## EXECUTIVE SUMMARY ## Source details **Canonical URL:** [EXECUTIVE SUMMARY](https://www.imf.org/-/media/files/publications/pp/2018/mip-100418.pdf) ## Other formats - [Markdown version](/-/media/files/publications/pp/2018/mip-100418.pdf.md) - [Structured JSON version](/-/media/files/publications/pp/2018/mip-100418.pdf.json) --- ### INTRODUCTION - Purpose: Present a management implementation plan (MIP) to take forward Board-endorsed recommendations of the IEO evaluation “The IMF and Fragile States.” - Scope: Proposes follow-up measures, timelines, and responsibilities; effectiveness and scope to be reviewed and adjusted as warranted. - Central point: Actions outlined have resource implications; some can be covered by reallocating resources or are already in the Work Program, while others may require temporary funding; a review of staffing allocations to countries in fragile and conflict situations (FCS) might call for new permanent resources. - Date on document: September 28, 2018 ### OVERALL APPROACH AND PACKAGE - Actions are broad in scope and self-reinforcing if adopted as a package. - Core components included: - Message of high-level commitment (Management statement for Executive Board and IMFC endorsement). - An effective institutional mechanism (high-level interdepartmental FCS Committee and a Technical Taskforce). - Country engagement strategies integrating social and political context and capacity development (CD) with surveillance and lending. - Review and adaptation of the lending toolkit for low-income countries to provide more tailored and flexible support, including for FCS. - Practical steps to increase the impact of CD support and consideration of a FCS multi-donor trust fund or suitable financing vehicle. - HR actions including strategic workforce and career planning, a “career” playbook, staffing allocation reviews, and stepped up staff training on FCS. ### IEO RECOMMENDATIONS (SUMMARY) - #1: Message of high-level commitment — issue a statement of importance for IMFC endorsement to guide fragile state work. - #2: Creation of an institutional mechanism — establish an effective mechanism with mandate and authority to coordinate and champion FCS work. - #3: Comprehensive country strategies — develop forward-looking holistic country strategies integrating policy advice, financial support, and CD as part of the Article IV process. - #4: Financial support — adapt the lending toolkit to deliver more sustained financial support to FCS and proactively engage stakeholders to mobilize creditor support for FCS with outstanding external arrears. - #5: Capacity development — increase impact of CD support in FCS, increase use of on-the-ground experts, employ realistic impact assessment tools, and ensure adequate financial resources. - #6: HR issues — incentivize high-quality and experienced staff to work on FCS, ensure adequate resources and staffing, and find pragmatic ways to increase field presence in high-risk locations while protecting staff safety. ### BOARD REACTIONS AND IMPLEMENTATION PLAN (BY RECOMMENDATION) - Recommendation #1 — Message of high-level commitment - Board reactions: Broad support; Directors called for a Managing Director and Executive Board statement to be endorsed by the IMFC, noting the need for concrete steps and greater internal value placed on FCS work. - Implementation: A Management statement accompanies the MIP (Annex II). If approved by the Evaluation Committee, it will be submitted for lapse of time approval and then to the IMFC. - Recommendation #2 — Institutional mechanism - Board reactions: Most Directors welcomed establishing a mechanism; some cautioned on duplication and resource costs; views differed on chairing and reporting modalities. - Implementation: - Establish a high-level interdepartmental FCS Committee by end-October 2018 comprising area, functional, and special services departments. - Committee chaired by the Director of the Strategy, Policy and Review Department; report and seek guidance in a formal meeting with management twice a year. - An interdepartmental FCS Technical Taskforce was established in July 2018 to support the Committee. - Technical Taskforce to prepare an assessment of FCS engagement effectiveness by late-2020, analyze MIP implementation progress, review and update the 2012 guidance note, and conduct analytical work including on program design in FCS. - 2020 review to consider ongoing need for Committee and Taskforce. - SPR to complement efforts through dedicated review of key FCS country papers. - FCS Committee chair and Technical Taskforce to act as contact points for external engagement (WB, OECD, G7+). - Recommendation #3 — Country engagement strategies - Board reactions: Directors stressed flexibility to avoid administrative burden and overloading Article IV. - Implementation: - Policy notes and staff reports for FCS to provide a succinct discussion of the country engagement strategy. - Strategy to draw on external