## Statement by the Managing Director on the Independent Evaluation Office Report on IMF Collaboration with the World Bank on Macro-Structural Issues

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### Overview
- Date: June 15, 2020
- Purpose: Response to the Independent Evaluation Office (IEO) report on collaboration between the IMF and the World Bank.
- Main judgment: Broad agreement with the IEO’s recommendations, with qualifications in some areas; emphasis on fostering more effective (not just more) collaboration tailored to different macro-structural areas.
- Key constraint noted: Successful implementation will hinge on reaching understandings with the World Bank.

### Historical context and examples of collaboration
- Longstanding institutional arrangements and initiatives:
  - 1989 Concordat
  - 2007 Joint Management Action Plan (JMAP)
  - Debt Sustainability Framework (2005)
  - Joint World Bank-IMF Multipronged Approach for Addressing Emerging Debt Vulnerabilities (2018)
  - Financial Sector Assessment Program (1999)
- Recent pilot and collaborative initiatives cited:
  - Climate Change Policy Assessments (CCPA) with the Bank
  - Inequality and distributional impacts collaboration with DFID
  - Gender issues collaboration with UN Women
- Internal constraints acknowledged: significant internal resource constraints at the Fund, yet Fund work in emerging issues is well regarded by outside experts.

### Assessment of IEO findings
- Agreement that no new umbrella agreement is needed for collaboration with the World Bank.
- Endorsement of prioritizing areas where collaboration yields high strategic returns and is cost-effective.
- Recognition that collaboration to date has been broad but uneven; opportunities to leverage the Bank’s expertise may have been missed.
- Identification of deeper structural factors hindering collaboration, including differing mandates and roles of the two institutions; these go beyond the scope of the short IEO evaluation.
- Importance of informal collaboration acknowledged; recommendation that collaboration modalities be tailored to context.

### Response to IEO Recommendations

- Recommendation 1: Develop and agree on concrete frameworks for effective collaboration on key macro-structural issues.
  - Position: Qualified Support
  - Key points:
    - Broad concurrence with a more structured approach in select strategic areas, based on evaluation of net benefits, Fund resources, and Bank incentives.
    - Climate workstream identified as a strong candidate where responsibilities overlap.
    - Building blocks already emerging: ongoing review of CCPAs; envisaged co-chairing by the Bank and the Fund of the Secretariat of the Coalition of Ministers for Climate Action.
    - Need to identify core staff as focal points for external engagement.
    - Fund tools supporting this objective: Integrated Competency Framework; establishment of centers of expertise envisaged in the Comprehensive Surveillance Review.
    - Financing joint work with the Bank could be useful but success depends on factors beyond the Fund’s control, including constraints on the Bank’s side.

- Recommendation 2: Improve internal incentives to collaborate and address cultural reluctance to engage with external partners.
  - Position: Qualified Support
  - Key points:
    - Agreement in principle on better aligning staff incentives to facilitate collaboration.
    - Suggests exploring broader systematic engagement on specific countries/issues to build networks and knowledge exchange.
    - Merit in fostering senior-level staff exchanges, subject to consultation and Bank agreement.
    - Cautions that embedding incentives in the performance management system understates difficulties given the recent adoption of a new performance management system still being absorbed by staff.
    - Notes the new performance management system is competency-based and includes multi-source input and behavioral competencies that already incorporate elements related to collaboration (Integrated Competency Framework).

- Recommendation 3: Work with the World Bank to improve access to and exchange of information and knowledge.
  - Position: Qualified Support
  - Key points:
    - Broad support for improving information availability to staff.
    - Actions already undertaken:
      - Establishing a list of first points of contact.
      - Strengthening upstream exchanges between IMF Area Departments and World Bank Regional Vice-Presidencies.
      - Institutions planning to regularly share rosters of technical experts.
    - Completing the initiative to clarify ground rules and disseminate best practices on information sharing would make significant inroads.
    - Concern about cross-linking knowledge exchange sites and reciprocal intranet access: poses accountability issues, coordination costs, technical challenges, and information security risks; feasibility depends on reaching understandings with the Bank.

- Recommendation 4: Strengthen the IMF Board’s strategic role in facilitating and supporting external collaboration.
  - Position: For the Board
  - Key points:
    - Concurrence with the Board’s strategic role and support for strengthening it.
    - Implementation of this recommendation lies outside the purview of a Management Implementation Plan (MIP) and would need to be taken up directly by the Board.

### Table of the Managing Director’s Position on IEO Recommendations (as presented)
- Recommendation 1: Qualified Support
- Recommendation 2: Qualified Support
- Recommendation 3: Qualified Support
- Recommendation 4: For the Board

*Statement by the Managing Director on the Independent Evaluation Office Report on IMF Collaboration with the World Bank on Macro-Structural Issues, June 15, 2020.*

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_Source: https://www.imf.org/-/media/files/publications/pp/2020/english/ppea2020063.pdf_