## _031708a

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---

### Decision under Article VIII, Section 5 — Summary and Member Obligations
- All members shall provide the information listed in Annex A to this decision, necessary for the Fund to discharge its duties effectively.
- Members shall provide the data specified in Annex A for the periods commencing after December 31, 2004.
- Annex A shall be reviewed no later than December 31, 2007.
- "Failure to provide information" includes both nonprovision and provision of inaccurate information.
- A member has an obligation to provide information required under Article VIII, Section 5 to the best of its ability.
- No breach if the member is unable to provide required information or more accurate information than it has; however, a member unable to provide final data is obligated to provide provisional data to the best of its ability until final data are available.
- When assessing ability, the Fund will give the member the benefit of any doubt.

### Procedures for Noncompliance, Reporting, and Executive Board Actions
- Prior steps before report by the Managing Director:
  - Managing Director calls upon the member to provide required information and enlists cooperation of the member's Executive Director.
  - If member persists and has not demonstrated inability, the Managing Director notifies the member of intention to report under Rule K-1, allowing a specified period of not less than a month to provide information or demonstrate inability.
  - If inaccurate data appear to have been provided, the Managing Director consults with the member to assess whether inaccuracy is due to lack of capacity; if not, notification of intention to report unless inability demonstrated within not less than one month.
  - If nonprovision or inaccuracy is due to inability, the Managing Director may inform the Executive Board; the Board may apply paragraph 10 (capacity-building/monitoring).

- Managing Director’s report and Executive Board consideration:
  - After expiration of the specified period, the Managing Director shall make a report to the Executive Board under Rule K-1 for breach of obligation, unless satisfied that the member's response meets notification requirements; the report shall identify the nature of the breach, include the member's response (if any), and may recommend remedial actions.
  - Within 90 days of the Managing Director’s report, the Executive Board will consider the report to decide whether the member has breached its obligations. The Executive Board may request additional clarification and will set a deadline for such clarification.

- Executive Board remedial measures:
  - If failure is due to inability, the Board may call upon the member to strengthen capacity and ask the Managing Director to report periodically on progress; the member may request Fund technical assistance (paragraph 10).
  - If the Executive Board finds a breach, it may call upon the member to prevent recurrence and take specific measures (e.g., improvements in statistical systems) (paragraph 11(a)).
  - If the member still does not provide required information, the Board will call upon the member to provide such information (paragraph 11(b)).
  - The Board will specify a deadline for remedial actions; in principle, the deadline will not exceed 90 days for actions under (b) (paragraph 11(c)). The decision may note the Managing Director’s intention to recommend issuance of a declaration of censure if actions are not implemented within the specified period.
  - At expiration of the specified period, the Managing Director shall report on status. If actions not taken, the Managing Director may recommend and the Executive Board may decide among:
    - (1) to extend the period before further steps are taken;
    - (2) to call upon the member to take additional remedial actions within a specified timeframe; or
    - (3) to issue a declaration of censure against the member (paragraph 11(d)).

- Declaration of censure and escalation:
  - If the member fails to implement Board–specified actions before the deadline, the Managing Director may recommend and the Executive Board may decide to issue a declaration of censure. Before adoption, the Board may issue a statement setting out concerns and giving the member a specified period to respond (paragraph 12).
  - The declaration of censure will:
    - identify the breach under Article VIII, Section 5 and the remedial actions not taken within the specified timeframe;
    - may specify a new deadline and further remedial actions;
    - note that failure to implement actions within the specified timeframe may result in issuance of a complaint for ineligibility under Article XXVI (a) and imposition of that measure;
    - at the expiration of the period, the Managing Director shall report to the Executive Board on status (paragraph 13).

- Sanctions under Article XXVI and further measures:
  - Following adoption of a declaration of censure, if the Board finds the member failed to implement any actions in the declaration within the specified timeframe, the Managing Director may issue a complaint and recommend that the Board declare the member ineligible to use the general resources of the Fund for breach of obligation under Article VIII, Section 5. The Executive Board decision declaring ineligibility will note that persistence following declaration of ineligibility may result in a complaint for suspension of voting and related rights and imposition of that measure (paragraph 14).
  - If the member persists in failure for six months after the declaration of ineligibility, the Managing Director may issue a complaint and recommend that the Fund suspend the member’s voting and related rights. The Executive Board decision suspending voting and related rights will note that persistence following suspension may result in a complaint for compulsory withdrawal and initiation of compulsory withdrawal proceedings (paragraph 15).
  - If the member persists in failure for six months after suspension of voting rights, the Managing Director may initiate proceedings for compulsory withdrawal of the member from the Fund (paragraph 16).
  - All Executive Board decisions arising from a breach of obligation under these procedures will give rise to a public announcement with prior review of the text by the Executive Board (paragraph 17).

### Annex A — Required National Data (paragraph 1 reference)
The data referred to in paragraph 1 are the national data on the following matters:
- (i) reserve, or base money;
- (ii) broad money;
- (iii) interest rates, both market-based and officially-determined, including discount rates, money market rates, rates on treasury bills, notes and bonds;
- (iv) revenue, expenditure, balance and composition of financing (i.e., foreign financing and domestic bank and nonbank financing) for the general and central governments respectively; the stocks of central government and central government-guaranteed debt, including currency and maturity composition and, if the debt data are amenable to classification on the basis of the residency or nonresidency of the holder, the extent to which the debt is held by residents or nonresidents;
- (v) balance sheet of the central bank;
- (vi) external current account balance;
- (vii) exports and imports of goods and services;
- (viii) the international reserve assets and reserve liabilities of the monetary authorities, specifying separately any reserve assets which are pledged or otherwise encumbered as well as net derivative positions;
- (ix) gross domestic product, or gross national product;
- (x) consumer price index;
- (xi) gross external debt;
- (xii) consolidated balance sheet of the banking system.

Notes within Annex A:
- Footnote 1: The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds) and state and local governments.
- Footnote 2: Gross external debt is the outstanding amount of those actual current, and not contingent, liabilities that require payment(s) of principal and/or interest by the debtor at some point(s) in the future and that are owed to nonresidents by residents of an economy.

### Annex II — Table of Common Indicators Required for Surveillance (memo items)
- Table headings and memo items: Date of latest observation; Date received; Frequency of Data; Frequency of Reporting; Frequency of publication; Data Quality – Methodological soundness; Data Quality – Accuracy and reliability.
- Data series listed: Exchange Rates; International Reserve Assets and Reserve Liabilities of the Monetary Authorities; Reserve/Base Money; Broad Money; Central Bank Balance Sheet; Consolidated Balance Sheet of the Banking System; Interest Rates; Consumer Price Index; Revenue, Expenditure, Balance and Composition of Financing – General Government; Revenue, Expenditure, Balance and Composition of Financing – Central Government; Stocks of Central Government and Central Government-Guaranteed Debt; External Current Account Balance; Exports and Imports of Goods and Services; GDP/GNP; Gross External Debt.
- Frequency codes: Daily (D), Weekly (W), Monthly (M), Quarterly (Q), Annually (A), Irregular (I); Not Available (NA).
- Footnotes clarify inclusion of pledged/encumbered reserve assets and net derivative positions; interest rates description; financing composition; definition of general government; inclusion of currency and maturity composition; and data ROSC guidance for Data Quality assessments.

