Public Information Notice: IMF Executive Board Reviews Data Standards Initiatives
July 23, 2003
|Public Information Notices (PINs) are issued, (i) at the request of a member country, following the conclusion of the Article IV consultation for countries seeking to make known the views of the IMF to the public. This action is intended to strengthen IMF surveillance over the economic policies of member countries by increasing the transparency of the IMF's assessment of these policies; and (ii) following policy discussions in the Executive Board at the decision of the Board.|
On July 9, 2003, the Executive Board concluded policy discussions on the International Monetary Fund's (IMF) Data Standards Initiatives. This was the Fifth Review of the Fund's Data Standards Initiatives.
The Fund's Data Standards Initiatives aim to enhance the availability of timely and comprehensive statistics and, therefore, contribute to the pursuit of sound macro-economic policies and to the improved functioning of financial markets.
The Special Data Dissemination Standard (SDDS) was established in 1996 to guide countries that have or might seek access to international capital markets in the provision of data to the public. There are currently 53 subscribers to the SDDS. Subscription is voluntary and subscribers undertake to follow the SDDS requirements with respect to the coverage, periodicity, and timeliness of the data and the dissemination of advance release calendars identifying when data are to be released. Subscribers also undertake to pursue good practice with respect to the integrity, access by the public, and quality of the data. SDDS subscribers provide information about their data dissemination practices for posting on the Dissemination Standards Bulletin Board (DSBB) at http://dsbb.imf.org. Subscribers are also required to maintain an Internet website that contains the actual data, referred to as a national summary data page (NSDP), and to which the DSBB is electronically linked.
The General Data Dissemination System (GDDS) was established in 1997 as a framework for countries to improve their statistical systems to meet the evolving requirements of the user community. The GDDS fosters the application of sound methodological principles, the adoption of rigorous compilation practices, and the observance of procedures that ensure professionalism and objectivity. The 58 IMF members that participate in the GDDS provide metadata describing their data dissemination practices and detailed plans for improvement for posting on the DSBB.
The Data Quality Assessment Framework (DQAF) is an assessment methodology that has been integrated into the structure of the data module of the Reports on the Observance of Standards and Codes (ROSCs) following the Fourth Review of the Data Standards Initiatives. At the same time, the DQAF's broader application in providing guidance to improving data quality has been integrated in an overall data quality assessment program.
The Executive Board's Fifth Review discussed developments of the SDDS and the GDDS, proposals for updating the SDDS and the GDDS to maintain their relevance and reflect evolving international best practice, plans for follow-up on the data module of the ROSCs, refinements to the DQAF, and the integration of the Data Standards Initiatives within the Data Quality Program (DQP). As background for the Board discussion, the staff prepared three supplements on The General Data Dissemination System and the Millennium Development Goals; Data Quality Assessment Framework and Data Quality Program (jointly with the World Bank); and Government Finance Statistics Manual 2001—Adjusting the Special Data Dissemination Standard Requirements for the Fiscal Sector.
Executive Board Assessment
Executive Directors welcomed the opportunity to review the experience under the Fund's Data Standards Initiatives and to consider proposals for their further refinement and consolidation. They expressed their strong satisfaction with the significant contribution that the Data Standards Initiatives have made toward strengthening the compilation, dissemination, quality, and transparency of data in member countries, and saw continued progress in these areas as a key pillar of effective crisis prevention and surveillance. They also highlighted the important role that the Fund has come to play as a data standard-setting body and in providing technical assistance on data issues. To build further on these encouraging developments, Directors supported the overall strategy that is being implemented for promoting data transparency by increasing members' participation in the Data Standards Initiatives, keeping up with international best practices, and integrating the various initiatives in the Data Quality Program (DQP). They called for a continuation of the close consultative process with members and other institutions on which the Fund's work on these initiatives has been grounded. They also underscored the importance of continuing to ensure the voluntary nature of the Data Standards Initiatives, which many Directors saw as a key to their success to date.
Directors welcomed the strong increase in General Data Dissemination System (GDDS) participation to 58 participants and the recent subscriptions to the Special Data Dissemination Standard (SDDS) that increased the number of subscribers to 53, which together have raised the overall Fund membership participation in the Data Standards Initiatives to over 60 percent. They noted the increasing—although still anecdotal—evidence that adherence to international transparency standards generally, and to the SDDS in particular, appears to be positively linked to a country's improved access to international capital markets.
Directors looked forward to sustained further increases in the rates of participation in the Data Standards Initiatives and members graduating from the GDDS to the SDDS. They were encouraged by the number of countries that have expressed interest in subscribing to the SDDS, while recognizing that it may take them considerable time to build up their statistical systems to meet SDDS requirements. Directors considered that the current phase of consolidation, following several years of intensive efforts to address weaknesses in data dissemination, provides a welcome opportunity for members to join the SDDS, and concurred that the emphasis should continue to be on consolidation in the period ahead. To promote a further expansion in SDDS subscriptions, Directors supported the staff's outreach effort-the "25/50 program"—including its close integration with technical assistance.