analysis and expertise (e.g. World Bank, United Nations), identify elements of fragility, political and social context, and link surveillance and CD priorities to fragility drivers. - For countries requiring Fund financial support, discussion will refer to complementary role and expected benefits of such support. - To limit costs, strategies will build on existing work: departmental country strategy notes, CD strategies, and Capacity Building Frameworks (CBFs). - Prepared at policy note (or pre-policy note) stage of Article IV and in new program requests. - Strategies to be discussed with country authorities and relevant development partners; updates to be on an as-needed basis. - Technical Taskforce to provide guidance and update relevant guidance notes, drawing on CBF pilot lessons. - Recommendation #4 — Financial support - Board reactions: Directors expressed differing views; at the July 20 discussion of the 2018 Low Income Countries Facilities Review, most Directors were open to proposals tailored to FCS. - Implementation: - Staff preparing formal proposals to modify the lending toolkit for LICs, ensuring uniformity of treatment and taking into account the catalytic role of Fund financing. - For FCS with longstanding arrears to the international community including the IMF, staff remains ready to support arrears clearance and help arrange bridge financing if external official bilateral creditors support a comprehensive debt settlement. - Staff to report on efforts to support FCS with protracted arrears to the Fund in the upcoming reviews of overdue financial obligations for Sudan and Somalia, including updates on discussions with donors and creditors and indicative timelines to clear arrears and restore access to Fund resources. - Recommendation #5 — Capacity development - Board reactions: Directors supported increased use of on-the-ground experts, realistic impact assessment tools, and ensuring adequate CD financing; most saw merit in a FCS MDTF if a business case is made and Regional Technical Assistance Centers are not undermined. - Implementation: - Measures already taken: continue tailoring CD to FCS needs; require country team approval of CD mission scope and timing in the Resource Allocation Plan (RAP); strengthen CD monitoring through mainstreaming results-based management; use project evaluation via the common evaluation framework. - CD Strategy Review to assess initiatives integrating CD and surveillance in FCS. - Staff to assess interest and need for a FCS multi-donor trust fund (MDTF) or other vehicle to support additional on-the-ground long-term advisors and boost field CD delivery. - Staff to undertake a stocktaking of experience providing statistical and financial CD to identify lessons for impact. - Technical Taskforce to review CBF pilots to learn lessons on coordination with other TA providers and identify high-impact practices for country strategies. - Recommendation #6 — Human resources - Board reactions: Directors called for the HR review to provide stronger recognition of staff work in FCS, reduce turnover, attract experienced staff, and consider recruitment changes; increased field presence should be balanced against staff safety. - Implementation: - Forthcoming phase of HR Strategy to address strategic workforce and career planning, including recruitment; consider actions to ensure staff expertise and experience for FCS. - Introduce a “career playbook” to provide incentives for staff to be responsive to Fund needs in FCS, with service on a fragile state or a low-income country required for career advancement in the economist stream (by end-November 2018). - Assess additional staffing resources needed for critical FCS missions—functional department support for program and near-program situations—by FAD, SPR, OBP, and area departments in consultation with the Technical Taskforce; additional needs to be discussed in context of the FY20 budget and ensuring evenhanded treatment of members. - Training on macroeconomic policies in fragile states to be stepped up by ICD in FY20. - Field presence decisions to continue to balance business case for field-based engagement with associated security risks; explore innovative engagement modes (e.g., video conferences). ### RESOURCE IMPLICATIONS (HIGHLIGHTS) - MIP actions have resource implications: - Some actions can be covered by reallocating resources or are already in the Work Program. - Others may require temporary funding. - A review of staffing allocations to FCS might call for new permanent resources. - Specific resource-related items and timings: - Establishment of Committee and Technical Taskforce (Committee by end-October 2018; Taskforce established July 2018). - Assessment of additional staffing needs to be considered in FY20 budget context. - Introduction of “career playbook” with target date by end-November 2018. - ICD training stepped up in FY20. - Technical Taskforce to prepare an assessment by late-2020 and to