By Maimuna Sey-Jawo
The West Africa Institute for Financial and Economic Management (Waifem) on Monday started a five-day regional course on public financial management, debt, budgeting, planning and performance.
The five-day event is being hosted by the Central Bank of The Gambia.
The deputy governor 2 of the Central Bank, Essa Drammeh, said the course is a direct result of several international declarations (namely, the Paris Declaration 2005, the Accra Agenda for Action 2008, and the Busan Partnership for Effective
Development Cooperation 2011) requiring countries to strengthen their Public Financial Management (PFM) systems and commit development partners to increase the amount of external assistance that flows through
their PFM systems.
“As you will learn in this course, public finance is at the heart of everything we do as central bankers, because fiscal balance is an important driver of key macroeconomic variables that is of great importance to central bankers. I am talking about the twin deficits (current account balance and primary
balance). In short, much of the variables that impact on macroeconomic stability are hugely affected by the fiscal side,” he said.
Speaking further, Mr Drammeh said it is instructive to consider the use of savings –investment identity, which holds that the current account balance is the difference between a country’s national savings and its gross domestic investment.
He stated: “As such, countries whose national savings exceed their gross domestic investment (such as China) run current account surpluses, while those whose national savings are less than their gross domestic investment (such as The Gambia and other Ecowas member states) run current account deficits.”
“Given the pass-through effect of exchange rate movements on domestic inflation, economic growth and development, living standards, and the rate of poverty in an economy, fiscal balance is without doubt very important in the promotion and maintenance of macroeconomic stability and economic wellbeing,” Drammeh noted.
The director general of Waifem, Dr Baba Yusuf Musa, said public finance management is a foundation to achieving developmental objectives and reducing poverty.
“It enables public funds to be managed and spent efficiently and with integrity, and it helps give donors and investor community necessary confidence.”
According to him, the regional course will cover a number of topics such as: review of basic macroeconomics; basic macroeconomics, models and indicators; fiscal and monetary policy coordination; review of programs and performance management; analysis of budget revenue among others.
It is expected that at the end of the course participants be able to understand the importance of public finance management,and macroeconomics analysis and management.“They should also be able to understand and identify the linkages between the components of PFM systems and improve economic and fiscal performance.”