## Topical Trust Funds—The New Assistance Vanguard

_IMF Blog, March 29, 2010_

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## Bibliographic details
- Authors: creating a series of topical trust funds that bring together interested donors.
- Published: March 29, 2010

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### Overview
- The IMF has begun implementing a new approach to financing its technical assistance by creating a series of topical trust funds that bring together interested donors.
- The idea behind the new topical trust funds is to support broader initiatives on policy topics and engage donors on a broader, longer-term, and more strategic basis.
- The overarching objective is to help meet the continuously rising needs of countries, particularly of low- and lower-middle-income countries seeking to build the institutions and capacity needed to implement growth-enhancing policies.

### Examples of trust fund programs under development
- Tax Policy and Administration
  - Aims at helping countries mobilize more domestic resources in support of investment toward reaching the Millennium Development Goals, while also reducing their aid dependency.
- Managing Natural Resource Wealth
  - Aims to help countries by addressing the related serious governance and policy challenges in a comprehensive way to avoid the “resource curse” and instead seize the opportunity for accelerated development.

### Integration with regional centers
- These trust fund programs are intended to be at the vanguard of international best practice in delivering technical assistance, often supported by an agenda for applied research.
- Compared with the regional centers, they:
  - Tackle more complex, diagnostic, and strategic issues within their field of specialization.
  - Devolve reform implementation to the regional centers, which provide hands-on institution and capacity building.
- In countries and regions that are not being served by a regional center:
  - Topical trust funds fill the gap and also cover implementation of reforms in their topical area.

### Advantages of topical trust funds
- For recipient countries:
  - Increase the project scope and resources available for capacity building, thus making the assistance more predictable in the medium term.
- For coordination and donors:
  - Promote coordination between donors and assistance providers—as called for in the 2005 Paris Declaration on Aid Effectiveness—and so avoid costly duplication.
  - Provide donors with a menu of topics to support, depending on their development strategies and priorities, while using the Fund’s technical expertise and existing apparatus for assistance delivery and follow-up.
- For the IMF:
  - Enable collective action in areas of common interest, and leverage the Fund’s own resources in strategic priority areas.

### Strategic guidance and governance
- Topical trust funds build on the positive experience with the successful governance model of our other multidonor trust funds, including the regional technical assistance centers.
- They are guided by a steering committee comprising donor representatives and IMF staff.
- International and regional institutions and assistance providers in the relevant field can be invited to participate as observers.
- The steering committees:
  - Provide strategic guidance and contribute to the setting of policies and priorities, including review and endorsement of an annual work plan.
  - Provide a forum for donors to coordinate assistance, exchange information, and expand their networks.

### Operational status and planned topics
- The first topical trust fund on Anti-Money Laundering and Combating the Financing of Terrorism became operational in May 2009.
- Further trust funds are planned for 2010, including:
  - Tax Administration and Policy (at an advanced stage of development).
  - Managing Natural Resource Wealth (at an advanced stage of development).
- Other program topics at earlier stages of development include:
  - Fiscal management.
  - Sustainable debt strategies.
  - Financial stability statistics.
  - Training in Africa.

*Topical Trust Funds—The New Assistance Vanguard, March 29, 2010*

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## References

- [technical assistance](http://www.imf.org/external/np/exr/facts/tech.htm)
- [Topical trust funds](http://www.imf.org/external/pubs/ft/survey/so/2008/new092908b.htm)
- [Paris Declaration on Aid Effectiveness](http://www.imf.org/external/pubs/ft/survey/so/2008/NEW090408A.htm)
- [regional technical assistance centers](http://www.imf.org/external/np/exr/facts/afritac.htm)
- [Anti-Money Laundering and Combating the Financing of Terrorism](http://www.imf.org/external/pubs/ft/survey/so/2010/NEW031210A.htm)

_Source: https://www.imf.org/en/blogs/articles/2010/03/29/topical-trust-funds-the-new-assistance-vanguard_