Chapter

Appendix III. Principal Policy Decisions of the Executive Board

Author(s):
International Monetary Fund
Published Date:
September 2001
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A. Access Policy and Limits in Credit Tranches and Under Extended Fund Facility—Review

The Fund decides that the next annual review of the guidelines and limits for access to the Fund’s general resources in the credit tranches and under the extended Fund facility prescribed by paragraph 2 of Decision No. 11870 -i99/2)1 shall be completed by June 30, 2001.

Decision No. 12385-00/129)

December 20. 2000

B. IMF’s Income Position

(a) Disposition of Net Income for FY 2001

1. SDR 48 million of the Fund’s net income for FY 2001 derived from the application of paragraph 2 of Decision No. 12188-(00/45)2, adopted April 28, 2000 shall be placed to the Fund’s Special Reserve after the end of the financial year.

2. The gain derived from the application of International Accounting Standard 19—Employee Benefits during FY 2001 shall be placed to the Fund’s Special Reserve and shall be recorded separately in the financial records of the Fund.

Decision Mo. 12403-(01/39)

April 16. 2001

(b) The Rate of Charge on the Use of Fund Resources for FY 2002

1. Notwithstanding Rule I-6(4)(a), effective May 1, 2001, the proportion of the rate of charge referred to in Rule 1-6(4) to the SDR interest rate under Rule T-l shall be 117.6 percent.

2. The net income target for FY 2002 shall be SDR 51 million. Any net income for financial year 2002 in excess of SDR 51 million shall be used to reduce retroactively the pro portion of the rate of charge for financial year 2002. If net income for financial year 2002 is below SDR 51 million, the amount of projected net income for financial year 2003 shall be increased by the equivalent ofthat shortfall. For the pur pose of this provision, net income shall be calculated without taking into account net operational income generated by the surcharges on purchases under the Supplemental Reserve Facility and Contingent Credit Lines, the surcharge on pur chases in the credit tranches and under the Extended Fund Facility or the effect on income of the implementation of International Accounting Standard 19—Employee Benefits.

Decision No. 12464-(01/39)

April 10. 2001

C. SDR Department

(a) SDR Valuation Basket—Revised Guidelines for Calculation of Currency

1. The value of the special drawing right shall be deter mined on the basis of the four currencies issued by Fund members, or by monetary unions that include Fund members (“monetary unions” i, whose exports of goods and services during the five-year period ending 12 months before the effective date of this decision or any subsequent revision had the largest value, and which have been determined by the Fund to be freely usable currencies in accordance with Article XXX(f) of the Fund’s Articles of Agreement. In the case of a monetary union, the determination of the values of exports of goods and services of the union shall exclude the trade of goods and services among members that arc part of the union.

2. The percentage weights of each of the currencies selected in accordance with paragraph 1 above shall reflect (i) the value of the balances ofthat currency held at the end of 1999, and thereafter at the end of each year of the relevant live year period referred to in paragraph 1 above, by the monetary authorities of other members or, in the case of the currency of a monetary union, by the monetary authorities of members other than those forming part of the monetary union, and (ii) the value of exports of goods and services, as defined in paragraph 1 above, of the members or monetary unions issuing the currencies over the relevant five-year period referred to in paragraph 1 above.

3. In accordance with the principles set forth in paragraphs 1 and 2 above, effective January I, 2001, the value of one special drawing right shall he the sum of the values of specified amounts of the four currencies listed below. These amounts shall be determined on December 29, 2000, in a manner that will ensure that, at the average exchange rates for the three-month period ending on that date, the shares of each of the four currencies in the value of the special drawing right correspond to the weights specified below.

CurrencyWeight
(in percent)
U.S. dollar45
Euro29
Japanese yen15
Pound sterling11

4. The list of the currencies that determine the value of the special drawing right, and the amounts of these currencies, shall be revised with effect on January 1, 2006, and on the first day of each subsequent period of five years in accordance with the following principles, unless the Fund decides otherwise in connection with a revision:

  • (a) The currencies determining the value of the special drawing right shall be determined in accordance with paragraph 1 above, provided that a currency shall not replace another currency included in the list at the time of the determination unless the value of the exports of goods and services of the member or of members of a monetary union, whose currency is not included in the list, during the relevant period exceeds that of the member or the monetary union issuing the currency included in the list by at least 1 percent.

  • (b) The amount of the four currencies referred to in (a) above shall be determined on the last working day preceding the effective date of the relevant revision in a manner that will ensure that, at the average exchange rates for the three-month period ending on that date, the shares of these currencies in the value of the special drawing right correspond to percentage weights for these currencies, which shall be established for each currency in accordance with (c) below.

  • (c) The percentage weights shall be established in accordance with the principles set forth in paragraph 2 above, in a manner that would maintain broadly the relative significance of the factors that underlie the percentage weights in paragraph 3 above. The percentage weights shall be rounded to the nearest 1 percent or as may be convenient.

5. The determination of the amounts of the currencies in accordance with 3 and 4 above shall be made in a manner that will ensure that the value of the special drawing right in terms of currencies on the last working day preceding the five-year period for which the determination is made will be the same under the valuation in effect before and after revision.

Decision No. 12281 -(00/98) G/S

October 11, 2000

(b) SDR Valuation—Amendment to Rule T-l

Effective January 1. 2001, Rule T-l(c) shall be amended by deleting the list of yields and rates and replacing it with the following list:

U.S. dollarMarket yield for three-month U.S. Treasury bills
EuroThree-month Euro Interbank Offered Rate (Euribor)
Japanese yenThirteen-week Japanese Government financing bills
Pound sterlingMarket yield for three month U.K. Treasury bills

Decision No. 12282 (00/9$), G/S

October 11. 2000

(c) SDR Valuation—Revised Guidelines for the Calculation of Currency—Amendment

Effective January 1, 2001, paragraph 2 of Decision No. 8160-(85/186) G/S3, adopted December 23, 1985, on the Guidelines for the Calculation of the Currency Amounts for purposes of the SDR Valuation Basket, shall be amended by deleting the reference to “paragraph 3(c) of Executive Board Decision No. 6631-(80/145)4 adopted September 17, 1980” and replacing it with the following: “paragraph 4 (c) of Executive Board Decision No. 12281 (00/98)5, adopted October 11. 2000.”

Decision No. 12283 (00/98), G/S

October 11, 2000

(d) European Central Bank—Prescription as Holder of SDRs

Prescription as a holder

The European Central Bank is prescribed, in accordance with Article XVII, Section 3(i) of the Articles of Agreement, as a holder of SDRs.

Terms and conditions for acceptance, holding, and use of SDRs

The European Central Bank is authorized to accept, hold, and use SDRs in transactions and operations in accordance with and on the terms and conditions specified in Executive Board Decision No. 6467-(80/71) S6, adopted April 14, 1980 (“Terms and Conditions for the Acceptance, Holding, and Use of Special Drawing Rights by Other Holders Prescribed under Article XVII, Section 3”).

Decision No. 12329-(00/l 13)

November 15, 2000

(e) Valuation of SDR—Amendment to Rule O-1

Effective January 1, 2001, Rule O-l, which specifies the amounts of the currencies in the SDR valuation basket, shall be amended to read as follows:

Rule O-1. The value of the SDR shall be the sum of the values of the follow me amounts of the following currencies:

U.S. dollar0.577
Euro0.426
Japanese yen21.0
Pound sterling0.0984

Decision No. 12403 (01/1)

December 29. 2000

D. Compensatory Financing Facility (CFF)

(a) Compensatory Financing Facility—Amendment

Decision No. 8955-(88/126)7, August 23, 1988, as amended, is-hereby amended to read as follows:

Compensatory Financing Facility

Section I. General Provisions

1. The Fund is prepared to extend financial assistance, in accordance with the provisions of this Decision, to members that encounter balance of payments difficulties arising out of (i) temporary export shortfalls or (ii) excess costs of cereal imports.

2. Purchases under this Decision and holdings resulting from such purchases shall be excluded for the purposes of the definition of reserve tranche purchase pursuant to Article XXX(f).

3. Except for the purpose of determining the level of conditionality applied to purchases in the credit tranches, the Fund’s holdings of a member’s currency resulting from purchases under this Decision shall be considered separate from the Fund’s holdings of the same currency resulting from purchases under any other policy on the use of the Fund’s general resources. In cases of concurrent requests for purchases under this Decision and for purchases in the credit tranches, purchases under this Decision shall be deemed to be made first.

4. In order to carry out the purposes of this Decision, the Fund will be prepared to grant a waiver of the limitation of’ 200 percent of quota in Article V, Section 3(b) (iii), whenever necessary to permit purchases under this Decision or to permit other purchases that would raise the Fund’s holdings of the purchasing member’s currency above that limitation because of purchases outstanding under this Decision.

5. The Fund shall indicate in an appropriate manner which purchases by a member are made pursuant to Section II or Section III of this Decision, as well as the export shortfall component and the cereal import cost component of each purchase under Section III.

6. When a request for a purchase is made by a member under either Section II or Section III of this Decision on account of circumstances that have already been taken into account in calculating the amounts of purchases made or to be made under the other Section, double compensation shall be avoided when calculating the amount of the requested purchase.

7. In providing financing pursuant to this Decision, the Fund, as under other policies of the Fund, shall pay due attention to the member’s capacity to service its financial obligations to the Fund, and, having regard to the outstanding financial obligations of the member to the Fund, may reduce the amount of financing accordingly, notwithstanding any other provision in this Decision.

8. Wherever used in this Decision, the expression “arrangement” will mean an upper credit tranche stand-by arrangement, an extended arrangement, or an arrangement under the Poverty Reduction and Growth Facility (PRGF).

9. Without prejudice to the other limitations on pur chases specified b\ this Decision, the Fund’s holdings of a member’s currency resulting from purchases under this Decision shall not exceed any of the following access limits:

  • (a) 45 percent of the member’s quota for purchases on account of an export shortfall under Section II or Section III;

  • (b) 45 percent of the member’s quota for pur chases on account of an excess of cereal import costs under Section III; and

  • (c) a combined limit of 55 percent of the member’s quota for purchases on account of an export short tall component under Section II or Section III and an excess cereal costs component under Section III.

Section II. Compensatory Financing of Export Fluctuations

Qualification and Timing of Purchases

10. The Fund is prepared to assist members, particularly primary exporters, encountering balance of payments difficulties produced by temporary export shortfalls and such members may expect that their request for purchases under this Section will be met, subject to the provisions of this Decision, where the Fund is satisfied that the shortfall is of a short-term character and is largely attributable to circumstances beyond the control of the member, and

  • (a) at the time of the request, the member’s balance of payments position apart from the effects of the export shortfall is satisfactory; or

  • (b) at the time of the request, the Fund approves an arrangement, or, in the case of an existing arrangement, either completes a review under such an arrange mem or determines that the member’s policies are such as would, in the Fund’s view, continue to meet the criteria for the use of the Fund’s resources in the upper credit tranches.