review CBF pilots. ### MONITORING AND EVALUATION - Reporting and review schedule: - Progress on implementation of the MIP will be reported in a Board Briefing by staff at end-2019 and a Review of FCS Engagement will be formally discussed by the Board at end-2020. - A high-level interdepartmental Committee on FCS, reporting to Management, will assess progress through end-2020 and will be supported by a Technical Taskforce to review MIP implementation, revisit FCS guidance, and conduct policy and analytical work on FCS issues. - SPR will provide an informal briefing on implementing this MIP at end-2019; a Board paper on Review of FCS Engagement is planned by end-2020. - Timelines and accountabilities embedded in follow-up plan entries include: Q1 2019, October 2018, July 20, 2018, end-Q1 2019, March 2019, November 2018, September 2019, end-December 2019, and end-2020 as noted for specific deliverables. ### ANNEX III — Resource implications (detailed figures and notes) - One-off and recurring resource entries: - Recommendation 1: Management statement — Budgeted in FY18 work program; one-off: n/a; recurring: n/a. - Recommendation 2: FCS Committee and Technical Taskforce staff — Reallocated. If resources for Technical Taskforce are not sufficient, a request for up to 2.0 FTE in FY20 and FY21 to be considered. Minor covered by reallocation. - Recommendation 3: Country strategies — Guidance for country strategies budgeted under Recommendation #2. Total of 1.0-2.0 FTE for strategy preparation reallocated within FCS country teams. Reallocated. - Recommendation 4: LIC Facilities Review 2018 — Budgeted in FY19 work program; one-off: n/a; recurring: n/a. - Recommendation 5: Explore FCS CD Trust Fund; MCM and STA CD stock takes; Review of CBFs — Reallocated; Covered by Trust Fund contributors, except for backstopping costs; MCM and STA stock takes reallocated; Review of CBFs budgeted under Recommendation #2. - Recommendation 6: HR Strategy; Staffing gaps by functional departments in FCS program and near-program country teams; Training on macroeconomics in FCS — Training budgeted in FY19 work program; reallocated resources for staffing; preliminary estimate of 2.66-4.00 FTEs (program only). Net cost to be determined in the budgetary process. - Aggregate summary: Total — Up to 1.0-2.0 FTE; To be determined. ### KEY OPERATIONAL AND TIMELINE COMMITMENTS (SELECTED) - From Q1 2019: area department FCS country teams to prepare as part of staff reports for Art. IV and new program requests a succinct country engagement strategy discussing country fragility, surveillance and CD priorities, and, if applicable, the complementary role for Fund financial support. - Options presented at the Review of Fund Facilities for LICs, July 20, 2018; follow-up paper to consider formal proposals by end-Q1 2019. - Report efforts to mobilize broad creditor support for FCS with external arrears in the context of upcoming reviews for Sudan and Somalia (March 2019). - CD Strategy Review by November 2018; report to management on the case for a dedicated MDTF or coordinated bilateral projects for FCS by September 2019; staff paper for Board discussion with analysis of experience and lessons by end-December 2019. - HR Strategy Review will assess strategic workforce and career planning including a “career” playbook with progress assessed at end-2020; report to Management on FCS staffing gaps by functional departments by October 2018. *Prepared by Chris Lane (team leader), Edward Gemayel, Kevin Greenidge, and Ermal Hitaj (Strategy, Policy and Review Department) in collaboration with other departments.* ### EXECUTIVE SUMMARY ### EXECUTIVE SUMMARY ### INTRODUCTION - Purpose: Present a management implementation plan (MIP) to take forward Board-endorsed recommendations of the IEO evaluation “The IMF and Fragile States.” - Scope: Proposes follow-up measures, timelines, and responsibilities; effectiveness and scope to be reviewed and adjusted as warranted. - Central point: Actions outlined have resource implications; some can be covered by reallocating resources or are already in the Work Program, while others may require temporary funding; a review of staffing allocations to countries in fragile and conflict situations (FCS) might call for new permanent resources. - Date on document: September 28, 2018 ### OVERALL APPROACH AND PACKAGE - The actions are broad in scope and self-reinforcing if adopted as a package. - Core components included in the package: - Message of high-level commitment (Management statement for Executive Board and IMFC endorsement). - An effective institutional mechanism (high-level interdepartmental FCS Committee and a Technical Taskforce). - Country engagement strategies integrating social and political context and capacity development (CD) with surveillance and lending. - Review and adaptation of the lending toolkit for low-income countries to provide more tailored and flexible support, including for FCS. - Practical