Policy Coordination Instrument — Updated Operational Guidance Note

Policy Papers, April 25, 2024

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Canonical URL: Policy Coordination Instrument — Updated Operational Guidance Note

The PCI is a non-financing instrument designed for countries that, at the time of the PCI request, are seeking to unlock financing from sources other than the Fund and/or to demonstrate a commitment to a reform agenda.
The note provides updated general guidance on the use of the Policy Coordination Instrument (PCI).
Since its establishment in 2017 as part of the Fund’s work on the Global Financial Safety Net, the PCI has been used by several members.
Experiences with past PCI use informed best practices reflected in this updated operational guidance note together with changes to the PCI policy approved by the Executive Board on October 4, 2023.
The note is an aid to the implementation of the PCI policy and its underlying principles.
If there is any instance in which a provision of the guidance note or its implementation conflicts with the policy approved by the Board, the PCI policy shall prevail.

The note covers operational issues in a broad range of areas such as:
- purpose,
- objectives,
- eligibility,
- modalities,
- applicability of UFR-related and other relevant policies,
- design of a PCI-supported program,
- conditionality framework,
- review schedule,
- and a comparison with other lending instruments.
The note provides guidance intended to implement the PCI policy and refine operational practice based on member experience.

The updated guidance reflects changes to the PCI policy approved by the Executive Board on October 4, 2023.
Where guidance and Board-approved policy conflict, the PCI policy prevails.

Primary intended uses:
- to help countries unlock financing from sources other than the IMF,
- to allow countries to demonstrate commitment to a reform agenda.
Limitation:
- The PCI is explicitly a non-financing instrument.

Subjects: Arrears, Balance of payments, Balance of payments need, External debt, Monetary policy, Political economy, Poverty, Poverty reduction strategy
Keywords: Arrears, Balance of payments need, Global, Guidance Note, IMF, non-financial instrument, PCI, PCI policy, PCI program, PCI review cycle, Poverty reduction strategy, SCF arrangement, transparency policy, UCT