Introduction

The executive boards of the World Bank and International Monetary Fund (IMF) suggested a new framework for poverty reduction for Heavily Indebted Poor Countries (HIPCs) and other poor client countries in December 1999 (IMF and IDA, 1999a). The HIPC countries are expected to prepare Poverty Reduction Strategy Papers (PRSPs) to be able to continue obtaining more loans. In PRSPs, national governments must show that they understand the current domestic problems in relation to poverty and must explain how they will create a democratic environment, including all the stakeholders in decision-making and implementation (IMF, 2013). What makes the PRSP approach distinct and worth further pedagogical investigation is its apparent proposition to be country-owned and participatory for wider sections of society. This was something new, as previous poverty reduction policies were solely masterminded by the World Bank and IMF. Poor countries were obliged to accept those policies in order to be eligible for loans and grants. PRSPs were supposed to be prepared by national governments with the participation of all major stakeholders in the country's development; namely, parliament, civil society organisations (CSOs), sectoral ministries, regional banks and international donor agencies (IMF and IDA, 1999a). A World Bank (2002a) report claimed that the PRSP approach emphasised the interdependence of all elements of development – social, structural, human, economic, environmental and financial – and advocated a holistic long-term development strategy with the developing country governments in the lead, both ‘owning’ and directing the strategy. In general, the PRSP approach aimed to plot a country's macroeconomic, structural and social policies and programmes over a three-year or longer period to promote growth and reduce poverty, as well as identifying associated external financing needs and major sources of finance (World Bank, 2001).

This chapter outlines some key features of the PRSP framework. It looks at: the background of the PRSP framework; how the PRSP approach has been imposed as a condition of debt relief and further loans from the World Bank and IMF; the role of PRSPs in connection with previous poverty reduction prescriptions for poor countries by international financial institutions (IFIs); and the notions of ‘ownership’ and ‘participation’ in preparing these documents. This discussion about the PRSP approach itself provides the book with a strong basis from which to understand the purpose of ‘participation’ in this framework.