1. Policy priorities. The Global Policy Agenda (GPA) presented to the IMFC in April identified a range of actions needed to transform the modest, uneven, and fragile recovery into more rapid, balanced, and sustainable growth. These actions included policies to manage monetary normalization and the associated policy spillovers and spillbacks; reforms to ensure robust growth while reducing vulnerabilities; and steps to facilitate external rebalancing. The GPA also outlined how the Fund would support the membership through assessments and policy advice provided in bilateral and multilateral surveillance, capacity building, and financial support (Figure 1).
2. Implementation. The Executive Board’s work program (WP) of November 2013 has been implemented broadly as planned. Most policy meetings were concluded on schedule, but a few administrative meetings suffered substantial delays, in most cases reflecting the need for more extensive consultations than originally envisaged.
3. Spring 2014 Work program. This document translates the policy priorities laid out in the GPA and the IMFC communiqué into a work agenda for the Executive Board over the next twelve months (Figure 2). A number of new Board items have been added, in line with emerging concerns and priorities, related to the management of monetary normalization and the associated spillovers and spillbacks, fiscal consolidation and growth-friendly policies, and structural reforms. The WP also envisages analytical and operational agendas tailored to the policy priorities and challenges of different country groups, including low-income countries (LICs), Arab Countries in Transition (ACTs), and small states (see Box 1).
Focus on LICs, Small States, and ACTs
Low-income Countries. The main challenge for LICs is to sustain and deepen growth, trade, and investment in their ongoing quest to achieve frontier and emerging market economy status. The WP includes a reformulated report on the prospects and vulnerabilities of LICs, which will include a special focus on debt issues (see ¶4). Staff also intends to operationalize its analytical work on structural transformation and diversification, and on the macroeconomic management of natural resource wealth, and will examine issues related to financial deepening, revenue mobilization, and the challenges faced by frontier economies. A strong focus on capacity building will be maintained, including on monetary policy frameworks and statistics, and financial assistance provided through the reformed LICs lending framework.
Small states. The Fund will engage small states, taking into account their particular needs. Possible steps include drawing lessons from implementing the 2014 staff guidance note in a number of pilot cases, exploring clustered Article IVs, and clustering cross-regional Board meetings. A paper on selected issues in small states will be presented to the Board in early-2015 (see ¶4). Areas of analytical focus will include growth, fiscal and debt challenges, and financial interconnections. Efforts to integrate capacity building into surveillance are underway, as well as initiatives to enhance outreach and policy dialogue.
Arab Countries in Transition. ACTs face considerable socio-political challenges against the backdrop of worsening public finances. The Fund will continue to engage with countries through surveillance, capacity building, and financial support. The analytical agenda will focus on lessons from Fund arrangements in ACTs, Islamic Finance, and the linkages between revenue mobilization, growth, and equity. Follow-up work on the key messages from the recent Amman conference will aim at developing country-specific reform priorities to increase employment and enhance medium-term growth prospects.