IMF comprehensive surveillance review: looking back and forward
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Article summary
Notes from the CSPF panel titled, IMF comprehensive surveillance review: looking back and forward, held during the 2025 Annual Meetings. IMF surveillance is a key input in shaping countries’ macroeconomic policies. In an increasingly shock-prone world, civil society organisations stressed the importance of aligning surveillance with economic sustainability and the latest evidence-based findings, to ensure that IMF policy advice promotes resilience, equity, and long-term sustainable growth across all member countries.
Moderator
- Federico Sibaja, IMF Campaign Manager, Recourse
Panelists
- Nabil Abdo, Senior Policy Advisor, Oxfam
- Zain Moulvi, Research Director, Alternative Law Collective
- Tara Povey, Macroeconomics Project Lead, Bretton Woods Project
- Rougui Dallo, Economic Research Officer, International Trade Union Confederation
- Aleksandra Zdzienicka, Deputy Division Chief, SPR IMF
- Sarah Sanya, Deputy Division Chief, SPF IMF
A recording from this session can be found online here.
Federico: this discussion takes place in the context of the ongoing Comprehensive Surveillance Review (CSR) – the first major surveillance review since 2021, when the IMF introduced economic sustainability as one of the key guiding pillars of its surveillance framework. This change was significant because it recognised that non-economic factors, such as inequality, gender and climate change, can have real macroeconomic consequences. It also reflected a shift in how the IMF sees its role, from focusing narrowly on short-term stabilization to considering longer-term sustainability and inclusion.
At the same time, the Independent Evaluation Office (IEO) had conducted work on the evolving application of the Fund’s mandate, examining how the IMF integrates new areas such as climate, gender and social spending into its operations. The evaluation pointed to a number of challenges, especially around decision-making and the lack of systematic analysis of distributional impacts which are expected to be addressed in this new CSR.
Before giving the floor to our speakers to present their research, I would like to emphasise that civil society organisations have been following this process closely and see this review as a critical opportunity for the IMF to deepen its work on economic sustainability, social equity and long-term resilience.
Tara: as Federico mentioned, our work has focused on how IMF surveillance has evolved – in particular, how the Fund started to address issues of social and gender inequality in its Article IV reports. We reviewed 14 years of Article IVs, from 2011 through 2025, to see how the IMF’s policy advice has changed – or not changed – over time.
This period has been one of intense global turbulence: the aftermath of the global financial crisis, the Covid-19 pandemic, increasing climate-related shocks, wars, displacement and growing social inequalities. We wanted to see whether the IMF’s surveillance work reflected these evolving realities.
What we found was surprisingly consistent policy direction over the entire period. Despite new rhetoric on inequality and gender, the IMF’s surveillance advice has remained anchored in the same macroeconomic policy paradigm – focused on fiscal consolidation, austerity and shrinking of the state. The emphasis continues to be on cutting public spending, limiting wage bills and privatising services, while encouraging external and private sector growth.
In our dataset, 100 per cent of the reports we reviewed recommended some form of fiscal austerity, and in 80 per cent of those, austerity was based on cutting the public sector wage bill or reducing social welfare expenditure. This is deeply concerning because such policies have significant social and gender impacts, and yet these impacts are rarely measured or analyzed by the Fund.
Although in recent years we have seen increased acknowledgment of risks associated with inequality and gender gaps, there has been no real policy shift in response. Often, the Fund recognises inequality as a “risk”, but then proceeds to recommend measures that exacerbate it. Where there are mentions of gender, they tend to be symbolic rather than operational.
We also looked at how other multilateral institutions handle these issues. Many conduct regular impact assessments – distributional, climate and gender – often publicly and in consultation with stakeholders. This is common practice in institutions like the World Bank or regional development banks, yet the IMF continues to treat such analysis as optional.
Our conclusion is that the IMF’s surveillance approach remains largely unchanged. While it now recognises inequality, gender and climate in principle, these have not been translated into measurable policy accountability. Without systematic impact assessments, the Fund risks reinforcing the same patterns of adjustment that have historically deepened inequality rather than reduced it.
