IMF Executive Board Reviews the IMF's Transparency PolicyPress Release No. 13/270
July 22, 2013
On June 24, 2013 the Executive Board concluded its review of the International Monetary Fund’s (IMF) Transparency Policy, based on a staff report entitled 2013 Review of the Fund’s Transparency Policy (hereafter referred to as “the paper”).
The IMF views transparency as a critical support for its objectives of promoting global economic and financial stability, by stimulating public discussion of economic policies, and facilitating orderly and efficient functioning of financial markets.
Two decades of reforms have improved significantly the IMF’s transparency. Starting in the late 1990s, the IMF has been publishing an increasing number of its documents, and over 90 percent of country documents and policy papers are now published. In addition, the Fund has gradually opened up its historical archives to the public, and now interacts regularly with the public through outreach, press briefings, and the publication of information via its external website. Enhanced transparency proved important during the global financial crisis: the IMF was able to contribute to public debates through open discussion of risks and policy options, and to respond to public scrutiny of its increased financing activities.
The paper discusses the IMF’s progress on transparency and issues that have emerged since the last review in 2009. It indicates that, despite some progress, the Fund still lags behind in terms of the timeliness of publication, and notes various concerns expressed by civil society organizations (CSOs). Moreover, some members have residual doubts as to whether the policy is being applied even-handedly, and if confidential information was being handled appropriately. The paper also examines what is needed to adapt the policy to recent surveillance reforms including the 2012 Integrated Surveillance Decision, which allows the Fund to discuss with members all systemic spillovers from their policies, and takes stock of progress in expanding public access to the Fund’s archives. Based on these findings, the paper proposes measures to increase further publication rates, promote faster publication, streamline the Fund’s communications with the public, provide stronger assurances to members about how the Fund safeguards confidential information, and improve the day-to-day implementation of the policy. The paper also proposes measures to adapt the policy to the new surveillance landscape, and considers further steps to help open up the archives to the public.
Executive Board Assessment
Executive Directors welcomed the opportunity to review the implementation of the Fund’s Transparency Policy and consider reform proposals in their discussions on June 5 and June 24. They broadly agreed with the assessment and recommendations in the staff paper (2013 Review of the Fund's Transparency Policy), as modified in Supplement 2. They noted that transparency is critical for the Fund to fulfill its mandate, and outlined its objectives. Specifically, transparency strengthens the effectiveness of the Fund by providing the public access to its views and deliberations, thus informing public debate and building traction for the Fund’s policy advice. Transparency supports the quality of surveillance and programs by subjecting the Fund to outside scrutiny. More generally, it enhances the Fund’s legitimacy by making it more accountable.
Directors noted that two decades of reform have transformed the Fund’s transparency. The Fund has been able to contribute to public debates during the crisis through open discussion of risks and policy options, and to respond to heightened public scrutiny of its increased financing activities. At the same time, the Transparency Policy gave members comfort to continue publishing country reports, with the assurance that the most sensitive information would be protected. The Fund is now broadly at par with other institutions with similar mandates as regard the amount and types of information that it publishes. Notwithstanding this progress, Directors agreed that there is room to enhance transparency to further improve the effectiveness of Fund surveillance and policy advice and enhance its legitimacy with members.
Increasing publication rates and reducing lags. Directors broadly supported the staff’s proposal to extend a stronger publication regime to all staff reports on the use of Fund resources and policy support instruments as a way to strengthen the Fund’s accountability to its shareholders. Some Directors emphasized members’ right to voluntary publication and the need to take into account country circumstances in the implementation of this proposal. Most Directors also agreed with the proposals to encourage faster release of information—including defining prompt publication as being within 14 days of Board consideration, issuing factual statements in case of delayed publication, and introducing lower profile publication for reports published more than 90 days after Board consideration. A few Directors, however, cautioned that the proposals could prove ineffective, given some members’ capacity constraints, and highlighted the possibility that the quality and candor of staff reports might be adversely affected. Directors took note of staff’s clarification that defining prompt publication and shortening the normal period for deletion requests would not establish a binding deadline. They recommended enhancing staff’s coordination with authorities to encourage timely publication.
Clarifying external communication. Directors agreed to streamline external communication products to reduce the risk of inconsistent messages. They supported the adoption of a single term―press release—for all external communication products, and the discontinuation of the term “Public Information Notice” (PIN). Directors also agreed that press releases should be issued for rare cases of standalone Financial System Stability Assessments. Some Directors highlighted the linkages between the Fund’s Transparency Policy and communication, particularly on country-related issues, and looked forward to a discussion on communication issues, including staff’s public statements on member countries ahead of Board meetings, in the next Work Program of the Executive Board.
Better explaining the Fund’s rules on confidentiality. Directors considered how best to reconcile the Fund’s role as a trusted advisor to individual members and its function as global watchdog. They recognized that the Fund’s mandate—to foster global growth and economic stability—requires candid discussions with members, the Board, and the public, without disrupting markets. At the same time, protecting information provided by members on a confidential basis is important for the trust between the Fund and its members. In this context, Directors supported staff’s proposals to encourage a common understanding of the Fund’s rules on confidentiality between staff and members, including through clearer staff guidance, clarifying confidentiality rules at the start of each mission, including when confidential information would need to be disclosed to the Executive Board, and strengthening departmental review to avoid leakage of confidential information.
Monitoring evenhandedness. Directors observed that the modification rate for staff reports on advanced markets was much higher than those pertaining to other economies. They also noted staff’s analysis of evenhandedness showing that only a few cases do not fulfill the criteria for modifications under the policy and that there was little evidence of bias. At the same time, some Directors noted that modification requests could be influenced by members’ capacity to analyze staff reports and to persuade staff and management. Directors supported the proposal to strengthen monitoring in this area, and urged staff to continue to explore ways to reinforce candor and evenhandedness.
Adapting the Transparency Policy to the new surveillance framework. Directors broadly agreed on the need to adapt the Transparency Policy to recent surveillance reforms. They agreed that the introduction of a publication regime for a new category of multi-country documents is a good way to ensure that the Fund publishes candid multilateral surveillance, while respecting members’ needs concerning confidentiality. A few Directors would have preferred to wait until more experience is gained with the new multilateral surveillance products before modifying rules. Directors generally saw the need to adapt the modification rules for Article IV staff reports to take into account the implications of the Integrated Surveillance Decision. A few Directors did not see a case for withdrawing the requirement for consent by the primary country in the case of third-party deletion requests; a few others emphasized the importance of management consultation with primary country authorities in such cases. A few Directors cautioned that the proposals might invite many requests for third-party modifications, and encouraged staff to further consider the proposed solutions.
Facilitating public access to the Fund’s archives. Directors welcomed the progress on implementing the 2009 reforms to the Archives Policy, and saw a case for further efforts to digitize other documentary material and to streamline procedures for declassifying these materials. Most Directors also saw scope for reducing the lags for public access to Executive Board minutes from five to three years. A significant minority of Directors favored retaining the existing lags in order to strike a balance between informing the public about the Board’s views and maintaining the candor of Board discussions. The proposal to reduce the lag to three years was not adopted at this time, pending further discussion to build a broader consensus among Directors. A separate discussion on this issue will be taken in the near future.
Timing of next review. Directors agreed that the next review should take place on the standard five-year review cycle expected for policy papers, although a few saw merit in a shorter review cycle in view of the Fund’s evolving work. Some Directors also favored an interim review focusing on the new publication regime for multi-country documents and the new modification rules for country documents. The Transparency Policy is expected to be reviewed in light of experience no later than 2018.