Amid encouraging indications of a gradual recovery from the economic crises that have affected many regions of the world, the Boards of Governors of the World Bank and the IMF will gather in Washington for the fifty-fourth Annual Meetings, which will formally open on Tuesday, September 28. The meetings will be chaired by Mahesh Acharya, Finance Minister of Nepal.
The Annual Meetings were to be preceded on September 26 by the meeting of the Interim Committee of the Board of Governors on the International Monetary System (Interim Committee), which is the IMF’s principal advisory body. Gordon Brown, U.K. Chancellor of the Exchequer, has been named the new Chair of the Interim Committee (see box below), succeeding Carlo Azeglio Ciampi of Italy, who resigned in May. The following day, September 27, the Joint Bank and Fund Committee on the Transfer of Real Resources to Developing Countries (Development Committee) was to meet, chaired by Tarrin Nimmanahaeminda, Finance Minister of Thailand.
In contrast to the 1998 Annual Meetings, which took place in an atmosphere of concern over the global repercussions of the Asian and Russian crises (IMF Survey, October 19, 1998, page 305), this year’s meetings will open amid signs of improvement in financial market conditions, particularly in those countries that have benefited from IMF support of their adjustment efforts. As noted in the IMF’s Annual Report for 1999, the countries in Southeast Asia that were directly affected by crisis are showing signs of recovery; Brazil’s economic program is showing success; and even Russia is doing better economically (see related story on page 291).
Against this encouraging background, the Interim Committee was to assess the outlook for the global economy and the policy requirements for a sustained and better balanced global economic recovery, as well as to consider developments in the international capital markets. To assist it in its deliberations, the Committee received summaries of the IMF Executive Board’s discussions of the World Economic Outlook and International Capital Markets reports.
Monetary and financial system. A major item on the Committee’s agenda was scheduled to be a review and discussion of progress in strengthening the international monetary and financial system, which has been a key element in the Executive Board’s discussions in recent months. This review includes consideration of ways to involve the private sector in forestalling and resolving financial crises; the appropriate choices of exchange rate regimes; the orderly liberalization of capital movements; and considerations of institutional reform and strengthening or transforming the Interim Committee.
ESAF and HIPC. As part of its consideration of the IMF’s role in promoting sustainable growth and reducing poverty, the Committee was scheduled to discuss means of reforming the Enhanced Structural Adjustment Facility (ESAF) to give greater prominence to the goal of supporting members’ poverty reduction efforts; ways to strengthen the Heavily Indebted Poor Countries (HIPC) Initiative; and the future financing of both ESAF and the HIPC Initiative.
At a September 23 press conference, IMF Managing Director Michel Camdessus explained that while negotiations on the future financing of ESAF and HIPC Initiative were still proceeding, the proposal was to have off-market transactions with member countries for 14 million ounces of IMF gold. This would allow the IMF to invest the capital gain from these transactions in the markets and, with the resources so generated, to provide the needed financing for ESAF and the HIPC Initiative.
Y2K problem. The Committee was also to examine contingency planning for the so-called millennium bug, or Y2K problem, and its possible impact on national accounts systems and other databases worldwide.
Surveillance and programs. The Committee was scheduled to discuss optimum ways to integrate social sector issues in IMF policy advice and IMF-supported programs, drawing on the work of the World Bank and other international institutions. The Committee was to review progress in the area of developing and monitoring standards, as well as the recent steps taken to make IMF practices and members’ policies more transparent, including through such measures as the release of Public Information Notices (PINs), IMF policy papers, summaries of Board discussions, and other materials, and the pilot program for the release of Article IV reports. The Committee’s agenda also included a discussion of the progress made in financial sector reform and banking system restructuring through IMF-supported programs.
The meeting of the Interim Committee was preceded by a preparatory meeting of the Committee’s deputies on September 17. Other meetings included those of the ministers of the Group of 10 industrial countries, the Group of 24 developing countries, and the deputies of the Group of 24. Also, the Financial Stability Forum met in Paris on September 15, chaired by Andrew Crockett, General Manager of the Bank for International Settlements. On September 22, Michael Mussa, Economic Counselor of the IMF and Director of the Research Department, briefed the press on the October 1999 edition of the IMF staff’s World Economic Outlook.
The opening ceremonies of the Annual Meetings on Tuesday, September 28, will be followed by the addresses of Mahesh Acharya, World Bank President James Wolfensohn, and Michel Camdessus. During the annual discussion, which will span September 28-30, the governors of the Bank and the IMF, representing industrial and developing countries and regional groupings, will address major issues affecting the world economy and the operations of the two institutions.
In addition to the formal proceedings of the Annual Meetings, a series of World Bank and IMF seminars is to be held in conjunction with the meetings. These will address a wide range of topics on the theme of “On the Eve of the Millennium: Setting the Agenda for Global Growth and Development” Keynote speakers at the seminars are scheduled to include Kofi Annan, the Secretary General of the United Nations, and Alan Greenspan, Chairman of the Board of Governors of the U.S. Federal Reserve System. The seminars are designed to bring together corporate executives and bankers, senior government officials, and other opinion leaders for discussion and debate on key issues.
The schedule for the Annual Meetings, fact sheets on the IMF, and related documents are available on the IMF website: http://www.imf.org.
The next issue of the IMF Survey, to be published on October 11, 1999, will provide complete coverage of the Annual Meetings.