### Annex III — Survey basis, sample, and trends in timeliness (Overview and Findings)
- Overview:
  - Survey basis: Article IV staff reports discussed by the Executive Board during October 2006–September 2007; data drawn from the Table of Common Indicators Required for Surveillance (TCIRS) approved at the time of the 2004 review.
  - Sample: 144 staff reports comprising 26 advanced economies (ADV), 56 market access economies (MAC), and 62 developing economies (DEV).
  - TCIRS coverage: 15 data categories (eight high frequency and seven low frequency indicators).

- Trends in data timeliness — high frequency indicators:
  - General finding: Some slippage in timeliness compared to performance through 2004, especially for high frequency indicators; exchange rate timeliness broadly unchanged.
  - Extent of slippage: Contained at two months for most indicators; cumulative shares of countries reporting within two months declined at most by three percentage points for most indicators.
  - Specific figures (2003 vs 2007 distributions shown in Figure 1):
    - Exchange Rates: 98% ≤ 1 month (2003) and 97% ≤ 1 month (2007).
    - International Reserve Assets and Reserve Liabilities of the Monetary Authorities: 54% ≤ 1 week (2003) vs 27% ≤ 1 week (2007).
    - Reserve / Base Money: 66% ≤ 1 month (2003) vs 59% ≤ 1 month (2007).
    - Central Bank Balance Sheet: 67% ≤ 1 month (2003) vs 52% ≤ 1 month (2007).
    - Broad Money: 56% ≤ 1 month (2003) vs 49% ≤ 1 month (2007).
    - Interest Rates: 76% ≤ 1 month (2003) vs 73% ≤ 1 month (2007).
    - Consolidated Balance Sheet of the Banking System (2007 only): 41% ≤ 1 month; 41% >1 month but ≤ 2 months.
    - Consumer Prices: 73% ≤ 1 month (2003) vs 68% ≤ 1 month (2007).
  - Possible cause: Slippage may be related, at least in part, to more comprehensive definitions of some TCIRS categories (e.g., TCIRS focuses on international reserve assets and liabilities of monetary authorities vs prior focus on gross reserves).

- Trends in data timeliness — low frequency indicators:
  - General finding: Slippage more pronounced for categories with enhanced definitions; timeliness for unchanged-definition indicators broadly similar.
  - Specific changes (2003 vs 2007 distributions shown in Figure 2):
    - Revenue, Expenditure and Composition of Financing of the General Government: 87% 0–3 months (2003) vs 70% 0–3 months (2007).
    - Revenue, Expenditure and Composition of Financing of the Central Government (2007): 88% 0–3 months.
    - Stocks of Central Government and Central Government-Guaranteed Debt (2007): 80% 0–3 months.
    - External Current Account Balance: 62% 0–3 months (2003) vs 58% 0–3 months (2007).
    - Exports and Imports of Goods and Services: 74% 0–3 months (2003) vs 61% 0–3 months (2007).
    - GDP / GNP: 61% 0–3 months (2003) vs 51% 0–3 months (2007).
    - Gross External Debt: 64% 0–3 months (2003) vs 67% 0–3 months (2007).
  - Quantified slippage: Shares of countries reporting government finance and external trade statistics within two quarters declined by about 8 percentage points.
  - Unchanged-definition indicators: Cumulative shares reporting within two quarters virtually unchanged for national accounts, external current account, and gross external debt, though shares reporting within one quarter decreased for national accounts and external current account.

- SDDS benchmarks and selected indicators (Table 1):
  - International Reserve Assets and Liabilities of the Monetary Authorities (timeliness shares in percent):
    - 1 week: 54 (2004 Review) and 27 (2008 Review).
    - 4 weeks (SDDS prescription): 81 (2004 Review) and 71 (2008 Review).
    - 8 weeks: 91 (2004 Review) and 93 (2008 Review).
    - 12 weeks: 97 (2004 Review) and 99 (2008 Review).
  - Gross External Debt (timeliness shares in percent):
    - 1 quarter (SDDS prescription): 64 (2004 Review) and 67 (2008 Review).
    - 2 quarters: 85 (2004 Review) and 86 (2008 Review).
    - 3 quarters: 92 (2004 Review) and 93 (2008 Review).
    - 4 quarters: 98 (2004 Review) and 96 (2008 Review).
  - Note: As of January 2008, 64 countries publish the Data Template on International Reserves and Foreign Currency Liquidity.
  - Interpretation: Observance of the SDDS one-month timeliness benchmark for international reserves assets and liabilities has slackened (from 81 percent in the 2004 review to 71 percent). Observance of the SDDS one-quarter benchmark for gross external debt has increased modestly.

- Correlates of weak performance:
  - High frequency indicators: Weak performance correlated with low per capita GDP.
  - Low frequency indicators: Weak performance correlated with small population size.

- Data ROSCs, coverage, and quality ratings:
  - Coverage in TCIRS: Data quality ratings included for 61 countries with a published data ROSC; only 42 percent of the countries surveyed have had a data ROSC published.
  - Data ROSCs concentrated in market access economies and the western hemisphere.
  - Participation by economy type: market access economies 57 percent; advanced economies (second highest participation).
  - Participation by region: WHD 58 percent; EUR 47 percent; AFR and MCD about 39 percent; APD 30 percent.
  - Data ROSC rating scale: observed (O), largely observed (LO), largely not observed (LNO), not observed (NO).
  - Aggregate findings: National accounts and government finance statistics are less likely to observe international standards for methodological soundness and accuracy and reliability relative to other datasets included.

### Annex III — Sample selection for in-depth analysis (Annex IV content included)
- Purpose: Sample of 50 countries for in-depth analysis selected through stratified sampling from all members with consultations between October 2006—September 2007, stratified by economy type and region.
- Stratification definitions:
  - Advanced (ADV) – advanced countries according to WEO classification.
  - Market Access Countries (MAC) - countries (excluding those classified as advanced) that have received ratings from S&P or Moody’s as of September 2007.
  - Developing countries (DEV) - countries not in the above categories.
  - Regions: AFR, APD, EUR, MCD, WHD corresponding to area departments.
- Allocation and selection: Allocation of 50 countries proportional to population distribution rounded to total 50; selection by simple random drawing within each of 15 strata.
- Sample distribution (Table 1 and Table 3 highlights):
  - Population of 144: ADV 26, MAC 56, DEV 62.
  - Share (%) by type: 18 (ADV), 39 (MAC), 43 (DEV).
  - In sample (of 50): ADV 8, MAC 19, DEV 23.
  - Distribution by region (population of 144): AFR 32, APD 27, EUR 36, MCD 23, WHD 26.
  - In sample (of 50) by region: AFR 12, APD 9, EUR 12, MCD 8, WHD 9.
- Comparison 2007 vs 2004 samples (Table 3):
  - By economy type (count, in percent): 2007 — ADV 8 (16), MAC 19 (38), DEV 23 (46); 2004 — ADV 10 (20), MAC 20 (40), DEV 20 (40).
  - By region (count, in percent): 2007 — AFR 12 (24), APD 9 (18), EUR 12 (24), MCD 8 (16), WHD 9 (18); 2004 — AFR 9 (18), APD 11 (22), EUR 12 (24), MCD 7 (14), WHD 11 (22).
  - By data standard (count, in percent): 2007 — SDDS 17 (34), GDDS 21 (42), Total 38 (76); 2004 — SDDS 21 (42), GDDS 9 (18), Total 30 (60).
  - By program status: 2007 Program 13 (26) vs 2004 Program 11 (22).
  - Common cases between 2004 and 2007 samples: 11 (22).
  - For the 2007 Sample additional attributes: Streamlined Art IV cases 5 (10) (2 with 24-month cycle); Cases with data ROSCs 4 (8).

