Policy Papers

September 28, 2009

The Implications of the Global Financial Crisis for Low-Income Countries—An Update

Description: Low-income countries are being hit hard by the global financial crisis. They are facing a sharp contraction in export growth, FDI inflows, and remittances, and lower-than-committed aid. But a marked recovery is in prospect for 2010 helped by rising world demand and supported by short-term domestic policies.

Countries are using fiscal and other policies to respond to the crisis and should continue to do so, where appropriate, until the economic recovery is clearly underway. However, the risks to debt sustainability are rising and countries should begin preparing to realign policies toward medium-term sustainability once the recovery is clearly on the move. Additional highly concessional donor support is needed to ensure that countries are not forced to make these adjustments prematurely, and to facilitate a smooth return to a sustainable debt path, with strong growth, over the medium term.

September 28, 2009

Provisional Agenda for the Twentieth Meeting of the International Monetary and Financial Committee

September 24, 2009

Update on the Financing of the Fund's Concessional Assistance and Debt Relief to Low-Income Member Countries

Description: This paper provides a semi-annual review of the status of financing for the Fund’s concessional lending and debt relief to low-income countries (LICs). Since the last review, the Executive Board has approved comprehensive reforms of the Fund’s concessional lending instruments and financing framework.

This update is based on data available at end-August and also takes into account the implications of these reforms.

September 18, 2009

Framework Administered Account for Selected Fund Activities—West Africa Regional Technical Assistance Center (AFRITAC West) Subaccount

Description: In March 2009, the Fund established a new Framework Administered Account to administer external financial resources for selected Fund activities (the “SFA Instrument”).

The financing of activities under the terms of the SFA Instrument is implemented through the establishment and operation of a subaccount within the SFA. The subaccount for the West Africa Regional Technical Assistance Center (AFRITAC West) would be the fourth one under the SFA.

This paper requests Executive Board approval to establish the AFRITAC West subaccount under the terms of the SFA Instrument.

September 17, 2009

Framework Administered Account for Selected Fund Activities—East Africa Regional Technical Assistance Center (AFRITAC East) Subaccount

Description: In March 2009, the Fund established a new Framework Administered Account to administer external financial resources for selected Fund activities (the “SFA Instrument”). The financing of activities under the terms of the SFA Instrument is implemented through the establishment and operation of a subaccount within the SFA.

The subaccount for the East Africa Regional Technical Assistance Center (AFRITAC East) would be the third one under the SFA.

This paper requests Executive Board approval to establish the AFRITAC East subaccount under the terms of the SFA Instrument.

September 16, 2009

Heavily Indebted Poor Countries (HIPC) Initiative and Multilateral Debt Relief Initiative (MDRI) - Status of Implementation 2009

Description: This paper updates the status of implementation, impact, and costs of the Enhanced Heavily Indebted Poor Country (HIPC) Initiative and the Multilateral Debt Relief Initiative (MDRI).

Debt relief provided under the Initiatives has substantially alleviated debt burdens in recipient countries. Aided by continued flexibility on the part of IDA and the Fund, substantial progress has been achieved under the Initiatives since the last report, and a number of post-decision-point countries have already benefited from debt relief.

September 14, 2009

Review of Recent Crisis Programs

Description: This study concludes that recent Fund-supported programs in emerging market countries are delivering the kind of policy response and financing needed to cushion the blow from the worst global crisis since the 1930s. While the crisis has had a profound effect on output and employment, especially in those countries starting with large external vulnerabilities, many of the severe disruptions attending previous crises—currency overshooting and bank runs—have so far been avoided. Internalizing lessons from the past, programs have responded to country conditions and adapted to worsening economic circumstances to attenuate contractionary forces. As a result, signs of stabilization are emerging in program countries, though there remain challenges to secure sustained recovery in a number of countries.

September 9, 2009

Creating Policy Space - Responsive Design and Streamlined Conditionality in Recent Low-Income Country Programs

Description: An analysis of recent programs in low-income countries, covering countries with continuous program engagement with the IMF throughout the period 2007-09, shows that program design has been adapted to provide expanded policy space in response to the food and fuel price shocks of 2007-08 and to the global financial crisis that followed. The analysis also finds that structural conditionality in Fund-supported programs in low-income countries has become more streamlined, with a dominant focus on public sector resource management and accountability.

September 2, 2009

Note Purchase Agreement Between the People's Bank of China and the International Monetary Fund

Description: In light of the international effort to ensure the adequacy of the financial resources available to the Fund, and with a view to supporting the Fund’s ability to provide timely and effective balance of payments assistance, particularly to developing and emerging market countries affected by the global financial crisis, the PBC agrees to purchase from the Fund promissory notes.

September 2, 2009

Borrowing Agreement Between Deutsche Bundesbank and the International Monetary Fund

Description: In light of the multilateral effort to ensure the adequacy of the financial resources available to the International Monetary Fund, and with a view to supporting the Fund’s ability to provide timely and effective balance of payments assistance to its members, Deutsche Bundesbank agrees to lend to the Fund an SDR-denominated amount up to the equivalent of EUR 15 billion.