International Monetary Fund. External Relations Dept.
At the UN’s Monterrey Summit in March 2002, heads of state and government agreed to broaden and strengthen the participation of developing countries and economies in transition in international decision making and norm setting. But five years later, it is clear that the reform of the IMF’s governance—which encompasses, among other things, quotas, voting rights, and voice—has progressed rather slowly. This situation urgently needs to be turned around, as recognized by the International Monetary and Financial Committee, which regularly reviews progress on the Monterrey consensus. Its April 2006 communiqué stated that the IMF’s effectiveness and credibility as a cooperative institution must be safeguarded and its governance further enhanced, emphasizing the importance of fair voice and representation for all members.
Although Afghanistan has made significant gains over the years, vulnerabilities remain. The economic program Afghanistan National Development Strategy (ANDS) has been developed to sustain democracy, reduce poverty, and improve growth. ANDS, an important milestone in the rebuilding and development of Afghanistan, serves as its Poverty Reduction Strategy Paper (PRSP) and uses the pillars, principles, and benchmarks of the Afghanistan Compact as a foundation to achieve its MDGs. It has given high priority to the security sector for implementing security policies and strategies and also for building an Afghan National Army for the country's security.
Macroeconomic costs of conflict are generally very large, with GDP per capita about 28 percent lower ten years after conflict onset. This is overwhelmingly driven by private consumption, which falls by 25 percent ten years after conflict onset. Conflict is also associated with dramatic declines in official trade, with exports (imports) estimated to be 58 (34) percent lower ten years after conflict onset. The onset of conflict often also induces significant refugee outflows to neighboring non-advanced countries in the short run, and relatively small but very persistent refugee outflows to advanced countries over the long run. Finally, we stress that conflict should be defined in terms of the number of people killed relative to the total population. The traditional definition of conflict—based on the absolute number of deaths—skews the sample toward low-intensity conflicts in large countries, thereby understating the negative effects of conflict from a macroeconomic perspective.