11. With respect to compensation under paragraph 10(a), a member may expect that the full amount of compensatory financing, subject to the provisions of this Decision, shall be made available in one purchase, unless estimated data are used for 9 months or more of the 12 month period referred to in paragraph 15, in which case the amount of compensatory financing shall be made available in two purchases, in accordance with the following provisions:

  • (a) the first purchase shall not exceed 05 percent of the amount of compensatory financing; and

  • (b) the second purchase request shall not exceed the difference between the amount of the compensatory financing recalculated at the time of the request for the second purchase and the amount of the first purchase and shall not be approved until actual statistical data become available for at least 6 months of the 12-month period used for the purposes of the first purchase; if the policy implementation or external circumstances of the member differ materially from that originally anticipated at the time of the request for the first purchase, the Fund may decide not to approve, or to reduce the amount available under, the second purchase.

12. With respect to compensation under paragraph 10(b), a member may expect that the amount of compensatory financing, subject to the provisions of this Decision, shall be made available in more than one purchase, whichshall normally be for equal amounts, unless recalculated pursuant to this paragraph, and that

  • (a) its request for a first purchase will be met immediately, subject to the provisions of this Decision,

  • (b) its requests for subsequent purchases will he met, subject to the provisions of this Decision, if, at the time of the request for the purchase,

    • —the member continues to have an arrangement, and

    • —the Hund decides that the member has met the conditions for the purchase or disbursement under the associated arrangement, including the observance or waiver of any applicable performance criteria or other conditions specified therein; provided that the last purchase shall not take place earlier than six months from the first purchase, and any actual statistical data that have become available for the shortfall year shall be used to recalculate the amount of any subsequent purchases under this paragraph.

13. A purchase under paragraph 11 or the first purchase under paragraph 11(a) or paragraph 12 shall not be approved under this Section later than six months after the end of the 12 month period referred to in paragraph 16, provided that it may be approved up to seven months after the end of such period if the delay beyond six months is the result of circumstances external to the member.

Calculation

14. If, in the opinion of the Fund, adequate data on receipts from services other than investment income arc avail able, the member requesting a purchase under this Section shall specify whether the receipts shall be included or excluded in the calculation of the shortfall. The choice by the member to include such receipts shall continue to apply for a period of three years.

15. The existence and amount of an export shortfall for the purpose of any purchase under this Section shall be deter mined with respect to the latest 12 month period preceding the request (or, in the case of paragraph 11(a) or paragraph 12, the first request) for which the Fund has sufficient statistical data, provided that a member may request a purchase in respect of a shortfall year for which not more than 12 months of the data on merchandise exports and on receipts from services are estimated.

16. In order to identify more clearly what are to he regarded as export shortfalls of a short-term character, the Fund, in conjunction with the member concerned, will seek to establish reasonable estimates regarding the medium-term trend of the member’s exports based partly on statistical calculation and partly on appraisal of export prospects. For the purposes of this Section, the shortfall shall be the amount by which the member’s export earnings in the shortfall year arc less than the geometric average of the member’s export earnings for the five year period centered on the shortfall year. In computing the five-year geometric average, the Fund, in conjunction with the member, will use an estimate based on a judgmental forecast for the period of the two post shortfall years, provided that any amount by which the forecast for the period of the two post-shortfall years would exceed the member’s export earnings for the period of the two pre-shortfall years by more than 20 percent shall not be included in such computation. When the Fund allows a member to purchase under the proviso in paragraph 15, the Fund may use such methods as it considers reasonable for estimating exports dining the period for which sufficient statistical data arc not available. If, in the opinion of the Fund, adequate statistical data arc available for this purpose, the calculations and estimates under this paragraph of earnings from an export item shall, with respect to a purchase on account of an export short-fall under this Section or Section III, be made net of the value of imported intermediate inputs, where such value exceeds 50 percent of the gross earnings from the export item and the exclusion of the value of the export item would increase or reduce by at least 10 percent the amount that could otherwise be purchased on account of the export shortfall.

Over Compensation

17. When a member has made a purchase under this Section on the basis of estimated data and the amount of the purchase exceeds the amount that could have been purchased on the basis of actual statistical data, the member will be expected to make a prompt repurchase in respect of the outstanding purchase, in an amount equivalent to the excess. The calculation of such an excess with respect to a purchase shall be made on the basis of the same post shortfall year projections used for the calculation of the purchase, provided that if the member has made more than one purchase with respect to the same 12 month period, the calculation of any excess with respect to all such purchases will be made on the basis of the post shortfall year projections used for the latest of such purchases.

18. Provision shall be made in all arrangements for the suspension of further disbursements under the arrangement whenever a member fails to meet a repurchase expectation pursuant to paragraph 17. Furthermore, the Managing Director shall not recommend for approval, and the Fund shall not approve, a request for the use of the Fund’s general resources by a member that is failing to meet such an expectation.

19. If a member requests financing under this Section in relation to a shortfall year that in whole or in part is included in the period of the two post-shortfall years concerning any earlier purchase under this Section, the amount of the requested purchase shall be adjusted so as to take into account any amount by which such earlier purchase differs from the amount that could have been purchased on the basis of the data available at the time of the request.

Section III. Compensatory Financing of Fluctuations in the Cost of Cereal Imports

Qualification anti Timing of Purchases

20. The Fund is prepared to extend financial assistance subject to the provisions of this Decision to members that encounter a balance of payments difficulty produced by an excess in the cost of their cereal imports.

21. For a period of three years from the date of a member’s first request for a purchase in respect of cereal imports under this Section, any purchases by the member in respect of its export shortfalls shall be made under this Section instead of under Section II of this Decision. The same provision shall apply if, after the end of the three-year period, the member makes a new purchase in respect of cereal imports under this Section.

22. A member with balance of payments difficulties may expect that its request for a purchase under this Section will be met if the Fund is satisfied that any shortfall in exports and am excess costs of cereal imports that result in a net shortfall in the member’s exports are of a short-term character and are largely attributable to circumstances beyond the control of the member, and

  • (a) at the time of the request, the member’s balance of payments position, apart from the effects of the net shortfall in the member’s exports, is satisfactory; or

  • (b) at the time of the request, the Fund approves an arrangement, or, in the case of an existing arrangement, either completes a review under such an arrangement or determines that the member’s policies are such as would, in the Fund’s view, continue to meet the criteria for the use of the Fund’s resources in the upper credit tranches.

23. Paragraphs 11, 12, and 13 shall apply mutatis mutandis to this Section. The applicable 12-month period shall be the period referred to in paragraph 25.

Calculation

24. (a) Subject to the limits specified in paragraph 9, a member may request a purchase under this Section for an amount equal to the net shortfall in its exports calculated as the sum of its export shortfall and the excess in its cereal import costs.

  • (b) (i) For the calculation of the net shortfall in exports, an excess in exports shall be considered a negative shortfall in exports and a shortfall in cereal import costs shall be considered a negative excess in cereal import costs.

  • (i) An export shortfall shall he determined in accordance with Section II.

  • (ii) An excess in cereal import costs shall be determined in accordance with paragraphs 25 and 26.

25. The existence and amount of an excess in the cost of cereal imports shall be determined, tor the purpose of purchases under this Section, with respect to the latest 12-month period preceding the request for which the Fund has sufficient statistical data, provided that the Fund may allow a member to make a purchase on the basis of estimated data in respect of a 12-month period ending not later than 12 months after the latest month tor which the Fund has sufficient statistical data on the member’s cereal import costs. The estimates used for this purpose shall be made in consultation with the member. The calculation of a member’s shortfall or excess in exports and its excess or shortfall in the cost of its cereal imports shall be made tor the same 12 month period.

26. In order to identity more clearly what are to be regarded as excess costs of cereal imports of a short-term character, the Fund, in consultation with the member concerned, will seek to establish reasonable estimates regarding the medium term trend of the member’s cereal import costs. For the purposes of this Section, the excess in a member’s cereal imports tor the 12-month period referred to in paragraph 25 shall be the amount by which the member’s cereal imports in that 12 month period are more than the arithmetic average of the member’s cereal imports tor the five-year period centered on that 12 month period.

27. The amount of a purchase under this Section, as defined in paragraph 24, may be either on account of an export shortfall or on account of an excess in cereal import costs, or the amount may consist of two components, one on account of an export shortfall and the other on account of an excess in cereal import costs. A member shall allocate the amount of its purchase under this Section between the export shortfall and cereal import components, each as limited by paragraph 9(a) or paragraph 9(b), provided that in no case the combined amount shall exceed the limit in paragraph 9(c).

  • 28. (a) The pan of a purchase relating to an export shortfall, subject to the limit in paragraph 9(a), shall not exceed the lesser of the export shorttall defined in paragraph 24(b)(ii) and the net shortfall in exports defined in paragraph 24(a).

  • (b) The amount of a purchase relating to an excess in cereal import costs, subject to the limit in paragraph 9(b), shall not exceed the lesser of the excess in cereal import costs defined in paragraph 24(b) (iii) and the net shortfall in exports defined in paragraph 24(a).

  • 29. (a) Subject to paragraph 31, when a reduction in the Fund’s holdings of a member’s currency is attributed to a purchase under this Section, the member shall attribute that reduction between the out standing cereal import component and export shortfall component of the purchase.

  • (b) When the Fund’s holdings of a member’s currency resulting from a purchase under this Section or Section II are reduced by the member’s repurchase or otherwise, the member’s access to the Fund’s resources under this Section will be restored pm tauto, subject to the limits in paragraph 9.

  • 30. (a) After the expiration of the period referred to in paragraph 21, the total amount of the export shortfall components of a member’s purchases outstanding under this Section shall be counted as having been purchased under Section II.

  • (b) The provisions of Section II shall continue to apply to the export shortfall component of a purchase under this Section after the expiration of the period referred to in paragraph 21.

Over Compensation

31. The provisions of paragraph 17, I8, and 19 shall apply mutatis mutandis to purchases under this Section. The applicable 12-month period shall be the period referred to in paragraph 25.

Section IV. Other Provisions

32. All references in other Fund decisions to the Com pensatory and Contingency Financing Facility shall be read as the Compensator) Financing Facility.

33. The Fund will review this Decision not later than August 30, 2002.

Decision No. 12325-(00/111)

November 10, 2000

(b) Repurchases Under Emergency Assistance; Purchases in Credit Tranches and Compensatory Financing Facility—Repurchase Expectations

(Sec Section F below, subsection (b) for the full text of this decision)

E. Contingent Credit Lines (CCL)

(a) Policy on CCL—Extension of Deadline for Review

Paragraph 20 of Decision No. 11627-(97/123)SRF8, as amended, shall he amended by deleting “May 5, 2000” and replacing it with “August 31, 2000”.

