magnitude of expenditure comparable to expenditure on education or health (Buckley and Kalarickal 2006:49).

**Table 7. Medium Term Fiscal Management, by Regions**

|2008|Savings (%<br>GNI)<br> <br><br>**Wealth of**|Extractives<br>Depletion<br>**Nations**|Education|"Genuine<br>Savings"|**Subsidy**<br>Fuel($)<br><br>|obs<br>**Medium T**|MTFF(%)<br>**erms Expen**|MTBF(%) <br>**diture Fra**|MTBF(%)<br>**meworks**|
|---|---|---|---|---|---|---|---|---|---|
||(i)|(ii)|(iii)|(iv)|(v)|(vi)|(vii)|(viii)|(ix)|
|Advanced Economies|18|1.6|4.6|6.8|1.44|28|96%|57%|46%|
|EAP|47.3|8.7|2.0|28.6|0.92|19|68%|16%|0%|
|ECA|24.8|12.7|4.1|3.2|1.06|30|87%|50%|7%|
|LAC|22.4|8.1|4.4|6.3|0.8|31|45%|13%|0%|
|**MENA**|...|20.1|4.4|...|0.5|19|58%|11%|0%|
|SA|35.3|5.7|3.0|21.8|1.07|8|88%|25%|0%|
|SSA|16.5|15.5|3.3|-6.2|1.19|46|74%|41%|9%|
|**Average/Total**|**20.9**|**4.4**|**4.2**|**7.2**|1.03|181|73%|34%|10%|
|**Non-oil &gas**|**8.7**|**2.1**|**4.2**|**10.0**|**1.14**|**160**|**75%**|**36%**|**11%**|
|**Non-oil &gas**<br>_Source:_Wealth of Natio|**23.5**<br>ns(2011:195|**33.1**<br>),PRMPS M|**3.4**<br>TEF Databa|**-7.8**<br>se,WDI,Coad|**0.61**<br>yet. al.(201|**21**<br>0) (ix)|**57%**|**14%**|**5%**|

_Source:_ Wealth of Nations (2011:195), PRMPS MTEF Database, WDI, Coady et. al. (2010) <u>(ix)</u> _Notes:_ Oil dependent refers to more than 25 % income, export, or fiscal revenue dependence (source Barma et. al. 2011) 66. Prevailing political pressures for greater inclusiveness have seen a number of MENA governments emphasize boosting wages and benefits, and increasing transfers and subsidies – especially towards aggrieved groups and politically-influential constituencies. Most of these measures seem to be short term, ad hoc and ultimately unsustainable. This implies westward movement in Table 1 (and Figure 4), as intertemporal commitments come under strain and short-term considerations overwhelm long-term planning. A central question therefore will pertain to the institutional capability of MENA‘s governments to both maintain aggregate fiscal discipline, even in the absence of significant changes in resource prices, while enhancing the selectivity and sustainability of distribution programs.

67. Various forms of Medium Term Expenditure Frameworks (MTEFs) can serve as instruments to support both aggregate fiscal discipline, expenditure prioritization, and performance based orientation. A recent cross-country dataset aims to capture the prevalence of degrees of MTEFs globally, focusing on three indicators to denote institutionalization of macro-fiscal management, expenditure prioritization, and performance orientation (see Table 7, Colum vi-ix, Table 8).<sup>26</sup> On adoption of expenditure prioritization mechanisms (MTBFs), MENA ranks lowest globally, followed by LAC. This raises significant questions as to the medium term mechanisms MENAs governments can adopt to sustainably reprioritize distribution programs in the context of political transitions, especially as the traditional 26 These are based on an extensive global dataset recently constructed by the World Bank‘s PREM Public Sector & Governance Group ( _forthcoming)_ . The three different MTEF—MTFF, MTBF, and MTPF—were coded as one if a country met the following criteria: (i) MTFF: the government has rolling aggregate, expenditure, revenue, and other fiscal forecasts. Features include the availability of a macro-fiscal strategy, macroeconomic and fiscal forecasts, and debt sustainability analysis, (ii) MTBF: the budget, spending agency or other reports explain aggregate and sectoral expenditure objectives and strategies, budget circulars detail medium-term expenditure ceilings and revenue forecasts, and budget documents contain some detail for medium-term estimates. MTPF: the budget, spending agency or other reports explain program objectives and strategies, listing specific agency and/or program output or outcome targets, as well as results.

19