The IMF executive board significantly weakened many of the far-ranging proposals made by Fund staff in the recently completed transparency review, leaving significant power in the hands of countries to block the disclosure of country documents, and failing to require publication of draft policy proposals before they are discussed at the Board.

The IMF board discussed the transparency review at the beginning of December, after putting it off for more than a year (see Update 65, 63, 61). The executive directors agreed to a new principle to guide its approach: “The Fund will strive to disclose documents and information on a timely basis unless strong and specific reasons argue against such disclosure.”

The new policy means that almost all IMF policy documents, most of which are proposals written by staff for IMF board consideration and decision, will now be published. Publication is now also expected for papers sent to the board “for consideration in formal and informal seminars”, which are often key stepping stones in the IMF’s decision making system. Exceptions are made for “papers that deal with market sensitive information” or “with internal or administrative matters of the Fund”.

Although the new policy does promote greater openness, it is too little, too late

For most country documents, such as letters of intent for IMF loans and annual economic assessments written by the Fund called Article IV reports, the IMF will move from a “voluntary but presumed” approach to a “non-objection basis” for getting consent to publish documents. Whereas in the past countries would have to give explicit consent to publish, now they must explicitly state they do not wish to publish or require more time to decide whether to do so. In the absence of a statement by the member, it is now expected that all documents going to the board will be published one day after the board meeting.

Changes were also made to the archives policy, with board papers to be released in the archives after three years instead of five, and board minutes after five years instead of ten. Papers not sent to the board, such as internal memos and draft staff reports, will continue to be kept secret for 20 years. Changes were also made to automate the process of declassifying materials labelled as “strictly confidential” so that they can be released along the same timeframes as other material. Any material that has been digitised and is available according to the new archive rules will now be made available on the IMF’s web site instead of only in the IMF’s headquarters.

Management also informed the board of further changes that did not require board consent, including presumed publication of staff guidance notes on interpreting Fund policy, publication of lists of countries that do not publish reports, and more detailed analysis of transparency trends such as requests from countries to change staff reports.

Massive loopholes created

While meaningful changes were made, the executive directors rejected some of the more far-reaching proposals by staff and created loopholes to allow countries to prevent publication of documents. The board first clarified that the new principle must still “operate within the framework of voluntary publication of documents pertaining to members.”

The biggest loophole was a provision that “it would be possible for a member to notify the Fund that country documents and related policy intention documents should be published only with its explicit consent.” This essentially allows a country to completely exempt itself from the new policy’s non-objection approach. Interestingly, for the first time ever, the staff report named the countries that have never consented to the publication of a Fund document. The 10 countries include Brazil, Myanmar, Saudi Arabia, and Venezuela.

The board also rejected the proposal that countries should have to provide a reason for rejecting publication, and the Fund management should not recommend approval of a Fund loan unless the loan papers receive consent to be published.

Civil society ideas ignored

The staff report for the transparency review included an appendix reporting on the external perceptions of the Fund’s transparency: “the Global Transparency Initiative, a network of CSOs, considers access to draft policy documents to be of key importance in order to influence the policy debate inside the Fund.” Despite this clear recognition, the staff made no proposals to publish draft policy papers. Instead they committed to “build on best practice for more effective public consultations on key policy issues.” The GTI’s recommendation for a formal information request process with an appeals mechanism was also ignored.

Toby Mendel, director of Canadian NGO Centre for Law and Democracy, a member of the GTI, stated: “As a public body, the IMF is bound to respect basic human rights, including the right to information, enshrined in the Universal Declaration of Human Rights. Although the new policy does promote greater openness, it is too little, too late, and the IMF remains far behind other international financial institutions, notably the World Bank, in terms of transparency. It is particularly disappointing that the Executive Directors, many of whom represent countries which have adopted progressive national right to information legislation, have played such a negative role in limiting progress made in the new policy.”