The IMF remains central to efforts to restore the global economy to a robust and sustained growth path. The institution’s work during FY20111 focused on providing policy advice and technical support to member countries to help achieve this goal, meeting the financing needs of countries to support their adjustment efforts, including through programs in Greece, Ireland, and Portugal (the latter in early FY2012), putting in place systems that will strengthen the institution’s ability to identify and respond to global economic risks as they emerge, and working on reforms that will strengthen the international monetary system.
After suffering the first contraction since World War II in 2009, the global economy staged a strong recovery in 2010, with world GDP growing by 5 percent. However, the pace of activity remained geographically uneven, with employment lagging. Economic performance during 2010 was a tale of two halves. During the first half of the year, the recovery was driven by the rebuilding of depleted inventories, which fostered a sharp rebound in industrial production and trade. Supportive macro-economic policies also played an important role. During the second half, as the inventory cycle leveled off and fiscal consolidation loomed in many advanced economies, fears of a double-dip recession increased. In the end, reduced excess capacity, accommodative policies, and further improvements in confidence and financial conditions bolstered private demand, making the recovery more self-sustaining. Investment was in the lead, though consumption also regained strength.
As the recovery from the global economic crisis continued at varying speeds and in varying modes across the globe in FY2011, the IMF’s efforts were directed toward identifying and promoting the implementation of policies that would secure sustained and balanced growth in the world economy and continuing to offer financial and other support to member countries suffering from the crisis’s lingering effects.
The IMF has been undergoing a fundamental governance overhaul, with the aim of ensuring that the institution better reflects the changing realities of the global economy, including the heightened importance of emerging markets, while protecting the voting shares of the poorest members. The latest round of reforms, approved in FY2011, builds on those initiated in 2008 and, combined with the earlier steps, will increase by nine percentage points the quota shares of dynamic emerging market and developing countries as a group. The new allocation of quota shares will result in the biggest-ever shift of influence within the institution in favor of emerging market and developing countries.
The global crisis highlighted the need for a substantial increase in the IMF’s resources for providing financing to member countries. During FY2011, the IMF approved a historic increase in members’ quotas, which is now awaiting ratification by the Fund membership to become effective, and also approved and activated a significant expansion of its standing arrangements to borrow from member countries, significantly augmenting its resources available to provide such financing. It also signed bilateral agreements with a number of member countries to support both nonconcessional and concessional lending. Conclusion of the Fund’s limited gold sales during the year will ensure funding of an endowment under the Fund’s new income model endorsed in 2008. There is also support for making resources linked to the gold sales profits available to provide concessional assistance to low-income countries, though agreement on the final strategy is still pending.
The European Union’s (EU) financial stability framework is being markedly strengthened. This is taking place on the heels of a severe financial crisis owing to weaknesses in the banking system interrelated with sovereign difficulties in the euro area periphery. Important progress has been made in designing an institutional framework to secure microeconomic and macroprudential supervision at the EU level, but this new set-up faces a number of challenges. Developments regarding the financial stability may assist in the continuing evolution of the European financial stability architecture.
This Selected Issues paper on Euro Area Policies 2013 Article IV Consultation highlights the monetary transmission mechanism and monetary policies. The European Central Bank has announced the Outright Monetary Transactions framework to address severe distortions in sovereign bond markets and safeguard monetary transmission. The cost of unsecured bond issuance remains elevated for both core and periphery banks, but there is a growing divergence between the two, driven mainly by rising periphery spreads. Weak growth and high levels of private balance sheet debt in the periphery are weighing on the health of bank balance sheets.
El Informe Anual 2011 del FMI describe la respuesta del Directorio Ejecutivo y el personal técnico de la institución a la crisis financiera mundial y a otros eventos ocurridos durante el ejercicio 2011, que abarca el período comprendido entre el 1 de mayo de 2010 y el 30 de abril de 2011. La versión impresa de este informe se publica en ocho idiomas (alemán, árabe, chino, español, francés, inglés, japonés y ruso). Se complementa con un CD-ROM (disponible solo en inglés) que incluye el texto del informe y material suplementario, incluidos los estados financieros del FMI correspondientes al ejercicio 2011.
Le rapport annuel 2011 du FMI relate les mesures prises par le conseil d'administration et les services du FMI à la suite de la crise financière mondiale et d'autres événements au cours de l'exercice 2011, qui couvre la période du 1er mai 2010 au 30 avril 2011. La version papier du rapport est disponible en huit langues (allemand, arabe, anglais, chinois, espagnol, français, japonais et russe), ainsi qu'un CD-ROM (disponible uniquement en anglais) contenant le texte du rapport et des documents connexes, dont les états financiers du FMI pour l'exercice 2011.
This 2009 Article IV Consultation focuses on euro area policies. The euro area remains in recession, with signs of improvement yet to evolve into a recovery. The large drop in financial wealth, an associated increase in private savings, tight financing conditions, and the adjustment of global imbalances are key drivers of the economic decline. Executive Directors have welcomed the broad arsenal of macroeconomic policies and financial sector interventions deployed by euro area authorities and Member States to address the crisis.