Derision No. 12197-(00/48) SRF

May 4. 2000

(b) Supplementary Reserve Facility and CCL—Amendments to Decision

See Section K below, subsection (a) for the full text of this decision)

(c) Surcharges on Purchases Under SRF and CCL, and in Credit Tranches and Under EFF—Disposition of Net Operating Income

See Section K below, subsection (b) for the full text of this decision)

F. Emergency Assistance

(a) Conversion of Emergency Assistance into a Special Policy

1. T he Fund will be prepared to provide financial assistance to members who arc afflicted by natural disasters or are in postconflict situations. This assistance will be provided in accordance with the provisions of this decision and the guide lines on emergency assistance for natural disasters and post-contlict situations set out in: (i) pages 17 and 18 of EBM/82/16 (2/10/82); (ii)Summing Up by the ChairmanFund Involvement in Postconflict Countries -Executive Hoard Meetinn 95/82-September 6, 1995 (BUFF/95/98 (9/19/95)); and (iii) Summing Up by the Acting Chairman -Fund Assistance to Postconflict Countries -Executive Hoard Medina 99/38 -April 5, 1999 (BUFF/99/48 (4/9/99)).

2. Purchases under this decision and holdings resulting tiro in such purchases shall be excluded for the purposes of the definition of reserve tranche purchase pursuant to Article XXX(c).

3. Except tor the purpose of determining the level of conditionality applied to purchases in the credit tranches, the Fund’s holdings of a member’s currency resulting from purchases under this decision shall be considered separate from the Fund’s holdings of the same currency resulting from purchases under any other policy on the use of the Fund’s general resources.

4. In order to carry out the purposes of this decision, the Fund will be prepared to grant a waiver of the limitation of 200 percent of quota in Article V, Section 3(b)(iii), whenever necessary to permit purchases under this decision or to permit other purchases that would raise the Fund’s holdings of the purchasing member’s currency above that limitation because of purchases outstanding under this decision.

Decision No. 12341 (00/117)

November 28, 2000

(b) Repurchases Under Emergency Assistance; Purchases in Credit Tranches and Compensatory Financing Facility—Repurchase Expectations

1. Decision No. 5703-(78/39)9 adopted March 22, 1978, shall be amended as follows:

  • (i) paragraph l(a) shall be amended by adding: “or the decision on Emergency Assistance (Decision No. 12341 (00/117)10),” before “shall be completed”;

  • (ii) the current paragraph l(b) shall be deleted in its entirety and replaced by the following:

    • “(b) A member will be expected to repurchase the Fund’s holdings of its currency resulting from purchases in the credit tranches or under the Compensatory Financing Facility made after November 28, 2000 in equal quarterly installments during the period beginning two years and ending four years after the date of the purchase, provided that the Fund may, upon request by the member, amend the schedule of repurchase expectations, if in the judgment of the Fund the member’s external position is not sufficiently strong tor repurchases to be made in accordance with the expectation schedule set out in this paragraph. In determining whether to amend the schedule, the Fund may consider all relevant information, including the size of the member’s foreign reserves, the member’s medium-term balance of payments outlook, and the degree of the member’s access to international capital markets.”;

    and

  • (iii) the following new paragraph 1(c) shall be added:

    • “(c) The Fund shall not approve, and the Managing Director shall not recommend for approval, any request for the use of the Fund’s general resources by a member that is tailing to meet a repurchase expectation under paragraph 1(b) above. Provision shall be made in each stand-by and extended arrangement tor the suspension of turther purchases under the arrangement whenever a member tails to meet a repurchase expectation under paragraph 1(b) above.”

2. The Fund shall review the time-based repurchase expectation scheme set out in paragraph 1(b) of Decision No. 5703 (78/39)11, adopted March 22, 1978, no later than November 30, 2005.

Decision No. 12342-(00/ID

November 28, 2000

G. Extended Fund Facility (EFF)

(a) Repurchase Expectations

1. Decision No. 4377 (74/114)12, adopted September 12, 1974, shall be amended by adding the following new paragraph:

  • “10. (a) In addition to making repurchases in accordance with paragraph 5, a member will be expected to repurchase an amount of the Fund’s holdings of its currency resulting from purchases under this decision made alter November 28, 2000 equal to, and at the time of, the six monthly installments of repurchases falling due during the period beginning four years and ending seven years after the date of the purchase, provided that the Fund may, upon request by the member, amend the schedule of repurchase expectations, if in the judgment of the Fund the member’s external position is not sufficiently strong tor repurchases to be made pursuant to the expectation schedule set out in this paragraph. In determining whether to amend the schedule, the Fund may consider all relevant information, including the size of the member’s foreign reserves, the member’s medium term balance of payments outlook, and the degree of the member’s access to international capital markets.

  • (b) The Fund shall not approve, and the Managing Director shall not recommend for approval, any request for the use of the Fund’s general resources by a member that is tailing to meet a repurchase expcctation under paragraph 10(a) above. Provision shall be made in each stand by and extended arrangement for the suspension of further purchases under the arrangement whenever a member fails to meet a repurchase expectation under paragraph 10(a) above.”

2. The Fund shall review the time-based repurchase expectation scheme set out in paragraph 10(a) of Decision No. 4377 (74/1 14)13, adopted September 13, 1974, no later than November 30, 2005.

Decision No. 12343-(00/117)

November 28, 2000

(b) Surcharge on Purchases in Credit Tranches and Under EFF

(See Section I below, subsection (a) tor the full text of this decision)

(c) Surcharges on Purchases Under SRF and CCL, and in Credit Tranches and Under EFF—Disposition of Net Operating Income

(See Section K below, subsection (b) for the foil text of this decision)

H. Poverty Reduction and Growth Facility (PRGF)

(a) PRGF Trust Instrument—Amendment

The instrument to Establish the Poverty Reduction and Growth Facility Trust (the Instrument) annexed to Decision No. 8759 (87/176) PRGF14 shall be amended as follows:

  • (i) The last sentence of Section II, Paragraph 1, subparagraph (b) shall be amended to read as follows:

    • “After the expiration of a three-year commitment period for an eligible member, or the can cellation of a three-year arrangement by the member, the Trustee may approve additional three year commitments for that member in accordance with the Instrument.”

  • (ii) The last sentence of Section II, Paragraph 1, subparagraph (bb) shall be amended to read as follows:

    • “After the expiration of a three-year arrangement for an eligible member, or the cancellation of the arrangement by the member, the Trustee may approve additional arrangements for that member in accordance with the Instrument.”

Decision No. 1220b-(00/55) PRGF

May 31, 2000

(b) PRGF Trust and PRGF-HIPC—Reserve Account—Review

1. Pursuant to Decision No. 10286 (93/23) ESAF15, the Fund has reviewed the adequacy of the Reserve Account of the PRGF Trust and determines that amounts held in the account are sufficient to meet all obligations which could give rise to a payment from the Reserve Account to lenders to the Loan Account of the PRGF Trust in the six months from July 1 to December 31,2000.

2. The next review provided under paragraph 1 of Decision No. 10286 (93/23) ESAF16 shall take place by end March 2001 This paragraph shall become effective when all lenders to the Loan Account of the PRGF Trust have consented to the change in the timing of the next review.

Decision No. 12227-(00/66) PRGF

June 30. 2000

(c) PRGF Trust—Amendment

The Instrument to establish the Poverty Reduction and Growth Facility Trust annexed to Decision No. 8759 (87/176) HSAF17, as amended, shall be further amended as follows: in Section II, paragraph 1, subparagraph (d), “2001” shall be substituted for “2000.’’ to read as follows: “(d) Commitments under three-year arrangements may be made during the period from January 1, 1988 to December 31, 2001.”

Decision No. 12228 (00/66) PRGF

June 30, 2000

(d) Modalities of Gold Pledge for Use of PRGF Trust Resources Under Rights Approach—Amendment

(See Section O below, subsection (b) for the full text of this decision)

(e) Amendment of the Provisions on Corrective Action for Misreporting and Noncomplying Disbursements Under PRGF

(See Section N below, subsection (d) for the full text of this decision)

(f) Establishment of General Policy to Condition Decisions Under PRGF on Accuracy of Information Regarding Implementation of Prior Actions

(See Section N below, subsection (e) for the full text of this decision)

(g) Establishment of General Policy to Condition Waiver Decisions Under PRGF on Accuracy of Information Regarding Performance Criteria

(See Section N below, subsection (f) for the full text of this decision)

(h) Completion of Reviews Under Arrangements Under PRGF

In the Instrument to Establish the Poverty Reduction and Growth Facility Trust, the following shall be added at the end of Section II, Paragraph 1:

  • “(f) The Trustee shall not complete a review under an arrangement unless and until all other conditions for the disbursement of the corresponding loan have been met or waived.”

Decision No. 12279-(00/86)

August 25. 2000

(i) PRGF Trust Instrument—Amendment

The Instrument to Establish the Poverty Reduction and Growth Facility Trust, annexed to Decision No. 8759-(87/176) PRGF18, as amended, is hereby amended as follows:

In Section II, paragraph 1(e), the reference to subpara graphs 16(a) or 33(a) of Decision No. 8955-(88/126)19 on the Compensatory and Contingency Financing Facility is hereby revised to read “paragraphs 17 or 31 of Decision No. 8955 (88/125) on the Compensatory Financing Facility.

Decision No. 12326-(00/l 11) PRGF

November 10, 2000

(j) Financing Fund Participation in Initiatives for Heavily Indebted Poor Countries and PRGF—Use of Investment Income on Proceeds of Off-Market Gold Transactions

Pursuant to Article V, Section 12(f), the Fund decides that the remaining five fourteenths (5/14ths) of proceeds from investments equivalent to SDR 1.76 billion on an “as needed’’ basis kept in the Special Disbursement Account in accordance with the last sentence of paragraph 2 of Decision No. 12063 (99/130)20, adopted December 8, 1999, shall be transferred and used in the same manner as specified for the other nine fourteenths (9/14ths) of the proceeds in paragraph 2 of Decision No. 12063-199/130)21.

Decision No. 12330-(00/118)

November 30. 2000

(k) Nonapproval of New Arrangements Under PRGF and Suspension of Loan Disbursements Under Existing PRGF Arrangements Whenever Member is Not Meeting Repurchase Expectation

The Instrument to Establish the Poverty Reduction and Growth Facility annexed to Decision No. 8759 (87/176) ESAF22 shall be amended by adding the following at the end of paragraph 1(e) of Section 11:

  • ”, or is tailing to meet a repurchase expectation pursuant to paragraph 1(b) of Decision No 5703 (78/39)23 or paragraph 10(a) of Decision No. 4377-174/114)24.”

Decision No. 12344 (00/117)

November 28, 2000

(I) Instrument to Establish a Trust for Special PRGF Operations for Heavily Indebted Poor Countries and Interim PRGF Subsidy Operations—Amendment

Section III, paragraph 3(d) of the Instrument to Establish a Trust for Special PRGF Operations for Heavily Indebted Poor Countries and Interim PRGF Subsidy Operations, annexed to Decision No. 11436 (97/10)25, adopted February 4, 1997 shall be amended by adding the following new sentence:

  • “In exceptional circumstances, interim assistance could be raised to 25 percent and 75 percent, respectively.”

