Financial management in the public administration of developing countries: the challenges of aid effectiveness
Abstract Key aspects of public financial management of developing countries (DCs) are considered, namely: 1) general characterization of DCs; 2) effectiveness of foreign aid (FA); 3) Russia`s role in providing FA to DCs. The study was conducted using methods of monographic desk research and statistical analysis. It was found that there is currently no established definition of DCs. Several known classifications of DCs have been analyzed; it is shown that there are two main methods of revenue generation in DCs: a) FA; b) reforming public administration instruments in DCs. The authors used GNI per capita as the key classification criterion of DCs. It is revealed that there are three ways to solve the problem of the effectiveness of the FA to DCs: 1) application of the "economic growth with two deficits" model; 2) application of the institutional regulation of the FA to DCs; 3) provision of FA to DCs adhering to the "right political course". It is concluded that no matter which instrument of FA to DCs is chosen, the responsibility for the economic development of DCs lies entirely with national governments and depends on their activities and their foreign policy course. It is established that for a longtime the Russian Federation has been actively participating in the implementation of the FA to DCs programs and is the largest donor for the CIS countries. It is shown that despite the instability of relations with Western countries in the new economic conditions and the downturn in the Russian economy, the Russian Federation continues to work actively in international development institutions. It is summarized that in order to increase the effectiveness of financial management in the public administration of the Russian Federation, it is necessary to create open mechanisms of accountability and transparency, information content of channels for the dissemination of information about Russian politics in the field of FA to DCs. The implementation of such measures will make it possible to promptly inform the entire world community about the huge role and value-added content of Russia`s FA to DCs for the purposes of sustainable development.
Keywords: public administration, NPM, state regulation of the economy, financial management, developing countries, revenue mobilization of the country, GDP, effectiveness of foreign policy, foreign aid, external assistance, new economic environment, Russia.
Highlights:
♦ the basic basis of financial management in public administration is the trend towards borrowing corporate governance techniques and methods;
♦ the main strategy of financial management in public administration of developing countries is an effective strategy of external assistance;
♦ the classifications of developing countries are considered; GNI per capita is chosen as the key classification criterion;
♦ three main directions of solving the problem of efficiency of developing countries are described; it is shown that the responsibility for the economic development of developing countries lies entirely with national governments and depends on their activities and their foreign policy course;
♦ the great role of Russia in the implementation of foreign aid programs for sustainable development is shown;
♦ the problem of improvingthe effectiveness of financial management in the public administration of the Russian Federation can be solved by creating mechanisms for openness and transparency, filling channels for the dissemination of information about Russian politics.
Galina V. Astratova - Ural Federal University named after the First President of Russia B.N. Yeltsin, Yekaterinburg, Russia, Ural Law Institute of the Ministry of Internal Affairs of Russia, Yekaterinburg, Russia; Alisher A. Toshpulotov - Russian-Tajik (Slavic) University, Dushanbe, Republic of Tajikistan