Capacity development (CD) is one of the Fund’s three core activities and has grown in importance in recent years. It supports member countries’ efforts to build the institutions and capacity necessary to formulate and implement sound economic policies, thereby complementing the Fund’s surveillance and lending mandates. Member countries, partners, and external commentators give the Fund high marks for the quality of its CD. At the same time, efforts need to continue to strengthen Fund CD to serve members’ current and evolving needs. The 2018 CD Strategy Review examines progress under the Fund’s 2013 CD Strategy and proposes a CD strategy for the next five years. It notes substantial progress in addressing the 2013 recommendations, which included strengthening the CD governance structure, enhancing the prioritization processes, clarifying the funding model, strengthening monitoring and evaluation, promoting greater integration of TA and training, exploiting new technologies for delivery, and leveraging CD as outreach. However, background work for this review also pointed to the need to strengthen the CD framework further. The review builds upon the existing CD strategy, focusing on two mutually reinforcing objectives. First, the impact of Fund CD needs to be increased by further strengthening integration with the Fund’s policy advice and lending operations, while continuing to make progress in framing CD through comprehensive strategies tailored to each member’s needs, capacity, and conditions, focusing on implementation and outcomes. Stronger coordination between CD and the Fund’s other core functions will better connect CD with countries’ risks and vulnerabilities and ensure surveillance and lending integrate lessons from CD more effectively. Second, the efficiency of CD needs to be increased by improving CD processes and systems. This will enhance transparency and strengthen the basis for strategic decision making. Five specific areas of recommendations support the strategy. Likewise, they mitigate institutional risks stemming from the Fund’s CD activities. They include clearer roles and responsibilities for key internal and external stakeholders in the CD process; continued strengthening of prioritization and monitoring; better tailoring and modernization of CD delivery with a focus on implementation of TA recommendations; greater internal consultation and sharing of CD information; and further progress in external coordination, communication, and dissemination of information (Annex I).
stepping-up mobilization of outside resources for TA and external training. Today, the Fund’s CD activities benefit from significant support from members. The share of external financing in direct CD spending reached 55 percent in FY18, with the largest five contributors now accounting for about half of the total. To mitigate risks stemming from increased reliance on external funding and its concentration, a funding model was codified in the 2014 CDpolicy statement, and an interdepartmental review process for new externally funded initiatives was established to ensure
endorsement . The paper seeks endorsement for the following:
The strengthening of CD governance, including updating the policy statement for CD and mandating regular reviews of CDpolicies and activities.
The principle of a two-level system of prioritization of CD activities: (i) the institutional level, within the context of the Fund’s key objectives leading to the broad composition of CD activities across regions and topics; and (ii) the country level, driven by country demand. Prioritization is needed because demand outstrips available resources.
facilitate information sharing and coordination as it regularly brings together recipient countries, donors, and key providers. In deciding on CD provision, the Fund considers whether other providers are engaged in similar efforts.
12. The Executive Board and Management exercise distinct but closely related functions in regard to the Fund’s CD activities, in accordance with the Articles of Agreement.
13. The Executive Board provides strategic direction and oversight through (i) regular reviews of, and policy guidance for, the Fund’s CDpolicies and
International Monetary Fund. Independent Evaluation Office
objectives for CD set out in the 2019 Statement of CDPolicies and Procedures ( IMF, 2019c ); the performance and approaches of other CD providers; and the standard Organisation for Economic Co-operation and Development (OECD) Development Assistance Committee (DAC) evaluative criteria, namely relevance, coherence, efficiency, effectiveness, impact, and sustainability. 6
10. The main sources of evidence for the evaluation are: (i) semi-structured interviews with current and former IMF Board members, management and staff; current and former country officials; academics
This statement summarizes the IMF’s policies and practices with regard to the delivery of capacity development (CD) activities. It updates the 2001 Policy Statement on IMF Technical Assistance, incorporating the principles outlined in the 2013 CD strategy paper approved by the Executive Board as well as relevant principles described in earlier documents considered by the Executive Board.1 The purpose of the statement is to consolidate the guiding principles endorsed by the Board with policies and practices that are within the authority of IMF’s Management and are followed by staff in carrying out capacity development activities. The statement is expected to be of use to IMF staff, Executive Directors and their staff, country authorities, and donors. It also serves as a point of reference for future reviews of the IMF’s CD activities.
Executive Board and management exercise distinct but closely related functions in regard to the Fund’s CD activities, in accordance with the Articles of Agreement.
13. The Executive Board provides strategic direction and oversight, including with respect to the overall envelope for externally financed CD and the size of CD relative to other outputs of the Fund, through (i) regular reviews of and policy guidance for the Fund’s CDpolicies and activities; (ii) the budget process; and (iii) the risk management process, including risk assessment reports and endorsement of
This statement summarizes the IMF’s policies and practices with regard to the delivery of capacity development (CD) activities. It updates the 2014 Statement on IMF Policies and Practices on Capacity Development and reflects the conclusions of the 2018 Review of the Fund’s Capacity Development Strategy, approved by the Executive Board on November 14, 2018. The purpose of the statement is to consolidate the guiding principles endorsed by the Board with policies and practices that are within the authority of IMF’s management and are followed by staff in carrying out capacity development activities. The statement is expected to be of use to IMF staff, Executive Directors and their staff, country authorities, and donors. It also serves as a point of reference for future reviews of the IMF’s CD activities.