Message on IMF Review Process 1/2

[Robert Weissman <rob@essential.org>]

This and the following message are from Angela Wood, of the Bretton Woods
Project <bwrf@gn.apc.org>.

Robert Weissman
Essential Information			|   Internet:	rob@essential.org



********************ACTION NEEDED ON ESAF REVIEW FOLLOW-UP********************

Dear Friends,

As you know, the external review of ESAF was published in March this year.
The IMF staff are now in the process of compeleting a follow-up report
which synthesises the findings from both the internal and external ESAF
reviews. The report will then go to the Board for discussion. If there is
general agreement then some of the recommendations could be put into effect
immediately, whilst others will require further debate and negotiation.

It was envisaged that the synthesis report would be complete by now and the
Board would discuss it on 19th June. However, the staff are running behind
schedule and the report is not yet complete (or at least has not yet
reached the EDs) and no date has yet been confirmed for the Board's
discussion, which is now unlikely to take place before the end of June at
the earliest.

Unlike the internal review, the external review made some useful
recommendations for changing the IMF's operational approach and policy
directions. Whilst we believe that some of these recommendations will be
adopted, for example, the suggestion that the IMF should draw on the Bank's
expertise to analyses the impact of ESAF programmes on vulnerable sections
of society, we at the Bretton Woods Project, are concerned that the more
far reaching recommendations, such as adopting ex-poste conditionality and
loosening budget requirements in the "post-stabilisation" phase etc, will
not be fully debated and considered by the Board. For example, in meetings
with IMF staff it became clear that they did not believe that ex post
conditionality was useful and that such a system was unworkable.

It is difficult to ascertain which recommendations are being pursued and
which are not without seeing the follow-up report. The Bretton Woods
Project has been pressing the UK government to urge the Executive Board to
make the follow-up report publicly available for comment from NGOs,
consultants and academics before the Board discusses it - on the grounds that:

1) NGOs have a valuable input to make to the process, having done extensive
work on the functioning and problems of ESAF and having looked at
alternative structures;

2) the evaluation process has been public so far and it should continue to
be so;

3) the external review found that the imf's image was very poor in the ESAF
countries. A transparent follow-up process which includes participation by
those outside the IMF will vastly improve the Fund's image as well as its
operations;

The UK government accepts these arguments and is prepared to push for the
paper to be made available. However, to achieve this it will be necessary
to persuade the other EDs. Please can you raise this issue with your
governments and ED's. Although it is unlikely the Board will discuss the
paper before the end of June it is possible, so please may I urge you to
raise this matter as quickly as possible.

Attached for your information is a short briefing paper, ESAF, Surviving
the Spotlight, which outlines the main recommendations of the external review.

Best wishes,

Angela Wood.