steps to increase the impact of CD support and consideration of a FCS multi-donor trust fund or suitable financing vehicle. - HR actions including strategic workforce and career planning, a “career” playbook, staffing allocation reviews, and stepped up staff training on FCS. ### IEO RECOMMENDATIONS (SUMMARY) - #1: Message of high-level commitment — issue a statement of importance for IMFC endorsement to guide fragile state work. - #2: Creation of an institutional mechanism — establish an effective mechanism with mandate and authority to coordinate and champion FCS work. - #3: Comprehensive country strategies — develop forward-looking holistic country strategies integrating policy advice, financial support, and CD as part of the Article IV process. - #4: Financial support — adapt the lending toolkit to deliver more sustained financial support to FCS and proactively engage stakeholders to mobilize creditor support for FCS with outstanding external arrears. - #5: Capacity development — increase impact of CD support in FCS, increase use of on-the-ground experts, employ realistic impact assessment tools, and ensure adequate financial resources. - #6: HR issues — incentivize high-quality and experienced staff to work on FCS, ensure adequate resources and staffing, and find pragmatic ways to increase field presence in high-risk locations while protecting staff safety. ### BOARD REACTIONS AND IMPLEMENTATION PLAN (BY RECOMMENDATION) - Recommendation #1 — Message of high-level commitment - Board reactions: Broad support; Directors called for a Managing Director and Executive Board statement to be endorsed by the IMFC, noting the need for concrete steps and greater internal value placed on FCS work. - Implementation: A Management statement accompanies the MIP (Annex II). If approved by the Evaluation Committee, it will be submitted for lapse of time approval and then to the IMFC. - Recommendation #2 — Institutional mechanism - Board reactions: Most Directors welcomed establishing a mechanism; some cautioned on duplication and resource costs; views differed on chairing and reporting modalities. - Implementation: - Establish a high-level interdepartmental FCS Committee by end-October 2018 comprising area, functional, and special services departments. - Committee chaired by the Director of the Strategy, Policy and Review Department; report and seek guidance in a formal meeting with management twice a year. - An interdepartmental FCS Technical Taskforce was established in July 2018 to support the Committee. - Technical Taskforce to prepare an assessment of FCS engagement effectiveness by late-2020, analyze MIP implementation progress, review and update the 2012 guidance note, and conduct analytical work including on program design in FCS. - 2020 review to consider ongoing need for Committee and Taskforce. - SPR to complement efforts through dedicated review of key FCS country papers. - FCS Committee chair and Technical Taskforce to act as contact points for external engagement (WB, OECD, G7+). - Recommendation #3 — Country engagement strategies - Board reactions: Directors stressed flexibility to avoid administrative burden and overloading Article IV. - Implementation: - Policy notes and staff reports for FCS to provide a succinct discussion of the country engagement strategy. - Strategy to draw on external analysis and expertise (e.g. World Bank, United Nations), identify elements of fragility, political and social context, and link surveillance and CD priorities to fragility drivers. - For countries requiring Fund financial support, discussion will refer to complementary role and expected benefits of such support. - To limit costs, strategies will build on existing work: departmental country strategy notes, CD strategies, and Capacity Building Frameworks (CBFs). - Prepared at policy note (or pre-policy note) stage of Article IV and in new program requests. - Strategies to be discussed with country authorities and relevant development partners; updates to be on an as-needed basis. - Technical Taskforce to provide guidance and update relevant guidance notes, drawing on CBF pilot lessons. - Recommendation #4 — Financial support - Board reactions: Directors expressed differing views; at the July 20 discussion of the 2018 Low Income Countries Facilities Review, most Directors were open to proposals tailored to FCS. - Implementation: - Staff preparing formal proposals to modify the lending toolkit for LICs, ensuring uniformity of treatment and taking into account the catalytic role of Fund financing. - For FCS with longstanding arrears to the international community including the IMF, staff remains ready to support arrears clearance and help arrange bridge financing if external official bilateral creditors support a comprehensive debt settlement. - Staff to report on efforts to support FCS with protracted arrears to the Fund in the upcoming reviews of overdue financial obligations for Sudan and Somalia, including