IFI governance

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IMF struggles to reach agreement on transparency

17 November 2003

A review of the IMF transparency policy was finally concluded in September. Amendments to the current policy still need to be approved before the various decisions take effect. The timing for this is unclear.

Discussions started in June but stalled on some key aspects (see Update 35). The IMF Executive Board has now reached a compromise on these, including a move towards more systematic publication of some country documents. Board meetings on this were split, largely along a North/South axis. Some countries including the US want systematic publication of documents to allow investors to make better-informed decisions. Others resist this, arguing that “this could undermine the candor of discussions and documents and the advisory role of the Fund”.

The key issue considered by the Board in June and September was publication of country reports. The main ones are Article IV and Use of Fund Resources, in particular in cases of ‘exceptional access’ to Fund resources. Fund staff outlined options and the Board finally reached a compromise on ‘voluntary but presumed’ publication. Rather than publication being the default option, this retains a requirement for countries to give explicit consent before publication. Countries will have to give a reason if they refuse to do so. This will take effect only in July 2004.

Other remarkable decisions included publication of the Executive Board agenda in advance

Another issue on the table was whether the Fund should have a systematic policy on when to allow deletions of highly politically sensitive material in staff reports. Until now the policy covers mostly deletions of market-sensitive information. Deletion of politically sensitive information however is also possible, mostly through the very debatable practice of ‘side letters’ (see At Issue ‘G-7, civil society press for IMF, World Bank transparency reforms’).

The Board also agreed to publish its agenda in advance, following the the World Bank’s example. No progress was made however in the debate over publication of the minutes of the Board. These are currently accessible only after 10 years. Similarly there was no discussion on publishing in advance draft country intention documents, such as letters of intent.