### Annex IV — Full country sample
- The annex lists the full country sample used for the 2007 and 2004 review.

### Annex V — Survey of Data Provision to the Fund for Surveillance (Mission Chiefs)
- Survey design and response:
  - Survey population: 117 recipients who led Article IV missions between Jan 31, 2005 and Jan 2008.
  - Responses: 40 respondents.
  - Response rate: 34 percent.
  - Confidentiality: respondents assured their identities would not be revealed to the review team.
  - Processing: results processed by a research assistant not a member of the review team.
  - Note: In a few questions respondents chose multiple answers; totals may not always equal number of respondents.

- Question 1 — Adequacy of data for surveillance (responses summarized):
  - 7: "we were provided with the high-quality data needed for the analyses and projections"
  - 11: "data provided had some minor deficiencies with limited impact on our analyses and projections"
  - 8: "lack of timely key data for macroeconomic analysis is a recurring problem, and the team routinely prepares estimates for key variables, with estimation based on limited indicators."
  - 15 respondents: "while we were provided with recent data needed for macroeconomic analysis, some key data suffer from severe deficiencies that hamper analyses and introduce considerable uncertainty into projections."
  - Key data suffering severe deficiencies (text responses include): "GDP, inflation, BOP"; "Mainly national account and balance of payment data"; "Wage and labor market data"; "BOP: imports, private sector income, FDI, and private capital flows; National Accounts: non-oil GDP."; "Balance of payments, national accounts and consumer prices."; and other specific listings.

- Question 2 — SIA summary assessment presence:
  - Responses: 40 Yes, 1 No, 0 No clear assessment, 0 Don’t know.

- Question 3 — Classification of country’s data provision (if summary assessment present):
  - 17: adequate
  - 21: broadly adequate, but deficiencies hamper surveillance
  - 2: inadequate

- Question 4 — Ease of classifying adequacy into three categories:
  - 28: "There was no difficulty, because the country clearly fell into one of the following categories"
    - Of these 28: 11 adequate; 13 broadly adequate, but deficiencies hamper surveillance; 2 inadequate.
  - 15: "There were some data shortcomings, but it was not obvious how to distinguish"
    - Of these 15: 3 "adequate" or "broadly adequate"; 12 "broadly adequate" or "inadequate".
  - 2: "Please provide your own response" (texts included in source).

- Question 4.1 — Reasons for difficulty choosing between “broadly adequate” or “inadequate”:
  - 4: term “inadequate” conveyed too negative a picture of the state of the data
  - 5: term “inadequate” conveyed too negative a picture given genuine capacity constraints
  - 4: term “inadequate” considered counterproductive for productive relations with authorities
  - 6: concerned about implications of the term “inadequate” for the Fund’s ability to conclude the Article IV consultation
  - 2: "Please provide your own response" (texts included in source)

- Question 5 — Preference for two-category classification:
  - 3: Very much so
  - 15: Yes
  - 14: Not really
  - 7: Definitely not
  - 2: No view/don’t know

- Question 6 — Discussions with authorities about data deficiencies (excluding technical-level discussions):
  - 5: "There were no significant issues to discuss"
  - 19: "The team had serious discussions with the authorities to raise awareness of the issues"
  - 10: "While there were some significant data shortcomings, discussions of data issues were limited because:"
    - Of the 10 limited-discussion cases, reasons (select all that apply):
      - 9: "the authorities were aware of them and were taking steps to address them, and had"
        - 2: a timetable for remedial action
        - 2: allocated increased resources for this purpose
        - 6: requested or been receiving relevant TA
      - 2: "previous missions had raised these issues, and the authorities had not addressed them, because of lack of"
        - 0: interest
        - 2: resources
        - 0: there were other more pressing issues to discuss
  - Text responses highlighted improvements underway in some cases; limits to improvements in others; and specific technical improvements (e.g., development of a producer price index with STA TA to be released in April 2008).

- SIA preparation and content:
  - Question 7 — How SIA was prepared:
    - 14: The country team responsible for opening summary assessment and key data issues, with inputs from STA for supporting expert views
    - 4: The country team was the primary author of the opening summary assessment, with the rest prepared by STA
    - 14: The team relied primarily on STA to draft/update the document
    - 6: The SIA was minimally updated because there was little change in data issues
  - Question 8 — Whether only significant data deficiencies were listed in the SIA:
    - 15: Yes, the SIA was primarily drafted/updated by the team
    - 5: Yes, while STA provided detailed inputs, the team edited to ensure only significant deficiencies presented
    - 8: Not clear, the team relied primarily on STA in drafting/updating the SIA
    - 6: No, because it was considered useful to provide substantial detail on existing data deficiencies in the SIA

- Question 9 — Country characteristics (select all that apply):
  - 8: Advanced country
  - 19: Developing country with market access (emerging market)
  - 12: Other developing country
  - 12: GDDS participant
  - 7: SDDS subscriber
  - 12: A data ROSC has been published

- Additional staff comments:
  - Some Article IV consultations were "streamlined" with only brief staff assessment sentences.
  - Improvements in data quality cited in at least one case due to cooperation with Eurostat and STA TA.
  - Suggestion for an additional grading category (category 5b).

### Annex VI — Recommended Methodologies for Data Provision
- I. Fiscal:
  - Preferred: Government Finance Statistics Manual 2001 (GFSM 2001)
  - Other: A Manual on Government Finance Statistics 1986
- II. BOP:
  - Preferred: Balance of Payments Manual, 5th Edition (BPM5)
  - Other: BPM4
- III. Monetary and Financial Statistics:
  - Preferred: Monetary and Financial Statistics Manual (MFSM)
  - Other: A Guide to Money and Banking Statistics in International Financial Statistics (1984)
  - Related: Compilation Guide on Financial Soundness Indicators (FSI) 2007
- IV. National Accounts:
  - Preferred: System of National Accounts (SNA) 1993, European System of Accounts (ESA) 95, IMF Quarterly National Accounts Manual, 2001
  - Other: SNA 1968, SNA 1953
- V. International Reserves:
  - Preferred: International Reserves and Foreign Currency Liquidity (Guidelines for a Data Template)
- VI. External Debt:
  - Preferred: External Debt Statistics Guide for Compilers and Users, 2003
- VII. Prices:
  - Preferred: Consumer Price Index Manual (2004); Producer Price Index Manual (2004); Handbook on the International Comparison Program (ICP)

### Annex VII — Ongoing Data Initiatives and Methodological Progress
- A. Methodological Progress:
  - Need for new methodological guidance in response to globalization, principally for balance of payments, national accounts, and monetary and financial statistics.
  - BPM6 themes: globalization, balance sheet issues, financial innovation; updated guidance on goods for processing (maquila operations), merchanting, remittances, special purpose entities, complex cross-border company structures; more detailed guidance on the IIP and impact of revaluation/volume changes on external assets and liabilities.
  - BPM6: revised draft to be posted early in 2008; regional outreach seminars scheduled for the first half of 2008.
  - SNA update efforts: address multi-territory enterprises, non-permanent workers, goods for processing, merchanting; guidance on financial innovation and public sector issues; measurement of the informal sector and return to capital; Volume 1 (core chapters) presented to the UN Statistical Commission in February 2008; extensions and harmonization topics to be presented in early 2009.