Decision No. 12349-(00/118)

December 1. 2000

(m) PRGF Trust—Amendment

The International Monetary Fund (the “Fund”), in its capacity as Trustee of the Poverty Reduction and Growth Facility (PRGF) Trust, approves the amendments to the borrowing agreements between the Fund and the lenders to the Loan Account of the PRGF Trust, and their related annexes, as enumerated below, and authorizes the Managing Director to take such action as is necessary to conclude and implement the amendments:

1. The references to the interest rates on domestic instruments in:

  • paragraph 4(a)(i) of the borrowing agreement with the National Bank of Belgium effective July 2, 1999;

  • paragraph 4(a)(i) of the borrowing agreements with the Government of Canada effective May 9, 1995 and April 6, 2000;

  • paragraph 4(a)(i) of the borrowing agreement with the Government of China effective July 5, 1994;

  • paragraph 3(a)(i) of the borrowing agreement with the National Bank of Denmark effective May 3, 2000;

  • paragraph 4(a)(i) of the borrowing agrement with the Central Bank of Egypt effective June 13, 1994;

  • paragraph 5(b)(i) of the borrowing agreement with the Agence Française de Développcment effective on April 5, 1988, and paragraph 5(a)(i) of the borrowing agreements with the Agence Française de Développement effective January 3, 1995 and December 17, 1999;

  • paragraph 4(a)(i) of the borrowing agreements with the Bank of Italy effective October 4, 1990, May 29, 1998, and March 1, 2000;

  • paragraph 6(b)(i) of the borrowing agreements with the Japan Bank for International Cooperation effective April 12, 1988 and October 5, 1994;

  • paragraph 4(a)(i) of the borrowing agreements with the Bank of Korea effective April 20, 1989 and June 20, 1994;

  • paragraph 4(a)(i) of the borrowing agreement with the Bank of the Netherlands effective September 29, 1999.

  • paragraph 4(a)(i) of the borrowing agreements with the Bank of Norway effective April 14, 1988 and June 16, 1994;

  • paragraph 4(a)(i) of the borrowing agreement with the OPEC Fund for International Development effective December 20, 1994;

  • paragraph 4(a)(i) of the borrowing agreements with the Bank of Spain effective June 20, 1988 and February 14, 2000; and

  • paragraph 4(a)(i) of the borrowing agreement with the Swiss National Bank effective June 22, 1995, shall be amended to read as follows:

    • – the bond equivalent yield for six-month U.S. Treasury bills,

    • – the six month euro interbank offered rate (Euribor),

    • – the bond equivalent yield on six-month Japanese treasury bills,

    • – the six-month interbank rate in the United Kingdom, and…

2. In the borrowing agreements with the Agence Française de Developpement, all references to the text “euros (as the currency of France and Germany)” shall be changed to read “euros.”

3. In the borrowing agreements and exchange of letters with the Japan Bank for International Cooperation, all references to “the percentage weight of the euro component of the SDR” made in regard to the former deutsche mark and French franc components of the SDR valuation basket shall be understood to mean solely “the percentage weight of the euro component of the SDR.”

4. In the borrowing agreement with the Kreditanstalt für Wiederaufbau effective March 31, 1989:

  • Paragraph 4(a)(i) shall be amended to read as follows:

    • U.S. dollar-Libor, the euro-Euribor, Japanese yen Libor, as well as pound sterling-Libor, as defined in the Annex to this agreement, and…

5. In the borrowing agreements with the Kreditanstalt für Wiederaufbau, and related Annexes, effective May 17, 1995 and June 19, 2000:

  • (i) Paragraph 4(a)(i) shall be amended to read as follows:

    • U.S. dollar rate on six month certificates of deposit, the euro-Euribor, Japanese yen Libor, as well as pound sterling-Libor, as defined in the Annex to this agreement; and…

  • (ii) Paragraph 1(b) of the Annex shall be amended to read as follows:

    • (b) Euro-Euribor:

    • means the rate at which euro interbank term deposits are offered for a period of six months within the European Monetary Union zone by one prime bank to another at 11:00 a.m. Brussels time.

  • (iii) Paragraph 1(c) of the Annex shall be deleted.

6. In the borrowing agreements with the Kreditanstalt für Wiederaufbau, all references to the text “the euro as the currency of Germany and France, respectively” shall be changed to read “euros.”

Decision No. 12387-(00/130) PROF

December 21, 2000

(n) PRGF Trust—Reserve Account—Review

Pursuant to Decision No. 10286-(93/23) ESAF26, the Fund has reviewed the adequacy of the Reserve Account of the PRGF Trust, and determines that amounts held in the account arc sufficient to meet all obligations which could give rise to a payment from the Reserve Account to lenders to the Loan Account of the PRGF Trust in the six months from April 1 to September 30, 2001.

Decision No. 12459-(01/31) PRCF

March 28, 2001

I. Purchases in Credit Tranches

(a) Surcharge on Purchases in Credit Tranches and Under Extended Fund Facility

1. The rate of charge under Article V, Section 8(b) on the Fund’s combined holdings of a member’s currency in excess of 200 percent of the member’s quota in the Fund resulting from purchases in the credit tranches and under the extended Fund facility made after the date of this decision shall be 100 basis points per annum above the rate of charge referred to in Rule 1-6(4) as adjusted tor purposes of burden sharing, provided that the rate on such holdings in excess of 300 percent of the member’s quota shall be 200 basis points per annum above the rate of charge referred to in Rule 1-6(4) as adjusted for purposes of burden sharing.

2. This decision shall be reviewed after November 30, 2004.

Decision No. 12346-(00/117)

November 28, 2000

(b) Repurchases Under Emergency Assistance; Purchases in Credit Tranches and Compensatory Financing Facility—Repurchase Expectations

(See Section F above, subsection (b) for the full text of this decision)

J. Stand-By and Extended Arrangements

(a) Amendment of Guidelines on Corrective Action for Misreporting and Noncomplying Purchases Under StandBy or Extended Arrangements

(Sec Section N below, subsection (a) for the full text of this decision ]

(b) Completion of Reviews Under Stand-By and Extended Arrangements

The Fund shall not complete a review under a stand-by or extended arrangement unless and until all other conditions for the availability of an associated purchase have been met or waived.

Decision No. l2278-(00/86)

August 25, 2000

(c) Changes to Commitment Charge—Stand-By and Extended Arrangements

Rules 1—8f a) and I—8(b) of the Rules and Regulations shall be amended to read as follow s:

  • “(a) A charge shall be payable at the beginning of each twelve month period (“the relevant period”) of an arrangement as follows:

    • (i) ¼ of 1 percent per annum on amounts of up to 100 percent of the member’s quota that could be purchased during the relevant period; and

    • (ii) 1/10 of 1 percent per annum on amounts in excess of 100 percent of the member’s quota that could be purchased during the relevant period.

  • (b) When a purchase is made under an arrangement, the amount of the charge paid shall be reduced, and a refund equal to the reduction shall be made, as follows:

    • (i) to the extent that purchases during the rel evant period do not exceed 100 percent of the member’s quota, the portion of the charge calculated in accordance with subparagraph (a)(i) above shall be reduced by the proportion that the amount of the purchase bears to the amount of the arrangement not exceeding 100 percent of the member’s quota that could be purchased during the relevant period; and

    • (ii) to the extent that purchases during the relevant period exceeds 100 percent of the member’s quota, the portion of the charge calculated in accordance with subparagraph (a)(ii) above shall be reduced by the proportion that the amount of the purchase bears to the amount of the arrangement exceeding 100 percent of the member’s quota that could be purchased during the relevant period.”

Decision No. 1234-(00/117)

November 28, 2000

K. Supplementary Reserve Facility

(a) Supplementary Reserve Facility and CCL—Amendments to Decision

Decision No. 11627(97/123) SRF27, adopted December 17, 1997, shall be amended as follows:

  • 1. Paragraph 13 shall be amended to read as follows:

    “13. Through November 30. 2003, the Fund will be prepared to commit and provide financial assistance to a member under the terms and conditions specified in this section.”

  • 2. Paragraph 17 shall be amended to read as follows:

    “17. The Fund may commit resources under this section at any time under an arrangement, but will only make such resources available after the completion of an activation review under the arrangement when it finds that the member meets the conditions specified in paragraph 15. The arrangement will specify the total amount of resources committed under this section and the amount of such resources that will be made available upon the completion of the activation review. The availability of the rest of the committed resources under this section shall be subject to such phasing and conditionality as the Fund shall consider appropriate, normally at the time of a post-activation review. In addition, the arrangement will normally provide for the continued commitment of resources under this section beyond a specified date to be subject to the completion of a program review by the Fund. The Fund max commit resources under this section for a period of up to one year and. after it makes such resources available, may extend such period for up to one year from the date such resources are made available.”

  • 3. Paragraph 19 shall be amended to read as follows:

    “19. Paragraphs 6, 7, 10 and 11 of this decision shall apply to purchases made under this section.”

  • 4. Paragraph 20 shall be amended to read as follows:

    “20. During the first year from the date of the first purchase financed under this section, the rate of charge under Article V, Section 8(b) on holdings acquired as a result of purchases under this section shall be 150 basis points per annum above the rate of charge referred to in Rule 1-6(41 as adjusted for purposes of burden sharing. Such rate shall be increased by 50 basis points at the end ofthat period and every six months thereafter, until the surcharge reaches 350 basis points, subject to the provisions of paragraph 21.”

  • 5. The following new paragraph 21 shall be added:

    “21. The provisions of Decision No. 8165 (85/189) G/TR,28 December 30, 1985. except section IV, shall apply to overdue obligations arising under this section, subject to the following provision:

    The rate of charge on overdue repurchases shall be determined by the Fund but shall not be less than the maximum rate of charge specified in paragraph 20.”

  • 6. The following new Paragraph 22 shall be added:

    “22. This section and its operation will be reviewed no later than November 30, 2002.”

Decision No. 12340-(00/117) SRF/CCL

November 28. 2000

(b) Surcharges on Purchases Under SRF and CCL, and in Credit Tranches and Under EFF—Disposition of Net Operating Income

For financial year 2002, after meeting the cost of administering the PRGF Trust, any remaining net operational income generated by the surcharges on purchases under the Supplemental Reserve Facility and the Contingent Credit Lines and the surcharges on purchases in the credit tranches and under the Extended Fund Facility shall be transferred, after the end of that financial year, to the General Reserve.

Decision No. 12407-(01/39) SRF/CCL

April 10. 2001

L. Guidelines for Early Repurchase—Revision

The Fund has reviewed the guidelines for early repurchase pursuant to Decision No. 6172-179/101)29, adopted June 28, 1979, and agrees that those guidelines should be revised to read as set out in Attachment II of EBS/01/11. (EBS/01/11,2/2/01)

Decision No. 12423-(01/14)

February 9, 2001

Attachment: Revised Guidelines for Early Repurchase

Members that make purchases in the General Resources Account are expected normally to repurchase as their balance of payments and reserve position improves. The Fund affirms the continued need for this general policy on early repurchase under the first sentence of Article V, Section 7(b) following the introduction in November 2000 of time-based repurchase expectations tor purchases in the credit tranches and under the Extended Fund Facility and the Compensatory Financing Facility. The Fund encourages members to make voluntary advance repurchases in lieu of or in addition to early repur chases under this general policy.

