Economic Surveillance

This paper provides an update on the status of the SDR trading market and operations. For more than three decades, SDRs have exclusively been exchanged for freely usable currencies in transactions by agreement, primarily through the Voluntary Trading Arrangements (VTAs). The paper covers SDR trading operations during the period September 2023 to August 2024.

The Fund’s decision on the New Arrangements to Borrow (the “NAB Decision”) is subject to renewals not later than 12 months before the end of each NAB period. The current NAB period became effective on January 1, 2021 and is set to expire on December 31, 2025. Pursuant to paragraph 19(b) of the NAB Decision, the Executive Board is to take a decision on the renewal no later than twelve months before the end of the current NAB period, i.e., by December 31, 2024.

The paper presents highlights from the FY 2024 budget, followed by a discussion of outputs based on the Fund Thematic Categories and of inputs.

The aim of this note is to help stakeholders optimize their decision-making on when, where, and how to use debt-for-development swaps (“debt swaps”), ensuring they bring the intended benefits to all parties involved. It also proposes new approaches to structure these mechanisms, making them less transaction-heavy and more sustainable while maintaining accountability for fulfilling policy and spending commitments.

This Supplement provides additional guidance to IMF and World Bank staff on the implementation of the Bank-Fund Debt Sustainability Framework for Low Income Countries (LIC-DSF) approved in 2017 by the IMF and World Bank Boards. It complements the 2018 Bank-Fund Guidance Note on the LIC-DSF.

This paper, prepared by the Fund’s Office of Internal Audit’s (OIA) in July 2024, provides the results of its independent assessment of the implementation progress on the Institutional Safeguards Review (ISR) actions.

The Basel Committee on Banking Supervision (BCBS) recently revised the Basel Core Principles for Effective Banking Supervision (BCP). The BCP are the de facto minimum standards for the sound prudential regulation and supervision of banks and banking systems and are universally applicable. This comprehensive update, the first since 2012, reflects the evolving financial landscape and incorporates feedback from a wide range of stakeholders including BCBS members, nonmember countries, the IMF, and the WBG.

At the time of the 2005 Review of the Fund’s Transparency Policy, the Executive Board requested regular updates on trends in implementing the transparency policy. This report provides an overview of recent developments, reflecting information on documents considered by the Board in 2022 and updating the previous annual report on Key Trends. Deeper analysis of these trends is undertaken in the context of periodic reviews of the Fund’s Transparency Policy.

This guidance note provides operational guidance on the Fund’s engagement with small developing states (SDS). It highlights the unique economic characteristics and constraints facing SDS, notably in a more shock-prone world. Building on advice that applies to the full membership, the note explains how the characteristics of SDS shape Fund surveillance, financial support and program design, capacity development (CD), and collaboration with other institutions and donors. The note updates the previous version that was published in December 2017.

In line with the framework for addressing excessive delays in the completion of Article IV consultations, the following table lists the IMF members for whom the Article IV consultation has been delayed by more than 18 months as of June 15, 2024.

The 2023 Review of the Flexible Credit Line (FCL), the Short-Term Liquidity Line (SLL), and the Precautionary and Liquidity Line (PLL) introduced a welcome streamlining of procedures. This included dropping the requirement for an informal consultation with the Executive Board for the approval of successor FCL and PLL arrangements when certain requirements were met.

The Resilience and Sustainability Trust (RST) provides affordable longer-term financing to help eligible IMF members address longer-term structural challenges, thereby progressing toward strengthening their prospective balance of payments stability. This paper takes stock of the initial experience with the RST—focusing on progress and challenges so far—and proposes fine-tuning RST design with a view to strengthening implementation of the Trust’s objectives. The paper also provides an assessment of the adequacy of the Trust’s resources and finds that increased near-term fundraising will be needed to meet strong demand.

This paper provides an update on progress towards the Fund’s FY 2025 Diversity Benchmarks, as of the end of FY 2023. The paper also includes information on action the Fund is taking to promote greater diversity and inclusion through a two-year roadmap of initiatives primarily focused on recruitment, talent development, equity and inclusion and promoting greater leadership accountability and transparency. The paper also covers plans to convene a cross-functional working group to establish the Diversity Benchmarks targets for FY 2030.