- B. External Debt:
  - QEDS launched November 2004 (online database) covering 60 countries, mostly SDDS subscribers; expanded in February 2008 to cover 14 low income GDDS participants.
  - JEDH launched March 2006 (BIS, IMF, OECD, World Bank) to bring together QEDS national data and creditor/market data.
  - Planned activities: expand QEDS country coverage; reconcile creditor-based and debtor-based data in JEDH.

- C. Public Sector Debt and Local Bond Markets:
  - Progress in reporting internationally comparable public debt data has been slow.
  - Development of a Public Debt Template (PDT) based on GFSM 2001 and the Debt Guide; prototype exercise elicited reporting from a limited number of countries.
  - Fund undertaking to populate the PDT with data available to international organizations; early results indicate considerable discrepancies across databases.
  - STA working (with AFR) on a streamlined version of the PDT tailored for low-income countries.
  - Inter-Agency Working Group on Securities Databases (chaired by the Fund) preparing a guide on methodology for compiling securities statistics; development of the European Centralized Securities Database is underway.

- D. Offshore Financial Centers:
  - Information Framework data collection exercise initiated for OFCs to improve statistical coverage.

### COFER Database and Standardized Report Forms (SRFs) — Security, Reporting, and Monetary Statistics Improvements
- COFER database — purpose and security:
  - COFER is one of the most confidential databases maintained by the Fund, used only for analysis of global balance of payments aggregates, with particular reference to capital movements.
  - Individual country data are treated as strictly confidential and are never published or revealed in the aggregate data.
  - Restricted access: Only four staff members in the Statistics Department have access to the individual country data; all other staff, management, Executive Directors, and those outside the Fund are denied access without exception.
  - Physical security: For countries not using ICS, questionnaires are mailed in a sealed envelope within a second (outer) envelope addressed to the designated COFER country correspondent; completed questionnaires returned in a sealed envelope marked "Currency Composition Questionnaire—Confidential," delivered directly to the Statistics Department.
  - Computer security: COFER data are maintained in a separate secure database accessible only by the four authorized staff members.
  - Reporting modalities: Questionnaires provided for holdings denominated in U.S. dollars, euro, pound sterling, Swiss franc, Japanese yen, and other currencies.
  - Most countries report data through the Integrated Correspondence System (ICS); if by email, use secure address stacofer@imf.org.
  - Frequency: Questionnaires are mailed in March, June, September, and December for countries not using ICS.

- Recent data improvements through SRFs — Coverage in Monetary Statistics:
  - SRF-based MFS led to broader coverage and classification improvements; examples:
    - Bangladesh and Colombia: SRFs led to a revision in credit of about 30 percent due to expanded coverage.
    - Canada and Japan: expanded coverage and improved classification led to significant revisions in credit aggregates.
    - Guatemala: SRFs used to include reporting by off-shore banks.
    - Mauritius, South Africa, and Swaziland: improved classification and sectorization improved understanding of financial sector financing of the public sector.
  - Inclusion of nonbank deposit-taking:
    - Brazil: with Fund TA, financial investment funds (FIFs) consolidated with other banking institutions; assets/liabilities of FIFs amounted to the equivalent of 40 percent of the total for the banking sector.
    - Turkey: inclusion of money market funds in the MFS resulted in a revision of credit aggregates of about 8 percent, while the monetary aggregates (M3, national definition) increased by about 5 percent.
    - Many countries have included data on nonbank liabilities in monetary aggregates even when full balance sheets have not been consolidated.

- Balance sheet approach enabled by SRFs:
  - SRF-based MFS allow tracking balance sheet vulnerabilities regularly and timely (monthly with a delay of only one month).
  - Mathisen and Pellechio (2007) offered guidance for constructing a matrix of intersectoral balance sheets using SRFs, QEDS, and the Coordinated Portfolio Investment Survey.
  - Applications: Two Article IV reports (Croatia and South Africa) used this framework, adding maturity structure and sensitivity analyses; confirmed need for further improvements in detail, frequency, and timely dissemination of external sector, government debt, and household and corporate statistics, including real assets and off-balance sheet liabilities.

*Source: Decision text and Annexes (as provided in the content unit).*

### 1.  Pursuant to Article VIII, Section 5, the Fund decides that all members shall provide

### Pursuant to Article VIII, Section 5, the Fund decides that all members shall provide

### Decision summary
- All members shall provide the information listed in Annex A to this decision, which is necessary for the Fund to discharge its duties effectively.
- Members shall provide the data specified in Annex A for the periods commencing after December 31, 2004.
- Annex A shall be reviewed no later than December 31, 2007.
- "Failure to provide information" includes both nonprovision and provision of inaccurate information.

### Member obligation and scope of noncompliance
- A member has an obligation to provide information required under Article VIII, Section 5 to the best of its ability.
- There is no breach if the member is unable to provide required information or to provide more accurate information than it has provided; however, a member unable to provide final data is obligated to provide provisional data to the best of its ability until final data are available.
- When assessing ability, the Fund will give the member the benefit of any doubt.
- In the context of performance criteria associated with the use of the Fund’s general resources, a member may be found in breach only if:
  - (i) it has reported that a performance criterion was met when in fact it was not, or that a performance criterion was not observed by a particular margin and it is subsequently discovered that the margin of non-observance was greater than originally reported, and
  - (ii) a purchase was made on the basis of the information provided by the member, or the information was reported to the Executive Board in the context of a review subsequently completed or of a decision of the Executive Board to grant a waiver for non-observance of the relevant performance criterion.

### Procedures prior to report by the Managing Director
- Paragraph 5: When it appears the member is not providing required information, the Managing Director shall call upon the member to provide it; before formal representation, the Managing Director shall inform and enlist the cooperation of the Executive Director for the member.
- Paragraph 5: If the member persists and has not demonstrated inability to provide the information, the Managing Director shall notify the member of his intention to make a report to the Executive Board under Rule K-1 for breach of obligation unless, within a specified period of not less than a month, such information is provided or inability demonstrated.
- Paragraph 6: If inaccurate data appear to have been provided, the Managing Director shall consult with the member to assess whether the inaccuracy is due to lack of capacity. If no reason to believe inaccuracy is due to lack of capacity, the Managing Director shall notify the member of intention to report unless the member demonstrates inability within a period of not less than one month.
- Paragraph 7: If the Managing Director concludes nonprovision or inaccuracy is due to inability, he may inform the Executive Board; the Executive Board may decide to apply paragraph 10 (capacity-building/monitoring).

### Report by the Managing Director and Executive Board consideration
- Paragraph 8: After the expiration of the specified period, the Managing Director shall make a report to the Executive Board under Rule K-1 for breach of obligation, unless satisfied that the member's response meets notification requirements. The report shall identify the nature of the breach, include the member's response (if any), and may recommend remedial actions.
- Paragraph 9: Within 90 days of the Managing Director’s report, the Executive Board will consider the report to decide whether the member has breached its obligations. The Executive Board may request additional clarification from staff and authorities and will set a deadline for such clarification.

