## EXECUTIVE SUMMARY — CD GUIDANCE NOTE (ppea2026002)

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### ABOUT CD GUIDANCE
- One-stop source of information and reference materials on Fund CD-related policies, practices, and procedures.
- Supersedes the Policies and Practices on Capacity Development (2019) and operationalizes recommendations of the 2024 CD Strategy Review (CDSR) approved by the Board in April 2024.
- Publication aims:
  - Align the approach to CD with strategic reviews of other IMF activities by providing unified and streamlined operational direction to staff.
  - Inform IMF staff, Executive Directors and their staff, country authorities, development partners, and the general public about relevant guidance on CD.
- Date: January 15, 2026
- Approved by: Catriona Purfield (ICD)
- Prepared by: Institute for Capacity Development (ICD), led by Faisal Ahmed, with contributions from Roman Didenko, Valeria Mensah, Enkhzaya Demid, Dilek Goncalves, Frank Thomas, Nathalie Carcenac, Barbra Licudine, Sylvia Mogeni; overall guidance by Charleen Gust and Michaela Erbenova (all ICD).

### MANDATE AND OBJECTIVES
- Legal foundation and scope:
  - The IMF's Articles of Agreement provide the CD legal basis.
  - Article V, Section 2(b) allows the IMF to provide, upon request, “financial and technical services”.
  - The 2012 Integrated Surveillance Decision (ISD) operationalizes the IMF’s surveillance mandate by defining its scope.
- Key principles:
  - CD is demand-driven and voluntary for both members and the Fund.
  - CD may be extended to nonmembers and international organization staff with prior Executive Board approval.
  - All CD must respect political neutrality and noninterference, focusing on agreed technical objectives.
- Main objective:
  - Help member countries build institutions and boost skills for sound macroeconomic and financial policies.
  - Deepen dialogue between the Fund and member country experts and complement surveillance and Fund-supported program discussions.

### SCOPE, MODALITIES, AND CORE AREAS
- CD goals:
  - Strengthen institutional capacity (institutions, legal frameworks, policies).
  - Build individual capability (skills of officials, peer-to-peer learning).
  - Combine institutional and individual capacity building where synergies exist.
- Core CD areas (will continue to account for the bulk of CD delivery):
  - Revenue administration, public financial management, macroeconomic statistics, financial supervision and regulation, macroeconomic frameworks, financial stability, central bank and monetary operations, debt management, tax policy, AML/CFT, anticorruption, rule of law, legal reform.
- Requests outside core areas:
  - Follow CD prioritization process and assess whether the Fund has relevant expertise and comparative advantage.
- Delivery and quality:
  - Fund delivers its own CD and retains responsibility for quality and integrity of TA and training.
  - All CD engagements must comply with Fund policies on intellectual property, confidentiality, and data protection (By-Laws and internal agreements).
  - The Fund neither funds other CD providers nor delegates delivery to independent contractors.
- Partnerships:
  - The Fund collaborates with multiple CD partners that contribute external financing to RCDCs, global TFs, and bilateral funding programs.
  - Steering Committees for RCDCs and global TFs facilitate strategic dialogue, information sharing, and coordination.
  - The IMF and World Bank coordinate under the 1989 Concordat and subsequent frameworks as outlined in operational guidance on information sharing.
- Demand and ownership:
  - CD activities are driven by member demand; recipient involvement and ownership are required for effectiveness.
  - Implementation of past recommendations is an input when considering new CD provision.

### INTEGRATION WITH SURVEILLANCE AND LENDING
- Integration principles:
  - Fund CD is integrated with policy dialogue under surveillance and Fund-supported programs.
  - Policy dialogue helps identify capacity constraints that affect policy options and program conditionality.
  - TA reports and detailed analysis (e.g., energy subsidy reform, debt management) can enrich Fund policy advice under surveillance and programs.
- Applicability and guidance:
  - Country-level CD is systematically integrated into surveillance and program reviews and is reflected in Article IV consultations when relevant.
  - The 2022 Guidance Note for Surveillance under Article IV Consultations: where institutional and capacity weaknesses constrain policy adoption, surveillance should cover these constraints and, if the Fund has technical expertise, CD can help address them; country teams expected to develop coherent CD strategies with CDDs and discuss with authorities.
  - The 2024 CDSR retired Country Strategy Notes (CSNs) as standalone documents for heavy CD users in favor of more substantive coverage in staff reports; in 2024, CD was covered in 90 percent of the Article IV and program reports, up from 55 percent in 2018.
  - For FCS, CD strategies embedded in the Country Engagement Strategy (per 2022 FCS Strategy and 2023 Staff Guidance Note on Implementation of the IMF Strategy for FCS).
  - For small developing states (SDSs), CD strategies are embedded in the Country Engagement Box (see Annex II of the 2024 Guidance Note on the IMF’s Engagement with SDS).
  - The 2024 Operational Guidance Note (OGN) on Program Design and Conditionality emphasizes aligning conditionality with absorptive capacity and using CD to strengthen implementation over time; CD diagnostics can identify capacity gaps and inform conditionality scope and sequencing.
- Legal and confidentiality constraints:
  - Integration must respect legal boundaries; CD activities should not create binding obligations beyond those permitted under the Articles of Agreement.
  - Confidentiality of CD-related information shared during surveillance and lending must be maintained in accordance with Fund policy.
- Internal coordination:
  - Effective integration requires close coordination within the Fund; ADs lead CD prioritization and resource allocation to ensure alignment with surveillance and lending objectives; CDDs design and implement CD projects in close coordination with country teams.

