Policy Papers
2023
February 23, 2023
Resilience And Sustainability Trust―2022 Contribution Agreements with Australia, Canada, China, Germany, Japan, And Spain
Description: This paper presents the first set of contribution agreements that had been finalized with contributors by the time of the operationalization of the Resilience and Sustainability Trust (RST) on October 12, 2022. The six finalized agreements provide for contributions in a total amount of about SDR 15.3 billion across the three RST accounts – the loan account, deposit account, and reserve account. These six finalized agreements deliver critical resources for the operationalization of the RST and represent an important step towards its adequate funding.
February 23, 2023
Elements of Effective Policies for Crypto Assets
Description: This paper aims to address questions by Fund members on how to respond to the rise of crypto assets and the associated risks. To frame the discussion, the paper defines and classifies crypto assets based on their underlying features and describes their purported benefits and potential risks. The paper presents a policy framework for crypto assets that aims to achieve key policy objectives such as macroeconomic stability, financial stability, consumer protection, and market and financial integrity. The framework outlines key elements that are necessary to ensure that these objectives are met. However, such a framework will not fix any underlying crypto design flaws (for instance, the lack of a credible nominal anchor, payments finality, or scalability).
February 21, 2023
Applications To Become Holders of SDRS
Description: The International Monetary Fund (IMF) approved on February 8, 2023 the applications of the Caribbean Development Bank (CDB), the Development Bank of Latin America (known as Corporacion Andina de Fomento or CAF), the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB), and the Inter-American Development Bank (IADB) to become prescribed holders of Special Drawings Rights (SDRs). The SDR is an international reserve asset created by the IMF to supplement the reserves of IMF members that participate in the SDR Department. The IMF’s Articles of Agreement authorize the IMF to prescribe (i.e., approve) as holders of SDRs (i) non-members, (ii) members that are not participants in the SDR Department; (iii) institutions that perform functions of a central bank for one or more IMF member countries, and (iv) other official entities (which all five entities approved on February 8 are). Prescribed holders may acquire, hold and use SDRs in transactions by agreement and in operations. Approval of these five institutions brings the number of prescribed holders to twenty.
February 6, 2023
International Corporate Tax Reform
Description: To relieve the pressure on the outdated international corporate tax system, an ambitious reform was agreed at the Inclusive Framework (IF) on Base Erosion and Profit Shifting in 2021, with now 138 jurisdictions joining. It complements previous efforts to mitigate profit shifting by addressing the challenges of the digitalization of the economy through a new allocation of taxing rights to market economies (Pillar 1) and tax competition through a global minimum corporate tax (Pillar 2). This paper concludes that the agreement makes the international tax system more robust to tax spillovers, better equipped to address digitalization, and modestly raises global tax revenues.
2022
December 20, 2022
The Managing Director’s Update on the FY 2023 Work Program of the Executive Board
Description: The membership is facing significant challenges, including high inflation, rising food and energy insecurity, elevated debt levels, tightening financial conditions, volatile capital flows and exchange rates, and intensifying geopolitical fragmentation. To this end, the Executive Board Work Program focuses on policy responses and bilateral and multilateral advice to stabilize the global economy and build resilience, critical financial assistance to those countries most affected by these shocks, and capacity development support to help implement policy advice. More than ever, the Fund has a key role to play in promoting international cooperation and collaborative solutions to shared challenges, including those related to climate, digitalization, and inclusion.
December 20, 2022
Review Of The Adequacy Of The Fund’s Precautionary Balances
Description: On December 12, 2022, the IMF’s Executive Board reviewed the adequacy of the Fund’s precautionary balances. The review took place on the standard two-year cycle, after an interim review in December 2021. Precautionary balances comprise the Fund’s general and special reserves. They are a key element of the IMF’s multi-layered framework for managing financial risks. Precautionary balances provide a buffer to protect the Fund against potential losses, resulting from credit, income, and other financial risks. In conducting the review, the Executive Board applied the rules-based framework agreed in 2010. Precautionary balances have risen further since the 2021 interim review and coverage metrics have strengthened. At the same, credit and other financial risks have also increased. The pace of reserve accumulation is expected to remain adequate. Against this background, Executive Directors endorsed staff’s proposal to retain the current medium-term target of SDR 25 billion and the minimum floor of SDR 15 billion. The Board also discussed the role of surcharges, which are primarily a component of the Fund’s risk management framework but also contribute to reserves accumulation.
December 19, 2022
List of IMF Member Countries With Delays In Completion of Article IV Consultations or Mandatory Financial Stability Assessments over 18 Months
Description: List of IMF Member Countries With Delays In Completion of Article IV Consultations or Mandatory Financial Stability Assessments over 18 Months
December 19, 2022
IMF Board Endorses Implementation Plan in Response to Institutional Safeguards Review
Description: IMF Board Endorses Implementation Plan in Response to Institutional Safeguards Review
December 16, 2022
Safeguards Assessments Policy—External Expert Panel's Advisory Report
Description: This report by the external expert panel (“the panel”) examines the effectiveness and appropriateness of the safeguards assessments policy in the five years since its last review in 2015. In addition to expressing an opinion on the effectiveness and appropriateness of the safeguards assessment policy, the panel also makes recommendations to the Executive Board for its consideration to improve and optimize the benefits to be garnered from the safeguards assessment policy. The panel’s opinion is based on (i) consultations with key stakeholders, including central bank authorities, IMF Executive Directors’ offices, and Fund staff; (ii) examination of safeguards assessment and other Fund-specific documents; and (iii) study of international reference materials.
December 16, 2022
Safeguards Assessments - 2022 Review of Experience
Description: This paper reviews experience with the safeguards assessment policy since the last review in 2015. The policy is subject to periodic reviews by the Executive Board. The policy’s main objective is to mitigate risks of misuse of Fund resources and misreporting of monetary data under Fund arrangements. Consistent with past reviews, an external panel of experts provided an independent perspective on the implementation of the policy.