CIGI sponsored a fascinating event in Washington DC this week in overlap with the IMF-World Bank Spring Meetings. The event called The IMF:What is Good For? brought together many former IMF officials, government officials, analysts, and private sector actors. Director of the Global Economy program, Domenico Lombardi opened the panel sessions to a full room at the Peterson Institute for International Economics (PIIE). The panel sessions were candid and reflective of past and proposed future policy actions of the IMF, and can be viewed on the online archive. Commemorating the IMF's 70th birthday, the conference reflected on the IMF's successes and failings.
Here are my takeaways:
The Fund was congratulated for a number of policy initiatives and changes. One private sector participant reminded us of the positive affect of the IMF's role on helping to disseminate vital government data and statistics, which continues to help calm market uncertainty. Fred Bergsten, former head of PIIE, the Fund has helped provide "intellectual leadership" in times of uncertainty -- an understated role that numerous groupings like the G20 and G7 have turned to in times of crisis.
Technical assistance is another area where many small countries rely on the assistance of the IMF to provided valuable training and ideas on how to tackle key policy concerns. While this may indeed be a successful IMF contribution to the world economy, I would note that it still remains obscure and non-transparent about what and who its technical assistance helping.
Of course, funding in times of crisis remains the key benefit for many countries, particularly when the systemic risk is high and international coordination can be garnered to help countries in need of a short term balance of payments. Yet, interestingly, CIGI's own James Boughton (Former IMF historian) recalls that IMF management had once asked him to put chapters about surveillance ahead of chapters on funding in his book surveying IMF history of the 1980s and Latin America. So in some ways the Fund prefers to see itself as a preventative tool and not a financing tool.
Bergsten noted one of the Fund's failings: it does not have a WTO-like dispute settlement mechanism. In other words, the IMF cannot reprimand countries that do not comply with its key statues and contracts. For example, when China circumscribes the key principle of a liberalized exchange rate, or when countries continuously ignore IMF policy advice. However, the IMF is not like the GATT where there are also an agreed upon set of international legal decisions concerning trade. Unlike the trade system, there are no international laws on monetary relations.
Well, the conference is just the tip of the iceberg on how the IMF has fared and where it can be improved, but my takeaway is that despite its 70 year history, there is still a lot of growing to do at the Fund and plenty of experts sharing ideas on where to go.