### Executive Board actions and remedial measures
- Paragraph 10: If the Executive Board finds failure is due to inability to provide information in a timely and accurate fashion, it may call upon the member to strengthen capacity and ask the Managing Director to report periodically on progress. The member may request technical assistance from the Fund.
- Paragraph 11(a): If the Executive Board finds a breach, it may call upon the member to prevent recurrence and take specific measures (e.g., improvements in statistical systems or other measures deemed appropriate).
- Paragraph 11(b): If still not providing required information, the Executive Board will call upon the member to provide such information.
- Paragraph 11(c): The Executive Board will specify a deadline for remedial actions; in principle, the deadline will not exceed 90 days for actions under (b). The decision may note the Managing Director’s intention to recommend issuance of a declaration of censure if actions are not implemented within the specified period. The member may, before the Board meeting, provide a statement specifying remedial actions and proposed timeframe and may request technical assistance.
- Paragraph 11(d): At expiration of the specified period, the Managing Director shall report on status. If the member has not taken specified actions, the Managing Director may recommend and the Executive Board may decide among:
  - (1) to extend the period before further steps are taken;
  - (2) to call upon the member to take additional remedial actions within a specified timeframe; or
  - (3) to issue a declaration of censure against the member.

### Declaration of censure and escalation
- Paragraph 12: If a member fails to implement Executive Board–specified actions before the deadline, the Managing Director may recommend and the Executive Board may decide to issue a declaration of censure. Before adoption, the Executive Board may issue a statement setting out concerns and giving the member a specified period to respond.
- Paragraph 13: The declaration of censure will:
  - identify the breach under Article VIII, Section 5 and the remedial actions not taken within the specified timeframe;
  - may specify a new deadline and further remedial actions;
  - note that failure to implement actions within the specified timeframe may result in issuance of a complaint for ineligibility under Article XXVI (a) and imposition of that measure;
  - at the expiration of the period, the Managing Director shall report to the Executive Board on status.

### Sanctions under Article XXVI and further measures
- Paragraph 14: Following adoption of a declaration of censure, if the Executive Board finds the member failed to implement any actions in the declaration within the specified timeframe, the Managing Director may issue a complaint and recommend that the Executive Board declare the member ineligible to use the general resources of the Fund for breach of obligation under Article VIII, Section 5. The Executive Board decision declaring ineligibility will note that persistence following declaration of ineligibility may result in a complaint for suspension of voting and related rights and imposition of that measure.
- Paragraph 15: If the member persists in failure for six months after the declaration of ineligibility, the Managing Director may issue a complaint and recommend that the Fund suspend the member’s voting and related rights. The Executive Board decision suspending voting and related rights will note that persistence following suspension may result in a complaint for compulsory withdrawal and initiation of compulsory withdrawal proceedings.
- Paragraph 16: If the member persists in failure for six months after suspension of voting rights, the Managing Director may initiate proceedings for compulsory withdrawal of the member from the Fund.
- Paragraph 17: All Executive Board decisions arising from a breach of obligation under these procedures, including a decision to issue the statement of concern referred to in paragraph 12, will give rise to a public announcement with prior review of the text by the Executive Board.

### Annex A — Required national data (paragraph 1 reference)
The data referred to in paragraph 1 are the national data on the following matters:
- (i) reserve, or base money;
- (ii) broad money;
- (iii) interest rates, both market-based and officially-determined, including discount rates, money market rates, rates on treasury bills, notes and bonds;
- (iv) revenue, expenditure, balance and composition of financing (i.e., foreign financing and domestic bank and nonbank financing) for the general and central governments respectively; the stocks of central government and central government-guaranteed debt, including currency and maturity composition and, if the debt data are amenable to classification on the basis of the residency or nonresidency of the holder, the extent to which the debt is held by residents or nonresidents;
- (v) balance sheet of the central bank;
- (vi) external current account balance;
- (vii) exports and imports of goods and services;
- (viii) the international reserve assets and reserve liabilities of the monetary authorities, specifying separately any reserve assets which are pledged or otherwise encumbered as well as net derivative positions;
- (ix) gross domestic product, or gross national product;
- (x) consumer price index;
- (xi) gross external debt;
- (xii) consolidated balance sheet of the banking system.

Notes within Annex A:
- Footnote 1: The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds) and state and local governments.
- Footnote 2: Gross external debt is the outstanding amount of those actual current, and not contingent, liabilities that require payment(s) of principal and/or interest by the debtor at some point(s) in the future and that are owed to nonresidents by residents of an economy.

### Annex II — Table of Common Indicators Required for Surveillance (memo items)
- Table headings and memo items include: Date of latest observation; Date received; Frequency of Data; Frequency of Reporting; Frequency of publication; Data Quality – Methodological soundness; Data Quality – Accuracy and reliability.
- Data series listed include: Exchange Rates; International Reserve Assets and Reserve Liabilities of the Monetary Authorities; Reserve/Base Money; Broad Money; Central Bank Balance Sheet; Consolidated Balance Sheet of the Banking System; Interest Rates; Consumer Price Index; Revenue, Expenditure, Balance and Composition of Financing – General Government; Revenue, Expenditure, Balance and Composition of Financing – Central Government; Stocks of Central Government and Central Government-Guaranteed Debt; External Current Account Balance; Exports and Imports of Goods and Services; GDP/GNP; Gross External Debt.
- Frequency codes: Daily (D), Weekly (W), Monthly (M), Quarterly (Q), Annually (A), Irregular (I); Not Available (NA).
- Footnotes clarify inclusion of pledged/encumbered reserve assets and net derivative positions; interest rates description; financing composition; definition of general government; inclusion of currency and maturity composition; and data ROSC guidance for Data Quality assessments.

*Source: Decision text and Annexes (as provided in the content unit).*

### ANNEX III

### ANNEX III

### Overview
- Survey basis: Article IV staff reports discussed by the Executive Board during October 2006–September 2007; data drawn from the Table of Common Indicators Required for Surveillance (TCIRS) approved at the time of the 2004 review.
- Sample: 144 staff reports comprising 26 advanced economies (ADV), 56 market access economies (MAC), and 62 developing economies (DEV).
- TCIRS coverage: 15 data categories (eight high frequency and seven low frequency indicators).

### Trends in data timeliness — high frequency indicators
- General finding: Some slippage in timeliness compared to performance through 2004, especially for high frequency indicators; exchange rate timeliness broadly unchanged.
- Extent of slippage: Contained at two months for most indicators; cumulative shares of countries reporting within two months declined at most by three percentage points for most indicators.
- Specific figure highlights (2003 vs 2007 distributions shown in Figure 1):
  - Exchange Rates: 98% ≤ 1 month (2003) and 97% ≤ 1 month (2007).
  - International Reserve Assets and Reserve Liabilities of the Monetary Authorities: 54% ≤ 1 week (2003) vs 27% ≤ 1 week (2007); other categories show switching toward longer lags.
  - Reserve / Base Money: 66% ≤ 1 month (2003) vs 59% ≤ 1 month (2007).
  - Central Bank Balance Sheet: 67% ≤ 1 month (2003) vs 52% ≤ 1 month (2007).
  - Broad Money: 56% ≤ 1 month (2003) vs 49% ≤ 1 month (2007).
  - Interest Rates: 76% ≤ 1 month (2003) vs 73% ≤ 1 month (2007).
  - Consolidated Balance Sheet of the Banking System (2007 only): 41% ≤ 1 month; 41% >1 month but ≤ 2 months.
  - Consumer Prices: 73% ≤ 1 month (2003) vs 68% ≤ 1 month (2007).