### CD GOVERNANCE, ROLES, AND MANAGEMENT MECHANISMS
- Executive Board:
  - Strategic direction and oversight, including overall envelope for externally financed CD and relative size of CD in the Fund’s outputs.
  - Receives information on CD features, implementation analysis, evaluations, and sets strategic direction while respecting demand-driven nature.
  - As part of annual MTB, receives CD outturns, planned financing, priorities, and approves the Fund’s MTB establishing budget space for externally financed CD.
- Management:
  - Operational conduct, establishes CD procedures and practices, approves medium-term departmental CD spending envelopes annually prior to MTW formulation.
  - Quarterly CD Forum chaired by management for high-level dialogue on CD outcomes and integration with surveillance and lending; systemic issues referred to the Committee on Capacity Building (CCB).
- Committee on Capacity Building (CCB):
  - Interdepartmental body chaired by a deputy managing director with secretariat provided by ICD.
  - Main responsibilities: advise management on strategic issues related to CD activities, including prioritization, impact, and external fundraising.
  - Functions and inputs include strategic input to resource allocation at the start of the annual MTB-CD cycle; steering follow-up to ICD-led CD strategy reviews; responding to emerging CD issues; setting evaluation agenda and improving CD outcomes.
  - Timing: initial fall meeting to inform annual CD prioritization; beginning of each fiscal year meeting to advise on topical issues and evaluation planning; ad hoc meetings as needed.

### PRIORITIZATION FRAMEWORK AND PROCESS
- Annual prioritization cycle:
  - Begins with CCB input in the fall, reflecting CD strategy reviews, Board work programs, IMFC communiqués, Global Policy Agenda (GPA), and budget execution outturns.
  - Outputs inform departments’ indicative resource allocations to regions and workstreams within CDMAP.
- Factors considered:
  - Country needs and CD demand identified in programs and surveillance.
  - Implementation outcomes of past CD and ownership indicators.
  - Availability of internal and external financing and fundraising outlook.
  - Links to other Fund strategies (e.g., FCS strategy) and enterprise risk considerations.
- Institutional principles:
  - Fund legally obligated to ensure equitable treatment of all members in allocation of CD resources, consistent with Article V, Section 2(b) and Board guidance.
  - CCB provides guidance integrated into Fund-wide priorities, departmental accountability, and budget formulation.
- Annual Fund-wide MTB integration:
  - Top-down: CCB strategic guidance; ADs update Regional Strategy Notes (RSNs); CDDs prepare aggregate medium-term CD spending proposals.
  - Bottom-up: departments identify and prioritize CD demand, prepare CD projects for the MTW, considering ongoing projects.
  - The annual exercise is iterative and overseen by the CCB; RSNs, the MTB-CD and MTW translate country demand, Fund priorities, and resource constraints into specific CD deliverables.

### MEDIUM-TERM PLANNING, RCDC ROLES, AND DELIVERY RESPONSIBILITIES
- Medium-term planning and budgeting:
  - ADs, in consultation with CDDs, update RSNs outlining short- and medium-term priorities and informing priority rankings for proposed CD projects.
  - CDDs (involving RCDCs) develop detailed CD MTWs based on RSNs and ADs’ CD demand rankings; MTWs indicate delivery by recipient region, country, core workstream, funding source, CD modality, and delivery CD department.
  - Externally funded staff positions are subject to limits due to risks between long-term staff obligations and less certain external financing; budgets for externally financed positions are set in the annual Fund-wide MTB process with limits set taking into account sustainability and minimization of risks.
  - Departments should maintain consistency between internally financed CD spending plans in CDMAP and the CD budget agreed as part of the annual Fund-wide MTB process.
- Roles and quality control:
  - CDDs are responsible for actual CD delivery and CD quality control after formulation of the CD MTW.
  - Delivery uses HQ-based staff, short-term hires, long-term resident advisors, and external experts to maximize efficiency while achieving measurable results.
  - Quality control includes developing, guiding, and backstopping work programs for experts placed at RCDCs and ensuring integration with CDDs’ other delivery programs.
- RCDCs structure and governance:
  - RCDCs are integral to CD delivery and part of the Fund-wide MTW process.
  - Distinction between RTACs and RTCs:
    - RTACs led by ADs; RTAC director, in consultation with CDDs, coordinates the work program across workstreams and aligns with AD priorities. A staff handbook provides internal guidance.
    - RTCs under ICD leadership, operating in close partnership with ADs and other CDDs; RTC directors, in consultation with CDDs and ADs, ensure regions and some individual countries receive prioritized courses.
    - Some RCDCs can have a dual RTAC/RTC mandate (example given: SARTTAC) implying AD leadership in the RTAC part and ICD leadership in the RTC part.
  - RCDC steering committees approve program documents, workplans, and working budgets; membership normally includes the IMF, contributing CD partners, and recipient countries (in RTACs).

### DELIVERY MODALITIES, BLENDED APPROACHES, AND TECHNOLOGY
- Delivery modalities:
  - Duty station work and virtual or field-based missions by HQ staff.
  - Short-term experts (STX) or resident advisors/long-term experts (LTX) including from RCDCs.
  - Online, classroom, and customized training; peer-to-peer learning and technical workshops.
  - Discussions at HQ or remotely from HQ or RCDC.
- Quality and control:
  - Fund CD represents TA or training of the highest quality, reflecting international best practices; tailored to country needs and absorptive capacity with follow-up support to ensure implementation and sustainable impact.
  - Fund retains full control over selection of experts and CD content; maintains a roster of experts; exercises backstopping, regular supervision by the relevant CDD, review processes, and feedback mechanisms.
- Blended delivery and innovation:
  - COVID-19 experience: virtual delivery offers reach and data advantages but can be less effective with poor internet connectivity, large time differences, and may limit trust-building and personalized knowledge transfer.
  - Guidance: complement in-person TA with virtual activities and self-paced online learning; use flexible blended modalities tailored to country needs.
  - Staff should leverage various resources and modalities—including approved Artificial Intelligence (AI) tools—and be strategic in deploying training, TA, in-country resident advisors, RCDCs, HQ staff, and delivery modes.