The following provisions set forth guidelines tor members regarding early repurchase under the first sentence of Article V. Section 7(b) when the balance of payments and reserve position of members improves. The guidelines apply to the Fund’s holdings of currency that result from the purchases under Article V, Section 3 that are subject to repurchase under the provisions of the Articles and policies of the Fund.

1. A member’s balance of payments and reserve position will be deemed normally to have improved sufficiently for early repurchases to be expected in accordance with these guidelines if the member’s balance of payments and reserve position is judged sufficiently strong for the purposes of a quarterly designation plan and financial transactions plan as determined by the Fund from time to time in the light of the relevant factors. A member that makes a purchase in the credit tranches or under a special policy of the Fund will not be expected, however, to make early repurchases within six months of a purchase.

2. During the quarter following the decisions adopting the designation plan and financial transactions plan, it will be expected that a specified amount of the Fund’s holdings of the member’s currency will be repurchased.

3. Subject to paragraphs 4 and 5 below, the specified amount for the expected quarterly repurchase will be 1.5 per cent of the member’s gross reserves plus (minus) 5 percent of the increase (decrease) in gross reserves over the latest six month period for which data are available (“latest gross reserves”). The quarterly amount will be subject to a limit of 4 percent of the member’s latest gross reserves. A quarterly repurchase will be limited to an amount that will not (i) reduce the member’s latest gross reserves below 250 percent of the member’s quota, and (ii) exceed, together with the member’s early repurchases during the preceding three quarters, 10 percent of these reserves.

4. The specified amount in accordance with paragraph 3 above will represent the minimum reduction in the Fund’s holdings of the member’s currency expected during the quar ter. Repurchases by the member during the quarter will he included in calculating the reductions for this purpose. If the member’s repurchases made during a quarter in advance of repurchase maturities exceed the minimum reduction expected during that quarter, the excess will give rise to a credit that will meet pro tanto the expectations of early repurchase for the next five quarters. At the end of a quarter the credit will be reduced by the larger of (i) the repurchase expectation tor the quarter that is deemed to be satisfied by the credit, and (ii) the repurchase obligations that would have matured during the quarter but have been discharged by the advance repurchase.

5. If, during the two quarters prior to the date when a member is added to the list of members whose positions are considered sufficiently strong for the purposes of the quarterly designation plan and financial transactions plan, the member’s repurchases in advance of maturity exceed the minimum reduction expected during those two quarters, a credit will be given in accordance with paragraph 4 above. Any credit still available when a member’s balance of payments and reserve position is no longer considered sufficiently strong for the purposes of a quarterly designation plan and financial transactions plan will continue to apply in accordance with paragraph 4 above.

6. In each financial transactions plan the Managing Director will report on the observance by members of the guide lines for early repurchase.

Derision No. 6172-(79/101)

Jnue 28, 1979 Amended

February 9, 2001

M. Attribution of Repurchases Made to Meet Time-Based Repurchase Expectations

Decision No. 6831(81/65)30, adopted April 22, 1981, shall be amended as follows:

1. Paragraph 1(a) shall be amended to read as follows:

  • ”(a) Subject to paragraphs (b), (c), (d) and (e) below a member shall be free to attribute a reduction in the Fund’s holdings of its currency (i) to any obligation to repurchase, and (ii) to enlarge its reserve tranche.”

2. The following new paragraphs 1(d) and l (e) shall be added:

  • (d) A reduction resulting from a repurchase made pursuant to a repurchase expectation under paragraph 1(b) of Decision No. 5703-(78/39)31 shall be attributed to the member’s repurchase obligation arising from the same purchase one year after the original date on which that repurchase expectation was to be met.

  • (e) A reduction resulting from a repurchase made pursuant to a repurchase expectation under paragraph 10(a) of Decision No. 4377-(74/114)32 shall be attributed to the member’s repurchase obligation arising from the same purchase three years after the original date on which that repurchase expectation was to be met.”

Decision No. 12345-100/117)

November 28, 2000

N. Guidelines on Corrective Action for Misreporting and Noncomplying Purchases

(a) Amendment of Guidelines on Corrective Action for Misreporting and Noncomplying Purchases Under StandBy or Extended Arrangements

The Guidelines on Corrective Action for Misreporting and Noncomplying Purchases under Stand-By or Extended Arrangements (Decision No. 7842 (84/165)33, adopted November 16, 1984) are hereby revised to read as set forth below.

Misreporting and Noncomplying Purchases in the General Resources Account—Guidelines on Corrective Action

In some cases, it has been found that a member has made a purchase in the General Resources Account that it was not entitled to make under the terms of the arrangement or other decisions governing the purchase (a “noncomplying purchase’’). The purchase was permitted because, on the basis of the information available to it at the time, the Fund was satisfied that all performance criteria or other conditions applica ble to the purchase under the terms of the relevant decision had been observed, but this information later proved to be incorrect. When such a case arises in the future, the member will be called upon to take corrective action regarding a noncomplying purchase, to the extent that it is still outstanding, either by repurchase or by the use of its currency in transactions and operations of the Fund, unless the Fund decides that the circumstances justify the member’s continued use of the purchased resources. Steps should also be taken to improve the accuracy and completeness of the information to be reported to the Fund by the member in connection with its use of the Fund’s general resources, and to define performance criteria and other applicable conditions in a manner that would facilitate accurate reporting. The Fund adopts the following guidelines, which shall apply to purchases made after the date of this decision:

1. Whenever evidence comes to the attention of the staff indicating that a performance criterion or other condition applicable to an outstanding purchase made in the General Resources Account may not have been observed, the Managing Director shall promptly inform the member concerned.

2. If, after consultation with the member, the Managing Director finds that, in fact, the performance criterion or other condition was not observed, the Managing Director shall promptly notify the member of this finding. At the same time, the Managing Director shall submit a report to the Executive Board together with recommendations.

3. In any case where the noncomplying purchase was made no more than four years prior to the date on which the Managing Director informed the member, as provided for in paragraph 1, the Executive Board may decide either (a) that the member shall be expected to repurchase from the Fund the outstanding amount of its currency resulting from the noncomplying purchase normally within a period of 30 days from the date of the Executive Board decision, or (b) that the nonobservance will be waived pursuant to paragraph 5.

4. Instead of repurchasing from the Fund the outstanding amount of its currency resulting from the noncomplying pur chase as provided for in paragraph 3(a), the member may request the Fund to use an equivalent amount of its holdings of the member’s currency in the Fund’s transactions and operations, but if such use cannot be made within 20 days from the date of the Executive Board decision the member shall be expected to make a repurchase in accordance with paragraph 3(a).

5. A waiver under paragraph 3(b) will normally be granted only if the deviation from the relevant performance criterion or other condition was minor or temporary, or if, subsequent to the purchase, the member had adopted additional policy measures appropriate to achieve the objectives supported by the relevant decision.

6. It a repurchase pursuant to the expectation under para graph 3(a) has not been effected, the Managing Director shall submit promptly a report to the Executive Board accompanied by a proposal on how to deal with this matter, in which the Managing Director may recommend that the Fund initiate action under Article V, Section 5 of the Articles.

7. Provision shall be made in Fund arrangements for the suspension of further purchases under an arrangement whenever a member fails to meet a repurchase expectation pursuant to these guidelines.

8. Nothing in these guidelines shall limit the power of the Fund to take, in cases of noncomplying purchases, other action that could be taken pursuant to the Fund’s Articles and Rules.

Decision No. 12249-(00/77)

July 2~. 2000

(b) Establishment of General Policy to Condition Decisions in General Resources Account on Accuracy of Information Regarding Implementation of Prior Actions

Any decision on the use of resources in the General Resources Account (including decisions approving an arrangement or an outright purchase, completing a review, or granting a waiver either of applicability or for the nonobservance of a performance criterion) will be made conditional upon the accuracy of information provided by the member regarding implementation of prior actions specified in the decision.

Decision No. 12250-(00/77)

Inly 27, 2000

(c) Establishment of General Policy to Condition Waiver Decisions in the General Resources Account on Accuracy of Information Regarding Performance Criteria

Any decision granting a waiver for the nonobservance of a performance criterion under an arrangement will be made conditional upon the accuracy of data or other information provided by the member to assess observance of the performance criterion in question.

Am decision waiving the applicability of a performance criterion under an arrangement will be made conditional upon (i) the accuracy of the member’s representation that the information necessary to assess observance of the relevant performance criterion is unavailable, and (ii) the accuracy of data provided by the member to assess observance of the same performance criterion for a preceding period (if applicable for that period).

Decision No. 122Sl-(00/77)

Inly 27, 2000

(d) Amendment of the Provisions on Corrective Action for Misreporting and Noncomplying Disbursements Under PRGF

Appendix I of the Instrument to Establish the Poverty Reduction and Growth Facility (adopted November 20, 1998 in Decision 11832-(98/119) ESAF34 is hereby revised to read as set forth below.

Misreporting and Noncomplying Disbursements in Arrangements under the Poverty Reduction and Growth Facility—Provisions on Corrective Action

a. A noncomplying disbursement occurs when (i) the Trustee makes a disbursement to a member under an arrangement approved in accordance with the Instrument on the basis of a finding by the Trustee or the Managing Director that all applicable conditions established for that disbursement under the terms of the decisions on the arrangement have been observed, and (ii) that finding later proves to be incorrect. For the purposes of these provisions, a condition established under the terms of a decision on an arrangement means a condition specified in the arrangement, or in a decision approving the arrangement, completing a review, or granting a waiver of applicability or for the nonobservance of a performance criterion under the arrangement.

b. Whenever evidence comes to the attention of the start of the Trustee indicating that a member may have received a noncomplying disbursement, the Managing Director shall promptly inform the member concerned.

c. If, after consultation with the member, the Managing Director determines that the member did receive a noncomplying disbursement, the Managing Director shall promptly notify the member and submit a report to the Executive Board together with recommendations.

d. In any case where the noncomplying disbursement was made no more than four years prior to the date on which the Managing Director informed the member, as provided for in paragraph (b), the Executive Board may decide either (i), that the member will be called upon to make an early repayment, or (ii) that the nonobservance will be waived.

e. If the decision of the Executive Board is to call upon the member to make an early repayment as provided for in paragraph (d) (i), the member will be expected to repay an amount equivalent to the noncomplying disbursement, together with any interest accrued thereon, normally within a period of 30 days from the date of the Executive Board decision.

f. A waiver under paragraph (d)(ii) will normally be granted only if the deviation from the relevant performance criterion or other condition was minor or temporary, or if, subsequent to the disbursement, the member had adopted additional measures appropriate to achieve the objectives of the program supported by the arrangement under which the disbursement was made.

g. If a member fails to meet a repayment expectation under these guidelines within the period established by the Executive Board, fit the Managing Director shall promptly submit a report to the Executive Board together with a proposal on how to deal with the matter, and (ii) interest shall be charged on the amount subject to the repayment expectation at the rate applicable to overdue amounts under Section II, Paragraph 4 of the Instrument.