Nabil: I explained that at Oxfam we recently analysed IMF Article IV reports from 2022 to 2024, focusing on the Fund’s tax policy advice. What we found is troubling: 53 per cent of all tax recommendations were regressive, meaning they tended to increase the burden on lower- and middle-income households rather than on the wealthy or large corporations. I said that 91 per cent of the advice simply involved tweaking existing tax systems rather than promoting bold or progressive reform, which shows that the IMF is still reluctant to support structural changes that would make taxation fairer.
I shared that our analysis – broken down by type of taxation – shows clear patterns: inequality remains an afterthought in IMF tax surveillance, and concerns about distributional fairness appear more often in reports for richer countries. By contrast, low- and middle-income countries are far more likely to receive regressive tax advice, focused on consumption taxes and fiscal consolidation. I also pointed out that the Fund’s tax guidance is largely gender- and race-blind, with no serious assessment of how tax structures affect different groups in society. My conclusion was simple: if the IMF is serious about economic sustainability, it must ensure that taxation reduces inequality rather than deepening it.
Aleksandra: the IMF’s surveillance has a clear mandate: to help members maintain domestic and balance-of-payments stability and to safeguard the efficient functioning of the international monetary system. Every few years, we review whether our framework remains fit for purpose, hence this Comprehensive Surveillance Review.
The 2021 CSR marked a turning point because we decided to institutionalise the analysis of long-term trends that can affect macroeconomic and financial stability. Many of our teams were already grappling with these issues – especially in low-income countries – so this step formalized that work.
Since then, there has been a significant investment in data, modeling and staff capacity to integrate climate and inequality into our analysis. But this has not been easy. We are a relatively small institution – fewer than 1,000 economists – and our resources are stretched. Many country teams have had to “front-load” efforts to develop new models and data, which has sometimes created trade-offs with traditional areas of surveillance.
From our preliminary review of about 400 surveillance reports since 2022, we actually found more progress than we expected. Most teams have successfully linked long-term trends – such as climate and demographics – to macro-critical outcomes. This linkage has been strongest in low-income countries, where the issues are most acute, while advanced economies are gradually catching up. That said, we’re still in the early stages. The challenge now is depth and consistency. We cannot cover every emerging issue for every country, so we are prioritising a risk-based, selective approach, focusing deeply on the most macro-critical risks rather than superficially covering all.
Sarah: to add to Alexandra’s points, I want to emphasise that we see this as a long-term institutional journey. When we begin working in new policy areas like climate, gender, or social inclusion, it takes years to build internal expertise, develop methodologies and integrate those consistently across our membership.
We have also learned that partnerships are essential. Many of these issues quickly become sectoral – for instance, gender and labor market policies, or climate adaptation measures. The IMF’s comparative advantage is identifying macro-critical linkages, not designing sectoral programs. Therefore, we must work closely with partners such as the World Bank, ILO and UN agencies who bring sectoral depth. Another lesson has to do with traction – the difference between giving policy advice and seeing it implemented. For advice to be implemented, it must be feasible and politically realistic. That requires better understanding of political economy dynamics and the distributional consequences of our recommendations.
We are still learning how to strengthen this link between advice and policy response. The 2025 CSR will examine this in detail, and we are collecting extensive feedback from authorities, staff and stakeholders like all of you here.
Rougui: from our perspective, IMF surveillance often fails to include workers’ voices in any meaningful way. In our global survey, three out of four trade unions reported never being consulted during Article IV missions, and the number is even higher – around 80 per cent – in program countries.
This exclusion matters because IMF advice has direct consequences for workers’ lives. Across countries, we see a consistent pattern of fiscal tightening, deregulation and privatisation being recommended. These policies weaken labor protections, push workers into informality and erode public services. We believe surveillance should change fundamentally. We propose three key reforms:
- Mandatory ex-ante distributional impact assessments for all policy recommendations. Every major policy – whether fiscal or debt-related – should be accompanied by an analysis of who pays and who benefits, disaggregated by income, gender and employment. These assessments must be public and peer reviewed by unions and civil society.