### COORDINATION, DISSEMINATION, AND KNOWLEDGE MANAGEMENT
- Coordination with other CD providers:
  - Effective coordination with the World Bank, regional development banks and key bilateral aid agencies supports efficiency gains and sustains CD impact.
  - Coordination is most important during preparation of action plans and logical frameworks and interdepartmental missions where technical synergies can be reaped.
  - Existing mechanisms include select joint missions (for example, with the World Bank); country-level coordination mechanisms with both HQ and field participation; steering committees of RCDCs and global TFs (including the Debt Management Facility, a joint initiative with the World Bank); global initiatives such as the Platform for Collaboration on Tax and the Joint Domestic Revenue Mobilization Initiative (DRMI).
- Dissemination of CD information:
  - Must follow the 2022 Updated Framework on the Dissemination of CD Information and the Staff Operational Guidance on Dissemination.
  - Key reforms:
    - Expansion of scope of TA information to be disseminated—to include training and other forms of CD output.
    - Introduction of publication of high-level summaries (HLS) of strategic final output based on a 30-day lapse-of-time basis.
    - Reduced lapse-of-time for consent from 60 days to 30 business days when sharing final CD information with financing partners and the Executive Board.
    - Norms reducing time between completing a mission/activity, producing the report, and submitting the final report to the Fund’s repository.
  - Staff responsibilities:
    - Staff and country authorities should discuss dissemination and publication of outputs during project implementation and ensure timely preparation, review and approval of CD information.
    - Staff must obtain explicit consent from member authorities before publishing or sharing sensitive CD information externally.
- Knowledge management:
  - Fund investing in better processes and information systems, including internal communication and Knowledge Management Initiatives (KMIs), and the CDMAP to strengthen access to and improve the quality of CD data, documents and tools across departments and workstreams.

### MONITORING, EVALUATION, AND IMPACT
- Objectives of M&E:
  - Review CD activities for accountability; assess relevance, coherence, efficiency, effectiveness, impact and sustainability; distill lessons to strengthen future activities.
- Principles and tools:
  - Regular reviews of CD content expected as part of CD-delivering departments’ work processes.
  - All M&E activities should seek input from recipient authorities.
  - Personal data collected during M&E must be handled in accordance with good international practices and Fund policy.
  - Instruments include internal and external evaluations, RBM, training assessments, and other progress reports.
  - RBM framework supports results-focused project design and management and systematizes tracking of outcomes using indicators; applies to all CD activities (internal and external financing).
  - For programmatic CD, teams to have an explicit discussion and agreement with authorities on results targeted in RBM before commencing a project (in line with 2024 CDSR recommendations).
- Evaluation modalities and timelines:
  - Internal and external evaluations vary in purpose and scope; external evaluations typically required in funding agreements with CD partners.
  - Evaluation instruments include Fund-wide evaluations; departmental evaluations; CD partner-mandated evaluations; evaluations by the Fund’s IEO.
  - Departmental and CD partner-mandated evaluations should apply the Fund’s 2020 Updated Common Evaluation Framework (CEF).
  - Internal evaluations are planned on a rolling three-year basis and the workplan is approved by the CCB.
  - External evaluations are normally planned 40 months after the start of a 5-year phase, but timelines may shift based on portfolio execution.
  - RCDCs, TFs, and some bilateral funding subaccounts are subject to partner-mandated evaluations conducted by independent external evaluators usually midway through each arrangement’s five-year funding cycle.
- Complementary use:
  - RBM data for immediate self-assessment and agile CD adjustments; evaluations for in-depth, longer-horizon assessment.
  - For Fund training, combination of post- and pre-course testing and follow-up surveys provide learner progress insights.
- Strategic Results Framework (SRF) pilot:
  - SRF builds on RBM’s project-level results and introduces:
    - progress indicators that measure intermediate outcomes and direct results of Fund CD across multiple projects;
    - high-level macroeconomic and development outcomes to which Fund CD contributes across workstreams.
  - Pilot experience will inform development and implementation of a Fund-wide SRF for CD.

