IMF technical assistance supports the development of the
productive resources of member countries by helping them to
effectively manage their economic policy and financial affairs. The
IMF helps countries to strengthen their capacity in both human and
institutional resources, and to design appropriate macroeconomic,
financial, and structural policies.
Technical assistance benefits low-income countries
Technical assistance is one of the benefits of IMF membership. About
two-thirds of IMF technical assistance goes to low- and
lower-middle-income countries. Post-conflict countries are also major
beneficiaries. Apart from the immediate benefit to recipient countries,
by helping individual countries reduce weaknesses and vulnerabilities,
technical assistance also contributes to a more robust and stable global
economy. Further, technical assistance provided to emerging and advanced
economies in select cutting-edge areas helps provide traction to IMF
policy advice, keeps the institution up to date on innovations and risks
to the international economy, and help address crisis-related
challenges.
Integrating technical assistance with IMF surveillance and lending
Technical assistance contributes to the effectiveness of the IMF’s
surveillance and lending programs, and is an important complement to
these other core IMF functions. Specialized technical assistance from
the IMF helps build capacity in countries for effective policymaking,
including in support of surveillance or lending operations. Conversely,
surveillance and lending work results in policy and other experiences
that further inform and strengthen the IMF’s technical assistance in
line with international best practices. In view of these linkages,
achieving greater integration between technical assistance, training,
surveillance, and lending operations is a key priority for the IMF.
Technical assistance covers core areas of IMF expertise
The IMF provides technical assistance in its areas of core expertise:
macroeconomic policy, tax policy and revenue administration, expenditure
management, monetary policy, the exchange rate system, financial sector
stability, legislative frameworks, and macroeconomic and financial
statistics. In particular, efforts in recent years to strengthen the
international financial system and fiscal and debt policies have
triggered additional demands for IMF technical assistance. For example,
countries have asked for help to address financial sector weaknesses
identified within the framework of the joint IMF-World Bank
Financial Sector Assessment Program and to adopt and adhere to
international
standards and codes for financial, fiscal, and statistical
management.
At the same time, there is a continuing demand for technical
assistance to help low-income countries build capacity to design and
implement poverty-reducing and growth programs, and help
countries—several of which have benefited from debt relief under the
Heavily Indebted Poor Countries (HIPC) Initiative—undertake debt
sustainability analyses and develop debt management strategies. The IMF
also contributes actively to the Enhanced
Integrated Framework for trade-related technical assistance, which
aims to assist low-income countries expand their participation in the
global economy. The recipient country is fully involved in the entire
process of technical assistance, from identification of need to
implementation, monitoring, and evaluation.
Technical assistance delivery takes a regional approach
The IMF delivers technical assistance in various ways. Depending on
the nature of the assignment, support is often provided through staff
missions of limited duration sent from headquarters or the placement of
experts and/or resident advisors for periods ranging from a few weeks to
a few years. Assistance might also be provided in the form of technical
and diagnostic studies, training courses, seminars, workshops, and
“online” advice and support.
The IMF has increasingly adopted a regional approach to the delivery
of technical assistance and training. It operates eight
regional technical assistance centers—in the Pacific; the Caribbean;
East, West, Central, and Southern Africa; the Middle East; and in
Central America. The IMF will open in late 2013 a second regional center
in West Africa for non-francophone countries.
Topical trust funds
The regional centers are complemented by technical assistance
financed through topical trust funds. The first such fund started
operations in May 2009, concentrating on building capacity in connection
with anti-money laundering and combating the financing of terrorism. The
trust funds on tax policy and administration, managing natural resource
wealth, and the South Sudan started operations in 2011. In addition, the
IMF and the World Bank are working on a joint trust fund to provide
assistance on developing sustainable debt strategies and are renewing
another joint trust fund to provide assistance on financial sector
issues.
Donors play a large role in financing technical assistance
Technical assistance accounts for about one-quarter of the IMF’s
operating budget. It is financed by both internal and external
resources, the latter comprising funds from both bilateral and
multilateral donors. Such cooperation and resource sharing with external
donors has benefits: it leverages the internal resources available for
technical assistance; helps avoid duplication of advice by different
donors; and strengthens collaboration with donors and other technical
assistance providers.
Bilateral donors to the IMF’s technical assistance program include
Australia, Belgium, Brazil, Canada, China, Denmark, France, Germany,
Italy, Japan, the Republic of Korea, Kuwait, Luxembourg, Mexico, the
Netherlands, New Zealand, Norway, Oman, Qatar, Saudi Arabia, Spain,
Sweden, Switzerland, the United Kingdom, the United States of America,
and more than forty beneficiary countries.
Multilateral donors include the African Development Bank, the Asian
Development Bank, the Caribbean Development Bank, the Central American
Bank for Economic Integration, the European Union, the European
Investment Bank, the Inter-American Development Bank, and the Islamic
Development Bank. In FY 2012, external financing accounted for about
three-fourths of IMF technical assistance field delivery.