WB, EU: Uzbekistan has stable, efficiently implemented state budget

Business Materials 14 March 2019 16:50 (UTC +04:00)

Baku, Azerbaijan, March 14

By Fakhri Vakilov-Trend:

A presentation of the results of the assessment of public expenditure and financial accountability of Uzbekistan (PEFA), conducted with the assistance of the World Bank and the European Union was held in Tashkent (Uzbekistan), Trend reports via Uzbek media.

"The results of the assessment will help the government to create a more efficient system for managing state finances, increase the transparency of the state budget and attractiveness of the country for international donors and foreign lenders," the World Bank said.

The main results of the assessment, according to the bank, show that Uzbekistan has a stable and efficiently implemented state budget.

"Nevertheless, it is necessary to improve the management of state assets and liabilities, strengthen medium-term budgeting, develop an effective fiscal strategy, and continue to work to increase the transparency of public finance. There is also a need to comply with international accounting and auditing standards," the World Bank stated.

In addition, the bank reported that the current assessment of PEFA revealed areas in need of reform in the state finance management system. It will be used to update the Strategy for the Public Finance Management of Uzbekistan for 2018-2025.

The head of the European Union Delegation to Uzbekistan, Eduard Stiprais, and the head of the World Bank office in Uzbekistan, Hideki Mori, welcomed the results of the PEFA assessment.

"An efficiently functioning state finance management system can provide targeted use of resources to provide specific public services to citizens. At the same time, its activities result in competent management of state assets and obligations, as well as improving the quality and availability of information for making right decisions, including decisions of international donors and foreign lenders to provide financial and technical assistance and affordable loans to Uzbekistan, " Eduard Stiprais and Hideki Mori noted.

Representatives of the European Union and the World Bank confirmed that their organizations will continue to assist in the implementation of reforms in the management of public finances through the provision of financial and technical assistance to Uzbek government.

PEFA is a methodology for evaluating the effectiveness of the state finance management system. It provides a thorough, consistent and evidence-based analysis of the effectiveness of managing public finances, including an assessment of the strengths and weaknesses of relevant government agencies and the legislative framework governing the system of managing public finances.

The assessment methodology is based on international standards and best practices recommended by leading experts and practitioners. To date, more than 600 PEFA assessments have been conducted in 150 countries of the world.

Uzbek government conducted the first assessment of the PEFA in 2012. Over the years since that time, a number of state finance management reforms have been implemented in the country. Therefore, there was a need to assess the progress achieved in this area and identify existing barriers for its further development. The government appealed to the World Bank and the European Union for assistance in conducting the second assessment of the PEFA. The evaluation was conducted from September 2018 to January 2019.

PEFA assesses 7 fundamental directions of the state finance management system: 1) budget sustainability, 2) public finance development transparency, 3) state assets and liabilities management quality, 4) fiscal strategy and budgeting based on economic policy, 5) predictability and control over budget execution , 6) accounting and reporting; 7) external control and audit. These sectors are evaluated on 31 indicators, which contain 94 characteristics.

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