### PARTNERSHIPS, FINANCING, AND SUSTAINABILITY
- Funding sources and institutional approach:
  - CD activities are funded by both the Fund’s own resources and external financing.
  - The Fund’s overall MTB process considers Fund- and externally financed CD together.
- Benefits of partnerships:
  - Enable coordination and scale-up CD delivery to meet increasing demand, particularly in low-income and lower-middle-income countries.
  - Partners value high quality and continuity of Fund CD and consistency with Fund surveillance and lending.
  - Partnerships promote Fund accountability for resources and results and enable partners to integrate Fund CD with their planning and resource allocation.
- Differences between internal and external financing:
  - External financing influenced by CD partners’ preferences (countries/regions, topics, vehicles).
  - Internal resources are more flexible and enable agile response to crisis-related priorities.
- Board-approved principles guiding choice of financing:
  - Fund financing of CD should be considered when:
    - in countries or on topics where external funding is not available, including program cases;
    - when a quick reaction is required;
    - when Fund expertise in particular areas needs to be maintained.
  - External financing should be considered when:
    - CD partners’ interests underpin CD demand and align with Fund priorities and objectives;
    - sufficient space is available in the Fund’s budget to cover related indirect costs;
    - sufficient space exists under the overall limit for externally financed CD expenditure set by the Board in the context of the MTB.
- Self-financing policy for high-income members:
  - First established in 2015 and updated as part of the 2024 CDSR.
  - Applies to high-income economies defined as the countries that fall into the top two deciles of the world distribution of per capita gross national income.
  - Since 2015, high-income members are required to self-finance CD they receive under specific conditions.
  - 2017 update: policy applies only when delivery costs exceed US$250,000.
  - Internal Fund resources for CD to advanced economies are limited to critical needs where no external funding can be found.
  - Some countries voluntarily contribute to the cost of CD they receive.
  - 2024 CDSR recommended modifications to the charging policy to ensure appropriate incentives for contributor countries and to facilitate technical dialogue.
  - Effective June 1, 2025, high-income economies that contribute to external financing of Fund CD are not subject to the self-financing requirement provided that the amount of their contribution exceeds the cost of CD provided to them (i.e., they must be net contributors to the Fund’s CD financing).
  - The US$250,000 threshold for application of the CD charging policy remains unchanged and is applicable to the total amount of CD provided to the recipient country across all delivery departments in a given fiscal year.
  - If a CD partner country’s authorities opt to self-finance CD despite these rules, this remains permissible under the Fund’s charging policy.
- New externally financed initiatives and approvals:
  - Subject to an interdepartmental review and management clearance process.
  - In certain cases (e.g., setting up a new TF requiring a new sub-account or modification) approval is required by the IMF’s Executive Board.
  - Process ensures initiatives are aligned with institutional objectives and internal budget constraints and assures CD partners that the Fund will be ready to use external financing.
- Funding sustainability and strategic fundraising:
  - Sustainability and fungibility of external financing is critical given significant growth of Fund CD activities.
  - Strategic fundraising roadmap aims to:
    - address high-priority funding needs of specific funding vehicles through concrete action plans;
    - diversify and broaden the CD partner base;
    - increase funding flexibility by negotiating broader umbrella agreements and funding vehicles, limiting bilateral agreements, and enhancing funding complementarity across funding vehicles.

*Source: EXECUTIVE SUMMARY — CD GUIDANCE NOTE (ppea2026002)*

### EXECUTIVE SUMMARY

### EXECUTIVE SUMMARY

### ABOUT CD GUIDANCE
- This CD Guidance Note provides a one-stop source of information and reference materials on Fund CD-related policies, practices, and procedures.
- It supersedes the Policies and Practices on Capacity Development (2019) and operationalizes recommendations of the 2024 CD Strategy Review (CDSR) approved by the Board in April 2024.
- Publication aims:
  - Align the approach to CD with strategic reviews of other IMF activities by providing unified and streamlined operational direction to staff.
  - Inform IMF staff, Executive Directors and their staff, country authorities, development partners, and the general public about relevant guidance on CD.
- Date: January 15, 2026
- Approved by: Catriona Purfield (ICD)
- Prepared by: Institute for Capacity Development (ICD), led by Faisal Ahmed, with contributions from Roman Didenko, Valeria Mensah, Enkhzaya Demid, Dilek Goncalves, Frank Thomas, Nathalie Carcenac, Barbra Licudine, Sylvia Mogeni; overall guidance by Charleen Gust and Michaela Erbenova (all ICD).

### MANDATE AND OBJECTIVES
- Legal foundation:
  - The IMF's Articles of Agreement provide the CD legal basis.
  - Article V, Section 2(b) allows the IMF to provide, upon request, “financial and technical services”.
  - The 2012 Integrated Surveillance Decision (ISD) operationalizes the IMF’s surveillance mandate by defining its scope.
- Key principles:
  - CD is demand-driven and voluntary for both members and the Fund.
  - CD may be extended to nonmembers and international organization staff with prior Executive Board approval.
  - All CD must respect political neutrality and noninterference, focusing on agreed technical objectives.
- Main objective:
  - Help member countries build institutions and boost skills for sound macroeconomic and financial policies.
  - Deepen dialogue between the Fund and member country experts and complement surveillance and Fund-supported program discussions.

### SCOPE AND MODALITIES
- CD goals:
  - Strengthen institutional capacity (institutions, legal frameworks, policies).
  - Build individual capability (skills of officials, peer-to-peer learning).
  - Combine institutional and individual capacity building where synergies exist.
- Core CD areas (will continue to account for the bulk of CD delivery):
  - Revenue administration, public financial management, macroeconomic statistics, financial supervision and regulation, macroeconomic frameworks, financial stability, central bank and monetary operations, debt management, tax policy, AML/CFT, anticorruption, rule of law, legal reform.
- Requests outside core areas:
  - Follow CD prioritization process and assess whether the Fund has relevant expertise and comparative advantage.
- Delivery and quality:
  - Fund delivers its own CD and retains responsibility for quality and integrity of TA and training.
  - All CD engagements must comply with Fund policies on intellectual property, confidentiality, and data protection (By-Laws and internal agreements).
  - The Fund neither funds other CD providers nor delegates delivery to independent contractors.
- Partnerships:
  - The Fund collaborates with multiple CD partners that contribute external financing to RCDCs, global TFs, and bilateral funding programs.
  - Steering Committees for RCDCs and global TFs facilitate strategic dialogue, information sharing, and coordination.
  - The IMF and World Bank coordinate under the 1989 Concordat and subsequent frameworks as outlined in operational guidance on information sharing.
- Demand and ownership:
  - CD activities are driven by member demand; recipient involvement and ownership are required for effectiveness.
  - Implementation of past recommendations is an input when considering new CD provision.