- Possible cause: Slippage may be related, at least in part, to more comprehensive definitions of some TCIRS categories (e.g., TCIRS focuses on international reserve assets and liabilities of monetary authorities vs prior focus on gross reserves).

### Trends in data timeliness — low frequency indicators
- General finding: Slippage more pronounced for categories with enhanced definitions; timeliness for unchanged-definition indicators broadly similar.
- Specific changes (2003 vs 2007 distributions shown in Figure 2):
  - Revenue, Expenditure and Composition of Financing of the General Government: 87% 0–3 months (2003) vs 70% 0–3 months (2007).
  - Revenue, Expenditure and Composition of Financing of the Central Government (2007): 88% 0–3 months.
  - Stocks of Central Government and Central Government-Guaranteed Debt (2007): 80% 0–3 months.
  - External Current Account Balance: 62% 0–3 months (2003) vs 58% 0–3 months (2007).
  - Exports and Imports of Goods and Services: 74% 0–3 months (2003) vs 61% 0–3 months (2007).
  - GDP / GNP: 61% 0–3 months (2003) vs 51% 0–3 months (2007).
  - Gross External Debt: 64% 0–3 months (2003) vs 67% 0–3 months (2007).

- Quantified slippage: Shares of countries reporting government finance and external trade statistics within two quarters declined by about 8 percentage points.
- Unchanged-definition indicators: Cumulative shares reporting within two quarters virtually unchanged for national accounts, external current account, and gross external debt, though shares reporting within one quarter decreased for national accounts and external current account.

### SDDS benchmarks and selected indicators (Table 1)
- International Reserve Assets and Liabilities of the Monetary Authorities (timeliness shares in percent):
  - 1 week: 54 (2004 Review) and 27 (2008 Review).
  - 4 weeks (SDDS prescription): 81 (2004 Review) and 71 (2008 Review).
  - 8 weeks: 91 (2004 Review) and 93 (2008 Review).
  - 12 weeks: 97 (2004 Review) and 99 (2008 Review).
- Gross External Debt (timeliness shares in percent):
  - 1 quarter (SDDS prescription): 64 (2004 Review) and 67 (2008 Review).
  - 2 quarters: 85 (2004 Review) and 86 (2008 Review).
  - 3 quarters: 92 (2004 Review) and 93 (2008 Review).
  - 4 quarters: 98 (2004 Review) and 96 (2008 Review).
- Note: As of January 2008, 64 countries publish the Data Template on International Reserves and Foreign Currency Liquidity.
- Interpretation: Observance of the SDDS one-month timeliness benchmark for international reserves assets and liabilities has slackened (from 81 percent in the 2004 review to 71 percent). Observance of the SDDS one-quarter benchmark for gross external debt has increased modestly.

### Correlates of weak performance
- High frequency indicators: Weak performance correlated with low per capita GDP.
- Low frequency indicators: Weak performance correlated with small population size.

### Data ROSCs, coverage, and quality ratings
- Coverage in TCIRS: Data quality ratings included for 61 countries with a published data ROSC; only 42 percent of the countries surveyed have had a data ROSC published.
- Regional and country-type concentration:
  - Data ROSCs mostly concentrated in market access economies and the western hemisphere.
  - Participation by economy type: market access economies 57 percent; advanced economies (second highest participation).
  - Participation by region: WHD 58 percent; EUR 47 percent; AFR and MCD about 39 percent; APD 30 percent.
- Data ROSC rating scale: observed (O), largely observed (LO), largely not observed (LNO), not observed (NO).
- Methodological soundness ratings cover: concepts and definitions, scope, classification/sectorization, basis for recording.
- Accuracy and reliability ratings cover: source data, statistical techniques, assessment and validation of source data, assessment and validation of intermediate data and statistical outputs, and revision studies.
- Aggregate findings (Figures 3 and 4):
  - National accounts and government finance statistics are less likely to observe international standards for methodological soundness and accuracy and reliability relative to other datasets included.

### Sample selection for in-depth analysis of treatment of data issues in staff reports (Annex IV content included)
- Purpose: Sample of 50 countries for in-depth analysis selected through stratified sampling from all members with consultations between October 2006—September 2007, stratified by economy type and region.
- Stratification definitions:
  - Advanced (ADV) – advanced countries according to WEO classification.
  - Market Access Countries (MAC) - countries (excluding those classified as advance countries) that have received ratings from S&P or Moody’s as of September 2007.
  - Developing countries (DEV) - countries not in the above categories.
  - Regions: AFR, APD, EUR, MCD, WHD corresponding to area departments.
- Allocation and selection: Allocation of 50 countries proportional to population distribution rounded to total 50; selection by simple random drawing within each of 15 strata.
- Sample distribution (Table 1 and Table 3 highlights):
  - Population of 144: ADV 26, MAC 56, DEV 62.
  - Share (%) by type: 18 (ADV), 39 (MAC), 43 (DEV).
  - In sample (of 50): ADV 8, MAC 19, DEV 23.
  - Distribution by region (population of 144): AFR 32, APD 27, EUR 36, MCD 23, WHD 26.
  - In sample (of 50) by region: AFR 12, APD 9, EUR 12, MCD 8, WHD 9.
- Comparison 2007 vs 2004 samples (Table 3):
  - By economy type (count, in percent): 2007 — ADV 8 (16), MAC 19 (38), DEV 23 (46); 2004 — ADV 10 (20), MAC 20 (40), DEV 20 (40).
  - By region (count, in percent): 2007 — AFR 12 (24), APD 9 (18), EUR 12 (24), MCD 8 (16), WHD 9 (18); 2004 — AFR 9 (18), APD 11 (22), EUR 12 (24), MCD 7 (14), WHD 11 (22).
  - By data standard (count, in percent): 2007 — SDDS 17 (34), GDDS 21 (42), Total 38 (76); 2004 — SDDS 21 (42), GDDS 9 (18), Total 30 (60).
  - By program status: 2007 Program 13 (26) vs 2004 Program 11 (22).
  - Common cases between 2004 and 2007 samples: 11 (22).
  - For the 2007 Sample additional attributes: Streamlined Art IV cases 5 (10) (2 with 24-month cycle); Cases with data ROSCs 4 (8).
- Sample composition details: Panel C and Table 2 show allocation by economic type and region and list of countries selected for in-depth review (distribution includes ADV, MAC, DEV across AFR, APD, EUR, MCD, WHD).

*Source: _031708a - ANNEX III*

### ANNEX                                                                        IV

### ANNEX IV

### Full country sample (for 2007 and 2004 review)
- The annex lists the full country sample used for the 2007 and 2004 review. (List as presented in the source document.)

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### ANNEX V — SURVEY OF DATA PROVISION TO THE FUND FOR SURVEILLANCE FOR FUND MISSION CHIEFS

### Survey design and response
- Survey population: 117 recipients who led Article IV missions between Jan 31, 2005 and Jan 2008.
- Responses: 40 respondents.
- Response rate: 34 percent.
- Confidentiality: respondents assured their identities would not be revealed to the review team.
- Processing: results processed by a research assistant not a member of the review team.
- Note: In a few questions respondents chose multiple answers; totals may not always equal number of respondents.

