IFI governance


Evaluation: IMF trade policy advice biased

10 July 2009

An evaluation by the IMF’s Independent Evaluation Office (IEO) finds that the IMF’s trade policy work between 1996 and 2007 had patchy effectiveness, was “not evenhanded” and has “diminished credibility of IMF independence”. It confirmed NGO criticisms that “a recurring problem was underestimating negative revenue effects from tariff cuts” and that the IMF gave poor advice on financial services liberalisation. The IMF “tended to urge greater openness almost indiscriminately … seldom did they assess risks, costs or benefits.” The board largely agreed with the recommendations. Including “that attention should be given to … policies in systematically-important economies.”