Chair's Statement: Forty-Eighth Meeting of the IMFC
IMF News, October 14, 2023
Source details
- Canonical URL
- Chair's Statement: Forty-Eighth Meeting of the IMFC
Other formats
Bibliographic details
- Published: October 14, 2023
Condolences, hosting, and geopolitical context
- Expressed deepest condolences to the people of Afghanistan and Morocco for the tragic loss of life and widespread destruction caused by the recent devastating earthquakes.
- Expressed deepest condolences to the people of Libya for the tragic loss of life and devastation caused by flooding in September 2023.
- Thanked the Moroccan authorities for hosting the 2023 Annual Meetings in Marrakech and for their outstanding hospitality.
- Noted with deep concern the immense human suffering and adverse impact of wars and conflicts around the world.
- On Russia’s invasion of Ukraine:
- Most members recognized continued massive humanitarian consequences and detrimental impact on the global economy and strongly condemned it; there were other views and different assessments.
- Recalled discussions in Bali, reiterated national positions and resolutions adopted at the UN Security Council and the UN General Assembly (A/RES/ES-11/1 and A/RES/ES-11/6).
- Underscored that all states must act in a manner consistent with the Purposes and Principles of the UN Charter in its entirety.
- Emphasized that all states must refrain from the threat or use of force to seek territorial acquisition against the territorial integrity and sovereignty or political independence of any state.
- Stated that the use or threat of use of nuclear weapons is inadmissible.
- Recognized the IMFC is not a platform to resolve geopolitical and security issues but acknowledged their significant consequences for the global economy.
- Welcomed Türkiye and UN-brokered Istanbul Agreements (Memorandum of Understanding between the Russian Federation and the Secretariat of the United Nations on Promoting Russian Food Products and Fertilizers to the World Markets and the Initiative on the Safe Transportation of Grain and Foodstuffs from Ukrainian Ports (Black Sea Initiative)) and called for full, timely and effective implementation to ensure immediate and unimpeded deliveries of grain, foodstuffs, and fertilizers/inputs from the Russian Federation and Ukraine.
- Emphasized cessation of military destruction or other attacks on relevant infrastructure to sustain food and energy security and expressed deep concern about the adverse impact of conflicts on civilian security and humanitarian response.
Global economic assessment and risks
- Global economy:
- Noted resilience and that the 2023 growth outlook was slightly upgraded since the Spring.
- Observed the recovery has been uneven; activity in many economies remains well below pre-pandemic trends and divergences across countries are rising.
- Stated medium-term global growth projections remain weak.
- Inflation and financial conditions:
- Global headline inflation has declined, although in some countries remains well above target.
- Core inflation has proven more persistent than expected.
- Thanks to decisive actions taken in early 2023 to contain financial turbulence, near-term risks are more balanced but remain tilted to the downside.
- Key risks listed:
- The war in Ukraine
- Elevated debt vulnerabilities
- Tightening of financial conditions
- Intensifying climate shocks
- Rising inequality
- Refugees and displaced people
- Food insecurity
- Risk of fragmentation
- Noted these risks affect vulnerable countries and people the most and complicate the policy environment, particularly for developing and least developed countries still recovering from the COVID-19 pandemic and economic disruption which has derailed progress towards the SDGs.
Policy priorities and recommended actions
- Core priorities:
- Durably reduce inflation.
- Safeguard financial stability.
- Ensure fiscal sustainability while protecting the most vulnerable.
- Boost inclusive and sustainable long-term growth.
- Monetary and financial policies:
- Central banks remain strongly committed to achieving price stability and will continue to calibrate policies in a data-dependent manner, while communicating policy objectives clearly to help limit negative cross-country spillovers.
- Central banks are working with supervisory and regulatory authorities to monitor risks for both banks and nonbanks.
- Will address data, supervisory, and regulatory gaps in the banking sector, and in particular the nonbanking financial sector, where relevant.
- Stand ready to deploy macroprudential policies to mitigate systemic risks.
- Fiscal and structural policies:
- Rebuild fiscal buffers, including by phasing out untargeted fiscal support, while continuing to protect the most vulnerable and creating budgetary room for needed investment.
- Provide clarity on medium-term fiscal plans.
- Reinvigorate structural reforms to enhance labor market participation, boost productivity, support potential growth, promote social cohesion and support the green and digital transitions, according to country-specific circumstances.
- Multilateral cooperation:
- Recognized international cooperation and multilateralism as essential for global growth and the stability of the International Monetary System.
- Reiterated commitments on exchange rates, addressing excessive global imbalances, and governance, and reaffirmed commitment to avoid protectionist measures (as made in April 2021).
- Will work together to strengthen the global financial safety net with the IMF at its center and address global debt vulnerabilities.
- Will act collectively, as appropriate, to support climate and digital transitions, taking into account country-specific circumstances.
- Will continue to support vulnerable countries as they address their financing needs and vulnerabilities.
IMF priorities, surveillance, and collaboration
- Welcomed the Managing Director’s Global Policy Agenda and the recent Joint Statement of the World Bank President and the IMF Managing Director on Enhancing Bank-Fund collaboration along their respective mandates.
- Took note of the Marrakech Principles for Global Cooperation.
- Supported IMF surveillance focusing on tailoring advice to help members navigate macroeconomic and financial challenges, strengthen resilience, and boost inclusive and sustainable growth.