This evaluation assesses the decision-making processes that guided the evolution of the application of the Fund's mandate, the criteria and principles used to operationalize engagement in newer policy areas, and the coherence of the Fund’s framework for engaging with partners. It finds that the systematic widening of the Fund’s areas of work is posing adaptation challenges, necessitating trade-offs, and overburdening staff within a context of budgetary and expertise constraints.

This evaluation assesses the decision-making processes that guided the evolution of the application of the Fund's mandate, the criteria and principles used to operationalize engagement in newer policy areas, and the coherence of the Fund’s framework for engaging with partners. It finds that the systematic widening of the Fund’s areas of work is posing adaptation challenges, necessitating trade-offs, and overburdening staff within a context of budgetary and expertise constraints.

This Executive Board Work Program (BWP) for FY 2025 (May 2024 to April 2025) is the first since the Executive Board has started to pilot a new strategic cycle, which aims at incorporating Directors’ broader views on work priorities at an earlier stage in the planning process for the fiscal year. High-level costing indicators are also included for non-recurring items based on a pilot costing exercise. The BWP focuses on supporting the membership in responding to current challenges through prompt and tailored policy advice, financial assistance, and support for debt restructuring and capacity development.

The benefits of gender diversity are well known – it increases effectiveness and efficiency and strengthens decision-making. Yet, the IMF Executive Board continues to fall short of reaching gender balance, with women constituting a small minority of the Executive Directors and Alternate Executive Directors. There is a clear need for change. The IMFC has called on the membership to take action, including by introducing voluntary medium-term objectives to raise the number of women holding leadership positions at the Board. This report summarizes the Executive Board’s recommendations for these targets and lays out proposals for concerted actions that can be taken by individual countries and constituencies.

This paper presents the last six borrowing agreements that were concluded between October 2023 and February 2024 to provide new loan resources to the Poverty Reduction and Growth Trust (PRGT) as part of the loan mobilization round launched in July 2021 to support low-income countries (LICs) during the pandemic and beyond. Five of the six agreements use SDRs in the context of SDR channeling. Together these borrowing agreements provide a total amount of SDR 3.9 billion in new PRGT loan resources. The 2021 loan fundraising campaign was concluded successfully. It mobilized total contributions of SDR 14.65 billion from 17 PRGT lenders, well exceeding the SDR 12.6 billion loan target.

The global economy has been resilient and appears headed for a soft landing. Inflation continues to recede and risks have become more balanced globally. Nonetheless, medium-term growth prospects remain at the lowest level in decades and a smooth completion of the disinflation process should not be taken for granted. While the outlook for low-income developing countries (LIDCs) is improving, risks are tilted to the downside.

On May 10, 2024, the IMF’s Executive Board approved the use of Special Drawing Rights (SDRs) for the acquisition of hybrid capital instruments issued by prescribed holders. This new use of SDRs, which adds to seven already authorized prescribed SDR operations, is subject to a cumulative limit of SDR 15 billion to minimize liquidity risks. The Executive Board also established a strong expectation that contributors channeling SDRs to prescribed holders under such capital contributions have Voluntary Trading Arrangements (VTAs) in place to ensure sufficient liquidity and equitable distribution of potential SDR exchanges into currencies.

This paper updates the projections of the Fund’s income position for FY 2024 and FY 2025-2026 and proposes related decisions for the current and the following financial years. The paper also includes a proposed decision to keep the margin for the rate of charge unchanged until completion of the review of surcharges, but until no later than end FY 2025, at which time the Board would set the margin for the rest of FY 2025 and FY 2026.

The Executive Board of the International Monetary Fund approved the 2025-27 financial years (FY25-27) medium-term budget. While the global economy has shown resilience to successive adverse shocks, the overall global economic context remains complex with slow and uneven growth, increased fragmentation, deepening divergence, and still high interest rates despite easing inflationary pressures. Against this backdrop, the FY25-27 budget continues to be guided by principles of agility and budget discipline, reinforced by ongoing reprioritization and savings capture

n October 2024, the IMF Executive Board established the “Strengthened Policy Safeguards (SPS) streamlining a key part of the safeguards framework for Fund lending. This note provides guidance on how to implement the SPS. It supersedes the 2022 guidance note on enhanced safeguards.

This note provides operational guidance on the use of the Flexible Credit Line (FCL) and the Short-Term Liquidity Line (SLL).

This note provides operational guidance on the use of the Precautionary and Liquidity Line (PLL).

