Post by Boston University Global Development Policy Center

For the first time since 2018, the International Monetary Fund is conducting a Review of Program Design and Conditionality (RoC). This process analyzes the performance of recent IMF programs and establishes changes to their guiding framework. It provides a crucial opportunity to better align the Fund’s lending with its mission of promoting global financial stability.    Our latest research offers insights on the IMF’s current program design and potential avenues to address areas where it falls short.    💡 In their new policy brief, Tim Hirschel-Burns and Marina Zucker-Marques identify three flaws with IMF conditionality. They recommend the IMF apply more realistic and gradual volumes of fiscal adjustment, increase coordination with MDBs and national authorities and commit strongly to evenhandedness. Read more: https://lnkd.in/e4i6Bmet    💡 A new working paper by Daniel Rinner, Kevin P Gallagher and Rebecca Ray considers the efficacy of IMF programs through the lens of gross fixed capital formation (GFCF). While IMF programs should catalyze GFCF, empirical estimates indicate that IMF participation has statistically significant negative impacts on both total and private GFCF. Read more: https://lnkd.in/e7pYrQ_E    💡 New in One Earth by Cell Press, Timon Forster, Rishikesh Ram Bhandary and Kevin P Gallagher analyze a sample of 109 emerging market and developing countries from 2000-2020. They find IMF programs are associated with an average 9.2 percent increase in annual tree cover loss, as countries may seek to cut conservation spending and increase natural resource extraction while under an IMF program. Read more: https://lnkd.in/ePsVcRZC