Policy Papers

March 13, 2009

GRA Lending Toolkit and Conditionality-Reform Proposals

Description: The Executive Board of the International Monetary Fund (IMF) considered a series of papers to reform the Fund's nonconcessional lending framework. This culminated in the approval of a major overhaul of the IMF’s lending framework, including the creation of a new Flexible Credit Line (FCL). The changes to the IMF’s lending framework which are described in GRA Lending Toolkit and Conditionality—Reform Proposalsand GRA Lending Toolkit and Conditionality—Reform Proposals—Revised Proposed Decisions include:
• modernizing IMF conditionality for all borrowers,
• introducing a new Flexible Credit Line,
• enhancing the flexibility of the Fund’s traditional stand-by arrangement,
• doubling normal access limits for nonconessional resources,
• simplifying cost and maturity structures, and
• eliminating certain seldom-used facilities.
The series of papers are: Review of Fund Facilities—Analytical Basis for Fund Lending and Reform Options, Conditionality in fund-Supported Programs—Purposes, Modalities and Options for Reform, Charges and Maturities and Proposals for Reform, Supplement 1 and Supplement 2, Review of Fund Facilities—Analytical Basis for Fund Lending and Reform Options, and Review of Limits on Access to Financing in the Credit Tranches and Under the Extended Fund Facility, and Overall Access Limits Under the General Resources Account provide the background on the earlier discussion of reforms in each of these areas.

March 6, 2009

The State of Public Finances-Outlook and Medium-Term Policies After the 2008 Crisis

Description: This paper quantifies the fiscal implications of the crisis, assesses the status of fiscal balances after the shock, and discusses the strategy to ensure fiscal solvency.

The focus is primarily on advanced and emerging economies, complementing the Board paper on the effect of the crisis on low-income countries. While, for practical purposes, some of the empirical evidence presented refers only to the G-20, information is provided also for other countries, and the analysis also applies to them. A Companion Paper provides supporting material. As a general caveat, the estimates presented are subject to a significant degree of uncertainty, and developments should be closely monitored as new information becomes available.

Notes: Companion Paper—The State of Public Finances: Outlook and Medium-Term Policies After the 2008 Crisis

The Size of the Fiscal Expansion: An Analysis for the Largest Countries

March 4, 2009

Establishment of a New Framework Administered Account for Selected Fund Activities

Description: This paper proposes the approval of an instrument for the establishment of a new framework administered account to administer external financial resources for selected Fund activities (the “SFA Instrument”). The SFA Instrument is designed to provide a more flexible platform through which the Fund may attract donor resources and meet the demand for its technical assistance (TA) and other activities.

March 4, 2009

Managing Public Debt-Formulating Strategies and Strengthening Institutional Capacity

Description: In May 2007, the IMF and World Bank Boards discussed the paper "Strengthening Debt Management Practices: Lessons from Country Experiences and Issues Going Forward". In those discussions, the Boards of both institutions endorsed a public debt management (PDM) work program that was particularly focused on strengthening frameworks and capacity in low-income countries (LICs). This comprised three main elements: (i) develop a toolkit to help LICs formulate an effective Medium-Term Debt Management Strategy (MTDS) and apply it in 4–6 countries a year; (ii) undertake debt management performance assessments; and (iii) continue the provision of debt management and domestic market development technical assistance (TA) and advisory services to middle-income countries (MICs). This paper is a response to the Boards' request for an update on the development and implementation of that work program.

Developing a Medium-Term Debt Management Strategy (MTDS)— Guidance Note for Country Authorities

Debt Management Performance Assessment Tool (DEMPA)

Developing a Medium Term Debt Management Strategy: User Guide and Analytical Tool — In March 2009, the Executive Boards of the World Bank and the IMF endorsed the Medium Term Debt Management Strategy (MTDS) Framework developed by IMF and World Bank staff to help countries elaborate effective debt management strategies. The MTDS framework and toolkit comprises two elements: An operational guidance note (GN) and a spreadsheet-based analytical tool (AT). The GN provides practical guidance on the process of developing an effective MTDS, describing each step involved, while the AT provides quantitative analysis to guide the MTDS decision-making process.

