ABOUT CAPACITY DEVELOPMENT
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Introduction
- For more than 50 years, the IMF has provided capacity development (technical assistance and training) on critical economic issues to central banks, finance ministries, tax authorities and other economic institutions.
- Capacity development helps countries strengthen their economy, create more jobs, and make progress towards the Sustainable Development Goals (SDGs).
- The IMF supports the SDGs by helping countries develop the foundation for strong, sustainable economic growth, job creation and poverty reduction.
Who We Are
- The IMF supports capacity development through a dedicated staff that comes from nearly 150 countries.
- IMF staff leverage professional experience from national and international agencies, academia and the private sector to share collective experiences with member countries on what policies work, why they unleash growth and how best to implement them.
What We Do
- Strengthening the capacity of economic institutions, such as central banks and finance ministries, leads to more effective policies, greater economic stability and growth.
- Capacity development is a core mandate of the IMF and accounts for nearly a third of its budget.
- Capacity development activities include:
- Advising finance ministries on how to raise revenue to enable governments to provide better public services such as schools, roads and hospitals.
- Helping countries align legal and governance frameworks to international standards to combat corruption, money laundering and terrorism financing.
- Improving countries’ macroeconomic and financial data to provide a more accurate read on their economy and send a message of transparency to attract greater investments.
- Training policymakers on policies such as progressive taxation, financial inclusion and gender budgeting to help frame policies that reduce inequality.
- The IMF’s capacity development efforts focus on helping member countries tackle development priorities such as income inequality, corruption, climate change and gender inequality, thereby helping them make progress toward the SDGs.
How We Work
- Capacity development is initiated at the request of member countries.
- Modalities used by the IMF include:
- Short-term staff missions from IMF headquarters
- Long-term in-country placements of resident advisors
- A global network of regional capacity development centers
- Training sessions and peer-learning workshops
- Online learning courses
- Outreach and financing facts:
- In FY 2018 (April 2017 – May 2018), low-income developing countries received about half of all IMF technical advice.
- In FY 2018 (April 2017 – May 2018), emerging market and middle‑income economies received just over half of IMF policy‑oriented training.
- Bilateral and multilateral partners presently finance about one half of the IMF’s capacity development effort.
How IMF Capacity Development Benefits Countries
- Raises public revenues so governments can provide better services such as schools, roads and hospitals.
- Example: The IMF’s work in Colombia helped build modern tax structures that created more jobs in the formal sector, resulting in higher wages, more job security, reduced income inequality, and raised public revenues for greater investments in healthcare and infrastructure.
- Creates a stable economic and monetary ecosystem—efficient tax structures, sustainable debt, reliable data, sound regulatory frameworks—that enables transparency, stimulates private sector development and leads to greater and more equitable economic growth.
- Example: When Kosovo sought to rebuild its post-conflict economy, it worked with the IMF to set up central banking operations such as payment systems; IMF efforts paved the way for establishment of commercial banks that provided basic financial services and stimulated private sector development.
- The IMF provides additional examples of how capacity development has benefited countries around the world.
Content in this bundle
- Partnerships for Capacity Development
- Regional Capacity Development Centers
References