Global growth is projected to remain broadly steady this year and next, but the outlook is subject to elevated uncertainty as significant policy changes are underway in major economies and ongoing wars and conflicts continue to impose a heavy humanitarian and economic toll. Medium-term growth prospects remain tepid, largely held back by weak productivity, and public debt is high in many countries.

The world economy is at a pivotal juncture. At the center are shifting policy priorities by major economies and escalating trade tensions, in the face of high public debt, weak medium-term growth prospects, and transformative forces reshaping the economic landscape. In this context, the economic outlook is highly uncertain, with intensifying downside risks.

This Handbook provides guidance to staff on the IMF’s facilities available to countries eligible to obtain concessional financing from the Fund under the PRGT, namely low-income countries (LICs). It updates the previous version of the Handbook that was published in March 2023 by incorporating modifications resulting from the 2024 Review of the Poverty Reduction and Growth Trust (PRGT) Facilities and Financing and other recent policy papers.

The 70 low-income countries (LICs) in the IMF’s membership experienced steady but modest growth in 2024, with marked divergence across countries. While 11 of the 20 fastest-growing countries in 2024 were LICs, many of the poorer and often also fragile and conflict-affected countries saw virtually no progress in per capita incomes over the past 15 years. Gradual fiscal consolidation proceeded in about half of the LICs, supporting further stabilization of public debt levels, but elevated debt service continues to constrain priority spending in many LICs.

This paper proposes a narrow and targeted change to the Resilience and Sustainability Trust Instrument relevant for cases where an arrangement under the Resilience and Sustainability Facility (RSF) is allowed to continue when the member switches from a Flexible Credit Line (FCL) arrangement to another qualifying UCT-quality instrument. In those cases, sufficient safeguards to anchor the RSF arrangement would be that, within the previous 12 months, the Executive Board approved the FCL arrangement or completed the mid-term review of the member’s qualification under the arrangement.

On November 8, 2024, the IMF's Executive Board approved a six-months extension of the period to consent to the quota increase and to the New Arrangements to Borrow (NAB) rollback under the Sixteenth General Review of Quotas (GRQ), through May 15, 2025. Such extension also extends the period of consent for quota increases under the 14th GRQ. The previous deadline was due to expire on November 15, 2024. However, the Board of Governors Resolution 79-1 provides that the Executive Board may extend the period for consent as it may determine.

This note provides general guidance on Resilience and Sustainability Facility (RSF) operations, including for arrangement requests and reviews. The RSF provides longer-term, affordable financing to members to help them address risks to prospective BOP stability stemming from longer-term macro critical structural challenges from climate change and pandemic preparedness.

List Of IMF Member Countries With Delays In Completion Of Article IV Consultations Or Mandatory Financial Stability Assessments Over 18 Months

Many emerging markets and developing economies face elevated debt vulnerabilities and financing needs. Following the 2020-21 surge in debt levels associated with the COVID-19 shock, and the subsequent tightening in global financial conditions, many emerging markets and developing economies (EMDEs)1 are grappling with rising debt service burdens that squeeze the space available for development spending. This paper aims to help inform the international debate on these issues by providing factual data and insight on the debt vulnerabilities and financing pressures facing EMDEs.

On November 22, 2024, the Executive Board of the International Monetary Fund (IMF) discussed a paper on the Review of the IMF’s Communication Strategy that outlines the objectives and scope of Fund communication, reviews its implementation in recent years, and proposes updates and modernization of its approach going forward.

On December 17, 2024, the IMF’s Executive Board concluded the Comprehensive Review of General Resources Account (GRA) Access Limits. The review maintained the overall annual and cumulative GRA access limits at 200 and 600 percent of current quotas, respectively, keeping them unchanged from the existing temporary limits that were set to expire at the end of 2024. . The Executive Board also approved adjustments to maintain access limits in nominal (Special Drawing Rights) terms when the general conditions for the effectiveness of the quota increase under the 16th General Review of Quotas are met.

The expansion of central bank balance sheets has become a critical topic in the wake of the Global Financial Crisis and the COVID-19 pandemic. Central banks have taken unprecedented measures to ensure price stability and financial stability, particularly when traditional policy tools were insufficient. However, this expansion has led to significant balance sheet risks, resulting in notable losses as central banks have adjusted their policies in response to rising inflation. This guidance note explores these risks and introduces a modeling framework to assess them.