- Supported IMF monitoring of interactions between conjunctural policies and vulnerabilities, including work on trade, spillovers, capital flows, and geoeconomic fragmentation.
- Reaffirmed support for the Fund mainstreaming its climate, digital, macro-financial, gender, and fragile and conflict-affected state strategies, focused on macro-critical elements in line with its mandate and leveraging collaborations with others.
- Supported work on the specific challenges facing small developing states.
IMF resources, quotas, and governance timetable
- Reaffirmed commitment to a strong, quota-based, and adequately resourced IMF at the center of the global financial safety net.
- Welcomed the fifth progress report to the Board of Governors covering adequacy and composition of Fund resources and the realignment of quota shares.
- Commitment to conclude the 16 th General Review of Quotas by December 15, 2023.
- Supported a meaningful quota increase that at least maintains the Fund’s current resource envelope, critical as bilateral borrowing agreements expire.
- Called on the Executive Board to work to swiftly bring a proposal to the Board of Governors and prioritize timely implementation by an expeditious approval of a quota increase through domestic processes.
- Requested the Executive Board propose transitional arrangements, if needed, to maintain the Fund’s current resource envelope until a quota increase becomes effective.
- Acknowledged urgency and importance of realignment in quota shares to better reflect members’ relative positions in the world economy while protecting the quota shares of the poorest members.
- Called on the Executive Board to work to develop, by June 2025, possible approaches as a guide for further quota realignment, including through a new quota formula, under the 17th General Review of Quotas.
IMF lending, facilities, and trust reviews
- Supported IMF’s catalytic role in providing financial assistance, including on a precautionary basis, to help members address balance of payments needs.
- Welcomed recent enhancement of the IMF’s precautionary facilities which reinforces their strong signaling function and their agility and capacity to deal with external risks.
- Following completion of the 16 th General Review of Quotas, called on the Fund to review the General Resources Account access limits.
- Stated members will consider a review of surcharge policies.
- Celebrated the closure of the Stage 1 fundraising gaps for the subsidy and loan resources of the Poverty Reduction and Growth Trust and encouraged further broad-based contributions.
- Looked forward to the upcoming interim review of the Poverty Reduction and Growth Trust access limits and a subsequent comprehensive review of Poverty Reduction and Growth Trust facilities and financing aiming to help meet Low Income Countries’ balance of payments needs and put the Poverty Reduction and Growth Trust on a sustainable footing by exploring all options, including the use of internal resources and reform of lending policies.
- Looked forward to the interim review of the Resilience and Sustainability Trust, considering experiences with the Resilience and Sustainability Facility programs, and the operationalization of the pandemic preparedness aspect of the Trust, after which members will consider a scaling up in voluntary contributions in Special Drawing Rights or equivalents.
- Looked forward to the Review of Conditionality to effectively support countries in sustainably addressing external imbalances.
Debt resolution and transparency
- Supported IMF efforts to help countries durably address debt vulnerabilities.
- Supported IMF and World Bank work to strengthen and accelerate implementation of the G20 Common Framework for debt treatments; welcomed the agreement reached on Zambia.
- Called for completing the debt treatment for Ghana and encouraged progress on a debt treatment for Ethiopia under an IMF-supported program.
- Called for the completion of the debt treatment for Malawi.
- Supported stronger creditor coordination for debt restructuring in low- and middle-income countries outside the Common Framework.
- Welcomed progress on debt treatments for Sri Lanka and Suriname and looked forward to their completion.
- Welcomed work at the Global Sovereign Debt Roundtable to support discussions in the G20 and Paris Club and encouraged further progress toward common understandings of key concepts and principles for efficient debt restructuring.
- Supported work on improving public debt transparency.
- Looked forward to discussing debt policy reform options to promote the Fund’s capacity to support countries undertaking debt restructurings and the upcoming review of the IMF-World Bank Low-Income Country Debt Sustainability Framework.
Capacity development, domestic resource mobilization, and institutional priorities
- Supported IMF efforts to integrate capacity development with surveillance and lending and secure appropriate capacity development financing.
- Asked the IMF, in collaboration with the World Bank and other relevant international institutions, to support efforts to enhance domestic resource mobilization in emerging market and developing economies.
- Welcomed ongoing work toward the launch of a new IMF capacity development fund under a global initiative for public finances.
- Looked forward to completing the review of the IMF capacity development Strategy.
Executive Board representation, diversity, and management priorities
- Called for creation of a 25 th chair on the IMF Executive Board for Sub-Saharan Africa to improve its voice and representation and overall balance of regional representation at the Board.
- Stressed importance of members putting in place means to effectively increase gender diversity in the Executive Board, including by developing medium-term voluntary objectives.
- Urged the IMF to step up efforts to attract talent to support existing and new priority areas, improving staff diversity and inclusion, and responding to specific challenges identified in the Diversity and Inclusion 2020-2021 Report.
Meetings and attendance
- Next meeting expected to be held in April 2024.
- Chair: Nadia Calviño, First Vice President of Spain and Minister for Economy and Digitalization.
- Managing Director: Kristalina Georgieva.
- Attendance list recorded for Saturday, October 14, 2023, Marrakech, Morocco, including members, alternates, and observers.
Chair's Statement: Forty-Eighth Meeting of the IMFC, Press Release No. 23/353, October 14, 2023.