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| ARTICLE V, SECTION 2(b) | ||||
| Technical and Financial Services | ||||
| Technical Services | ||||
| General Decisions | ||||
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The Acting Chair’s Summing Up—Review of the Fund’s Capacity Development Strategy—Towards a More Flexible, Integrated, and Tailored Model, Executive Board Meeting 24/35, April 4, 2024 Executive Directors welcomed the opportunity to discuss the Fund’s capacity development (CD) strategy. They noted the sustained progress in implementing the recommendations of the previous CD strategy reviews to further enhance the efficiency and impact of Fund CD, and broadly supported the proposals of the review toward a more flexible, integrated and tailored CD model. Directors commended the staff’s work and their outreach efforts to build consensus for the proposals leading up to the Board discussion. They also called for strengthening coordination and communication with other development partners to improve traction and efficiency of Fund CD delivery. Directors appreciated the quality and value added of Fund CD, noting the central role it plays in supporting member countries. The importance of Fund CD was also recognized by the IEO evaluation in 2022 and confirmed by the recent surveys of CD stakeholders. Directors noted that Fund CD should continue to respond to the membership’s demands and evolving needs, and endorsed the vision of agile and demand-driven CD that focuses on the Fund’s comparative advantages and is well-integrated with surveillance and lending activities. Directors broadly supported the review’s proposals in six inter-related areas: CD Prioritization and Integration Directors concurred that the current size of CD relative to surveillance and lending is broadly appropriate, while noting that prioritization is key to meeting the evolving and most pressing needs of our members. They underscored the need to closely collaborate with authorities in setting priorities to ensure ownership, and stressed the importance of further deepening CD integration with the Fund’s surveillance and lending activities, including through improved coverage of those efforts in staff reports for heavy CD users. Directors considered that CD delivery should be scaled up to address unmet demand from member countries in the Western Hemisphere. Funding Model Directors concurred that external funding has enabled the Fund to expand significantly its CD and better meet members’ needs. While acknowledging the risks associated with the Fund’s reliance on external financing for CD, they agreed that external financing would continue to play a key role, given internal budget constraints. Directors encouraged staff to continue work on mitigating those risks, and welcomed in this regard the staff’s ongoing efforts to increase the flexibility and diversity of funding sources, including through regional and thematic vehicles, with a number of Directors also calling for deployment of a larger share of internal resources. Directors also supported exploring the future establishment of a CD stabilization mechanism, and called for additional work on its design, mechanisms, and funding sources. Most Directors also supported the proposed modification in the charging policy for CD delivery to lift the self-financing requirement for high-income members that are already contributors to Fund CD, with a few Directors calling for this requirement to be lifted for all high-income members. Impact Directors welcomed the progress in enhancing monitoring and evaluation of Fund CD (prioritized by past CD Strategy Reviews) to more effectively demonstrate effectiveness and impact. They concurred with the proposed enhancements of the results management framework, including measures to seek explicit agreement with country authorities on targeted results and resource commitments; and developing strategic results frameworks at the project level. Directors also welcomed the proposals to build standardized mechanisms for monitoring and evaluation results to directly inform CD priorities. They emphasized that coordination with other development partners is critical to enhancing the efficiency and impact of Fund CD. Modalities Directors welcomed proposals to further modernize the ways that country-tailored CD is implemented, such as combining in-person and virtual delivery and further integrating technical assistance and training. While in-person CD delivery is a large and essential component of Fund CD, they welcomed the increased effectiveness under mixed modalities supported by technological progress. Directors stressed that the choice of modalities should be tailored to country-specific circumstances and the authorities’ absorptive capacity, particularly in fragile and conflict-affected states and in small developing states. They also supported undertaking a review of the Fund’s external training curriculum to complement these approaches. Field Presence Directors agreed that field presence, in particular through the global network of Regional CD Centers (RCDCs), has become fundamental to the Fund’s CD model. They supported the proposals to clarify RCDC governance, regularly review RCDC’s coverage and, after careful consideration, introduce modifications to their financing and administrative frameworks, effectively adopting these centers as an integral part of the CD strategy in order to strengthen the effectiveness of this network. HR Policies Directors emphasized the importance of appropriate HR policies to maintain the quality and continuity of CD expertise, and to incentivize staffing in these areas. They supported initiating a strategic review of the HR framework for staff working on CD over the medium term to complement existing HR initiatives, such as the work on the local employment framework. Directors emphasized the desirability of increasing mobility and career progression possibilities for specialized economists and CD experts, including by adjusting and harmonizing policies and practices for these career streams. Directors also urged staff to manage the risks associated with the reform proposals. They called for careful management of resource implications of the proposals’ implementation in a flat real budget environment, and welcomed in this regard the staff’s assessment that most costs could be achieved by re-prioritizing within current workstreams. A few Directors considered that an implementation roadmap with indicative timeframes and accountabilities would be useful to support implementation. It is expected that the next review of the Fund’s CD strategy will be completed no later than April 2029. SU/24/51 April 8, 2024 | ||||
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