The Gulf Cooperation Council countries have successfully weathered recent turbulence in the Middle East, and their economic prospects remain favorable. Nonhydrocarbon activity has been strong amid reform implementation, although overall growth has decelerated due to cuts in oil production. The growth outlook is positive. External buffers remain comfortable despite current account balances having narrowed. Risks around the outlook are broadly balanced in the near term. More challenging medium-term risks, especially in the context of geoeconomic fragmentation and climate change, call for action on policy priorities to continue to strengthen the private sector and to diversify the economy.

This letter provides IMF staff’s assessment of macroeconomic policies in Somalia. It also discusses the authorities’ intention to reintroduce the Somali Shilling and implement a currency board arrangement, which the IMF will be supporting through extensive capacity development and the Extended Credit Facility arrangement. This assessment letter has been requested by the Central Bank of Somalia with the objective of sharing it with international partners to explain the currency reform and seek their support.

In 2024, the Board endorsed Management’s proposal to cancel the planned 2025 Interim Surveillance Review, to focus staff’s efforts on completing the CSR by May 2026, five years after the 2021 CSR. This Board paper provides the background on this decision and explains how related risks are mitigated.

The evaluation assesses the IMF’s EAP from its inception in 2002 through mid-2023, the launch of the evaluation. Drawing on experience with 38 Exceptional Access (EA) arrangements during the evaluation period, the analysis spans the EAP’s objectives and design, successive reforms, and experience with implementation. It notes that there has been one comprehensive review of the EAP, in 2004, although the policy was examined and modified in 2009, 2010, and 2016.

Executive Directors welcomed the report of the Independent Evaluation Office (IEO) on the IMF’s Exceptional Access Policy (EAP), encompassing the policy’s objectives and design, successive reforms, and experience with its implementation. They recognized that the Fund has sought to find a generally good balance between rules and flexibility in applying the EAP, while reinforcing transparency and accountability and adopting adequate safeguards.

The paper briefs the Executive Board on the further considerations on CBDC. These cover the positioning of CBDC in the payments landscape, cyber resilience of the CBDC ecosystem, CBDC adoption, CBDC data use and privacy protection, implications for monetary policy operations, and cross-border payments with retail CBDC.

This paper describes implementation steps related to the board-endorsed recommendations from the Fourth External Evaluation of the Fund's Independent Evaluation Office (The Garcia Silva Report). Therefore, this paper focuses on staff’s proposals to enhance the ownership in implementation and the follow-up of Board-endorsed IEO recommendations.

The IMF’s Executive Board concluded the Review of the IMF’s Transparency Policy and Open Archives Policy and approved a number of reforms. The reforms further clarify the scope and objectives of these policies, their implementation processes, and how to strengthen knowledge sharing. The review was supported by data analysis as well as surveys and consultations with key stakeholders, including Executive Directors, country authorities, IMF missions chiefs, and civil society organizations as detailed in the three background papers accompanying this 2024 review.

The IMF’s Executive Board concluded the Review of the IMF’s Transparency Policy and Open Archives Policy and approved a number of reforms. The 2024 Review of the IMF’s Transparency Policy and Open Archives Policy focuses on targeted reforms to (i) support faster publication of board documents and communications of Board’s decisions; (ii) strengthen the rules and processes to modify Board documents prior to publication; and (iii) allow faster release of some documents in the Fund’s archives accessible to the public.

The IMF’s Executive Board concluded the Review of the IMF’s Transparency Policy and Open Archives Policy and approved a number of reforms. IMF staff regularly produces papers proposing new IMF policies, exploring options for reform, or reviewing existing IMF policies and operations.

The IMF’s Executive Board concluded the Review of the IMF’s Transparency Policy and Open Archives Policy and approved a number of reforms. The review was supported by data analysis as well as surveys and consultations with key stakeholders, including Executive Directors, country authorities, IMF missions chiefs, and civil society organizations as detailed in the three background papers accompanying this 2024 review.

This paper reports on the Fund’s income position for FY 2024 following the closing of the Fund’s accounts for the financial year and completion of the external audit. Overall net income of the General Department was SDR 4.7 billion, about SDR 0.2 billion higher than estimated in April, mainly reflecting an increase in the remeasurement gain reported under IAS 19 (the accounting standard for employee benefits). GRA net income in FY 2024 increases the Fund’s reserves. The Fund’s precautionary balances, freached SDR 25.1 billion at the end of FY 2024, in line with the April projection.