### INTEGRATION WITH SURVEILLANCE AND LENDING
- Integration principles:
  - Fund CD is integrated with policy dialogue under surveillance and Fund-supported programs.
  - Policy dialogue helps identify capacity constraints that affect policy options and program conditionality.
  - TA reports and detailed analysis (e.g., energy subsidy reform, debt management) can enrich Fund policy advice under surveillance and programs.
- Applicability:
  - Country-level CD is systematically integrated into surveillance and program reviews.
  - CD activities are reflected in Article IV consultations when relevant.

### CD GOVERNANCE
- Roles and responsibilities:
  - Executive Board: strategic direction and oversight, including overall envelope for externally financed CD and relative size of CD in the Fund’s outputs.
  - Management: operational conduct, establishes CD procedures and practices, approves medium-term departmental CD spending envelopes annually prior to MTW formulation.
- Executive Board engagement:
  - Receives information on CD features, implementation analysis, evaluations, and sets strategic direction while respecting demand-driven nature.
  - As part of annual MTB, receives CD outturns, planned financing, priorities, and approves the Fund’s MTB establishing budget space for externally financed CD.
  - Regular opportunities to discuss multi-year CD priorities, integration with Fund-wide priorities, and enterprise risks during budget formulation.
  - Staff provide periodic briefings and informal engagement on CD activities, strategic directions, and delivery against priorities.
- Management-level mechanisms:
  - Quarterly CD Forum chaired by management for high-level dialogue on CD outcomes and integration with surveillance and lending; normally centered on country case presentations by AD country teams and CDDs.
  - Systemic issues from CD Forum are referred to the Committee on Capacity Building (CCB).
- Committee on Capacity Building (CCB):
  - Interdepartmental body chaired by a deputy managing director with secretariat provided by ICD.
  - Main responsibilities: advise management on strategic issues related to CD activities, including prioritization, impact, and external fundraising.
  - Functions and inputs:
    - Provide strategic input to resource allocation and prioritization at the start of the annual MTB-CD cycle and influence CD-spending envelopes and regional/topical shares.
    - Steer follow-up to ICD-led CD strategy reviews and provide guidance on implementation risks.
    - Respond to emerging CD issues surfaced in CD Forum or analytical work (e.g., CD design for FCS, mainstreaming digital approaches in fiscal CD).
    - Set evaluation agenda and improve CD outcomes by identifying areas for internal evaluations and providing guidance on actions (e.g., sequencing of CD, assessments of capacity and absorptive capacity).
  - Timing:
    - Every fall: meeting at the beginning of annual CD prioritization cycle to provide initial strategic input for resource allocation, informing departments’ indicative resource allocations within CDMAP.
    - Beginning of each fiscal year: meeting to advise on topical strategic issues, evaluation planning, and issues from CD Forum or ICD analytical work.
    - Ad hoc meetings as needed for major operational developments related to CD.

### PRIORITIZATION (process highlights)
- Annual prioritization cycle:
  - Begins with CCB input in the fall, reflecting CD strategy reviews, Board work programs, IMFC communiqués, Global Policy Agenda (GPA), and budget execution outturns.
  - Outputs inform departments’ indicative resource allocations to regions and workstreams within CDMAP.
- Factors considered in prioritization:
  - Country needs and CD demand identified in programs and surveillance.
  - Implementation outcomes of past CD and ownership indicators.
  - Availability of internal and external financing and fundraising outlook.
  - Links to other Fund strategies (e.g., FCS strategy) and enterprise risk considerations.
- Management approval:
  - Management approves medium-term departmental CD spending envelopes yearly prior to detailed MTW formulation; CCB discussion needed if interdepartmental issues remain.

### DELIVERY (modalities and quality assurance)
- Delivery modalities:
  - Increasingly flexible approaches combining TA, training, RCDCs, TFs, and collaborative modalities to exploit synergies and promote impact.
- Quality control:
  - Fund stands by TA and training regardless of delivery mode and exercises quality control.
  - All engagements must comply with Fund policies on intellectual property, confidentiality, and data protection.
- Use of CD in policy work:
  - CD can identify capacity constraints relevant for surveillance and program design and help assess feasibility of policy options.
  - CD outputs (e.g., TA reports) can be repurposed to enrich surveillance advice across countries.

### COORDINATION, MONITORING, EVALUATION, AND PARTNERSHIPS
- Coordination:
  - Fund aims to avoid duplication and enhance complementarity with other CD providers given tight focus and limited resources.
  - Steering Committees in RCDCs and TFs facilitate strategic dialogue and coordination.
- Monitoring and evaluation:
  - CCB links resource allocation with evaluations, identifies areas for internal evaluations, and draws from RBM information and analytical work.
  - Collaborative evaluation and monitoring can enhance country ownership and inform future CD decisions.
- Partnerships and funding:
  - Fund engages closely with external partners that finance RCDCs, global TFs, and bilateral programs.
  - External financing decisions and fundraising outlook feed into prioritization and MTB-CD planning.

*Source: EXECUTIVE SUMMARY — CD GUIDANCE NOTE (ppea2026002)*

### 18.      Guided by the CCB and deliberations on departments’ accountability frameworks and

### 18.      Guided by the CCB and deliberations on departments’ accountability frameworks and budgets, ADs and CDDs formulate and agree on medium-term CD delivery plans

### Medium-term planning and budgeting
- Annual process to formulate medium-term CD delivery plans, including:
  - ADs, in consultation with CDDs, update Regional Strategy Notes (RSNs) outlining short- and medium-term priorities and informing priority rankings for proposed CD projects.
  - CDDs (involving RCDCs) develop detailed CD MTWs based on RSNs and ADs’ CD demand rankings; MTWs indicate delivery by recipient region, country, core workstream, funding source, CD modality, and delivery CD department.
  - Externally funded staff positions are subject to limits due to risks between long-term staff obligations and less certain external financing; budgets for externally financed positions are set in the annual Fund-wide MTB process with limits set taking into account sustainability and minimization of risks.
  - Departments should maintain consistency between internally financed CD spending plans in CDMAP and the CD budget agreed as part of the annual Fund-wide MTB process.

