Poverty Reduction Support Credits : Nicaragua Country Study

Poverty Reduction Support Credits : Nicaragua Country Study

Nicaragua's state domination of productive capacity from the late 1970s to 1990, coupled with the civil war of the 1980s, left the economy with hyperinflation, large fiscal and current account deficits, and an external debt that was six times...

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Bibliographic Details
Main Author:	Hinds, Manuel
Format:	Working Paper
Language:	English en_US
Published:	Washington, DC: World Bank 2017
Subjects:	ACCESS TO INFORMATION ACCOUNTABILITY ACCOUNTING ADJUSTMENT LENDING AGRICULTURAL SERVICES AID EFFECTIVENESS ALLOCATION ANNUAL RATE AUDITING BALANCE OF PAYMENTS BUDGET CREDIBILITY BUDGET EXECUTION BUDGET FORMULATION BUDGET MANAGEMENT BUDGET PLANNING BUDGET PREPARATION BUDGET PREPARATION CYCLE BUDGET SUPPORT BUDGET SUPPORT OPERATIONS BUDGETARY PROCESS BUDGETARY RESOURCES CAPACITY BUILDING CAPITAL INVESTMENT CENTRAL BANK CENTRAL GOVERNMENT CHRONIC MALNUTRITION CIVIL SERVANTS CIVIL SERVICE CIVIL SERVICE LAW CIVIL SERVICE REFORMS CIVIL SERVICE SYSTEM COMMODITY PRICES CONDITIONALITIES CONDITIONALITY COUNTRY PROCUREMENT COUNTRY PROCUREMENT ASSESSMENT DEBT DEBT BURDEN DEBT RELIEF DEBT SERVICE DIAGNOSTIC WORK DIVISION OF LABOR DONOR COORDINATION DRINKING WATER DUE DILIGENCE ECONOMIC GROWTH ECONOMIC RECOVERY ECONOMIC REFORM ELIMINATION OF POVERTY EXPENDITURES EXTERNAL AID EXTERNAL AUDIT EXTERNAL DEBT EXTERNAL FINANCING EXTREME POVERTY FINANCE MINISTRY FINANCIAL ACCOUNTABILITY FINANCIAL ADMINISTRATION FINANCIAL CRISIS FINANCIAL INFORMATION FINANCIAL MANAGEMENT REPORT FINANCIAL MANAGEMENT SYSTEM FINANCIAL OPERATIONS FINANCIAL SECTOR FINANCIAL STRUCTURE FINANCIAL SYSTEM FISCAL ADJUSTMENT FISCAL DEFICIT FISCAL DEFICITS FISCAL DISCIPLINE FISCAL IMPACT FISCAL IMPLICATIONS FISCAL STABILITY FOREIGN INVESTMENT GENERAL BUDGET SUPPORT GOVERNMENT BONDS GOVERNMENT EXPENDITURES GOVERNMENT POLICY GOVERNMENT PRIORITIES GROSS DOMESTIC PRODUCT HEALTH CARE HEALTH PROBLEMS HEALTH SECTOR HEALTH SERVICES HUMAN CAPITAL INCOME GROWTH INEQUALITY INFLATION INSTITUTIONAL CAPACITY LOCAL CURRENCY MACROECONOMIC CONDITIONS MACROECONOMIC FRAMEWORK MACROECONOMIC MANAGEMENT MACROECONOMIC POLICY MACROECONOMIC SITUATION MACROECONOMIC STABILITY MEDIUM TERM EXPENDITURE MEDIUM TERM EXPENDITURE FRAMEWORK MEDIUM-TERM EXPENDITURE MEDIUM-TERM EXPENDITURE FRAMEWORK MINISTRY OF FINANCE MONETARY DISCIPLINE MUNICIPALITIES NATIONAL AUTHORITIES NATIONAL DEVELOPMENT NATIONAL DEVELOPMENT PLAN NATIONAL INCOME NET PRESENT VALUE PENSION REFORM PERFORMANCE ASSESSMENT PERSONNEL MANAGEMENT POLICY FORMULATION POOR POOR COUNTRIES POOR HOUSEHOLDS POOR PEOPLE POVERTY ALLEVIATION POVERTY ASSESSMENT POVERTY ASSESSMENTS POVERTY PROGRAMS POVERTY RATES POVERTY REDUCING POVERTY REDUCTION POVERTY REDUCTION OBJECTIVES POVERTY REDUCTION PROGRAMS POVERTY REDUCTION STRATEGIES POVERTY REDUCTION STRATEGY POVERTY REDUCTION STRATEGY PAPER POVERTY REDUCTION STRATEGY PAPERS POVERTY REDUCTION SUPPORT POVERTY SITUATION POVERTY-REDUCTION GOALS PRICE STABILITY PRIVATE FUNDS PRIVATE INVESTMENT PRIVATE PENSION PRIVATE SECTOR PROGRAM DESIGN PROGRAM OBJECTIVES PROGRAMS PUBLIC AGENCIES PUBLIC DEBT PUBLIC EMPLOYEES PUBLIC ENTITIES PUBLIC EXPENDITURE REVIEW PUBLIC EXPENDITURE TRACKING PUBLIC EXPENDITURES PUBLIC FINANCE PUBLIC FINANCES PUBLIC FINANCIAL MANAGEMENT PUBLIC FINANCIAL MANAGEMENT SYSTEM PUBLIC FINANCIAL MANAGEMENT SYSTEMS PUBLIC GOODS PUBLIC INSTITUTIONS PUBLIC INVESTMENT PUBLIC INVESTMENT PROGRAM PUBLIC INVESTMENTS PUBLIC RESOURCES PUBLIC SECTOR BUDGET REFORM AGENDA REFORM EFFORTS REFORM PROGRAM RESOURCE FLOWS RURAL RURAL DEVELOPMENT RURAL ELECTRIFICATION RURAL FAMILIES RURAL FAMILY RURAL WATER SANITATION SCHOOL ADMINISTRATION SECTOR EXPENDITURE SERVICE DELIVERY SOCIAL EXPENDITURES SOCIAL POLICIES SOCIAL PROTECTION SOCIAL SECURITY SOCIAL SERVICE SOCIAL SERVICES STABILIZATION POLICIES STRUCTURAL ADJUSTMENT STRUCTURAL ADJUSTMENT LOANS STRUCTURAL REFORM STRUCTURAL REFORMS SUSTAINABLE REDUCTION OF POVERTY TECHNICAL ASSISTANCE TOTAL EXPENDITURES TOTAL PUBLIC EXPENDITURE TOTAL PUBLIC SECTOR TRANSPARENCY UNCERTAINTY WAR YEARLY BUDGET
Online Access:	http://documents.worldbank.org/curated/en/253421468053328120/Poverty-reduction-support-credits-Nicaragua-country-study http://hdl.handle.net/10986/27915

