Policy Papers
2013
March 21, 2013
Implementation Plan in Response to Board-Endorsed Recommendations for the IEO Evaluation of International Reserves--IMF Concerns and Country Perspectives
Description: This paper proposes Management’s response to the IEO’s Evaluation of International Reserves—IMF Concerns and Country Perspectives. The proposed implementation plan focuses on those recommendations that are not already being addressed by other recent Fund initiatives, and include: (i) a successor paper on reserve adequacy, which will review the work contained in the Fund’s 2011 Assessing Reserve Adequacy paper and develop additional and updated guidance where needed; (ii) the preparation of a staff guidance note for assessing adequacy; and (iii) additional engagement on reserve issues with members, the private sector, and academics.
March 20, 2013
Mid-Term Evaluation Report on the Enhanced Data Dissemination Initiative Project
Description:
This report presents the results of the mid-term evaluation of the Enhanced Data Dissemination Initiative (EDDI) financed by the United Kingdom’s Department for International Development (DFID) covering the period April 1, 2010 to September 30, 2012. The evaluation was conducted internally by the IMF in consultation with DFID. EDDI is a five-year project (April 2010–March 2015) implemented by the IMF to improve macroeconomic statistics in 25 African countries. The project includes modules for sub-groups of countries covering national accounts, monetary statistics, government finance statistics (GFS), balance of payments statistics (BOP), and harmonization of statistics in several regional organizations.
The mid-point of a five-year project is an appropriate time for all stakeholders of the project to step back and take stock of what has been accomplished in the first half of the project, what has gone well, what aspects have been disappointing, and what might be adjusted or changed to make the remainder of the project more effective in achieving its objectives.
To facilitate this process, questionnaires were developed to obtain feedback from three groups: counterparts in participating countries, IMF module managers and experts, and DFID country and regional advisors. Recommendations made by the stakeholders that will be followed up in the second half of the project are listed as bullets in italics below.
March 18, 2013
Eligibility to Use the Fund's Facilities for Concessinal Financing
Description:
During the 2012 Review of Poverty Reduction and Growth Trust (PRGT) Eligibility, Executive Directors expressed a number of concerns about the eligibility framework. The Board decided to bring forward the next review of eligibility by one year, to early 2013, in light of these concerns. In particular, Directors called for the review to assess:
Possible shortcomings of the gross national income (GNI) per capita criterion in the case of small states, and whether additional or alternative variables should be used to better capture members‘ circumstances, particularly those of small states; as well as further options to enhance the flexibility of the PRGT-eligibility framework to cover small and very small countries;
The application of the short-term vulnerabilities criterion for graduation, which can lead to repeated non-graduation of members that meet either the income or the market access criteria for graduation.
March 18, 2013
Review of Facilities for Low-Income Countries - Proposals for Implementation
Description: Based on the Executive Board’s guidance during the first stage of the Review of Low Income Countries (LIC) Facilities, this paper suggests a number of refinements to the facilities and instruments that are consistent with the self-sustainability of the Poverty Reduction and Growth Trust (PRGT). The proposals seek to improve the tailoring and flexibility of Fund support. Taken together with those advanced in the parallel paper on PRGT eligibility, they are projected to keep the average annual demand for PRGT resources within a range consistent with the Board’s approved strategy to make the PRGT self-sustaining over the period 2013–35. The proposals are as follows.
March 14, 2013
Jobs and Growth - Analytical and Operational Considerations for the Fund
Description: Job creation and growth with inclusion are imperatives that resonate today in every country. While some advanced countries face the challenge of supporting aggregate demand with limited fiscal space in the aftermath of the Great Recession, many countries have to address ways to generate growth and create jobs in the face of the strong ongoing global megatrends of technological change, globalization, and significant shifts in demographic trends. The latter includes rapid population aging in some parts of the world, and the entry of a large number of new workers into the labor force in others. Low female labor force participation represents a significant missed opportunity to strengthen economic development and growth in many countries.
March 5, 2013
Helping Developing Countries Address Public Debt Management Challenges - An IMF-World Bank Capacity Building Partnership
Description: In 2009, the Boards of the IMF and World Bank jointly endorsed a capacity building program to help developing countries strengthen their public debt management frameworks. A key aspect of the program was to help developing countries implement the framework developed by staffs to formulate an effective medium-term debt management strategy (MTDS). The Boards also supported the continued use of the complementary framework—the Debt Management Performance Assessment (DeMPA)—developed in 2007, to assess the effectiveness of the broader institutional arrangements for public debt management. This paper provides an update on the implementation of the program since its endorsement in 2009.
March 4, 2013
Termination of the Administered Account for Liberia
Description: On March 14, 2008 the Fund established the Administered Account for Liberia (“Liberia Administered Account” or LAA) to facilitate fundraising for, and delivery of, debt relief to Liberia with respect to obligations owed to the Fund. Specifically, the account was intended to: (i) receive resources contributed for the financing of the IMF’s share of debt relief to Liberia; and (ii) use these resources, as provided for in the Instrument to establish the LAA, to make contributions in the context of debt relief to Liberia under the Heavily Indebted Poor Country (HIPC) Initiative, and to deliver “beyond-HIPC” debt relief to Liberia (Attachment). As stipulated in the Instrument (paragraph 10(a)), the LAA shall remain in effect for as long as necessary, in the judgment of the Fund, to conduct and wind up the business of the account. Following Liberia’s successful achievement of the HIPC completion point in June 2010 and the full delivery of “beyond-HIPC” debt relief, which exhausted the balances in the account, the LAA can be terminated as it has no pending business.
March 1, 2013
Review of the Policy on Debt Limits in Fund-Supported Programs
Description:
This review examines the experience with the policy on debt limits in Fund-supported programs across the membership and proposes possible reforms to strengthen the policy. The policy was last reformed in 2009 with a view to adapting it to the changing circumstances in low-income countries (LICs). Given its primary focus on LICs, the reform left the policy applying to the rest of the membership broadly unchanged.
The Fund’s debt limits policy has been in place since the 1960s. From the policy’s inception, concessional flows have been excluded from debt limits under the presumption that such financing was critical for LICs and posed only limited risks to debt sustainability. Over time, the exclusion of concessional flows has led to a bifurcation in the policy, with one branch focusing on members to whom concessional financing is normally available, and the other on those to whom it is not—a distinction which in practical terms has involved differentiating between LICs and non-LICs.
February 22, 2013
IMF Membership in the Financial Stability Board
Description: In light of the recent establishment of the Financial Stability Board (FSB) as an association under Swiss law, this paper proposes Fund membership in the new association. The FSB was formed in 2009 and the Fund’s Executive Board approved the Fund’s membership in 2010, which has provided the Fund with the necessary scope to engage and collaborate with the FSB on a wide range of issues of mutual interest. Recently, in response to a request by the G-20 to establish the FSB with a well-defined “legal personality,” the FSB was established as an association under Swiss law. In light of this change, an Executive Board decision is required for the Fund to formally join the Association.
February 20, 2013
Caribbean Small States - Challenges of High Debt and Low Growth
Description: This paper presents background on Caribbean small states as context for the main paper, “Macroeconomic Issues in Small States and Implications for Fund Engagement.” It draws on recent analytical work presented at a conference for policy makers in September 2012, in Trinidad and Tobago. Caribbean small states, while sharing many features of other small states (size-related macroeconomic vulnerabilities, lack of economies of scale, and capacity constraints) have specific characteristics which merit attention.