### Roles, responsibilities, and quality control
- CDDs are responsible for actual CD delivery and CD quality control after formulation of the CD MTW.
- Delivery leverages an optimal mix of resources: HQ-based staff, short-term hires, long-term resident advisors, and external experts, designed to maximize efficiency while achieving measurable results.
- Quality control includes developing, guiding, and backstopping work programs for experts placed at RCDCs and ensuring integration with CDDs’ other delivery programs.

### RCDCs: structure, mandates, and governance
- RCDCs are integral to the Fund’s CD delivery model and part of the Fund-wide annual MTW process.
- Distinction between RTACs and RTCs, reflected in governance:
  - RTACs are led by ADs; RTAC director, in consultation with CDDs, coordinates the work program across workstreams and aligns with AD priorities. A staff handbook provides internal guidance on administrative arrangements, stakeholder responsibilities, and recommended practices.
  - RTCs are under ICD leadership, operating in close partnership with ADs and other CDDs; RTC directors, in consultation with CDDs and ADs, ensure regions and some individual countries receive prioritized courses from relevant CD departments.
  - Some RCDCs can have a dual RTAC/RTC mandate (example given: SARTTAC), implying AD leadership in the RTAC part and ICD leadership in the RTC part.
- RCDC steering committees approve program documents, workplans, and working budgets, focusing on reporting results, regional issues and synergies, future priorities, and coordination with relevant development partners. Membership normally includes the IMF, contributing CD partners, and recipient countries (in RTACs).

### Integration with surveillance and lending
- The 2024 CDSR emphasized that CD should be integrated with surveillance and lending to enhance effectiveness and impact.
- Integration rationale and effects:
  - Integration ensures CD is woven into policy dialogue and advice, enabling granular, timely, topical, and targeted policy advice as required by modern surveillance frameworks (reference: 2021 CSR).
  - Integration helps tailor policy advice to members’ implementation capacity and improve traction.
- Relevant guidance and practices:
  - The 2022 Guidance Note for Surveillance under Article IV Consultations: when institutional and capacity weaknesses constrain policy adoption, surveillance should cover these constraints and, if the Fund has technical expertise, CD can help address them; country teams expected to develop coherent CD strategies with CDDs and discuss with authorities.
  - The 2024 CDSR retired Country Strategy Notes (CSNs) as standalone documents for heavy CD users in favor of more substantive coverage in staff reports; in 2024, CD was covered in 90 percent of the Article IV and program reports, up from 55 percent in 2018.
  - For FCS, CD strategies embedded in the Country Engagement Strategy (per 2022 FCS Strategy and 2023 Staff Guidance Note on Implementation of the IMF Strategy for FCS).
  - For small developing states (SDSs), CD strategies are embedded in the Country Engagement Box (see Annex II of the 2024 Guidance Note on the IMF’s Engagement with SDS).
  - The 2024 Operational Guidance Note (OGN) on Program Design and Conditionality emphasizes aligning conditionality with absorptive capacity and using CD to strengthen implementation over time; CD diagnostics can identify capacity gaps and inform conditionality scope and sequencing.
- Legal and confidentiality constraints:
  - Integration must respect legal boundaries; CD activities should not create binding obligations beyond those permitted under the Articles of Agreement.
  - Confidentiality of CD-related information shared during surveillance and lending must be maintained in accordance with Fund policy.
- Internal coordination:
  - Effective integration requires close coordination within the Fund; ADs lead CD prioritization and resource allocation to ensure alignment with surveillance and lending objectives; CDDs design and implement CD projects in close coordination with country teams.

### Prioritization framework and principles
- Prioritization is essential because the Fund, even with CD partners’ support, cannot meet all CD requests.
- Framework basis:
  - Prioritization guided by country demand and the Fund’s overall strategic priorities, balancing scarce resources across regions, countries, topic areas, and between short- and medium-term needs.
  - Fund is legally obligated to ensure equitable treatment of all members in allocation of CD resources, consistent with Article V, Section 2(b) and Board guidance.
  - Partner-funded CD must comply with Fund policies on external financing, including due diligence and anti-money laundering safeguards.
- Underlying principles:
  - The Board provides strategic direction and oversight into CD priorities.
  - Institutional decisions on CD size relative to other Fund outputs and composition across regions and topics are best made through strategic planning and MTB processes; the CCB provides guidance on institutional priorities for CD which is integrated into Fund-wide priorities, departmental accountability, and budget formulation.
  - Country-level prioritization should reflect country demand and the country’s reform strategy; ADs lead overall country engagement and establishment of country strategies and CD priorities, considering authorities’ strategy, reform commitments under IMF-supported programs, absorptive capacity, and working collaboratively with CDDs.
  - ADs, resident representatives, and RCDC directors engage member countries on CD needs and convey demand to CDDs; CDDs are in frequent dialogue with member countries about CD needs, informing RSNs and the MTW.
- Annual Fund-wide MTB integration:
  - Prioritization embedded in the Fund-wide MTB process with a top-down and bottom-up cycle:
    - Top-down prioritization: CCB provides strategic guidance; ADs prepare/update RSNs; CDDs prepare aggregate medium-term CD spending proposals for discussion with management and the Executive Board.
    - Bottom-up prioritization: departments identify and prioritize CD demand and prepare CD projects for the MTW, considering ongoing projects prioritized in previous years.
  - The annual exercise is iterative and overseen by the CCB; RSNs, the MTB-CD and MTW translate country demand, Fund priorities, and resource constraints into specific CD deliverables.

