This management implementation plan (MIP) proposes actions in response to the Independent Evaluation Office (IEO)’s report on growth and adjustment in IMF-supported programs. The full implementation of the MIP package will help ensure that, at a time when many countries face strong headwinds, IMF-supported programs not only deliver necessary adjustment to address balance of payments needs but also pay greater attention to their growth effects. While the policy-related deliverables are already incorporated into current departmental work plans and budgets, the operational implementation of these recommendations may require mobilizing additional resources.

This paper presents a Management Implementation Plan (MIP) with actions to take forward the Board-endorsed recommendations from the Independent Evaluation Office (IEO)'s report on IMF Engagement with Small Developing States (SDS). The actions in the MIP are broad in scope, touching on all modalities of the Fund's engagement with SDS, and seek to be comprehensive, self-reinforcing, cost-effective, and designed to be adopted as a package. The MIP aims to support a targeted and effective recalibration of engagement with SDS; enhance IMF's surveillance and capacity development in SDS members; strengthen the Fund's lending engagement with SDS, in line with the applicable policy frameworks; and secure an effective, well-tailored and more continuous staff presence in SDS.

The Management Implementation Plan (MIP) proposes actions in response to the Board-endorsed recommendations provided by the Independent Evaluation Office (IEO)’s report on the IMF’s early response to the COVID pandemic. The two IEO recommendations aim for the Fund to (i) Develop special policies and procedures that could be quickly activated to address particular needs and circumstances of global crises and (ii) Take steps to reinforce the Fund’s institutional preparedness to deal with global crises and other large shocks. The MIP highlights how existing workstreams will be used to address part of the recommendations, specifically: (i) Drawing the lessons from the use of precautionary lending instruments during the pandemic and using them in the ongoing review of these facilities; (ii) Drawing the lessons from the implementation of governance safeguards in the context of covid-related emergency financing and respond to the actions identified in the final stocktaking; and (iii) Reviewing financial implications of covid-related lending on Poverty Reduction and Growth Trust (PRGT) resources in the regular updates on PRGT financing and resources. The MIP also defines new actions that aim to enhance the Fund’s preparedness to face future crises and are slated to be implemented by the end of FY25. These consists in: (i) Developing a crisis playbook, which will further codify Management’s commitment to an early participatory consultation with the Board in the event of a global crisis and inform the engagement with the Board on the broad strategy and institutional priorities for responding to the crisis; (ii) Enhancing the process of staff reallocation during a crisis through expanding the staff Talent Inventory to include skills and experience relevant in crises and examining HRD’s coordinating role in staff reallocation, as well as reviewing how recruitment processes could be made more agile in a crisis; (iii) Developing a strategy for surge capacity of the Crisis Management Team; (iv) Reviewing the experience of pandemic-related lending to low-income countries to consider the adequacy of access norms and the possible need for enhancements of the low-income lending toolkit against the long-term financial sustainability of the PRGT; and (v) Exploring ways to further strengthen the coordination with partners, especially the World Bank.

Capacity Development (CD), comprising technical assistance and training, fosters economic development by improving human capital and institutions in member countries. Every five years, the IMF reviews its CD Strategy to ensure that CD continues to be of high quality and well-focused on the needs of its members. This review calls for CD to become more flexible, integrated with the Fund’s policy advice and lending, and tailored to respond to member needs. The review benefitted from the recent independent evaluation of the Fund’s CD and a wide range of inputs, including internal and external consultations, surveys of recipients and development partners, staff background studies and recommendations of an External Advisory Group. The vision for CD is informed by the Fund’s comparative advantages and surveillance priorities. The proposals of the current review center around the six key areas: (1) strengthening CD prioritization and integration; (2) enhancing the funding model; (3) strengthening monitoring and evaluation; (4) modernizing modalities; (5) enhancing field presence; and (5) strengthening human resources policies for staff working on CD.

