IMF Executive Board Discusses The 4th Financing for Development Conference—Contribution of the IMF to the International Financing for Development Agenda

IMF News, June 5, 2025

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Published: June 5, 2025

Context and scope

Discussion date: June 5, 2025 (also described as June 3 in the text).
Purpose: Executive Board discussed the staff paper on the contribution of the IMF to the international financing for development agenda, prepared in view of the 4th Financing for Development Conference (FfD4).
FfD4 dates and location: Sevilla, Spain from June 30 to July 3, 2025.
Press Release No.: 25/184.

Challenging environment for development — key findings

The series of shocks since 2020 has added to longstanding structural challenges, with low-income and fragile countries affected the most.
Debt vulnerabilities deserve attention, particularly for low‑income countries.
While debt appears sustainable for most countries under baseline assumptions, uncertainties and risks to the baseline have increased significantly.
Many countries face high interest costs and elevated refinancing needs that constrain their ability to finance critical spending necessary to progress on their development path.
Achieving the Sustainable Development Goals (SDGs) by 2030 appears increasingly unlikely, as it would require financing that exceeds credible assumptions and surpasses what countries could absorb without creating additional macroeconomic imbalances.

Executive Board assessment — summary of Directors’ views

Directors welcomed the opportunity to discuss the IMF’s contribution to the international financing for development agenda and the review of recent experiences in IMF–World Bank collaboration ahead of FfD4.
Directors concurred with staff’s analysis of the challenging context for development and the disproportionate effects on low‑income and fragile countries.
Directors agreed accelerating development progress requires a major collective effort comprising:
- strong domestic reforms;
- significant international support; and
- proactively addressing debt vulnerabilities.
Directors emphasized increasing heterogeneity across developing countries calls for appropriate differentiation in countries’ policy and reform agenda, and in international support.
Directors underscored the importance of advancing a strong domestic reform agenda to:
- maintain or promote a stable and sound macroeconomic and financial environment;
- boost private‑sector led growth and job creation;
- increase the efficiency of public spending and optimize the use of available resources;
- mobilize domestic resources;
- strengthen debt management; and
- improve governance.
Directors agreed international support—through well‑coordinated and sequenced capacity development (CD), and additional public and private financing—will be critical to complement and facilitate domestic reforms.

Debt-related conclusions and actions supported by Directors

Agreed approach to debt challenges:
- (i) improve further debt restructuring processes to ensure countries with unsustainable debt have access to timely and sufficiently deep debt relief, building on progress under the Common Framework and through work at the Global Sovereign Debt Roundtable (GSDR);
- (ii) accelerate implementation of the “3‑pillar approach” to help countries with sustainable debt and a robust reform agenda where productive spending is crowded out by high debt service.
Welcomed the recent publication of the GSDR “Restructuring Playbook”.
Supported further strengthening the IMF’s contribution to help address debt vulnerabilities, consistent with its role and policies and respecting its duty of neutrality.
Underlined the importance of further enhancing debt transparency and the accuracy of debt data.

IMF role, tools, and recent reforms highlighted by Directors

The IMF has a strong role to help member countries maintain or restore macroeconomic and financial stability—a key condition to enable sustainable growth and development—through:
- surveillance;
- capacity development (CD); and
- financial support to countries faced with balance of payments needs.
Directors looked forward to:
- the upcoming comprehensive surveillance review; and
- the review of program design and conditionality.
Recent reforms noted:
- finalization in October 2024 of the review of the Poverty Reduction and Growth Trust (PRGT) facilities and financing;
- review of the Charges and the Surcharge Policy;
- significant expansion of CD delivery over time, with emphasis on supporting low‑income countries and fragile and conflict‑affected states.
Perspectives among Directors:
- Some saw room to further scale up the IMF’s concessional facilities and CD support.
- Some cautioned against placing greater emphasis in IMF‑supported programs on development spending needs and higher financing volumes.

Additional issues highlighted by Directors

Some Directors noted the paper could have given greater emphasis to the IMF’s existing work on climate to illustrate active contribution within its mandate.
A few Directors highlighted the macro‑critical nature of inequality and its impact on long‑term stability and development, supporting deeper analytical and operational engagement on these fronts within the Fund’s existing mandate.
Directors underscored the importance of IMF collaboration with partners, in particular the World Bank and relevant UN agencies, building on comparative advantages and consistent with each institution’s mandate.
Directors emphasized the importance of clear communication to promote better public understanding of the IMF’s unique role, mandate, and activities in fostering macroeconomic and financial stability.

Source: IMF Executive Board discussion, "IMF Executive Board Discusses The 4th Financing for Development Conference—Contribution of the IMF to the International Financing for Development Agenda", June 5, 2025 (Press Release No. 25/184).