Notes: Prepared by a Bank-Fund staff team supervised by Udaibir S. Das (IMF) and Carlos Braga and Phillip Anderson (World Bank). The staff team consisted of Allison Holland, Peter Kunzel, Abha Prasad, Francis Rowe, Abdourahmane Sarr, and Eriko Togo

February 27, 2009

Survey of Private Sector Trade Credit Developments

Description: In response to the dearth of information on trade finance, the Fund has undertaken a survey of major advanced country and emerging market banks. The results suggest that the cost of trade finance is rising globally, but that provision is falling in emerging markets while staying stable in advanced countries, possibly reflecting structural differences in markets.

February 26, 2009

Togo - Assessment Letter for the World Bank

Description: This note provides the IMF staff assessment of recent macroeconomic developments in Togo and progress under the Fund-supported three-year Poverty Reduction and Growth Facility program (PRGF) starting from January 2008 based on preliminary information through end-December 2008.

February 26, 2009

Changing Patterns in Low-Income Country Financing and Implications for Fund Policies on External Financing and Debt

Description: Low-income countries (LICs) face significant challenges in meeting their development objectives while maintaining a sustainable debt position. The international community’s main answer to this dilemma has been to promote recourse to concessional external resources. The Fund’s recommendations to LICs conform to this preference: the practice in Fund-supported programs in LICs has generally been to set zero limits on nonconcessional external borrowing while not restricting concessional financing, although flexibility has been applied on a case-by-case basis to allow some nonconcessional borrowing when warranted.

February 25, 2009

The Fund's Facilities and Financing Framework for Low-Income Countries

Description: This paper assesses the adequacy of the Fund’s facilities and financing framework for low-income countries (LICs) and proposes reform options. It is part of a broader review of all Fund financial instruments and is timely given the pressure the current global financial crisis is putting on LICs. It builds on previous efforts to adapt the Fund’s toolkit to the evolving needs of its LIC members, including creation of the Policy Support Instrument (PSI) and the recent modification of the Exogenous Shocks Facility (ESF). This paper provides the basis for the first stage of the LIC-specific review, with a focus on: (i) gaps and overlaps in the facility architecture for LICs, (ii) design issues such as access, financing terms, and conditionality, and (iii) the concessional resource envelope and funding structure. Based on feedback from Executive Directors and further external consultation, more detailed reform proposals will be prepared in the second stage of the review.


The Fund’s Facilities and Financing Framework for Low-Income Countries—Supplementary Information
March 13, 2009

February 23, 2009

Key Trends in the Implementation of the Fund's Transparency Policy

Description: At the time of the 2005 review of the Fund’s transparency policy, it was agreed that information on key trends in implementation of the transparency policy would be circulated to the Board regularly, along with lists indicating the publication status of reports discussed by the Board.

The set of tables provided in this report updates the last Key Trends 2 with information on documents published through December 2007. An update will continue to be issued annually to the Executive Board.

February 23, 2009

Evaluation of Technical Assistance to Post-Conflict Countries-Mozambique and Rwanda

Description: This evaluation of technical assistance (TA) in statistics covers two post-conflict countries, namely, Mozambique and Rwanda during the period 2000–08. The TA, including training, covered the broad spectrum of the Statistics Department’s (STA) program, including collaboration with the East Africa Regional Technical Assistance Center (East AFRITAC), the U. K. Department for International Development (DFID), and the Japanese-funded General Data Dissemination System (GDDS) projects, as well as TA funded directly from the IMF’s budget. The emerging lessons also provide a useful guide to future TA to non-English-speaking countries.
The evaluation is based on missions to each country and relied on responses to questionnaires, desk reviews of available data, and discussions with country authorities, donors, data users, and national officials who participated in IMF courses in statistics.