updates on discussions with donors and creditors and indicative timelines to clear arrears and restore access to Fund resources. - Recommendation #5 — Capacity development - Board reactions: Directors supported increased use of on-the-ground experts, realistic impact assessment tools, and ensuring adequate CD financing; most saw merit in a FCS MDTF if a business case is made and Regional Technical Assistance Centers are not undermined. - Implementation: - Measures already taken: continue tailoring CD to FCS needs; require country team approval of CD mission scope and timing in the Resource Allocation Plan (RAP); strengthen CD monitoring through mainstreaming results-based management; use project evaluation via the common evaluation framework. - CD Strategy Review to assess initiatives integrating CD and surveillance in FCS. - Staff to assess interest and need for a FCS multi-donor trust fund (MDTF) or other vehicle to support additional on-the-ground long-term advisors and boost field CD delivery. - Staff to undertake a stocktaking of experience providing statistical and financial CD to identify lessons for impact. - Technical Taskforce to review CBF pilots to learn lessons on coordination with other TA providers and identify high-impact practices for country strategies. - Recommendation #6 — Human resources - Board reactions: Directors called for the HR review to provide stronger recognition of staff work in FCS, reduce turnover, attract experienced staff, and consider recruitment changes; increased field presence should be balanced against staff safety. - Implementation: - Forthcoming phase of HR Strategy to address strategic workforce and career planning, including recruitment; consider actions to ensure staff expertise and experience for FCS. - Introduce a “career playbook” to provide incentives for staff to be responsive to Fund needs in FCS, with service on a fragile state or a low-income country required for career advancement in the economist stream (by end-November 2018). - Assess additional staffing resources needed for critical FCS missions—functional department support for program and near-program situations—by FAD, SPR, OBP, and area departments in consultation with the Technical Taskforce; additional needs to be discussed in context of the FY20 budget and ensuring evenhanded treatment of members. - Training on macroeconomic policies in fragile states to be stepped up by ICD in FY20. - Field presence decisions to continue to balance business case for field-based engagement with associated security risks; explore innovative engagement modes (e.g., video conferences). ### RESOURCE IMPLICATIONS (HIGHLIGHTS) - The MIP actions have resource implications: - Some actions can be covered by reallocating resources or are already in the Work Program. - Others may require temporary funding. - A review of staffing allocations to FCS might call for new permanent resources. - Specific resource-related items in implementation: - Establishment of Committee and Technical Taskforce (timing: Committee by end-October 2018; Taskforce established July 2018). - Assessment of additional staffing needs to be considered in FY20 budget context. - Introduction of “career playbook” with target date by end-November 2018. - ICD training stepped up in FY20. - Technical Taskforce to prepare an assessment by late-2020 and to review CBF pilots. *Prepared by Chris Lane (team leader), Edward Gemayel, Kevin Greenidge, and Ermal Hitaj (Strategy, Policy and Review Department) in collaboration with other departments.* ### 10. Monitoring and Evaluation. Progress on implementation of the MIP will be reported in a ### mip-100418 - 10. Monitoring and Evaluation. Progress on implementation of the MIP will be reported in a ### Monitoring and evaluation - Progress on implementation of the MIP will be reported in a Board Briefing by staff at end-2019 and a Review of FCS Engagement will be formally discussed by the Board at end-2020. - A high-level interdepartmental Committee on FCS, reporting to Management, will assess progress through end-2020 and will be supported by a Technical Taskforce to review MIP implementation, revisit FCS guidance, and conduct policy and analytical work on FCS issues. - SPR will provide an informal briefing on implementing this MIP at end-2019; a Board paper on Review of FCS Engagement is planned by end-2020. - Timelines and accountabilities embedded in follow-up plan entries include Q1 2019, October 2018, July 20, 2018, end-Q1 2019, March 2019, November 2018, September 2019, end-December 2019, and end-2020 as noted for specific deliverables. ### Resource implications (overview) - Some deliverables can be covered by reallocating existing resources or are already in the Board’s Work Program; the Technical Taskforce operations may require temporary funding. - Adding staff to FCS country teams on an ongoing basis would require additional resources to be considered in annual budget discussions. - Specific