Financial Crime World

Azerbaijan Makes Progress in Public Financial Management

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Azerbaijan has made significant strides in improving its public financial management (PFM) system in recent years. According to a new report by the International Monetary Fund (IMF), the country has taken steps to strengthen its institutional capacities, improve budgeting processes, and enhance transparency and accountability.

Progress Made


The report highlights several key areas where Azerbaijan has made progress:

  • Medium-term expenditure framework: The country has developed a medium-term expenditure framework, which will help ensure more sustainable fiscal management.
  • Institutional capacities: Azerbaijan has taken steps to strengthen its institutional capacities by improving budgeting processes and enhancing transparency and accountability.
  • IT systems: While IT systems are still under development, the Treasury Information Management System is one notable exception.

Challenges Ahead


Despite progress made, Azerbaijan’s PFM system still faces several challenges:

  • Lack of skilled personnel: There is a shortage of skilled personnel in the public sector.
  • Inadequate infrastructure: The country’s infrastructure is inadequate to support efficient financial management.
  • Limited use of IT systems: Many IT systems are not being effectively used, hindering progress.
  • Structural problems: Disparities in wages between the public and private sectors can make it difficult to recruit and retain qualified civil servants.

Recommendations


To build a more robust and sustainable PFM system, Azerbaijan is recommended to:

  • Strengthen institutional capacities: Continue to improve budgeting processes and enhance transparency and accountability.
  • Develop IT systems: Implement a comprehensive plan to develop IT systems and ensure their effective use.
  • Address structural problems: Develop strategies to address disparities in wages between the public and private sectors.
  • Improve skills and capacity of civil servants: Develop programs to improve the skills and capacity of civil servants.

By taking these steps, Azerbaijan can continue to build a more robust and sustainable PFM system that serves the needs of its citizens.