- Alignment with international standards – IMF advice should strengthen countries’ ability to meet their obligations under ILO conventions, the SDGs and the Paris Agreement.
- Institutionalised consultation mechanisms, with clear timelines and adequate preparation. Stakeholders, including unions, must have the opportunity to provide input throughout the surveillance cycle, not just in one-off meetings.
When we look at debt sustainability, the current framework only measures a country’s ability to repay creditors, not its capacity to sustain social investment. True sustainability should mean the ability to achieve human development and climate resilience. We also urge the IMF to look at fair burden-sharing in its adjustment advice. Too often, the costs of fiscal consolidation fall on the poorest – through subsidy removals or wage freezes – while the wealthiest remain largely untouched. Adjustment must be designed so that the burden falls more on those who can afford it, not on the vulnerable. Our message is simple: worker welfare and macroeconomic stability are not opposing goals – they are interdependent. A stable economy requires empowered workers, strong social protection and equitable distribution.
Zain: I want to share Pakistan’s experience, because I think it illustrates why the IMF needs a more grounded, context-specific approach to surveillance. Over the past seven years, Pakistan has gone through four successive IMF programs, while also facing catastrophic climate shocks, including the 2022 floods. Despite new “climate-aligned” conditions in our IMF programs, what we have seen on the ground is a “green austerity paradox.”
Our external debt servicing costs have risen by over 45 per cent, while development and social spending have declined sharply. During the floods, Pakistan spent 11 times more on debt servicing than on climate adaptation. This isn’t just a financing issue – it’s an analytical failure. The IMF’s debt sustainability assessments systematically underestimate climate losses and exclude disaster risks, even when these are immediate and well-documented. In the 2022 program, the IMF’s DSA did not include flood risks, despite flood warnings being issued months in advance. The problem lies in top-down modeling and lack of local data. These models assume smooth, long-term trends, but climate shocks are nonlinear and immediate. Local institutions and indigenous communities in Pakistan have been accurately predicting these risks for decades, yet their data and knowledge are excluded from the IMF’s analysis.
We need a bottom-up approach, one that integrates local climate stress tests, welfare trade-off analysis, and community knowledge into surveillance. Without this, policies risk being not only ineffective but also harmful. I also believe the IMF should create an accountability mechanism for surveillance, similar to the World Bank’s Inspection Panel. This would allow affected communities to raise concerns if IMF-advised policies worsen inequality or undermine environmental and social resilience.
Questions and answers
CSO representative: how is the IMF plans to share the findings of its internal assessment and the results of the consultation process with civil society? Having access to the initial draft or summary of the evaluation would allow us to stay informed and provide meaningful feedback as the Comprehensive Surveillance Review moves forward.
Alexandra: we understand how important transparency is for all stakeholders. I explained that the team will share the main findings of the evaluation once the review is finalised, and we very much value the input civil society has provided so far.
CSO representative: when the IMF takes on new thematic areas like gender or climate, it often seems to co-opt those issues rather than focus on how its own macroeconomic advice contributes to inequality or vulnerability. Why is the Fund talking about topics like child marriage, instead of examining how its own fiscal and structural policies are impacting gender inequality, climate risks and poverty?
Alexandra: this is an important question. The IMF’s strength is in macro-fiscal analysis, and our focus should indeed be on assessing how our policy advice influences inequality, gender dynamics and climate outcomes , not on replacing the roles of specialised institutions.
Sarah: the Fund is still learning how to incorporate these dimensions consistently into surveillance. We are developing stronger partnerships with the World Bank, ILO and UN agencies so that our analysis remains macro-critical but informed by broader social and environmental perspectives.
CSO representative: often, fiscal consolidation falls hardest on the poor. How can you make sure that the cost of reform is shared more fairly and that inequality and political economy realities are fully considered?
Alexandra: this is a valid concern but we are facing difficulties, for example we lack data from countries to integrate distributional impact assessments and social spending indicators more systematically into its surveillance and program advice.
