## PROGRESS REPORT TO THE IMFC ON THE ACTIVITIES OF THE INDEPENDENT EVALUATION OFFICE OF THE IMF

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**Canonical URL:** [PROGRESS REPORT TO THE IMFC ON THE ACTIVITIES OF THE INDEPENDENT EVALUATION OFFICE OF THE IMF](https://www.imf.org/-/media/files/publications/pp/2022/english/ppea2022046.pdf)

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### Overview
- Date: October 7, 2022
- Since the 2022 Spring Meetings, the IEO has completed two evaluations—on IMF engagement with small developing states and capacity development—and has made significant progress on a third evaluation on the IMF’s emergency response to the Covid pandemic.
- A list of new evaluation topics has been drawn up for discussion with the Executive Board later this year.

### Small Developing States—Key Findings
- Report discussed by the Executive Board in May.
- Evaluation scope: IMF engagement with Small Developing States (SDS) during 2010–2020.
- Main conclusions:
  - The IMF “deserves considerable credit” for stepping up engagement with SDS over this time frame.
  - Noted improvements: specific guidance for work on SDS, increased attention to climate change, rising resources for capacity development (CD) and particularly regional CD centers.
  - Serious challenges affecting value added and traction:
    - Difficulties in staffing SDS assignments contributing to high turnover.
    - Questions about whether the lending architecture is well suited for SDS needs and capabilities.
    - Limited institutional capacity in SDS to implement Fund advice.

### Small Developing States—Recommendations and Follow Up
- Executive Directors broadly agreed additional actions should be considered to strengthen IMF engagement with SDS; a major overhaul was not needed.
- Directors broadly supported IEO recommendations that the IMF should:
  - Pursue a targeted recalibration of the Fund’s overall approach for engagement with SDS.
  - Take operational steps to enhance the focus and traction in the areas of surveillance and CD.
  - Adopt further HR and budgetary commitments to increase continuity and impact of staff’s engagement with SDS.
- Views on lending framework:
  - Many Directors broadly supported the IEO recommendation to consider how to use the lending framework to better address SDS needs and vulnerabilities.
  - Many others agreed with the Managing Director’s partial and qualified support.
- IMF management will work with staff to propose a follow-up implementation plan in coming months.

### Capacity Development—Key Findings
- Executive Board discussion: September.
- Evaluation: The IMF and Capacity Development, covering 2012–2020.
- Overall finding: IMF CD was relevant, valued, and broadly effective.
- Perceptions:
  - Recipients and donors saw IMF CD as being of the highest technical quality in the IMF’s core expertise.
  - CD perceived to have become better tailored to recipient needs and circumstances over the evaluation period.
- Identified challenges and areas for improvement:
  - Prioritization and the strategic framework for CD could be enhanced further.
  - The Board could be provided more opportunities and information to exercise strategic oversight.
  - Integration of CD with surveillance and programs needed additional attention.
  - Country ownership and delivery could be enhanced further, including by building the role of regional CD centers.
  - Application of the CD monitoring system and evaluation framework needed additional work to make them more useful.
  - The CD funding model should be reviewed to ensure that CD funding is sustainable and flexible.
  - HR policies and incentives could be better calibrated to sustain high-level expertise in the Fund’s core areas and nurture the Fund’s capacity to provide CD in emerging areas.

### Capacity Development—Recommendations and Follow Up
- The Executive Board broadly supported the evaluation’s findings and generally supported the recommendations addressing identified challenges.
- Agreement that the new CD strategy review about to be launched provides an excellent opportunity to consider the way forward.
- An implementation plan will be prepared by early 2023.

### IEO work program
- Ongoing evaluation: IMF’s Emergency Response to the COVID-19 Pandemic — covers the IMF’s response during the first year of the pandemic; completion expected in early 2023.
- Mid-point update on initial findings and tentative lessons provided to the Executive Board in March.
- IEO is finalizing for publication before end-2022 a book presenting material from the IEO’s 20th Anniversary Conference in November 2021, which will consider lessons learned from the IEO’s past decade and consider challenges for independent evaluation at the Fund going forward.

### New evaluation topics
- Following wide consultations, the IEO has drawn up a list of new topics for evaluation, including:
  - (i) the Fund’s experience with Exceptional Access Policy;
  - (ii) the IMF’s approach to managing credit risk;
  - (iii) IMF engagement on debt issues in low-income countries;
  - (iv) how the Fund’s mandate is applied;
  - (v) the Fund’s fiscal policy advice for macroeconomic management;
  - (vi) the Fund’s strategy for dealing with climate change;
  - (vii) diversity and inclusion at the IMF; and
  - (viii) research and forecasting at the Fund.

*Source: PROGRESS REPORT TO THE IMFC ON THE ACTIVITIES OF THE INDEPENDENT EVALUATION OFFICE OF THE IMF, October 7, 2022.*

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_Source: https://www.imf.org/-/media/files/publications/pp/2022/english/ppea2022046.pdf_