### Question 1 — Adequacy of data for surveillance
- 7: "we were provided with the high-quality data needed for the analyses and projections"
- 11: "data provided had some minor deficiencies with limited impact on our analyses and projections"
- 8: "lack of timely key data for macroeconomic analysis is a recurring problem, and the team routinely prepares estimates for key variables, with estimation based on limited indicators."
- Extent of estimation (text responses): Real GDP; Fiscal Balance; Balance of payments; Private and public consumption, central government budget deficit; Growth; GDP, Fiscal balances; Balance for the consolidated public sector.
- Dataset/aggregates estimated: examples given include GDP:1998—2005; 2006—2012; several; Estimation by staff covered ( ) year(s) — Texts of responses: 1, 2, or 3 years; or ( ) quarter(s) — Texts of responses: FY2005, FY2006 1-2Q.

- 15 respondents: "while we were provided with recent data needed for macroeconomic analysis, some key data suffer from severe deficiencies that hamper analyses and introduce considerable uncertainty into projections."
- Key data suffering severe deficiencies (text responses, as provided):
  - "GDP, inflation, BOP"
  - "Mainly national account and balance of payment data"
  - "Wage and labor market data"
  - "BOP: imports, private sector income, FDI, and private capital flows; National Accounts: non-oil GDP."
  - "Balance of payments, national accounts and consumer prices."
  - "BOP; national accounts; price level"
  - "National accounts; balance of payments."
  - "IIP not compiled, external debt data incomplete, timeliness of data irregular"
  - "BOP, fiscal, GDP"
  - "GDP, BOP, CPI"
  - "Low frequency and long time lags on national accounts data; relatively large unexplained residuals (errors and omissions) in the balance of payments; lags in the provision of data for key public enterprises"
  - "National Accounts, CPI, BOP"
  - "Import data has been revised significantly owing to historic systematic under evaluation of imports"

### Question 2 — SIA summary assessment presence
- Responses: 40 Yes, 1 No, 0 No clear assessment, 0 Don’t know.

### Question 3 — Classification of country’s data provision (if summary assessment present)
- 17: adequate
- 21: broadly adequate, but deficiencies hamper surveillance
- 2: inadequate

### Question 4 — Ease of classifying adequacy into three categories
- 28: "There was no difficulty, because the country clearly fell into one of the following categories"
  - Of these 28:
    - 11: adequate
    - 13: broadly adequate, but deficiencies hamper surveillance
    - 2: inadequate
- 15: "There were some data shortcomings, but it was not obvious how to distinguish"
  - Of these 15:
    - 3: "adequate" or "broadly adequate"
    - 12: "broadly adequate" or "inadequate"
- 0: "I was unaware of this requirement"
- 2: "Please provide your own response" (texts of responses included in source)

### Question 4.1 — Reasons for difficulty choosing between “broadly adequate” or “inadequate” (select all that apply)
- 4: found that the term “inadequate” conveyed too negative a picture of the state of the data
- 5: found that the term “inadequate” conveyed too negative a picture given that there are genuine capacity constraints
- 4: considered the term “inadequate” counterproductive for productive relations with the authorities
- 6: were concerned about the implications of the term “inadequate” for the Fund’s ability to conclude the Article IV consultation
- 0: were concerned about other negative implications for the country of the term “inadequate”
- 2: "Please provide your own response" (texts of responses included in source)

### Question 5 — Preference for two-category classification
- 3: Very much so
- 15: Yes
- 14: Not really
- 7: Definitely not
- 2: No view/don’t know

### Question 6 — Discussions with authorities about data deficiencies (excluding technical-level discussions)
- 5: "There were no significant issues to discuss"
- 19: "The team had serious discussions with the authorities to raise awareness of the issues"
- 10: "While there were some significant data shortcomings, discussions of data issues were limited because:"

  - Of the 10 limited-discussion cases, reasons (select all that apply):
    - 9: "the authorities were aware of them and were taking steps to address them, and had"
      - 2: a timetable for remedial action
      - 2: allocated increased resources for this purpose
      - 6: requested or been receiving relevant TA
    - 2: "previous missions had raised these issues, and the authorities had not addressed them, because of lack of"
      - 0: interest
      - 2: resources
      - 0: there were other more pressing issues to discuss

- Text responses highlighted:
  - Improvements underway in some cases, building on updated data modules.
  - Authorities sometimes lack capacity and rely on external advisors.
  - In some cases, realistic limits to improvement (e.g., underground economy) led to focus on quantifying deviations and implications for analysis.
  - Specific technical improvements: development of a producer price index with STA TA (to be released in April 2008); criticisms of a housing price index methodology based on advertised prices.
  - Instances of streamlined consultations with limited SIA coverage in certain years.

### SIA (Statistical Issues Appendix) preparation and content
- Question 7 — How SIA was prepared:
  - 14: The country team responsible for opening summary assessment and key data issues, with inputs from STA for supporting expert views
  - 4: The country team was the primary author of the opening summary assessment, with the rest prepared by STA
  - 14: The team relied primarily on STA to draft/update the document
  - 6: The SIA was minimally updated because there was little change in data issues
  - Additional text responses: mix of primarily STA drafts with country team inputs or updates; some streamlined consultations had no SIA.

- Question 8 — Whether only significant data deficiencies were listed in the SIA:
  - 15: Yes, the SIA was primarily drafted/updated by the team
  - 5: Yes, while STA provided detailed inputs, the team edited to ensure only significant deficiencies presented
  - 8: Not clear, the team relied primarily on STA in drafting/updating the SIA
  - 6: No, because it was considered useful to provide substantial detail on existing data deficiencies in the SIA
  - Additional text responses indicate variation: some teams relied on STA and STA listed only significant deficiencies; others reported substantive STA input and team editing.

### Question 9 — Country characteristics (select all that apply)
- 8: Advanced country
- 19: Developing country with market access (emerging market)
- 12: Other developing country
- 12: GDDS participant
- 7: SDDS subscriber
- 12: A data ROSC has been published

### Additional comments (selected points from respondents)
- Some staff noted that 2007 Article IV consultations were "streamlined" with only brief staff assessment sentences while previous years had full appendices.
- Views that certain data guidance requests should be optional.
- Improvements in data quality cited in at least one case due to cooperation with Eurostat and STA TA.
- Suggestion: "I think the proposed category 5b. would be a useful addition/refinement to the existing grading (not as a substitute)."

