2021 Comprehensive Surveillance Review — Overview Paper

Policy Papers, May 18, 2021

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Fund surveillance needs to evolve to face the economic and financial challenges that will shape the global landscape for years to come.
The paper first takes stock of the current economic and financial landscape.
To better serve the membership in this context, Fund surveillance should be prioritized around four key priorities:
- (i) confronting risks and uncertainties: policymakers will need to actively manage the risks of a highly uncertain outlook;
- (ii) preempting and mitigating adverse spillovers: shifting patterns of global economic integration will bring about new channels for contagion and policy spillovers;
- (iii) fostering economic sustainability: a broader understanding of sustainability to better account for the impact of economic and non-economic developments on stability; and
- (iv) unified policy advice: better accounting for the trade-offs and synergies among different policy combinations in the face of limited policy space and overlapping priorities, tailored to country-specific circumstances.
These priorities should further enhance the traction of Fund surveillance.

Confronting risks and uncertainties
- Emphasis on active management of risks stemming from a highly uncertain outlook.
Preempting and mitigating adverse spillovers
- Attention to shifting patterns of global economic integration that create new contagion and policy spillover channels.
Fostering economic sustainability
- Advocates a broader understanding of sustainability that incorporates the impact of economic and non-economic developments on stability.
Unified policy advice
- Calls for better accounting of trade-offs and synergies among different policy combinations, recognizing limited policy space and overlapping priorities, and tailoring advice to country-specific circumstances.

Subjects: Climate change, COVID-19, Environment, Financial sector policy and analysis, Financial sector risk, Health, Income inequality, Monetary policy, National accounts, Political economy, Spillovers
Keywords: Climate change, COVID-19, Financial sector risk, Fund surveillance, Global, IMF surveillance, Income inequality, policy advice, Policy reaction, Spillovers, surveillance activity