The 14th Periodic Monitoring Report (PMR) on the Status of Management Implementation Plans (MIPs) in Response to Board-endorsed Independent Evaluation Office (IEO) Recommendations assesses the progress made over the past year on 91 actions contain in 11 MIPs. Over the past year, substantial progress has been made in implementing management actions with the closure of 49 actions, more than double that of the previous PMR (24 closed actions), and most of these closed actions are strategic actions involving important reviews and key policy steps.

This note is designed as a reference and primer on these key sovereign debt-related Fund policies. It focuses on how to establish that a program is “fully financed” (i.e., the financing assurances policy), how to handle arrears owed by a member to its official and private creditors (i.e., the lending into arrears policies), and how to establish safeguards for continued Fund lending at the stage of program reviews (i.e., financing assurances reviews). It also provides guidance on the more general role of the Fund in debt-restructuring situations. It is the first comprehensive operational guidance on these policies, replacing the guidance previously available at the departmental level.

The EBA-lite methodology is a key input in external sector assessments for over three-quarters of IMF member countries, representing a broad set of emerging and low-income economies. The EBA-lite methodology is refined periodically, and this paper provides a comprehensive discussion of the current EBA-lite econometric models and framework which is referred to as EBA-lite 3.0. is paper also updates operational guidance on the complementary EBA-lite tools, such as the external sustainability approach and the modules for commodity exporters.

The global economy has proven resilient, and a soft landing is within reach. Inflation has moderated thanks to tight monetary policy and fading supply shocks, and growth is expected to remain steady. But uncertainty remains significant, with risks tilted to the downside; medium-term growth prospects are lackluster; public debt has reached record highs and is expected to approach 100 percent of GDP by 2030; and geoeconomic fragmentation threatens to undo decades of gains from cross-border economic integration. The Fund will remain a strong advocate for multilateralism and economic integration as foundations on which to build a resilient and inclusive global economy.

Since the 2024 Spring Meetings, the IEO finalized the evaluation on The Evolving Application of the IMF’s Mandate and launched a new evaluation on The IMF and Climate Change. The IEO has continued its progress on the ongoing evaluations of The IMF’s Exceptional Access Policy and the IMF Advice on Fiscal Policy. The IEO will develop an Evaluation Policy that addresses the recommendations of the Fourth External Evaluation of the IEO, which was concluded in July 2024.

Global growth has been resilient despite a series of shocks and is projected to remain steady, and inflation has continued to moderate, although progress is uneven across countries. However, medium-term growth prospects remain weak, with the risk for the global economy to get stuck on a low growth-high debt path. While the low-income developing countries (LIDCs) continue to recover, many remain vulnerable, with significant scarring from recent shocks. The pace of convergence toward higher living standards has slowed, making it increasingly challenging to achieve the Sustainable Development Goals (SDGs).

The IMF’s Executive Board concluded the Review of Charges and the Surcharge Policy. The review is part of a broader ongoing effort to ensure that the IMF’s lending policies remain fit for purpose to meet the evolving needs of the membership. Charges and surcharges are important elements of the IMF’s cooperative lending and risk-management framework, where all members contribute and all can benefit from support when needed.

On October 11, 2024, the IMF’s Executive Board concluded the Review of Charges and the Surcharge Policy. The review is part of a broader ongoing effort to ensure that the IMF’s lending policies remain fit for purpose to meet the evolving needs of the membership. Charges and surcharges are important elements of the IMF’s cooperative lending and risk-management framework, where all members contribute and all can benefit from support when needed.

On October 11, 2024, the IMF’s Executive Board concluded the Review of Charges and the Surcharge Policy. The review is part of a broader ongoing effort to ensure that the IMF’s lending policies remain fit for purpose to meet the evolving needs of the membership.

This paper reviews Poverty Reduction and Growth Trust (PRGT) facilities and financing. It proposes a comprehensive package of lending policy reforms and financing measures that aims to bolster the Fund’s capacity to support Low-Income Countries (LICs) in addressing their balance of payment needs, while restoring the self-sustainability of the Trust.

This paper provides background for an informal discussion to engage with Executive Directors, held on November 26, 2024, on the Comprehensive Review of GRA Access Limits. The General Resources Account (GRA) access limits are part of the Fund’s risk management framework. They help maintain a balance between the need to: (i) ensure that members have confidence in the availability of Fund financing; and (ii) preserve liquidity and the revolving nature of the Fund’s resources.