Press Release No. 07/95

Press Release No. 07/95
May 15, 2007

The Executive Board of the International Monetary Fund (IMF) approved on May 8, 2007 the revised Code of Good Practices on Fiscal Transparency. The Code, a central element in IMF actions to promote transparency and good governance, was initially launched in 1998. It has since underpinned assessments of fiscal transparency in 86 countries under the Standards and Codes initiative.

Fiscal transparency promotes better-informed public debate about the design and results of fiscal policy, makes governments more accountable for the implementation of fiscal policy, and strengthens credibility and public understanding of economic policies and choices. These are crucial elements in securing economic stability and high-quality growth in an increasingly globalized economic environment.

The revised Code retains the original four pillars of fiscal transparency: clarity of roles and responsibilities; open budget processes; public availability of information; and assurances of integrity. But it introduces nine new specific `good practices' and broadens the coverage of others. Issues covered by the new and extended practices include contractual arrangements with private companies; publication of a `citizen's guide' to the budget; consultation periods for the budget and for proposed changes to laws and regulations; periodic reports on long term public finances; and openness in the sale and purchase of government assets. The revised Code distinguishes key issues and priorities more clearly, and includes some emerging issues in more detail.

A broad public consultation process was crucial in finalizing the revised Code. Feedback on the initial draft posted on the Fund's website and the circulation of a questionnaire resulted in the addition of the `citizen's guide' to the budget, and more explicit wording on many specific practices. Country authorities, civil society organizations, international institutions, academia, and the private sector took part in the consultation exercise.

A major aim of the revision to the Code is to fully integrate resource revenue transparency issues, drawing on experience gained from using the 2005 Guide on Resource Revenue Transparency. The updated Guide identifies links to the Extractive Industries Transparency Initiative (EITI). Extensive revisions have also been made to the Manual on Fiscal Transparency, which provides detailed guidance on good fiscal transparency practices. The numerous examples of good and best practices in the Manual are drawn from real-world experience across a range of developing countries, emerging markets, and advanced economies.