Public Sector Governance and Accountability Series: Budgeting and ...

454 Salvatore Schiavo-Campo
corruption, diminished soil productivity and other severe environmental
problems, and degraded public sector institutions. It has also inherited,
however, a strong consensus—for the first time in postindependence
Burundi—in favor of peace, ethnic reconciliation, good governance, and
restoration of security throughout the country.
Rebuilding the Budgeting System
A gradual improvement in Burundi’s economy is evident. After a dip in
2003, annual GDP growth recovered and is projected at about 6 percent in
the next few years, with inflation dropping to single digits. The balance of
payments was about in equilibrium (aided by external assistance) in 2005 to
2006, although a small deficit is projected for 2007 and 2008. The exchange
rate has stabilized, with exports recovering to some extent. And the fiscal
deficit has been kept under control. Many of the ingredients for sustained
recovery and development are now in place. Progress has been made, too, in
the public expenditure area, and some initial improvements in the dilapidated
budgeting process have occurred.
Before the onset of overt civil war in 1993, and despite the periodic
eruptions of violence, Burundi was deservedly known as one of the bestmanaged
economies in Africa. Corruption, though present, was limited and
predictable; budgeting was fairly well organized and transparent; civil
servants were competent and disciplined; and basic public services were
delivered in a reasonably efficient manner. This still-recent experience offers
the country the memory of better times, the confidence of knowing that it
did have the capability to manage the public finances, and a vision of how
public management can be improved by a return to the good standards of
the country’s own past. This intangible asset, not present in many other
postconflict situations, is very important for rebuilding the public
expenditure management system in Burundi.
Functional priorities in reconstructing public expenditure management
Although the existence and reference point of good past management is an
unusual asset, the functional priorities in budgeting and public expenditure
management in Burundi are similar to those in other postconflict situations:
Pending an eventual upswing in private investment, growth and poverty
reduction depend on an improvement in public investment efficiency,
which, in turn, will be critical for the effectiveness of aid. Better project
selection and closer monitoring will be necessary in this regard, as will the