resource notes by recommendation: - Recommendation #1: A message of high-level commitment will not require additional resources. - Recommendation #2: Creation of an institutional mechanism (FCS Committee and Technical Taskforce) will require modest additional resources. SPR will use additional staff resources for dedicated review of FCS from a reallocation of staff (in addition to staff already working on FCS issues). Other departments will be requested to nominate staff for the Committee and to support the Technical Taskforce. After experience in FY19 and if needed, a request for secondments to the Technical Taskforce might be made in FY20 and FY21 for up to two full-time equivalent staff (FTEs) with financing decided through the budget process. - Recommendation #3: Preparation of country engagement strategies will require modest additional resources as they will build on existing country strategy notes and CBFs. Additional resources will be needed for consultations with country authorities and other CD providers; these will need to be reallocated within existing resources. Increasing functional department staffing of FCS teams (#6) would lessen the need for reallocation. - Recommendation #4: Work on providing more sustained financial support to FCS is part of the Work Program. - Recommendation #5: Initiatives to increase the impact of Fund CD would mostly be covered within the existing budgetary envelope. The exception is a new FCS MDTF that, if established, would incur overhead management costs (the magnitude cannot be estimated without further information on the scope of the MDTF). There would be modest resources incurred in stocktaking exercises in MCM and STA that would be covered within existing budgets in FY19–20. Resources for the review of CBFs are discussed under recommendation #2. Resources for additional training on macroeconomics in FCS would be reallocated within the existing training budget. - Recommendation #6: HR issues are covered under the HR strategy review. Higher functional department staffing of FCS country teams would require additional dedicated staff resources; how to finance these would be discussed in the context of the budget process. ### Annex III — Resource implications (detailed figures and notes) - One-off and recurring resource entries: - Recommendation 1: Management statement — Budgeted in FY18 work program; one-off: n/a; recurring: n/a. - Recommendation 2: FCS Committee and Technical Taskforce staff — Reallocated. If resources for Technical Taskforce are not sufficient, a request for up to 2.0 FTE in FY20 and FY21 to be considered. Minor covered by reallocation. - Recommendation 3: Country strategies — Guidance for country strategies budgeted under Recommendation #2. Total of 1.0-2.0 FTE for strategy preparation reallocated within FCS country teams. Reallocated. - Recommendation 4: LIC Facilities Review 2018 — Budgeted in FY19 work program; one-off: n/a; recurring: n/a. - Recommendation 5: Explore FCS CD Trust Fund; MCM and STA CD stock takes; Review of CBFs — Reallocated; Covered by Trust Fund contributors, except for backstopping costs; MCM and STA stock takes reallocated; Review of CBFs budgeted under Recommendation #2. - Recommendation 6: HR Strategy; Staffing gaps by functional departments in FCS program and near-program country teams; Training on macroeconomics in FCS — Training budgeted in FY19 work program; reallocated resources for staffing; preliminary estimate of 2.66-4.00 FTEs (program only). Net cost to be determined in the budgetary process. - Aggregate table summary line: Total — Up to 1.0-2.0 FTE; To be determined. ### Key operational and timeline commitments (selected) - From Q1 2019: area department FCS country teams to prepare as part of staff reports for Art. IV and new program requests a succinct country engagement strategy discussing country fragility, surveillance and CD priorities, and, if applicable, the complementary role for Fund financial support. - Options presented at the Review of Fund Facilities for LICs, July 20, 2018; follow-up paper to consider formal proposals by end-Q1 2019. - Report efforts to mobilize broad creditor support for FCS with external arrears in the context of upcoming reviews for Sudan and Somalia (March 2019). - CD Strategy Review by November 2018; report to management on the case for a dedicated MDTF or coordinated bilateral projects for FCS by September 2019; staff paper for Board discussion with analysis of experience and lessons by end-December 2019. - HR Strategy Review will assess strategic workforce and career planning including a “career” playbook with progress assessed at end-2020; report to Management on FCS staffing gaps by functional departments by October 2018. *Source: mip-100418 - 10. Monitoring and Evaluation. Progress on implementation of the MIP will be reported in a (IMF PDF content provided).* --- _Source: https://www.imf.org/-/media/files/publications/pp/2018/mip-100418.pdf_