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Spending for Development Watch Video Connection Speed: High Speed Low Speed    Event Title : Spending for Development Date : 7/10/2007 Duration : 86 minutes Language  : English Country/Region : World Keyword :  Financial Management  Financial Sector  Country Assistance Strategy Presenter : James Adams Wolfgang  Fengler Homi Kharas Vikram Nehru | Related Material | Recommendations |Related B-SPAN Videos |  DESCRIPTION  After its economic meltdown in 1997 due to the East Asia financial crisis, followed by the devastating tsunami in 2004, Indonesia faced its share of difficulties. Yet the country has managed a steady economic recovery over the last 10 years, due in part to the realization that it could restart many parts of its fiscal strategy. In this presentation on July 10, 2007, at World Bank headquarters in Washington, DC, as the Bank released a report titled “Spending for Development” on Indonesia’s recent past and future strategies, a panel of experts discussed the report’s findings and the outlook for this East Asian country. Wolfgang Fengler, Senior Economist for the World Bank, discussed the Bank’s findings in the wake of Indonesia’s recovery, namely that the country has a lot of fiscal space, and that regional governments can benefit from this flexibility. He stressed that decentralization changed the fiscal fundamentals drastically, with poor regions standing out as the main beneficiaries of the system. Because of these factors, the primary challenge is to ensure that subnational governments are spending effectively, said Fengler. He also noted sectors where the country is either spending well or lagging behind, and identified spending policies that Indonesia needs to make the most of its new opportunities. Homi Kharas, Visiting Fellow at the Brookings Institution and a former East Asia Chief Economist at the World Bank, commented on the report’s process and impact, as well as the reasons for Indonesia’s recovery growth. Vikram Nehru, a Director for the World Bank’s Poverty Reduction Network, praised the report for its emphasis on decentralization, targeting, and fiscal space. He questioned, however, the ability to anticipate similar financial situations unless greater understanding of market psychology is reached. Audience members asked the panelists about efficiency in the public sector, need for budget increases, and the risk of public-private partnerships.  RELATED MATERIALS   Spending for Development Conference Related World Bank and Other Links: World Bank: Indonesia World Bank: Tsunami Recovery Related B-SPAN Events: Promoting Local Entrepreneurship Globally and the Possibilities for Impact Civil Society Impact on Budgetary Priorities, Transparency, and Results RELATED B-SPAN EVENTS Financial Management (93) Financial Sector (90) Country Assistance Strategy (26)