### Delivery modalities and general guidelines
- CD delivered at member request through various modalities, often as multi-year programs but also ad hoc engagements. Modalities include:
  - Duty station work and virtual or field-based missions by HQ staff.
  - Work by short-term experts (STX) or resident advisors/long-term experts (LTX) including from RCDCs.
  - Online, classroom, and customized training; peer-to-peer learning and technical workshops.
  - Discussions at HQ or remotely from HQ or RCDC.
- General delivery guidelines:
  - Fund CD represents TA or training—often complementary—of the highest quality, reflecting international best practices and complemented by the Fund’s analytical work; CD is tailored to country needs and absorptive capacity and allows for follow-up support to ensure implementation and sustainable impact.
  - Fund CD is delivered by HQ staff and/or external experts selected, contracted, and backstopped by the Fund; the Fund maintains a roster of experts with proven track records in relevant areas.
  - The Fund retains full control over selection of experts and CD content regardless of delivery mode or financing source; Fund CD activities are subject to quality control, including backstopping, regular supervision by the relevant CDD, review processes, and feedback from authorities and surveillance teams in ADs.
  - Experts consult with ADs to understand country circumstances and offer appropriate advice; these processes help integrate CD into the Fund’s analytical activities and policy dialogue.

### Blended delivery, innovation, and use of technology
- Post-pandemic lessons:
  - COVID-19-induced shift to virtual delivery showed opportunities and challenges: technology can shrink distances, reach otherwise inaccessible countries, facilitate data collection and preparation, and advance CD integration; but virtual delivery can be less effective with poor internet connectivity, large time differences, and may limit trust-building and personalized knowledge transfer.
- Blended delivery guidance:
  - Staff should complement in-person TA with virtual activities and self-paced online learning as needed to deepen engagements.
  - Consider flexible blended modalities—with online courses, virtual, hybrid, peer-to-peer and in-person channels in programmatic CD—tailored to country needs to improve TA effectiveness.
- Innovation and country-centered programmatic approach:
  - Fund CD should be country-focused and programmatic: well-sequenced series of TA activities and training to achieve defined medium-term CD objectives aligned to surveillance and lending priorities.
  - Staff should leverage various resources and modalities—including approved Artificial Intelligence (AI) tools—and be strategic in deploying training, TA, in-country resident advisors, RCDCs, HQ staff, and delivery modes (self-paced online, virtual, in-person, hybrid).

### RCDC integration, financing risks, and continuity
- The 2024 CDSR recognized RCDCs as fundamental to the Fund’s CD model and part of the Fund (not temporary funding vehicles).
- RCDCs boost field presence and broaden scope of CD functions in the field.
- Reliance on external financing presents risks to CD delivery, including prioritization risks from diverging priorities between members and CD partners; financing of RCDCs is being diversified to facilitate continuity.
- The 2024 CDSR recommended further integration of RCDCs with HQ while maintaining strong ownership of member countries.

### Coordination, communication, and knowledge management
- Effective internal consultation and information sharing on CD activities is critical to the country-centered model.
- The Fund is investing in better processes and information systems, including internal communication and Knowledge Management Initiatives (KMIs), and the CDMAP to strengthen access to and improve the quality of CD data, documents and tools across departments and workstreams.
- Mechanisms discussed throughout (e.g., CD prioritization and integration) facilitate internal communication and coordination.

*Source: CD GUIDANCE NOTE — INTERNATIONAL MONETARY FUND*

### 38.      Exploring and systematizing good practices on coordination with other CD providers,

### 38.      Exploring and systematizing good practices on coordination with other CD providers

### Coordination with other CD providers
- Effective coordination with the World Bank, regional development banks and key bilateral aid agencies supports efficiency gains and sustains the impact of CD by ensuring consistency of policy advice, mitigating duplication, and leveraging resources and expertise.
- Coordination is most important during:
  - preparation of action plans and logical frameworks (log frames), and
  - interdepartmental missions where technical synergies can be reaped.
- Existing Fund mechanisms and good practices staff can leverage include:
  - select joint missions (for example, with the World Bank);
  - country-level coordination mechanisms with both HQ and field participation;
  - steering committees of RCDCs and global TFs (including the Debt Management Facility, a joint initiative with the World Bank);
  - global initiatives such as the Platform for Collaboration on Tax and the Joint Domestic Revenue Mobilization Initiative (DRMI).

### Dissemination of CD information
- Dissemination must follow the 2022 Updated Framework on the Dissemination of CD Information and the Staff Operational Guidance on Dissemination.
- Key reforms introduced by the updated framework:
  - expansion of the scope of TA information to be disseminated—to include training and other forms of CD output;
  - introduction of the publication of high-level summaries (HLS) of strategic final output based on a 30-day lapse-of-time basis;
  - reduced lapse-of-time for consent from 60 days to 30 business days when sharing final CD information with financing partners and the Executive Board;
  - norms reducing time between completing a mission/activity, producing the report, and submitting the final report to the Fund’s repository.
- Fund staff responsibilities and practices:
  - staff and country authorities should discuss dissemination and publication of outputs during project implementation and ensure timely preparation, review and approval of CD information;
  - staff must obtain explicit consent from member authorities before publishing or sharing sensitive CD information externally.

