Front Matter

Front Matter Page

IMF POLICY PAPER

REVIEW OF IMPLEMENTATION OF IMF COMMITMENTS IN SUPPORT OF THE 2030 AGENDA FOR SUSTAINABLE DEVELOPMENT

June 2019

IMF staff regularly produces papers proposing new IMF policies, exploring options for reform, or reviewing existing IMF policies and operations. The following documents have been released and are included in this package:

  • A Press Release summarizing the views of the Executive Board as expressed during its May 3, 2019 consideration of the staff report.

  • The Staff Report, prepared by IMF staff and completed on April 5, 2019 for the Executive Board’s consideration on May 3, 2019.

  • A Staff Supplement or Staff Statement.

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Front Matter Page

REVIEW OF IMPLEMENTATION OF IMF COMMITMENTS IN SUPPORT OF THE 2030 AGENDA FOR SUSTAINABLE DEVELOPMENT

April 5, 2019

Executive Summary

The IMF is committed to supporting implementation of the 2030 development agenda. The IMF’s primary contribution to global development is to deliver on its mandate to help maintain macroeconomic and financial stability at both the global and national levels. The IMF also supports the development agenda through targeted support for national policies—via policy advice and support for capacity development (CD) in areas where it has specialist expertise.

In 2015, the IMF made a series of commitments to intensify its support for the 2030 development agenda (IMF, 2015a, 2015b, 2015c, 2015d). This paper takes stock of the progress made in implementing these commitments and other relevant post-2015 initiatives, while drawing some general lessons from the experience.

The implementation record to date, some 3½ years after adoption of the Sustainable Development Goals (SDGs), can be summarized as follows:

  • Increased support for countries’ efforts to boost domestic revenue mobilization: The annual volume of technical support for building tax systems in FY2016–18 was some 28 percent higher than in FY 2013–15; coverage of taxation issues (both domestic and international) in Article IV consultations has also increased markedly.

  • Infrastructure Policy Support (IPS): The IPS initiative supports state capacity building in managing public investment and public debt; detailed diagnostic assessments have been undertaken in over 50 countries, while support for developing medium-term debt strategies has been provided in 21 countries.

  • Intensified analytical and operational engagement on inclusion issues: The volume of analytical/policy work on economic inclusion (income and gender inequalities, financial inclusion) has steadily increased; inclusion has featured as a policy issue in Article IV consultations with almost half of the IMF’s member countries; and inclusion-related issues have also featured in IMF-supported programs.

  • Support development of domestic financial markets: Annual technical support on financial sector issues rose by 12 percent from FY2013–15 to FY2016–18, with most assistance going to lower-income countries.

  • Support for fragile and conflict-affected states (FCS): Technical support for FCS is rising, accounting for about one-quarter of all IMF CD support. Improving effectiveness of IMF engagement in FCS is a work-in-progress, with a 2018 plan being implemented to address key areas where results can be improved.

  • Support for macroeconomic data compilation and dissemination: The scale of support for statistical capacity development has increased by about one-third since 2014; further support for low and lower-middle income countries is to be provided under the donor-financed Data for Decisions (D4D) initiative.

  • Strengthening the financial safety net for developing countries: Key actions include a 50 percent increase in access to IMF concessional resources in 2015, with another increase anticipated by end-May; enhanced collaboration with Regional Financial Arrangements; and completion of Quota/Governance reforms in 2016.

  • Engagement on climate change issues: IMF actions have focused on (i) advice on measures to contain carbon emissions (energy price reform, carbon pricing) and (ii) policy work on how to support countries vulnerable to natural disasters, now moving to the implementation phase.

  • New initiatives. Since 2015, the IMF has undertaken other initiatives supporting the 2030 development agenda, including (i) a 2018–19 SDG costing exercise to identify the additional spending needed to meet key SDGs in developing countries; (ii) scaled-up engagement on governance/corruption issues, tackling a key barrier to inclusive growth; and (iii) extensive advocacy activities in support of the agenda by IMF Management (such as Lagarde, 2018).

The paper also draws lessons from the implementation of the various initiatives to date. Cross-cutting messages include (i) the importance of maintaining country ownership of reform programs over time; (ii) the need to work with a medium-term time frame when seeking to build institutional capacity; and (iii) the importance of strategic coordination across development partners operating in a sector, with a clear division of labor and responsibilities.

Looking forward, the IMF is committed to continue its support for countries pursuing the 2030 development agenda within its current aggregate spending envelope. The surge of support in recent years was facilitated by increased financing from bilateral donors; a levelling off in the scale of externally-financed activities is envisaged to maintain the high quality of IMF assistance. Attention will therefore shift to generating more from existing resources through better prioritization of projects, operationalizing the lessons learned from recent experience, and making full use of the new results-based management system to maximize the impact of IMF technical support.

Approved By

Martin Mühleisen

Prepared by SPR in consultation with functional and area departments. The SPR team was led by Stefania Fabrizio and included Rahul Giri, Daniel Gurara, and Etienne Yehoue, under the guidance of Seán Nolan. Research assistance was provided by Rujun Yin and Sibabrata Das and production assistance by Lesa Yee.