Description
Summary:	Nicaragua's state domination of productive capacity from the late 1970s to 1990, coupled with the civil war of the 1980s, left the economy with hyperinflation, large fiscal and current account deficits, and an external debt that was six times gross domestic product. As a result, economic activity declined at a sharp rate. By 1993, per capita income had fallen by a full 60 percent from the 1977 level. By the early 1990s the country was receiving aid equivalent to more than 70 percent of Gross Domestic Product (GDP). Subsequent administrations tried to address the country's economic problems through fiscal and monetary discipline and market-oriented reforms to redefine the role of the state. There were some successes, for example, decisive government action reduced inflation to around 10 percent by 1995, but many reforms failed due to their slow pace and to continued political volatility. The Bank supported the reform agenda with two economic recovery credit operations in the early 1990s. The results were less positive than expected, as the government's capacity to privatize state-owned enterprises and otherwise reform the public sector wavered in the face of political instability. The lack of political consensus prompted the Bank to withdraw from structural adjustment lending for several years. An opening for re-engagement was provided in 2002 when, after several failed attempts, Nicaragua successfully implemented the International Monetary Fund's (IMF) Poverty Reduction and Growth Facility (PRGF). This allowed the Bank to respond to the government's request for assistance to close a financing gap through fast disbursing budget support in the form of a programmatic structural adjustment credit. While technically a structural adjustment loan, the credit supported objectives based on budget-based goals already attained in implementing a Poverty Reduction Strategy Paper (PRSP), which had been prepared by the government in 2001. In this sense, the credit was the last structural adjustment loan and the precursor to the Poverty Reduction Support Credits (PRSCs).

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