Chapter

Appendix III. Principal Policy Decisions of the Executive Board

Author(s):
International Monetary Fund
Published Date:
September 1999
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A. Access Policy—Guidelines on Access Limits

(a) Extension of Annual Access Limit and Period for Review

The Fund decides that the annual review of the guidelines and limits for access to the Fund’s general resources under the credit tranches and the Extended Fund Facility prescribed by paragraph 2 of Decision No. 11608-(97/112),1 adopted November 13, 1997, shall be completed by December 31, 1998, and that, until this review is completed, the annual access limit of 100 percent of quota established by Decision No. 10819-(94/95),2 adopted October 24, 1994, as amended by Decision No. 11608-(97/112),3 shall remain in effect.

Decision No. 11818-(98/110)

October 28, 1998

(b) Extension of Period for Review

The Fund decides that the annual review of the guidelines and limits for access to the Fund’s general resources under the credit tranches and the Extended Fund Facility prescribed by paragraph 2 of Decision No. 11608-(97/112),4 as amended, shall be completed by January 15, 1999.

Decision No. 11863-(99/l)

December 21, 1998

(c) Limits in Credit Tranches and Under Extended Fund Facility—Review

1. The Fund, having reviewed Decision No. 10181- (92/132),5 adopted November 3, 1992, and Decision No. 10819-(94/95),6 adopted October 24, 1994, and in light of the increases in quotas under the Eleventh Review of Quotas that will take effect upon the fulfillment of the requirement for the effectiveness of such increases specified by paragraph 3 of the Resolution of the Board of Governors No. 53-2, decides that the limits for access by members to the Fund’s general resources in the credit tranches and under the Extended Fund Facility remain appropriate. Accordingly, such access shall be subject to an annual limit of 100 percent of quota and a cumulative limit of 300 percent of quota, net of scheduled repurchases. These limits shall not be regarded as targets. Within these limits, the amount of access in individual cases will vary according to the circumstances of the member in accordance with criteria established by the Executive Board. The Fund may approve Stand-By or Extended Arrangements that provide for amounts in excess of these access limits in exceptional circumstances.

2. The guidelines and the access limits set forth in this decision shall be reviewed not later than December 31, 1999 and at least annually thereafter on the basis of all relevant factors, including the magnitude of members’ payments problems and developments in the Fund’s liquidity.

Decision No. 11876-(99/2)

January 6, 1999

(d) Access Limits Under Special Facilities

Upon the fulfillment of the requirement for effectiveness of the increases in quotas under the Eleventh General Review of Quotas specified by paragraph 3 of the Resolution of the Board of Governors No. 53-2:

(a) The percentage of a member’s quota referred to in Decision No. 8955-(88/126),7 August 23, 1988, on the establishment of the Compensatory and Contingency Financing Facility shall be changed as follows:

  • in paragraph 8(a)(i), 80 percent shall be changed to 55 percent;
  • in paragraph 8(a)(ii), 65 and 30 percent shall be changed to 45 and to 20 percent, respectively;
  • in paragraph 8(a)(iii), 30 percent shall be changed to 20 percent;
  • in paragraph 8(a)(iv), 65 and 15 percent shall be changed to 45 and to 10 percent, respectively;
  • in paragraph 8(a)(vi), 95 percent shall be changed to 65 percent;
  • in paragraph 8(b), 30, 15, and 20 percent shall be changed to 20, 10, and 15 percent, respectively;
  • in paragraphs 12(a)(i) and 12(a)(ii), 30 percent shall be changed to 20 percent, and 50 percent to 35 percent, respectively;
  • in paragraphs 12(b)(i), 12(b)(ii), and 12(b)(iii), 15 percent shall be changed to 10 percent, 30 percent to 20 percent, and 50 percent to 35 percent, respectively;
  • in paragraph 12(c), 65 percent shall be changed to 45 percent;
  • in paragraph 19(b), 70 percent shall be changed to 50 percent;
  • in paragraph 20(c)(iii), 25 percent shall be changed to 15 percent;
  • in paragraph 20(e), the three references to 30 percent shall be changed to 20 percent;
  • in paragraphs 31(b)(i) and 31(b)(ii), 15 percent shall be changed to 10 percent and 35 percent shall be changed to 25 percent, respectively;
  • in paragraphs 31(c)(i) and 31(c)(ii), 15 percent shall be changed to 10 percent and 35 percent shall be changed to 25 percent, respectively;
  • in paragraph 31(d), 83 percent shall be changed to 45 percent; and
  • in paragraph 32(a), 80 percent shall be changed to 55 percent.

(b) The percentage in paragraph 2 of Decision No. 2772-(69/47),8 June 25,1969, on the Buffer Stock Financing Facility, shall be changed from 35 percent to 25 percent.