Twelfth Periodic Monitoring Report On The Status Of Management Implementation Plans In Response To Board-Endorsed IEO Recommendations

Overall, progress has been made since the Twelfth PMR on actions in response to eight IEO evaluations, with the pace of implementation being faster on actions October 31, 2023 THIRTEENTH PERIODIC MONITORING REPORT 2 INTERNATIONAL MONETARY FUND contained in the MIP in Response to the Executive Board-Endorsed Categorization of Open Actions in Management Implementation Plans. It is also worth mentioning that many open actions depend on the implementation of some important reviews/key steps that are expected to be completed in or soon after December 2023, such as the Capacity Development (CD) Strategy Review, the issuance of a new CD Guidance Note, an update of the Small Developing States Staff Guidance Note (SDS-SGN), the Operational Guidance Note (OGN) on Program Design and Conditionality, and a Board paper on Bank-Fund collaboration.

Since the 2021 Annual Meetings, the IEO has made considerable progress with three ongoing evaluations, while two management implementation plans (MIPs) to follow up on recommendations from previous evaluations have been approved by the Board. In addition, to mark its twentieth birthday, the IEO organized a virtual conference to reflect on experience from its second decade and consider future challenges. We have also contributed to the ongoing work on institutional integrity at the IMF, drawing on a stocktaking of material contained in past evaluations and are considering additional work on these issues as we select two new evaluation topics later this year.

The Eleventh Periodic Monitoring Report (PMR) on the Status of Management Implementation Plans (MIPs) in Response to Board-Endorsed Independent Evaluation Office (IEO) Recommendations assessed the progress made over the past 18 months on 72 actions contained in 10 MIPs. Significant progress has been made with the implementation of management actions, despite challenges that have arisen from the ongoing COVID-19 pandemic. Overall, 29 of the 72 actions for which implementation progress is assessed in the Eleventh PMR were deemed to have been satisfactorily implemented, while 35 remain open, and eight actions are being reformulated in line with the Board-approved triage framework for long-standing open actions. Despite the effect of reprioritization to make space for the urgent needs of the membership resulting from the pandemic, the pace of implementation observed in the Eleventh PMR, with the 29 actions closed, significantly exceeds the previous trend of about 15 implemented actions per year. Of the 35 open actions, 16 are more than one year past their implementation due dates. The reprioritization of activities owing to the COVID-19 pandemic and resource constraints on account of several years of flat budgets led to delays in the implementation of several actions, partly because of the postponement of important reviews.

This issue of Annual Report discusses that the global economy is at a delicate moment. The expansion of early 2018 has lost momentum, in large part in response to rising trade tensions. There are threats from rising financial vulnerabilities and geopolitical uncertainties. These challenges call for policymakers to avoid missteps and to take the right policy steps: at home, across borders, and globally. In addition to several major reviews looking at IMF conditionality, economic and financial surveillance, and lending facilities, the management has deepened its analysis on trade spillovers and financial stability and are revamping frameworks for debt sustainability assessment in low-income and market access countries. Building on earlier research that showed how trade can boost incomes and living standards by enabling the flow of technology across countries, the October 2018 World Economic Outlook provided illustrative scenarios of the potential impact of escalating trade tensions between the United States and China.

This note aims to provide guidance on the key principles and considerations underlying the design of Fund-supported programs. The note expands on the previous operational guidance notes on conditionality published over 2003-2014, incorporating lessons from the 2018-19 Review of Conditionality, and other recent key policy developments including the recommendation of the Management’s Implementation Plan in response to Independent Evaluation Office (IEO)’s report on growth and adjustment in IMF-supported programs. The note in particular highlights operational advice to (i) improve the realism of macroeconomic forecast in programs and fostering a more systematic analysis of contingency plans and risks; (ii) improve the focus, depth, implementation, and tailoring of structural conditions (SCs), with due consideration of growth effects; and (iii) help strengthen the ownership of country authorities. Designed as a comprehensive reference and primer on program design and conditionality in an accessible and transparent manner, the note refers in summary to a broad range of economic and policy considerations over the lifecycle of Fund-supported programs. As with all guidance notes, the relevant IMF Executive Board Decisions remain the primary legal authority on matters covered in this note.