Decision No. 12252-(00/77)

Inly 27, 2000

(e) Establishment of General Policy to Condition Decisions Under PRGF on Accuracy of Information Regarding Implementation of Prior Actions

Any decision 011 the use of resources under the Poverty Reduction and Growth Facility (including decisions approving an arrangement, completing a review, or granting a waiver either of applicability or for the nonobservance of a performance criterion 1 will be made conditional upon the accuracy of information provided by the member regarding implementation of prior actions specified in the decision.

Decision No. 12253-(00/77)

July 27, 2000

(f) Establishment of General Policy to Condition Waiver Decisions Under PRGF on Accuracy of Information Regarding Performance Criteria

Any decision granting a waiver for the nonobservance of a performance criterion under an arrangement under the Poverty Reduction and Growth Facility will be made conditional upon the accuracy of data or other information provided by the member to assess observance of the performance criterion in question.

Any decision waiving the applicability of a performance criterion under an arrangement under the Poverty Reduction and Growth Facility will be made conditional upon (i) the accuracy of the member’s representation that the information necessary to assess observance of the relevant performance criterion is unavailable, and (ii) the accuracy of data provided by the member to assess observance of the same performance criterion for a preceding period (if applicable for that period). Decision No. 12234-(00/77) July 27, 2000

O. Overdue Financial Obligations

(a) Strengthened Cooperative Strategy—Review

The Fund has reviewed progress under the strengthened cooperative strategy with respect to overdue financial obligations to the Fund as described in EBS/00/100 (6/7/00 The Fund reaffirms its support tor the strengthened cooperative strategy and agrees to extend the availability of the rights approach until end-June 2001.

Derision No. 12220-100/62)

June 21, 2000

(b) Modalities of Gold Pledge for Use of PRGF Trust Resources Under Rights Approach—Amendment

1. Decision No. 10286 (93/23) ESAF35 February 22. 1993, shall be amended as follows: in paragraph I, “by end March and end September” shall be substituted for “shortly before June 30 and December 30,” to read as follows:

  • “1. As long as loans from the Poverty Reduction and Growth Facility Trust (hereinafter the “PRGF Trust”) to members for the financing of “rights” as defined by the Managing Director’s Summing Up at EBM/90/97 of June 20, 1990 are outstanding, the Fund shall review the adequacy of the Reserve Account of the PRGF Trust (hereinafter the “Reserve Account”) by end-March and end-September of each year.”

2. This decision shall become effective when all lenders to the Loan Account of the PRGF Trust have consented to the amendment, or March 1, 2001, whichever is later.

Decision No. 12229-(00/66) PRGF

June 30. 2000

(c) Burden Sharing—Implementation in FY 2002

Section 1. Principles of Burden Sharing

1. The financial consequences for the Fund which stem from the existence of overdue financial obligations shall be shared between debtor and creditor member countries.

2. The sharing shall be applied in a simultaneous and symmetrical fashion.

Section II. Determination of the Rate of Charge

The rate of charge referred to in Rule 1-6 (4) shall be adjusted in accordance with the provisions of Section III of this decision and Section IV of Executive Board Decision No. 12189 (00/45),36 adopted April 28, 2000.

Section III. Amount for Special Contingent Account-1

1. An amount of SDR 94 million shall be generated during financial year 2002 in accordance with the provisions of this Section, and shall be placed to the Special Contingent Account-1 referred to in Decision No. 9471 (90/98),37 adopted June 20, 1990.

  • 2. (a) In order to generate the amount to be placed to the Special Contingent Account-1 in accordance with paragraph 1 of this Section, notwithstanding Rule I-6(4)(a) and (b) and Rule I-10, the rate of charge referred to in Rule 1-6(4) and, subject to the limitation in (b), the rate of remuneration prescribed in Rule I 10, shall be adjusted in accordance with the provisions of this paragraph so as to produce equal amounts of income.

  • (b) No adjustment in the rate of remuneration under this paragraph shall be carried to the point where the average remuneration coefficient would be reduced below 85 percent for an adjustment period.

  • (c) The adjustments under this paragraph shall be made as of May 1, 2001, August 1, 2001, November 1, 2001 and February 1, 2002; shortly after July 31 for the period May 1 to July 31; shortly after October 31 for the period from August 1 to October 31; shortly after January 31 for the period from November I to January 31; shortly after April 30 for the period from February 1 to April 30.

  • 3. (a) Subject to paragraph 3 of Decision No. 8780-(88/12)38, adopted January 29, 1988, the balances held in the Special Contingent Account-1 shall be distributed in accordance with the provisions of this paragraph to members that have paid additional charges or have received reduced remuneration as a result of the adjustment when there are no outstanding overdue charges and repurchases, or at such earlier time as the Fund may decide.

  • (b) Distributions under (a) shall be made in proportion to the amounts that have been paid or have not been received by each member as a result of the respective adjustments.

  • (c) If a member that is entitled to a payment under this paragraph has any overdue obligation to the Fund in the General Department at the time of payment, the member’s claim under this paragraph shall be set off against the Fund’s claim in accordance with Decision No. 8271 (86/74)39 adopted April 30, 1986, or any subsequent decision of the Fund.

  • (d) Subject to paragraph 4 of Decision No. 8780 (88/12),40 adopted January 29, 1988, it any loss is charged against the Special Contingent Account-1, it shall be recorded in accordance with the principles of proportionality set forth in (b).

Section IV. Review

The operation of this decision shall be reviewed when the adjustment in the rate of remuneration reduces the remuneration coefficient to the limit set forth in paragraph 2(b) of Section III of this decision and Section IV of Executive Board Decision No. 12189 (00/45)41 adopted April 28. 2000.

Decision No. 12465-(01/39)

April 16. 2001

P. Guidelines on Performance Criteria with Respect to Foreign Debt in Fund Arrangements—Change in Coverage of Debt Limits

Executive Board Decision No. 6230 79/140) 42 (Guidelines on Performance Criteria with Respect to Foreign Borrowing), adopted August 3, 1979, as amended by Executive Board Decision No. 11096-(95/100)43, adopted October 25, 1995, shall be amended as follows:

1. The terms “borrowing’’ and “loan’’ shall be replaced with “debt.”

2. The guideline on the performance criteria with respect to foreign debt shall be amended to read as follows:

  • “When the size and the rate of growth of external indebt edness is a relevant factor in the design of an adjustment program, a performance criterion relating to official and officially guaranteed foreign debt will be included in upper credit tranche arrangements. The criterion will include all forms of debt, including loans, suppliers’ credits and leases, that constitute current, i.e., not contingent, liabilities, which are created under a contractual arrangement through the provision of value in the form of assets (including currency) or services, and which require the obligor to make-one or more payments in the form of assets (including currency) or services, at some future point! s) in time; these payments discharge the principal and/or interest liabilities incurred under the contract. The criterion will include foreign debts with maturities of over one year, and, in appropriate cases and where specifically provided, other financial instruments that have the potential to create substantial external liabilities for governments. The criterion will usually be formulated in terms of debts contracted or audio rized. However, in appropriate cases, it may be formulated in terms of net disbursements or net changes in the stock of external official and officially guaranteed debt. Flexibility will be exercised to ensure that the use of the performance criterion will not discourage capital flow s of a concessional nature by excluding from the coverage of performance criteria debts defined as concessional on the basis of currency specific discount rates based on the OECD commercial interest reference rates, and including a grant element of at least 35 percent, provided that a higher grant element may be required in exceptional cases. Normally, the performance criterion will include a subceiling on foreign debt with maturities of over one year and up to five years. Additional subceilings may also be included on debt with specified maturities beyond five years or with a specified grant element lower than 35 percent.”

3. The following shall be added to the Guidelines as points 8 and 9:

  • “8. In principle, a performance criterion on foreign debt will incorporate by reference the definition of debt set forth in point No. 9 below. Financial instruments that are not covered under the definition but have the potential to create substantial external liabilities for governments will be included in the performance criterion where appropriate, in which case they would be explicitly specified.

  • 9. (a) For the purpose of this guideline, the term “debt” will be understood to mean a current, i.e., not contingent, liability, created under a contractual arrangement through the provision of value in the form of assets (including currency) or services, and which requires the obligor to make one or more payments in the form of assets (including currency) or services, at some future point(s) in time; these payments will discharge the principal and/or interest liabilities incurred under the contract. Debts can take a number of forms, the primary ones being as follows:

    • (i) loans, i.e., advances of money to the obligor by the lender made on the basis of an undertaking that the obligor will repay the hinds in the future (including deposits, bonds, debentures, commercial loans, and buyers’ credits) and temporary exchanges of assets that are equivalent to fully collateralized loans under which the obligor is required to repay the funds, and usually pay interest, by repurchasing the collateral from the buyer in the future (such as repurchase agreements and official swap arrangements);

    • (ii) suppliers’ credits, i.e., contracts where the supplier permits the obligor to defer payments until some time alter the date on which the goods are delivered or services arc provided; and

    • (iii) leases, i.e., arrangements under which property is provided which the lessee has the right to use for one or more specified period(s) of time that arc usually shorter than the total expected service life of the property, while the lessor retains the title to the property. For the purpose of the guideline, the debt is the present value (at the inception of the lease) of all lease payments expected to be made during the period of the agreement excluding those payments that cover the operation, repair, or maintenance of the property.

  • (b) Under the definition of debt set out in point 9(a) above, arrears, penalties, and judicially awarded damages arising from the failure to make payment under a contractual obligation that constitutes debt are debt. Failure to make payment on an obligation that is not considered debt under this definition (e.g., payment on delivery) will not give rise to debt.”

Decision No. 12274-(00/85)

August 24.2000

Q. Eleventh General Review of Quotas

(a) Period for Consent to Increases—Extension

The Executive Board approves the extension of the period for consent to quota increases under the Eleventh General Review.

Decision No. 12238-(00/71)

July 13. 2000

(b) Period for Consent to Increases in Quotas

Pursuant to Paragraph 4 of the Resolution of the Board of Governors No. 53-2, “Increase in Quotas of Fund Mem bers—Eleventh General Review,” the Executive Board decides that notices of consent from members to increases in their quotas must be received in the Fund by 6:00 p.m., Washington time, on July 31, 2001.

Decision No. 12413-101/6)

January 16, 2001

R. Transparency and Fund Policies

(a) Continuation of Publication of Article IV Consultation Staff Reports Under Rules of Pilot Project

Pending the adoption of a decision pursuant to the Summing Up by the Chairman on the Review of the Pilot Project for Voluntary Release of Article IV Staff Reports and Other Issues in Fund Transparency (SUR/00/85, 9/6/00), the publication of Article IV consultation staff reports shall remain possible under the same rules set out in the pilot program established by Decision No. 11973 (99/58)44, adopted June 3, 1999.