Decision No. 11878-(99/2)

January 6, 1999

(e) Access Limits Under Enhanced Structural Adjustment Facility

Upon the fulfillment of the requirement for effectiveness of the increases in quotas under the Eleventh General Review of Quotas specified by paragraph 3 of the Resolution of the Board of Governors No. 53-2, the percentages of quota referred to in paragraphs 1 and 2 of Decision No. 8845- (88/61) ESAF,9 April 20, 1988, on access under the Enhanced Structural Adjustment Facility shall be as follows:

  • 190 percent shall be changed to 140 percent, and
  • 255 percent shall be changed to 185 percent.

Decision No. 11879-(99/2) ESAF

January 6,1999

B. IMF’s Income Position

(a) Disposition of Net Income for FY 1999

SDR 106,675,756 of the Fund’s net income for financial year 1999 shall be placed in the Fund’s Special Reserve after the end of the financial year.

Decision No. 11943-(99/49)

April 30,1999

(b) Rate of Charge on the Use of Fund Resources for FY 2000

1. Not withstanding Rule I-6(4)(a), effective May 1, 1999, 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 113.7 percent.

2. Any net income for financial year 2000 in excess of an amount equivalent to 5 percent of the Fund’s reserves at the beginning of that financial year shall be used to reduce retroactively the proportion of the rate of charge to the SDR interest rate for financial year 2000. If net income for financial year 2000 is below an amount equivalent to 5 percent of the Fund’s reserves at the beginning of that financial year, the amount of projected net income for financial year 2001 shall be increased by the equivalent of that shortfall. For the purpose of this provision, net income shall be calculated without taking into account net operational income generated by the Supplemental Reserve Facility and Contingent Credit Lines or the effect on income of the implementation of International Accounting Standard 19—Employee Benefits.

Decision No. 11944-(99/49)

April 30, 1999

(c) ESAF Trust-Reserve Account—Transfer to the ESAF-HIPC Trust

For financial year 2000, no reimbursement shall be made to the General Resources Account from the ESAF Trust Reserve Account for the cost of administering the ESAF Trust. One-fourth of the estimated annual cost shall be transferred at the end of each financial quarter ended July 31 and October 31, 1999 and January 31 and April 30, 2000 from the ESAF Trust Reserve Account (through the Special Disbursement Account) to the ESAF-HIPC Trust.

Decision No. 11946-(99/49)ESAF

April 30,1999

(d) Supplemental Reserve Facility and Contingent Credit Lines—Disposition of Net Operating Income

For financial year 2000, after meeting the cost of administering the ESAF Trust, any remaining net operational income generated by the Supplemental Reserve Facility and Contingent Credit Lines shall be transferred, after the end of that financial year, to the General Reserve.

Decision No. 11949- (99/49) SRF/CCL

April 30,1999

C. Enhanced Structural Adjustment Facility (ESAF)

(a) ESAF Trust-Reserve Account—Review

Pursuant to Decision No. 10286-(93/23) ESAF,10 adopted February 22, 1993, the Fund has reviewed the adequacy of the Reserve Account of the ESAF Trust and determines that amounts held in the account are sufficient to meet all obligations that could give rise to a payment from the Reserve Account to lenders to the Loan Account of the ESAF Trust in the six months from July 1 to December 31, 1998.

Decision No. 11754-(98/71) ESAF

June 30, 1998

(b) ESAF Trust-Reserve Account—Review

Pursuant to Decision No. 10286-(93/23) ESAF,11 adopted February 22,1993, the Fund has reviewed the adequacy of the Reserve Account of the ESAF Trust, and determines that amounts held in the account are sufficient to meet all obligations that could give rise to a payment from the Reserve Account to lenders to the Loan Account of the ESAF Trust in the six months from January 1 to June 30, 1999.

Decision No. 11864-(99/l) ESAF

December 30,1998

(c) ESAF Trust-Reserve Account—Transfer to the ESAF-HIPC Trust

(See Section B above, Fund’s Income Position, subsection (c) for the full text of this Decision.)

(d) ESAF Trust—Amendment

Part I

1. The Instrument to Establish the Enhanced Structural Adjustment Facility Trust (the Instrument) annexed to Decision No. 8789-(87/176) ESAF12 shall be amended as follows:

Section A

  • (i) In Section II, Paragraph 1: subparagraphs (e) and (f) shall be deleted;
  • (ii) In Section II, Paragraph 2: in subparagraph (d), the first two sentences shall be replaced by the following sentence:The amount of resources committed to a qualifying member under a three-year arrangement may be increased at the time of consideration of each annual program or at the time of any review contemplated under an annual arrangement, to help meet a larger balance of payments need or to support a strengthening of the program during the period of such annual arrangement.
  • (iii) In Section II, Paragraph 3: subparagraph (b) shall be amended to read as follows:
    • (b) Disbursements must precede the expiration of the three-year commitment period. If an annual arrangement expires with undisbursed amounts, the Trustee may rephase those amounts over the remaining annual arrangements under the three-year commitment. It may also extend the period of the three-year commitment for up to one year to allow the disbursement of undisbursed amounts or of additional resources committed to the member, subject to appropriate conditions consistent with the terms of assistance under this Instrument.
    • Each annual arrangement shall determine the phasing of disbursements, which, in principle, shall be at semiannual intervals (one upon approval and at approximately six-monthly intervals thereafter) with semiannual performance criteria and appropriate monitoring of key financial variables in the form of quarterly quantitative benchmarks and structural benchmarks for important structural reforms. Arrangements shall also contain provisions for reviews of the member’s program with the Trustee to evaluate the macroeconomic and structural reform policies of the member and reach new understandings if necessary. In cases where closer monitoring is needed, an annual arrangement may provide for quarterly performance criteria and reviews and quarterly disbursements. In establishing the phasing under an arrangement, the Trustee shall endeavor to avoid undesirable bunching of disbursements under one arrangement with the disbursements under the subsequent arrangement.

Section B

  • (iv) In Section II: a new subparagraph l(aa) shall be added, which will read as follows:
    • (aa) The provisions of subparagraphs l(b), 2(d), and 3(b) of this Section shall apply to assistance committed to qualifying members through November 20, 1998. The provisions of subparagraphs l(bb), 2(dd), and 3(bb) of this Section shall apply to assistance committed after that date.
  • a new subparagraph l(bb) shall be added, which will read as follows:
  • (bb) Assistance shall be committed and made available to a qualifying member under a single three-year arrangement in support of a three-year macroeconomic and structural adjustment program presented by the member. The member shall also present a detailed statement of the policies and measures it intends to pursue for the first twelve months of the arrangement, in line with the objectives and policies of the three-year program. The three-year arrangement will prescribe the total amount of resources committed to the member, the amount to be made available during the first year of the arrangement, the phasing of disbursements during that year and the overall amounts to be made available during the second and third years of the arrangement. In principle, disbursements shall be phased at semiannual intervals (one upon approval and at approximately six-monthly intervals thereafter) with semiannual performance criteria and appropriate monitoring of key financial variables in the form of quarterly quantitative benchmarks and structural benchmarks for important structural reforms. The arrangement shall also provide for reviews of the member’s program with the Trustee to evaluate the macroeconomic and structural reform policies of the member and the implementation of its program and reach new understandings if necessary. In cases where closer monitoring is needed, the arrangement may provide for quarterly performance criteria and reviews and quarterly disbursements. The determination of the phasing of, and the conditions applying to, disbursements during the second and third years of the arrangement will be made by the Trustee in the context of a review of the program with the member, and of a detailed statement presented by the member describing progress made under the program, and of the policies it will follow during the subsequent year of the arrangement to further the realization of the objectives of the three-year program, with such modifications as may be necessary to assist it to achieve its objectives in changing circumstances. After the expiration of a three-year arrangement for an eligible member, the Trustee may approve additional arrangements for that member in accordance with the Instrument.
  • a new subparagraph 2(dd) shall be added, which will read as follows:
  • (dd) The amount of resources committed to a qualifying member under a three-year arrangement may be increased at the time of any review contemplated under the arrangement, to help meet a larger balance of payments need or to support a strengthening of the program. The amount committed to a member shall not be reduced because of developments in its balance of payments, unless such developments are substantially more favorable than envisaged at the time of approval of the three-year arrangement and the improvement for the member derives in particular from improvements in the external environment.
  • a new subparagraph 3(bb) shall be added, which will read as follows:
  • (bb) Disbursements under a three-year arrangement must precede the expiration of the arrangement period. If phased amounts under an arrangement do not become available as scheduled due to delays in program implementation, nonobservance of conditions attached to such disbursements or delays in reaching new understandings when necessary, the Trustee may rephase those amounts over the remaining period of the arrangement. The Trustee may also extend the period of the arrangement for up to one year to allow for the disbursement of rephased amounts or to provide additional resources, subject to appropriate conditions consistent with the terms of assistance under the Instrument.

Section C

(v) In Section V, Paragraph 1:

  • a new subparagraph (f) shall be added, which will read as follows:
  • (f) repayments of the principal under Trust loans, to the extent that resources in the Reserve Account have been used to make payments to a lender due to a difference in timing between scheduled principal repayments to the lender and principal repayments under Trust loans.

