IMF Survey: IMF to Enhance Impact of Its Technical Assistance

IMF News, July 31, 2008

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Technical assistance provided by IMF experts and consultants is being better integrated with the IMF's economic monitoring (surveillance), lending, and country reform agendas to ensure high impact.
The IMF plans to open four more regional technical assistance centers around the world.
Publication date: July 31, 2008.

Unique linkage: The surveillance-lending-technical assistance relationship differentiates the IMF from other technical assistance providers and helps prioritize assistance in line with country strategic objectives and IMF policy advice.
IMF operations back implementation of surveillance and lending recommendations with technical assistance when appropriate.
Area departments assume lead role for setting technical assistance strategies in coordination with country authorities.
Strategic planning: Regional Strategy Notes articulate and prioritize technical assistance needs in a medium-term framework to balance short-term policy needs and medium-term capacity-building requirements.
Cooperation: Longer planning horizons facilitate cooperation with other providers (World Bank, regional development banks, other agencies and donors) to avoid overlap and reflect respective expertise.

Technical assistance is a core IMF activity aimed at helping countries build institutions and skills to design and implement macroeconomic policies that promote growth.
In FY2008, close to 200 "person-years" (or about 52,000 working days) of assistance was delivered to IMF member countries.
Regional centers: The IMF's six existing regional assistance centers are in the Pacific; the Caribbean; East, West, and Central Africa; and the Middle East.
Planned expansion: The IMF plans to establish four new regional centers—one in Central America, one in Central Asia, and two more in sub-Saharan Africa.
Regional center financing: Each center receives the bulk of its funding from donor countries, international agencies, regional development banks, and sometimes from recipient countries themselves.
Governance: Steering committees comprising representatives from beneficiary countries, donors, and the IMF provide strategic guidance for centers' work programs.

A strengthened framework is being put in place to systematically track the achievement of objectives and deliverables in technical assistance projects.
Indicators are defined in advance by project managers and results will be assessed against them to allow systematic evaluation and derive lessons when shortfalls occur.
Costing: Costing technical assistance activities is becoming more accurate and transparent to enable efficient allocation of resources, improve accountability, and facilitate raising additional external financing.
Meaningful assessments of technical assistance results will involve weighing costs of delivery.

The IMF is forging stronger partnerships with donors who finance technical assistance; donors value IMF technical assistance for benefits to individual countries and for promoting international growth and stability.
The IMF seeks to leverage comparative advantages of its technical assistance to expand donor financing by deepening existing partnerships and broadening the donor base to tap new financing sources.
Pooling of donor funds has proven effective, particularly through regional assistance centers that operate with multi-donor financing and donor input via steering committees.

The IMF is developing a menu of topical trust funds to pool donor resources for technical assistance in selected areas of IMF expertise; trust funds would highlight links between IMF technical assistance and donors' overseas development strategies.
Potential trust fund topics include:
- strengthening public financial management;
- combating money laundering and the financing of terrorism;
- developing statistics;
- managing natural resource wealth;
- assisting with debt sustainability and public debt/asset management;
- improving financial sector stability and development in low-income countries;
- financing technical assistance to fragile states.
Rationale: Topical trust funds would concentrate on specialized technical assistance on specific issues, creating synergies with regional centers (which tend to have a more "hands-on" capacity-building focus).
Coordination: Pooling arrangements would facilitate coordination between donors of their respective assistance to countries, consistent with the Paris Declaration on Aid Effectiveness.

Match capacity building with overall strategic objectives through medium-term strategic planning (Regional Strategy Notes).
Strengthen internal governance by defining indicators in advance and systematically assessing results against deliverables.
Improve costing transparency to inform resource allocation, accountability, and fundraising.
Deepen and broaden donor partnerships; pursue pooled financing models (regional centers and topical trust funds).
Expand regional presence by opening four new regional technical assistance centers to enhance delivery and donor coordination.

IMF Survey online, July 31, 2008.