Decision No. 12317 (00/102)

October 18, 2000

(b) Publication Policies

1. The Managing Director shall arrange for publication by the Fund of the documents on the attached list, subject to the consent of the member concerned in the case of Documents 111, 13. and 16-17 and to the authorization of the World Bank in the case of Documents 6 and 11. For purposes of this decision: in Documents 1-4,6,9-10, 11, 13, and 17 will be referred to as “Country Documents”; (ii), Documents 5, 7-8, and 16 will be referred to as “Country Policy Intentions Documents”; and (iii) Documents 14 and 15 will be referred to as “Fund Policy Documents.”

2. The Executive Board encourages each member to con sent, where required, to the publication by the Fund of a document under this decision, it is recognized that for some members such publication would be a longer term objective.

3. In the case of Documents 5-8 and 11, which pertain to a member’s use of Fund resources, a member’s consent for Fund publication shall be voluntary but presumed. Such pre sumption means that if, in a particular case, a member docs not wish to consent to Fund publication of a document, the member will need to notify its decision and should provide an explanation, which may be done through an Executive Direc tor appointed, elected, or designated by the member, before the Executive Board takes a decision relating to the member’s use of Fund resources. In the case of a Chairman’s Statement (Document 10), if the member does not consent to its publication by the Fund, a brief factual statement describing the Executive Board’s decision relating to the member’s use of Fund resources (including any information on waivers, HIPC initiative decisions, and endorsements of Documents 5) will be released instead. In the cases of Documents 1-4, 9, 13. and 16-17, publication shall be voluntary.

4. In the ease of a member’s Poverty Reduction Strategy Paper (PRSP), Interim PRSP, or PRSP progress report (Document 5), the Managing Director will not recommend its endorsement by the Executive Board if the member concerned does not consent to its publication.

5. For the purposes of paragraph 1, a member’s actual consent shall normally be communicated to the Secretary of the Fund. Such consent may be communicated by the Executive Director elected, appointed, or designated by the member.

6. In respect of documents circulated to the Executive Board for which publication requires a member’s consent, the Secretary’s cover note will indicate whether a communication has been received from the member in this regard and, if so, the member’s intentions.

Member’s Statement Regarding Fund Staff Reports

7. If a Fund staff report (Documents 1, 9, and 17) on a member is to be published under this decision, the member concerned shall be given the opportunity to provide a statement regarding the staff report and the Executive Board assessment. Such statement shall be communicated to the Fund and published together with the staff report.

Deletions

8. Prior to publication of a Country Document, or a certain Country Policy Intentions Document (Documents 7-8) that has been the basis of a Fund decision, or Document 16, the member concerned may propose deletions to the Managing Director. In the case of a serious disagreement between the Managing Director and the member, the Managing Director, or the Executive Director elected, appointed, or designated by that member, may refer the matter to the Executive Board for its consideration. Deletions should be limited to highly market-sensitive information, mainly exchange rate and interest rate matters. In particular, deletions will not apply to information in the public domain or politically sensitive information that is not highly market sensitive. In the case of Documents 7-9 and 16, performance criteria (if applicable) and structural benchmarks may not be deleted.

9. Deletions will not generally apply to a PRSP, an Interim PRSP, or a PRSP progress report that has been the basis of a Fund decision.

Chairman’s Statements in Respect of Use of Fund Resources

10. After the Executive Board adopts a decision regarding a member’s use of Fund resources (including a decision completing a review under a Fund arrangement), or completes a discussion on a member’s participation in the HIPC Initiative, PRSP, Interim PRSP, or PRSP progress report, a Chairman’s statement on the discussion, emphasizing the key points made by Executive Directors, will be released to the public. Where relevant, the Chairman’s statement will contain a summary of HIPC Initiative decisions pertaining to the member and the Executive Board’s views on the member’s PRSP, Interim PRSP, or PRSP progress report. Waivers for nonobservance, or of applicability, of performance criteria, if any, will be mentioned in the press release containing the Chairman’s statement. Before the statement is released, it will be read by the Chairman to the Executive Board and Executive Directors will have an opportunity to comment at that time. The Executive Director elected, appointed or designated by the member concerned will have the opportunity to review the Chairman’s statement, to propose very minor revisions, if any. and to con sent to its publication immediately after the Executive Board meeting. Notwithstanding the above, no Chairman’s Statement released under this paragraph shall contain any reference to a discussion or decision pertaining to: (i)] a member’s overdue financial obligations to the Fund; or (ii) a request to amend a repurchase expectation schedule pursuant to paragraph 1(b) of Decision No. 5703-(78/39)45 or paragraph 10(a) of Decision No. 4377 74/114)46. In the case of an Executive Board meeting pertaining solely to a discussion or decision described in either (i) or (ii) above, no Chairman’s statement will be released.

Fund Policy Documents

11. After the Executive Board meets on policy issues, it may decide to publish the staff report considered at the meeting (Document 14) and/ora Public Information Notice (PIN, Document 15) on the discussion. The factors on which this decision shall he based shall include whether the discussions have reached completion or, if not completed, whether informing the public of the state of the discussions would be useful. The staff shall make a recommendation on the publication of a staff policy paper and/or a PIN on its cover. A PIN on policy discussions will be based on the decision that may have been adopted by the Executive Board or the Chair man’s summing-up of the discussions. It will also include a short section setting out background information.

Timing and Means of Fund Publication

12. Documents may be published under this decision only after their consideration by the Executive Board, except for: (i) PRSPs, Interim PRSPs, or PRSP progress reports; (ii) documents circulated to the Executive Board for information only; and (iii) Reports on Observance of Standards and Codes (ROSCs). Documents under items (i) and (ii) may be published immediately after circulation to the Executive Board. Documents under item (iii) may be published after notifying the Executive Board of the intention to publish.

13. Publication by the Fund under this decision shall mean normally publication on its website but may include publication through other media.

Repeal of Superseded Decisions

14. The following decisions arc repealed: (i) “Use of Fund Resources -Release of Chairman’s Statement,” Decision No. 11971 (99/58), adopted June 3, 1999; (ii) “Public Information Notices for Policy Matters,” Decision No. 11972 (99/58), adopted June 3, 1999; (iii) “Publication of Letters of Intent, Memoranda of Economic and Financial Policies and Policy Framework Papers,” Decision No. 11974 (99/58), adopted June 3, 1999; and (iv) “Release of Information -Reports on Recent Economic Developments and Statistical Appendices and Annexes,” Decision No. A-10138 (94/61), adopted July 11, 1994. The decision set forth in EBD/98/64 (6/19/98), which was approved on a lapse-of time basis on June 24, 1998, is repealed to the extent that it relates to the publication of the final Decision and Completion Point documents under the HIPC’ Initiative.

Article XII, Section 8

15. Nothing in this decision shall be construed to be inconsistent with the power of the Fund to decide under Article XII, Section 8, by a seventy percent majority of the total voting power, to publish a report made to a member regarding its monetary or economic conditions and developments which directly tend to produce a serious disequilibrium in the international balance of payments of members.

Review

16. This decision shall be reviewed in light of experience not later than 18 months from the date of its adoption.

Decision Mo. 12405-(0l/2)

January 4, 2001

Attachment I:

List of Documents Covered by the Decision

I. Surveillance and Supporting Documents

  • 1. Article IV and Combined Article I V/Use of Fund Resources Staff Reports

  • 2. Recent Economic Developments Reports, Selected Issues Papers, Statistical Appendices

  • 3. Reports on Observance of Standards and Codes (ROSCs)

  • 4. Public Information Notices (PINs) following Article IV consultations and regional surveillance discussions

II. Use of Fund Resources by a Members

  • 5. Poverty Reduction Strategy Papers (PRSPsi, Interim PRSPs, and PRSP Progress Reports

  • 6. Joint Fund/World Bank Staff Assessments of PRSPs, Interim PRSPs, and PRSP Progress Reports

  • 7. Letters of Intent and Memoranda of Economic and Financial Policies (LOIs/MEFPs)

  • 8. Technical Memoranda of Understanding (TMUs) with policy content

  • 9. Use of Fund Resources and Post Program Monitoring Staff Reports (excluding staff reports dealing solely with a member’s overdue financial obligations to the Fund)

  • 10. Chairman’s Statements

  • 11. Preliminary, decision point, and completion point documents under the HIPC Initiative

  • 12. Statements on Fund decisions on waivers of applicability, or tor nonobservance, of performance criteria

  • 13. PINs following Executive Board discussions on post program monitoring

III. Fund Policy Documents

  • 14. Fund Policy issues papers

  • 15. PINs following Executive Board discussions on policy issues

IV. Other Documents

  • 16. LOIs/MEFPs for Staff Monitored Programs (SMPs)

  • 17. Stand-alone Staff Reports on SMPs

Attachment II: Some Modalities for the Publication of Staff Reports and Other Selected Documents

These modalities provide specific guidelines for the implementation of the key elements of the Fund’s publication policies.47 The proposed procedures also reflect the general principles for publication endorsed by the Executive Board and presented in the document “Guiding Principles for the IMF’s Publication Policy.” Such principles aim in particular at preserving the candor of the staff reports to the Executive Board and guarding against a trend toward negotiated documents. Consistent with the Executive Board request that publication policies be continuously monitored and reviewed, some of the modalities presented below also aim at gathering information for this purpose.

1. Notification of the Decision to Release the Staff Report on Article IV Consultations or Use of Fund Resources

At the time the staff report is circulated to the Executive Board, the authorities’ publication intentions would be noted in the Secretary’s cover memorandum for the information of Executive Directors. This notification on the Secretary’s cover memorandum would take one of the following forms:

  • “As of the time that this paper is circulated to the Board, the Secretary’s Department has not received a communication from the authorities of [Country X] indicating whether or not they consent to the Fund’s publication of this paper; such communication may be received after the authorities have had an opportunity to read the paper.”

  • “As of the time that this paper is circulated to the Board, the Secretary’s Department has received a communication from the authorities of [Country X] indicating that they consent to the Fund’s publication of this paper.”

  • “As of the time that this paper is circulated to the Board, the Secretary’s Department has received a communication from the authorities of [Country X] indicating that they do not consent to the Fund’s publication of this paper.”

The authorities could change their intentions on public release at any time up to publication notwithstanding having given prior consent. While the intention not to proceed with publication (i.e., the change in intentions) would be communicated to the Board, there would be no public announcement of these developments—although the authorities’ themselves could make their initial intention public. A member’s decision to consent to publication of the staff report after the Executive Board meeting would not be ruled out, though the general expectation would be to indicate the authorities’ decision on publication to Executive Directors in advance of the Board discussion. The Executive Board would be notified of a member’s decision to consent to publication of the staff report after the Executive Board discussion.

2. Policy Against Sharing Draft Staff Reports

To guard against a trend toward negotiated documents, staff would not provide drafts of staff reports to country authorities, including the Executive Director, before the reports are issued to the Executive Board, and country authorities and Executive Directors would not seek such opportunities for review.