### Monitoring, evaluation, and impact (M&E)
- Purpose of M&E:
  - review CD activities for accountability;
  - assess relevance, coherence, efficiency, effectiveness, impact and sustainability;
  - distill lessons to strengthen future activities.
- Principles and requirements:
  - regular reviews of CD content are expected as an integral part of CD-delivering departments’ work processes;
  - all M&E activities should seek input from recipient authorities;
  - all personal data collected during M&E must be handled in accordance with good international practices and Fund policy.
- M&E framework and tools:
  - instruments include internal and external evaluations, RBM, training assessments, and other progress reports.
  - RBM framework supports results-focused project design, management, decision making, applies to all CD activities (internal and external financing), and systematizes tracking of outcomes using indicators.
  - For programmatic CD, teams are to have an explicit discussion and agreement with authorities on results targeted in RBM before commencing a project (in line with the 2024 CDSR recommendations).
- Evaluation modalities:
  - internal and external evaluations vary in purpose and scope; external evaluations are typically required in funding agreements with CD partners.
  - evaluation instruments include: Fund-wide evaluations; departmental evaluations; CD partner-mandated evaluations; evaluations by the Fund’s IEO.
  - departmental and CD partner-mandated evaluations should apply the Fund’s 2020 Updated Common Evaluation Framework (CEF).
  - internal evaluations are planned on a rolling three-year basis and the workplan is approved by the CCB.
  - external evaluations are normally planned 40 months after the start of a 5-year phase, but timelines may shift based on portfolio execution.
  - RCDCs, TFs, and some bilateral funding subaccounts are subject to partner-mandated evaluations conducted by independent external evaluators usually midway through each arrangement’s five-year funding cycle.
- Complementary use of tools:
  - RBM data for immediate self-assessment and agile CD adjustments;
  - evaluations for in-depth, longer-horizon assessment.
  - For Fund training, a combination of post- and pre-course testing and follow-up surveys provide learner progress insights.
- Strategic Results Framework (SRF) pilot (2024 CSDR recommendation):
  - SRF builds on RBM’s project-level results and introduces two additional levels of indicators:
    - progress indicators that measure intermediate outcomes and direct results of Fund CD across multiple projects;
    - high-level macroeconomic and development outcomes to which Fund CD contributes across workstreams.
  - Pilot experience will inform development and implementation of a Fund-wide SRF for CD.

### Partnerships and funding
- Funding sources:
  - CD activities are funded by both the Fund’s own resources and external financing.
  - The Fund’s overall MTB process considers Fund- and externally financed CD together.
- Benefits of engaging with CD partners:
  - promote coordination and scale-up CD delivery to meet increasing demand, particularly in low-income and lower-middle-income countries;
  - partners value high quality and continuity of Fund CD and consistency with Fund surveillance and lending;
  - partnerships promote Fund accountability for resources and results and enable partners to integrate Fund CD with their planning and resource allocation;
  - partnerships improve visibility and communication of results to global audiences.
- Differences between internal and external financing:
  - external financing is influenced by CD partners’ preferences (countries/regions, topics, vehicles);
  - internal resources are more flexible and enable agile response to crisis-related priorities.
- Board-approved principles guiding choice of financing:
  - Fund financing of CD should be considered when:
    - in countries or on topics where external funding is not available, including program cases;
    - when a quick reaction is required;
    - when Fund expertise in particular areas needs to be maintained.
  - External financing should be considered when:
    - CD partners’ interests underpin CD demand and align with Fund priorities and objectives;
    - sufficient space is available in the Fund’s budget to cover related indirect costs;
    - sufficient space exists under the overall limit for externally financed CD expenditure set by the Board in the context of the MTB.
- Self-financing policy for high-income members:
  - first established in 2015 and updated as part of the 2024 CDSR.
  - applies to high-income economies defined as the countries that fall into the top two deciles of the world distribution of per capita gross national income.
  - since 2015, high-income members are required to self-finance CD they receive under specific conditions.
  - 2017 update: policy applies only when delivery costs exceed US$250,000.
  - internal Fund resources for CD to advanced economies are limited to critical needs where no external funding can be found.
  - some countries voluntarily contribute to the cost of CD they receive.
  - 2024 CDSR recommended modifications to the charging policy to ensure appropriate incentives for contributor countries and to facilitate technical dialogue.
  - Effective June 1, 2025, high-income economies that contribute to external financing of Fund CD are not subject to the self-financing requirement provided that the amount of their contribution exceeds the cost of CD provided to them (i.e., they must be net contributors to the Fund’s CD financing).
  - The US$250,000 threshold for application of the CD charging policy remains unchanged and is applicable to the total amount of CD provided to the recipient country across all delivery departments in a given fiscal year.
  - If a CD partner country’s authorities opt to self-finance CD despite these rules, this remains permissible under the Fund’s charging policy.
- New externally financed initiatives and approvals:
  - subject to an interdepartmental review and management clearance process;
  - in certain cases (e.g., setting up a new TF requiring a new sub-account or modification) approval is required by the IMF’s Executive Board.
  - process ensures initiatives are aligned with institutional objectives and internal budget constraints and assures CD partners that the Fund will be ready to use external financing.
- Funding sustainability and strategic fundraising:
  - sustainability and fungibility of external financing is critical given significant growth of Fund CD activities.
  - Fund relies on a strategic fundraising roadmap aiming to:
    - address high-priority funding needs of specific funding vehicles through concrete action plans;
    - diversify and broaden the CD partner base;
    - increase funding flexibility by negotiating broader umbrella agreements and funding vehicles, limiting bilateral agreements, and enhancing funding complementarity across funding vehicles.

*Source: ppea2026002 - 38.      Exploring and systematizing good practices on coordination with other CD providers*

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_Source: https://www.imf.org/-/media/files/publications/pp/2026/english/ppea2026002.pdf_