Contents

  • Acronyms

  • INTRODUCTION

  • THE ECONOMIC LANDSCAPE AND CHALLENGES

  • IMF COMMITMENTS: IMPLEMENTATION

  • A. Boosting Domestic Revenue Mobilization

  • B. Supporting State Capacity for Infrastructure Provision

  • C. Fostering Economic Inclusion

  • D. Promoting Sustainable Development of Domestic Financial Markets

  • E. Enhanced Support for Fragile and Conflict-Affected States (FCS)

  • F. Increased Support for Macroeconomic Data Collection and Dissemination

  • G. Improving the Financial Safety Net for Developing Countries

  • H. Addressing the Challenges of Climate Change

  • I. Recent Initiatives

  • CONCLUSIONS

  • ISSUES FOR DISCUSSION

  • References

  • BOXES

  • 1. Strengthening Tax Capacity

  • 2. Examples of Revenue Capacity Building Achievements

  • 3. Macroeconomic Implications of Infrastructure Investment Scaling-up: Policy Lessons from the Applications of DIG Model

  • 4. Available Analytical Tools for Distributional Analysis

  • 5. Policy Messages on Inequality and Gender: Illustrations

  • 6. Tackling Fragility: The Case of Côte d’Ivoire, Somalia, and Myanmar

  • FIGURES

  • 1. Real GDP Growth in Developing Countries

  • 2. Government Debt

  • 3. Financial Flows to Developing Countries

  • 4. Share of Working-Age Population, by Country Groups

  • 5. Tax Revenue to GDP in Developing Countries

  • 6. Tax-Related TA in Developing Countries

  • 7. Financial Sector TA in Developing Countries

  • 8. IMF TA Expenditures on Fragile States

  • 9. IMF TA to Fragile States by Topic, FY2011–18

  • 10. Approved Loans by Facility

  • TABLE

  • 1. Expected versus Realized Growth

  • APPENDICES

  • I. IMF Alignment with the 2030 Agenda

  • 11. Developing Countries and Country Groups

  • III. Summary of the Initiatives Committed in Support of the 2030 Agenda

Acronyms

AAAA

Addis Ababa Action Agenda

ACES

Analytic Costing and Estimation System

AEs

Advance Economies

ASEAN

Association of Southeast Asian Nations

BEPS

Base Erosion and Profit Shifting

BOP

Balance of Payments

CBF

Capacity Building Framework

CBS

Central Bank of Somalia

CCPA

Climate Change Policy Assessment

CD

Capacity Development

CEMAC

Central African Economic and Monetary Community

CPI

Consumer Price Index

CwA

Compact with Africa

D4D

Data for Decisions Initiative

DFID

Department for International Development

DIG

Debt-Investment Growth Model

DSA

Debt Sustainability Assessments

DRM

Domestic Revenue Mobilization

e-GDDS

Enhanced General Data Dissemination System

EMs

Emerging Market Economies

FARI

Fiscal Resource of Analysis Industries

FAS

Financial Access Survey

FCL

Flexible Credit Line

FCS

Fragile and Conflict-Affected States

FfD

Financing for Development

FSAP

Financial Sector Assessment Program

FSSR

Financial Sector Stability Reviews

G20

Group of Twenty

GFSN

Global Financial Safety Net

GRA

General Resources Account

HIPC

Heavily Indebted Poor Countries

HQ

Headquarter

ICD

Institute for Capacity Development

IDA

International Development Association

IEO

Independent Evaluation Office

IMF

International Monetary Fund

IPCC

Inter-Governmental Panel on Climate Change

IPS

Infrastructure Policy Support

IPSI

Infrastructure Policy Support Initiative

LICs

Low-Income Countries

LIDCs

Low-Income Developing Countries

LIC-DSF

Debt Sustainability Framework for Low-Income Countries

MNRW

Managing Natural Resources Wealth Thematic Fund

MTDS

Medium-Term Debt Strategy

MTRS

Medium-Term Revenue Strategies

NSDPs

National Summary Data Pages

OECD

Organization for Economic Co-operation and Development

ODA

Official Development Assistance

PFM

Public Financial Management

P-FRAM

PPP Fiscal Risk Assessment Model

PIMA

Public Investment Management Assessment

PLL

Precautionary and Liquidity Line

PPPs

Public-Private Partnerships

PRESS

Partner Report on Support to Statistics, Paris21

PRGT

Poverty Reduction Growth Trust

RA-FIT/ISORA

Revenue Administration Fiscal Information Tool

RA-GAP

Revenue Administration Gap Analysis Program

RBM

Results-Based Management

RFAs

Regional Financial Arrangements

RMTF

Revenue Mobilization Thematic Fund

RTAC

Regional Technical Assistance Center

SDGs

Sustainable Development Goals

SDGEM

Stochastic Dynamic General Equilibrium Model

SDR

Special Drawing Rights

SMP

Staff-Monitored Program

TA

Technical Assistance

TADAT

Tax Administration Diagnostic Assessment Tool

TIMS

Travel Information Management System

TPAF

Tax Policy Diagnostic Framework

UN

United Nations

UNFCCC

UN Framework Convention on Climate Change

WB

World Bank

WBG

World Bank Group

WEO

World Economic Outlook

WoRLD

IMF World Revenue Longitudianal Dataset

Front Matter Page

Press Release No. 19/194

FOR IMMEDIATE RELEASE

June 3, 2019

International Monetary Fund

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Review of Implementation of IMF Commitments in Support of the 2030 Agenda for Sustainable Development
Author: International Monetary Fund. Strategy, Policy, & and Review Department