3. Corrections to Staff Reports

Corrections to staff reports would be limited to factual matters consistent with information available at the time the staff report was issued or with descriptions of the authorities’ own views. In this regard, staff will take care to ensure that the views of counterparts among members’ authorities are properly characterized as official views of authorities, views of institutions, or otherwise, as appropriate. Corrections should not be used as a mechanism to update the information in staff reports to reflect developments subsequent to the circulation of the staff report and staff supplements (see paragraph 6). Material containing the analysis of economic developments and trends, the policy assessment and the staff appraisal, which arc the responsibilities of the staff, would not be subject to corrections once the staff report is issued.

4. Treatment of Highly Market Sensitive Material

The Executive Board adopted a uniform deletions policy tor staff reports and a range of published Country Documents and Country Policy Intentions Documents. Under the policy, a member may propose the deletion of highly market sensitive information—mainly views on exchange rate and interest rate matters—from a document prior to its publication. Facts that are already in the public domain,48 as well as politically sensitive information that is not highly market sensitive and, for Country Policy Intentions Documents, performance criteria and structural benchmarks, would not be candidates for deletion.49 Case-by-case decisions would be made by management on deletions proposed by the authorities or an Executive Director on their behalf. In cases of serious disagreements between management and the authorities on a proposed modification to a document, or for cases deemed useful to inform the Executive Board’s thinking on the deletions policy, the matter could be brought to the Executive Board by the Managing Director or by Executive Directors—e.g., in their BUFF statement—for consideration.

5. Informing the Board of Authorized Deletions/Corrections Requested by the Authorities

Evenhanded and transparent implementation of the agreed deletions and corrections policy requires clear rules of circulation of information to the Executive Board. In this regard, authorized deletions and corrections would be circulated to the Executive Board as close to the Executive Board discussion as possible—preferably in advance of the meeting. It would be expected that the rationale underpinning these modifications would be provided in the Secretary’s memoranda on deletions and corrections to the members of the Executive Board. In addition, as requested by Executive Directors, staff would circulate to the Executive Board a redlined version of the relevant sections of the document, to provide context for the deletions and corrections. Finally, the Secretary would continue to circulate to Executive Board members separate memoranda distinguishing deletions and corrections.50 These procedures would also provide information for the review, requested by the Executive Board, of the application of deletions and corrections policy to be considered by the Executive Board before the Spring 2001 Meetings.

6. Updates to Staff Reports

New information available after the staff discussions with the authorities and circulation of the staff report could require updates of factual material or modifications of staff assessments on the basis of that material. Updates to staff reports would be limited to staff supplements or statements circulated to the Executive Board, rather than direct modifications to the content of the staff report after it has been circulated to the Executive Board, as follows: (i) supplements to the staff report—for new information available one day or more prior to the Board meeting, and (ii) staff statements—for information available the day of the Executive Board meeting. Staff statements and supplements would explicitly state how the new information affects the thrust of the staff appraisal.51 The staff would inform the Executive Director or the country concerned when supplements or staff statements are to be circulated. Supplements and staff statements would be published on the Fund’s website with the staff report. In addition, the introductory paragraph of the cover note for the package published would clearly indicate the timing of the staff discussions with the authorities, underscoring that the staff report and other documents were based on information available at that time they were issued. It would also indicate the date of the Executive Board discussion.

7. The Authorities’ Statement

The authorities would be free to provide additional or updated information and comment on any of the analysis and/or conclusions of the report and the Executive Board assessment in the statement by the authorities—a so-called “right of reply” which could be the Executive Director’s BUFF statement or another document from the authorities. This statement, with the authorities’ consent, would be published together with the staff report.

8. Timing of Release

Chairman’s Statements will continue to be quick-release news instruments. For all other documents, the Fund’s policy would be to encourage prompt release, recognizing circumstances of individual members. As an indicative time limit for staff reports, the Executive Director would seek to obtain the authorities’ consent for release on the Fund’s website within ten working days of the Executive Board’s discussion. This objective is consistent with the policy for the timing of the publication of Public Information Notices and staff reports under the pilot project. In cases where publication of a staff report is embargoed or delayed, the PIN should nevertheless be published within ten working days normally. Documents would not be posted on the Fund’s website in advance of Executive Board discussion of the document, with the exception of Poverty Reduction Strategy Papers (PRSPs), Interim PRSPs, and PRSP progress reports, which are to be posted on the Fund website immediately after circulation to the Executive Board.52 Reports on Observance of Standards and Codes (ROSCs) may be published after notifying the Executive Board.

9. Publication of Staff Reports on the Fund’s Website

The cover page for the staff report packages published on the Fund’s website would continue to reference all documents comprising the package and would also reference other relevant documents. The packages would include the following documents:

  • stand-alone Article IV staff reports will be published with the staff supplement and/or statement, the PIN and the statement by the authorities, and cross-referenced to other relevant published documents (e.g., RED, Selected Issues Paper, Statistical Appendix, ROSC documents and mission concluding statements);

  • stand-alone UFR staff reports will be published with the staff supplement and/or statement, and statement by the authorities, and the Press Release or News Brief containing the Chairman’s Statement and cross-referenced to the relevant published documents (e.g., the LOI/MEFP and PRSP, Interim PRSP, or PRSP progress report);

  • combined Article IV/UFR staff reports will be published with the start supplement and/or statement, the PIN and the statement by the authorities, and cross-referenced to other relevant published documents (e.g., RED, Selected Issues Paper, Statistical Appendix and ROSC documents, LOI/MEFP, and PRSP, mission concluding statement, and Interim PRSP or PRSP progress report).

10. Website Cross-References and Languages

Staff would continue to investigate options to facilitate access to documents on the Fund’s website with the objective to establish systematic links between relevant documents. This would involve significant resource implications which, together with the costs of implementing the various transparency initiatives agreed, would be taken up in the context of the next budget review exercise. Options for publication of documents in languages other than English would also be considered by the Executive Board in the period ahead.

11. Other country documents

In general, other Fund staff documents relating to country matters are the intellectual property of the Fund and, if they arc not Executive Board documents, may be published if the Managing Director approves and the member concerned consents. In the specific case of mission concluding statements, management approval is granted generally, not on a case-by-case basis.

S. Cooperation with Investigations on Fund Activities by Auditing Institutions of Members

The Executive Board of the International Monetary Fund adopts the following procedures to cooperate, upon request, with investigating agencies of members for the preparation of reports on the Fund and its activities. In keeping with the multilateral character of the Fund and in light of the many existing mechanisms to assess the Fund and its activities, the Executive Board expects that restraint will be exercised in requesting such investigations.

1. All requests from official investigating agencies will be notified to the Executive Board at least two weeks before the commencement of any cooperation with the agency pursuant to the request. The notification will include the full text of the terms of reference of the enquiry and any special features of the enquiry. Executive Directors will have an opportunity to comment on all aspects of the notification, as they deem suitable.

2. Management and staff will be prepared to meet a request if it is channeled through an Executive Director’s office and provides:

  • (i) a precise description of the terms of reference of the enquiry; and

  • (ii) written assurances that:

    • confidential information provided in the course of the enquiry will not be disclosed;

    • management and staff will be given an opportunity to review any report resulting from the enquiry before its circulation outside the agency to ascertain that no confidential information is being disclosed in the report and that the factual information is correct; and

    • the views of management and staff will be included in the report in an acceptable manner.

3. In principle only documents and information available to the Executive Board will be made available to the agency; the consent of Executive Directors whose statements are involved should be requested before transmitting grays or Executive Board minutes to the agency. Requests by the agency for access to additional documents and information (other than those relating to the Fund’s internal advisory procedures) will be submitted to the Executive Board for approval if management supports the request. The Executive Board will not approve the request unless it has reviewed the relevant document or information; the procedures for the review will ensure the confidentiality of the document or information.

4. The Executive Board will be informed of requests which are denied by management under paragraph 2 or 3. In such cases, management or the relevant Executive Director may consult with the Executive Board.

5. All published reports resulting from such investigations will be circulated to the Executive Board for information, together with an assessment of the staff resources used by the Fund in the enquiry.

6. If, in the judgment of management, an investigative agency did not respect the written assurances provided in accordance with paragraph 2(ii), it shall so inform the Executive Board and propose any remedial action it considers necessary.

7. These procedures will be reviewed not later than January 31, 2003.

Decision No. 1242-4-(01/13)

February 5, 2001

Sec Selected Decisions, Twenty-Fifth Issue (December 31, 2000), page 209-10.

Ibid., page 327.

Ibid., page 514-15.

Ibid., page 511-12.

Ibid., page 515-17.

Ibid., page 520-22.

Ibid., page 220-30.

Ibid., page 233-239.

Ibid., page 273-76.

Ibid., page 191-92.

Ibid., page 273-76.

Ibid., page 165-69.

Ibid., page 165-69.

Ibid., page 44.

Ibid., page 359-61.

Ibid., page 359-61.

Ibid., page 44.

Ibid., page 44.

Ibid., page 220-30.

Ibid., page 278-79, 362-63.

Ibid., page 278-79, 362-63.

Ibid., page 44.

Ibid., page 272-76.

Ibid., page 165-69.

Ibid., page 80.

Ibid., page 359-61.

Ibid., page 233-39.

Ibid., page 282-84.

Ibid., page 271-73.

Ibid., page 276-77.

Ibid., page 273-76.

Ibid., page 165-69.

Ibid., page 63.

Ibid., page 67-68.

Ibid., page 359-61.

Ibid., page 331-33.

Ibid., page 334-37.

Ibid., page 292-94.

Ibid., page 285-86.

Ibid., page 292-94.

Ibid., page 331-33.

Ibid., page 154-56.

Ibid., page 154-56.

Ibid., page 501.

Ibid., page 273-76.

Ibid., page 165-69.

See “Summing Up by the Chairman—Review of the Pilot Project for Voluntary Release of Article IV Staff Reports and Other Issues in Fund Transparency” (SUR/00/85,9/6/2000).

That is, information which might otherwise bo considered as market sensitive but which has already been made publicly available by the authorities.

The general practice since June 1999, endorsed by the Board, has been for LOIs/MEFPs to be published with all performance criteria and structural benchmarks.

As is current practice with memoranda on deletions, management and heads o f departments would continue to be copied.

See memo on “Country Information Updates and Publication of Article IV Staff Reports,” circulated by the Secretary to Executive Directors on May 12, 2000.

Unlike PRSPs, Interim PRSPs and PRSP progress reports, LOIs and MEFPs are not proposed to be published by the Fund upon circulation to the Executive Board. The reason is that these documents contain policy intentions which form the basis for the Executive Board’s decision to provide Fund resources to the member. As such, it would be odd for the Fund to publish an LOI/MEFP before the Executive Board has had a chance to consider the documents, since that could suggest a pre-judgment of the outcome of the Board meeting. For that reason, LOIs and MEFPs are to be published only after consideration by the Board. However, the member is free to publish these documents at any time, since they belong to the member.

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