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International Monetary Fund

This Selected Issues Paper on Belgium provides an overview of the extent of trade and financial openness of Belgium and the links to particular countries. With an export-to-GDP ratio of 79 percent, Belgium belongs to the most open economies in Europe and also globally. Its exports are highly concentrated with a share of three-fourths of total merchandise exports accounted for by the European Union, of which close to two-thirds go to Germany, France, and the Netherlands.

Abstract

5. Prior to the global crisis, the Fund was often portrayed as losing relevance to the global economy, in view of its diminishing financing role and the widespread belief in the “Great Moderation.”2 During the immediate pre-crisis period, except for low-volume lending to low-income countries, the IMF was almost exclusively focused on surveillance. Many of the large advanced and emerging economies had lost interest in engaging with the Fund. Key stakeholders argued for downsizing the Fund, as they saw little likelihood that the global economy would again need an “emergency firefighter” for emerging market economies.3 Consequently, the institution was seen as struggling to redefine its strategic role.

Abstract

10. This evaluation considers the period from 2005 to the present, with an emphasis on the period since the onset of the global crisis in 2007–08. This period allows an examination of whether the IMF’s provision of crisis-related financing and the many new initiatives may have changed country authorities’ perceptions of the Fund.

Abstract

14. What does it mean for the Fund to be a trusted advisor? And for whom? As noted earlier, this evaluation focuses primarily on the Fund as trusted advisor to its individual member countries (at the bilateral level), since policy is implemented at the national level. But the Fund’s surveillance mandate to underpin global economic and financial stability nevertheless suggests the importance of developing trust with the wider constituency of global stakeholders (at the multilateral level). Chapter 5, Section B discusses some of the trade-offs and complementarities that arise from attempting to build trust at both the bilateral and multilateral levels.

Abstract

20. How well does the Fund perform with regard to the criteria outlined above? Given the complexity of the issue, there is no simple answer. Based on evidence from both the interviews and surveys of country authorities, the Fund received high marks in many dimensions of the trusted advisor role. Moreover, the Fund can be rightfully proud of its achievements in improving its overall image in the aftermath of the global crisis. But the evaluation also identified areas where the Fund falls short, some representing longstanding problem areas.

Abstract

72. The present time offers a unique window of opportunity to lay the groundwork to make the upswing in trust sustainable in a post-crisis environment. To do so, the Fund needs to have an institutional and incentive structure suited not only to dealing with member countries during crises, but also for periods of relative calm. The true test for the Fund will be in periods of calm, when a trusted advisor role is even more critical for traction and is likely best supported by an intellectually diverse culture and a flexible, open-minded approach to engaging with countries.