiscal ROSCs will periodically be completely revised and new assessments published.

WORLD BANK-IMF PUBLIC EXPENDITURE TRACKING ASSESSMENTS AND ACTION PLANS FOR HEAVILY INDEBTED POOR COUNTRIES

In 1996 the Bank, IMF, and numerous bilateral donors introduced the Heavily Indebted Poor Country (HIPC) initiative to reduce the external debt of the worlds poorest, most indebted countries.3 Following a 1999 review, the initiative was enhanced to provide faster, deeper debt relief to