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### ANNEX VI — RECOMMENDED METHODOLOGIES FOR DATA PROVISION

- I. Fiscal
  - Preferred: Government Finance Statistics Manual 2001 (GFSM 2001)
  - Other: A Manual on Government Finance Statistics 1986

- II. BOP
  - Preferred: Balance of Payments Manual, 5th Edition (BPM5)
  - Other: BPM4

- III. Monetary and Financial Statistics
  - Preferred: Monetary and Financial Statistics Manual (MFSM)
  - Other: A Guide to Money and Banking Statistics in International Financial Statistics (1984)
  - Related: Compilation Guide on Financial Soundness Indicators (FSI) 2007

- IV. National Accounts
  - Preferred: System of National Accounts (SNA) 1993, European System of Accounts (ESA) 95, IMF Quarterly National Accounts Manual, 2001
  - Other: SNA 1968, SNA 1953

- V. International Reserves
  - Preferred: International Reserves and Foreign Currency Liquidity (Guidelines for a Data Template)

- VI. External Debt
  - Preferred: External Debt Statistics Guide for Compilers and Users, 2003

- VII. Prices
  - Preferred: Consumer Price Index Manual (2004); Producer Price Index Manual (2004); Handbook on the International Comparison Program (ICP)

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### ANNEX VII — OTHER ONGOING DATA INITIATIVES

### A. Methodological Progress
- New methodological guidance is essential to respond to globalization; recent advances relate principally to balance of payments, national accounts, and monetary and financial statistics.
- BPM6 themes: globalization, balance sheet issues, financial innovation.
  - BPM6 will offer updated guidance on goods for processing (maquila operations), merchanting, remittances, special purpose entities, complex cross-border company structures.
  - BPM6 will provide more detailed guidance on the IIP and on the impact of revaluation/volume changes on external assets and liabilities.
  - A revised draft of BPM6 to be posted on the IMF’s webpage early in 2008, with regional outreach seminars scheduled for the first half of the year.
- SNA update efforts:
  - Aim to bring SNA 1993 in line with emerging needs: allocation of multi-territory enterprises, non-permanent workers, goods for processing, merchanting.
  - Guidance developed on financial innovation (index-linked debt instruments, retained earnings of mutual funds) and public sector issues (Public-Private Partnerships).
  - Update includes guidance on measurement of the informal sector and return to capital.
  - Update led by the Inter-Secretariat Working Group on National Accounts (Eurostat, IMF, OECD, UN, World Bank).
  - February 2008: Volume 1 of the manual (core chapters) presented to the UN Statistical Commission.
  - Extensions and harmonization topics to be presented to the Commission in early 2009.

### B. External Debt
- Fund activities to improve external debt statistics include QEDS and JEDH.
  - QEDS launched November 2004 (online database), improved access to timely quarterly external debt statistics; covers 60 countries, mostly SDDS subscribers; expanded in February 2008 to cover 14 low income GDDS participants.
  - JEDH launched March 2006 (jointly by BIS, IMF, OECD, World Bank) — brings together QEDS national data and creditor/market data from international agencies.
  - Planned activities: expand QEDS country coverage; reconcile creditor-based and debtor-based data in the JEDH.

### C. Public Sector Debt and Local Bond Markets
- Progress in reporting internationally comparable public debt data has been slow.
- Development of a Public Debt Template (PDT) based on Government Finance Statistics 2001 and the Debt Guide; prototype exercise elicited reporting from a limited number of countries.
- Fund undertaking to populate the PDT with data available to international organizations; early results indicate considerable discrepancies across databases.
- STA working (with AFR) on a streamlined version of the PDT tailored for low-income countries.
- Work on local bond markets:
  - Inter-Agency Working Group on Securities Databases (chaired by the Fund) preparing a guide on methodology for compiling securities statistics.
  - Development of the European Centralized Securities Database is underway.

### D. Offshore Financial Centers
- Given the importance of OFCs for intermediation of cross-country capital flows, the Fund has made efforts to improve their statistical coverage.
- An Information Framework data collection exercise was initiated for OFCs.

*Source: ANNEX IV–VII, as provided in the supplied IMF content unit.*

### 2004. The goal of this initiative was to provide a common statistical template that would

### _031708a - 2004. The goal of this initiative was to provide a common statistical template that would

### COFER database: security and reporting procedures
- Purpose and confidentiality:
  - The COFER database is one of the most confidential databases maintained by the Fund, utilized only for the analysis of global balance of payments aggregates, with particular reference to capital movements.
  - Individual country data are treated as strictly confidential and are never published or revealed in the aggregate data.
- Security system components:
  - Restricted access to the data: Only four staff members in the Statistics Department have access to the individual country data. All other members of the Fund staff and management, Executive Directors, and those outside the Fund are denied access to these data, without exception.
  - Physical security of the questionnaires: For countries not using ICS, questionnaires are mailed in a sealed envelope within a second (outer) envelope addressed to the designated COFER country correspondent. Reporters are requested to return completed questionnaires in a sealed envelope marked "Currency Composition Questionnaire—Confidential," delivered directly to the Statistics Department. The envelope is included in an outer envelope addressed to the Director of the Statistics Department, with no outward indication that part of its contents is confidential.
  - Computer security of the database: COFER data are maintained in a separate secure database that can be accessed only by the four staff members mentioned above.
- Reporting modalities:
  - The Statistics Department provides questionnaires for reporting monetary authorities' holdings of foreign exchange denominated in U.S. dollars, euro, pound sterling, Swiss franc, Japanese yen, and other currencies.
  - Most countries report data through the Integrated Correspondence System (ICS), a secure web-based data reporting system developed by the Statistics Department. ICS is the recommended means for transmission of COFER data.
  - Countries returning the questionnaire by email are directed to use the secure address stacofer@imf.org.
- Frequency:
  - Questionnaires are mailed in March, June, September, and December for countries not using ICS.

### Recent data improvements through the Standardized Report Forms (SRFs) — Coverage in Monetary Statistics
- Broader coverage and classification improvements from SRF-based MFS:
  - Bangladesh and Colombia: introduction of SRFs led to a revision in credit of about 30 percent, as expanded coverage included the national savings scheme and the savings and housing corporations.
  - Canada and Japan: expanded coverage and improved classification (e.g., reporting credit to other financial corporations) led to significant revisions in credit aggregates.
  - Guatemala: SRFs used to include reporting by off-shore banks.
  - Mauritius, South Africa, and Swaziland: improved classification and sectorization facilitated a better understanding of financial sector financing of the public sector.
- Inclusion of nonbank deposit-taking:
  - Brazil: with technical assistance from the Fund, financial investment funds (FIFs) were consolidated with other banking institutions into an expanded survey of other depository corporations; the assets/liabilities of FIFs amounted to the equivalent of 40 percent of the total for the banking sector.
  - Turkey: inclusion of money market funds in the MFS resulted in a revision of credit aggregates of about 8 percent, while the monetary aggregates (M3, national definition) increased by about 5 percent.
  - Many countries have included data on nonbank liabilities in the monetary aggregates even when the full balance sheet of those institutions has not been consolidated with the rest of the financial system.

### Balance sheet approach enabled by SRFs
- Analytical capabilities:
  - SRF-based MFS allow tracking balance sheet vulnerabilities on a regular and timely basis (monthly with a delay of only one month).
  - Mathisen and Pellechio (2007) offered guidance for constructing a matrix of intersectoral balance sheets for the key sectors of the economy using SRFs data along with data from the Quarterly External Debt Statistics database, and the Coordinated Portfolio Investment Survey.
  - These data sources can provide a comprehensive picture of net positions of one sector against another, along with underlying claims and liabilities (including currency denomination).
- Practical applications and limitations:
  - Two recent Article IV reports (Croatia and South Africa) used this framework—adding maturity structure and sensitivity analyses—illustrating how this approach can be used to assess sectoral net exposures to specific financial shocks and the transmission of shocks across sectors.
  - Both applications confirmed that improvements are still needed, particularly on the detail, frequency, and timely dissemination of relevant external sector, government debt, and household and corporate statistics, including on real assets and off-balance sheet liabilities.

*Source: _031708a - 2004. The goal of this initiative was to provide a common statistical template that would*

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