Public Investment Management in Colombia

Abstract

The Colombian Government has made significant progress in the implementation of effective processes, practices, and methodologies for public investment management (PIM). A 2011 IMF-published report ranked Colombia among the top 5 countries with best PIM practices out of a sample of 71 low- and middle-income countries (Dabla-Norris and others, 2011). The report assessed the following 4 key features: (a) strategic guidance and project review, (b) project selection and budgeting, (c) project implementation, and (d) project evaluation and auditing. Colombia was deemed to have achieved a good performance on 3 out of the 4 key features. Nevertheless, the country’s PIM system still faces the need for areas of improvement identified by the World Bank’s PIM framework. This framework allows for identification of not only the presence of must-have features in PIM systems that are key to promoting effective and efficient public investment but also if those features are implemented in the field and if they have achieved their intended purpose. In the case of Colombia, the main challenges identified were related to the broad implementation of tools designed, particularly for management of public investment projects as well as with the fractioning of standards and practices, and the overemphasis placed on formal controls during the formulation and project implementation stages. In addition, the country PIM processes had weaknesses in terms of the review and ex post project evaluation. This document summarizes the main findings of a PIM study carried out in Colombia in 2015. The document includes an analytical framework for assessing public investment management and presents the assessment results as well as improvement recommendations to strengthen the institutional set-up to increase the effectiveness and efficiency of public investment in Colombia.