June 3, 2019
PRESS OFFICER: Ting Yan
Phone: +1 202 623-7100Email: MEDIA@IMF.org
On May 3, 2019, the Executive Board discussed a staff paper examining the experience with implementation of the IMF’s commitments to support the 2030 Development Agenda.
In 2015, the international community reached agreement on key elements of the 2030 Agenda for Sustainable Development, as reflected in theAddis Ababa Action Agenda, the adoption of theSustainable Development Goals (SDGs), and the Paris Agreement among parties to the UN Framework Convention on Climate Change (UNFCCC) on actions to combat climate change.
At that time, IMF’s Executive Board agreed that the primary contribution the IMF could make to supporting the global development agenda was to deliver on its core mandate of helping maintain macroeconomic and financial stability at both the global and national levels. The Board also agreed that there were several areas where targeted expansion of Fund policy engagement and technical support could help countries accelerate sustainable development. [1]
The IMF committed to increase its support, primarily for developing countries, in several areas, including: (i) strengthening national tax systems; (ii) tackling large infrastructure gaps; (iii) promoting economic inclusion; (iv) development of domestic financial markets; (v) intensified engagement in fragile and conflict-affected states; (vi) improving economic statistics; (vii) expanding the financial safety net for developing countries; and (viii) addressing macroeconomic aspects of climate change. Further initiatives that support attainment of the SDGs, including developing methodologies to quantify the fiscal costs of achieving individual goals and increasing IMF engagement in tackling corruption vulnerabilities, have followed since 2015.
The new staff paper examines the experience with implementing these commitments. Key findings from the assessment include:
The substantial scaling-up of technical support since 2015 was facilitated by increased financing from bilateral donors, which is set to level off around current levels. Efforts will now need to shift to producing greater impact from existing resources through better prioritization of projects and applying the lessons learned from the recent scaling-up experience.
Executive Board Assessment [5]
Executive Directors welcomed the opportunity to review the implementation of commitments made by the Fund to support the 2030 development agenda. They agreed that the Fund has a critical role to play in supporting the achievement of the Sustainable Development Goals (SDGs), consistent with the Fund’s mandate and areas of expertise.
Directors welcomed the Fund’s strong track record in implementing its specific commitments, while noting that, going forward, it will also be important to assess the effectiveness of Fund support. They commended the significant increase in technical assistance in strengthening tax systems, which is critical if countries are to increase development spending on a lasting basis. Directors also welcomed the intensified Fund engagement on international taxation issues of relevance for developing countries.
Directors agreed that scaling up of investment in public infrastructure is needed to support economic development in many developing countries, while emphasizing that the trajectory for public spending should be consistent with maintaining or regaining a sustainable debt position. They welcomed the increased use of the Public Investment Management Assessment as a tool to guide efforts to increase the efficiency of public investment. Directors also emphasized the importance of strengthening debt management capacity in many countries and called for expanded Fund support for country-owned efforts to build such capacity.
Directors welcomed the substantive work the Fund has undertaken on the macro-critical elements of inclusion, as well as the increased coverage of inequality, gender, and financial inclusion issues in surveillance work. They also welcomed the increase in technical support for countries seeking to develop financial markets. Directors supported the collaboration with the World Bank, based on the clear division of responsibilities between the two institutions on financial sector issues.
Directors supported the Fund’s work on climate change and on countries exposed to natural disasters. They welcomed the increase in Fund support for the development of statistical capacity, which is expected to deliver significant improvements in national economic and sociodemographic statistics. They also underscored the importance of full implementation of the Fund’s 2018 framework for engagement on governance issues for improving development outcomes.
Directors welcomed the Fund’s intensified engagement in fragile and conflict- affected states, focused on achieving macroeconomic stability and building core state capacities, and considered this work to be critical for ending global poverty (SDG 1). They looked forward to an assessment of the effectiveness of the Capacity-Building Framework introduced on a pilot basis in 2017 and called for full and timely implementation of the 2018 Management Implementation Plan to increase the effectiveness of Fund engagement in fragile and conflicted-affected countries.
Directors agreed with the cross-cutting lessons drawn from implementation of the various initiatives, including the importance of maintaining country ownership of reform programs over time and the need for strategic and effective collaboration with development partners, including the World Bank.
Directors emphasized the need to maintain the high level of support being provided to developing countries in areas of Fund expertise that are critical for supporting growth and attainment of the SDGs. With scope for further large increases in the volume of support limited by budget constraints, Directors called for an increased focus on enhancing the impact and efficiency of Fund assistance, drawing on the conclusions of the recent review of the Fund’s capacity development strategy and making full use of the results-based management framework. They also called for aligning the HR strategy accordingly. An appropriately measured communications strategy is also warranted.
[1] IMF (2015), “Financing for Development - Revisiting the Monterrey Consensus.”
[2] See IMF (2018): “Implementation Plan in Response to the Board-Endorsed Recommendations for the IEO Evaluation Report—The IMF and Fragile States.”
[3] See IMF (2019, forthcoming): “The 2018–19 Review of Facilities for Low-Income Countries—Reform Proposals.”
[4] See IMF (2019, forthcoming): “Building Resilience in Developing Countries Vulnerable to Large Natural Disasters.”
[5] An explanation of any qualifiers used in summings up can be found here: http://www.imf.org/external/np/sec/misc/qualifiers.htm.
