This paper analyzes the contribution made by IDA-financed technical assistants to institutional development in macro-economic policy formulation in Togo during 1983-85. The Government's comprehensive policy response to a deteriorating economic and financial situation is presented with emphasis on the role of technical assistance. The performance of the resident technical assistants financed by IDA is reviewed. Institutional development has overall been limited because technical assistants have been absorbed by current operational tasks. On the basis of the mixed experience so far, the paper goes on to make recommendations to improve the contribution of technical assistance to institutional development in macro-economic policy formulation. Clear objectives and a receptive framework are cited as key factors. Different instruments are needed depending on whether technical assistance is aimed at performance of tasks, facilitation of processes or promotion of institutional development.