Southeast Sulawesi is one ofIndonesia's developing provinces and over the past fiveyears has achieved one of the country's highest growthrates. In 2010, Southeast Sulawesi's economy grew at8.2percent the third fastest in Indonesia. The poverty ratehas declined significantly in the past 10 years and theunemployment rate is one the lowest in Indonesia. Per capitaexpenditure in Southeast Sulawesi has increased nine-foldcompared to pre decentralization rates SoutheastSulawesi's consolidated per capita expenditure nowfalls in the top 10 in Indonesia. However, SoutheastSulawesi is still facing a range of challenges. The HumanDevelopment Index (HDI) has continued to lag at 25th inIndonesia over the past five years. Although regional GrossDomestic Product (GDP) has grown rapidly, in real per capitaterms it is still far below the national provincial average.Southeast Sulawesi' poverty rate also remains above thenational average. It will be important for the high andgrowing rate of per capita expenditure to be matched withimprovements in public financial management capacity withinthe local government. In the context of overcoming thesechallenges and capitalizing on expanding opportunities, thelocal governments in Southeast Sulawesi and in particularthe provincial government need to work harder to make themost of its budgetary resources. The development agenda andprograms must be sharpened and budget allocations must beoptimized to achieve development targets, especially in thestrategic sectors of education, health, infrastructure andagriculture. This report contains findings andrecommendations intended to support sub national governmentsin Southeast Sulawesi province to enhance their publicfinancial management performance; improve the quality ofevidence based planning and budgeting; and accelerate theachievement of existing development targets.
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