Directors welcomed the significant improvement in compliance of SDDS subscribers with their commitments to disseminate timely data. They also highlighted the positive experience with implementing new data categories. All subscribers now meet the data dissemination requirements for the template on international reserves and foreign currency liquidity-and there was a call, in this context, for further increasing the frequency of reporting key data-as well as for the international investment position, with many subscribers exceeding the dissemination requirements for the latter. Directors were encouraged by the number of subscribers already disseminating external debt data, and supported the continuation of the program of seminars to facilitate the dissemination of these data. Directors will have a future opportunity to discuss the possible inclusion of Financial Soundness Indicators (FSIs) into the SDDS based on further experience with making FSIs operational.
Directors welcomed the enhancements to the Fund's Dissemination Standards Bulletin Board (DSBB), which provides improved access to metadata and the associated datasets on the National Summary Data Pages (NSDPs). They supported continued efforts to promote the distribution and exchange of statistical information on the Internet under the Statistical Data and Metadata Exchange (SDMX) initiative, and looked forward to the findings of the users' survey on the usefulness of the DSBB.
Directors discussed several proposed refinements to update the Fund's data standards and incorporate the latest developments in statistical methodology. Most Directors shared the view that a targeted flexibility option for the timeliness of monthly central government operations would help promote the dissemination of quarterly accrual-based general government operations data in line with the Fund's Government Finance Statistics Manual 2001 or an equivalent standard. However, a number of Directors considered that a more flexible approach would be required, given the resource intensive nature of accrual-based statistics and to take account of country-specific circumstances, and some of them remained unconvinced that the proposed approach would effectively improve data quality. To help address the heavy resource requirements and country-specific conditions associated with accrual-based dissemination, the staff proposal will be implemented with appropriate flexibility. Directors agreed to introduce a 12-month transition period for relevant subscribers, during which time those subscribers could continue to disseminate fiscal data on a "best effort" basis.
Many Directors endorsed the suggestion that SDDS subscribers take advantage of the possibility to provide—on a strictly voluntary basis—additional metadata to promote public knowledge and understanding of their practices with respect to measuring core inflation, forward-looking indicators, and interest rates used as operating targets. At the same time, however, many Directors also expressed various concerns about this approach. These included: the risk that it might be perceived as giving special recognition to inflation-targeting regimes as a preferred policy standard; concerns about overstretching the SDDS; as well as operational difficulties that might be involved in posting forward-looking indicators. Going forward, Directors underscored their understanding that the SDDS remains a general framework applicable to countries regardless of their monetary policy regime. Accordingly, subscribers continue to have flexibility in furnishing metadata.
Directors also highlighted the role of the GDDS as a catalyst in the mobilization and coordination of technical assistance by the Fund, the World Bank, and other donors. They saw the regional approach adopted by the staff as an effective way of leveraging vitally needed technical assistance resources to assist participants and members that wish to participate in the GDDS. They also welcomed the support provided by some bilateral donors for technical assistance activities, and encouraged others to follow suit. Given the expanding number of GDDS participants and the continued interest in joining by nonparticipating countries, Directors stressed the importance of making the most effective use of available resources, including by giving priority to countries that are firmly committed to strengthening their statistical systems. Some Directors cautioned that this should not come at the expense of those countries that are most constrained by lack of resources and human capacity.
Directors recognized the important role that the GDDS is playing in promoting the compilation of data for effective poverty reduction strategies, and several Directors encouraged countries with Poverty Reduction Strategy Papers (PRSPs) to move toward GDDS participation. Most Directors endorsed further refinements in the GDDS that would support the compilation of Millennium Development Goals (MDGs) indicators. They noted that the incorporation of these indicators within the GDDS structure would not require major changes, and would indeed be helpful in promoting further close collaboration with the World Bank as well as other institutions and donors. Some Directors cautioned that the MDGs indicators may go beyond the specifications of the GDDS framework, and expressed concern that the incorporation of these data indicators could stretch members' limited capacity and Fund resources. These Directors stressed that the focus of the GDDS should remain as much as possible on core and macroeconomic-relevant data.
Directors underscored that the data module of the Reports on the Observance of Standards and Codes (ROSCs) plays a key role in contributing to data transparency and facilitating the identification of priority areas for statistical improvements. Most Directors welcomed plans to keep finalized data ROSCs current, on a voluntary basis, on the occasion of Article IV Consultation discussions, but some Directors cautioned against overloading the Article IV process. Directors supported the proposed strategy to balance, through careful prioritization, the preparation of "new" ROSCs with follow-up ROSCs, including for those countries for which the report was undertaken before the incorporation of the Data Quality Assessment Framework (DQAF). The possibility of self-assessments by countries that have the capacity to do so, in particular the major advanced economies, was also highlighted. Directors welcomed the fine-tuning of the DQAF to keep it up to date with statistical methodology and to take account of experience gained in conducting ROSCs.
Directors welcomed the implementation of the Data Quality Program, which has integrated successfully the Fund's Data Standards Initiatives to sharpen the focus on both quality assessments as well as the identification and promotion of good statistical practices. They endorsed the staff's plans to prepare a "Compendium of Good Statistical Practices", while underscoring the illustrative character of such a compendium.
Directors noted the assessment by the staff that—through careful monitoring and prioritization as well as further efficiency gains—it should be possible to implement the work program on the Fund's Data Standards Initiatives and maintain quality standards without additional resources for the current year or medium term. A number of Directors, however, expressed concern that the present level of resources might be insufficient to meet the challenge, given the high demands on staff resources that increased participation by member countries in the initiatives is expected to generate.
Directors agreed that the next review of the Fund's Data Standards Initiatives should take place in the second half of 2005.