(vi) Section V, Paragraph 3 shall be amended to read as follows:

  • Any repayment of principal under Trust loans, to the extent that repayment to a lender has been made from the Reserve Account due to differences in timing between scheduled principal repayments to the lender and principal repayments under Trust loans, any payments of overdue principal or interest or interest thereon under Trust loans, and any payments of interest under Trust loans to the extent that payment has been made to a lender from the Reserve Account, shall be made to the Reserve Account.

Section D

(vii) In Section II, Paragraph 1:

  • a new subparagraph (e) shall be added, which will read as follows:
  • (e) The Managing Director shall not recommend for approval, and the Trustee shall not approve, a request for a three-year arrangement under this Instrument whenever the member has an overdue financial obligation to the Fund in the General Resources Account, the Special Disbursement Account, or the SDR Department, or to the Fund as Trustee, or while the member is failing to meet a repurchase expectation to the Fund pursuant to Decision No. 7842-(84/165)13 on the Guidelines on Corrective Action, or pursuant to subparagraphs 16(a) or 33(a) of Decision No. 8955-(88/126) on the Compensatory and Contingency Financing Facility, or in respect to a purchase in support of debt- and debt-service- reduction operations pursuant to Decision No.9331 -(89/167),14 or a purchase pursuant to Decision No. 11627-(97/123) SRF15 on the Supplemental Reserve Facility, or pursuant to the Guidelines for Fund Support for Currency Stabilization Funds, or is failing to meet a repayment expectation pursuant to the provisions of Appendix I to this Instrument.

(viii) In Section II, Paragraph 3:

  • a new subparagraph (e) shall be added, which will read as follows:
  • (e) In cases of misreporting and noncomplying disbursements of Trust loans, the provisions of Appendix I, which shall be incorporated at the end of this Instrument, shall apply.
  • a new subparagraph (f) shall be added, which will read as follows:
  • (f) Disbursements under an arrangement to a qualifying member shall be suspended in all the cases specified in Paragraph l(e) of this Section.

(ix) The following Appendix I shall be incorporated at the end of the Instrument:

Appendix I Misreporting and Noncomplying Disbursements Under ESAF Arrangements—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 performance criteria and other 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, in a decision approving the arrangement, completing a review, or granting a waiver for the nonobservance of a performance criterion under the arrangement.

b. Whenever evidence comes to the attention of the Trustee indicating that a member may have received a noncomplying disbursement within the previous two years, 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, he shall promptly notify the member and submit a report to the Executive Board together with his recommendations, which may include a recommendation that the member be called upon to make an early repayment or that the nonobservance be waived. If the decision of the Executive Board is to call upon the member to make an early repayment, the member will be expected to repay an amount equivalent to the noncomplying disbursement, together with any interest accrued thereon, within a period of 30 days from the date of the Executive Board decision.

d. A waiver will 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.

e. If a member fails to meet a repayment expectation under these guidelines within the period established by the Executive Board, (i) 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.

Part II

2. All the provisions applying to assistance under the Enhanced Structural Adjustment Facility Trust Instrument, other than those amended or deleted pursuant to Part A of this Decision, shall continue to apply to assistance committed after November 20, 1998 under such Instrument, including the maturity of loans, which will continue to be repaid in 10 equal semiannual installments beginning not later than five-and-a-half years from the date of each disbursement and completed at the end of the tenth year after that date.

3. The Managing Director shall not recommend, and the Fund shall not approve, a request by a member for the use of the Fund’s general resources, Special Disbursement Account resources, or resources administered by the Fund as Trustee, whenever the member is in arrears, or is failing to meet a repayment expectation, to the Enhanced Structural Adjustment Facility Trust.

4. Provision shall be made in Stand-By and Extended Arrangements for the suspension of further purchases whenever a member fails to meet a repayment obligation to the ESAF Trust or a repayment expectation to that Trust within the period established by the Executive Board pursuant to the provisions of Appendix I to the ESAF Trust Instrument.

Decision No. 11832- (98/119) ESAF

November 23, 1998

(e) Trust for Special ESAF Operations for the Heavily Indebted Poor Countries and Interim ESAF Subsidy Operations—Amendment

The Instrument to Establish a Trust for Special ESAF Operations for the Heavily Indebted Poor Countries and Interim ESAF Subsidy Operations annexed to Decision No. 11436- (97/10) ESAF16 shall be amended as follows:

In Section III:

  • (i) paragraph l(b): the words “two-year period beginning October 1, 1996" shall be amended to read:
  • period beginning October 1, 1996 and ending December 31, 2000.
  • (ii) paragraph 2(c): in the third sentence, delete the word “or" appearing before “decisions on rights accumulations” and add the following words at the end of the sentence:
  • , or programs supported by the Fund under the policy on emergency assistance for postconflict countries.
  • (iii) paragraph 3: the following new paragraph (c) shall be inserted after paragraph (b):
  • In case of protracted delays by a member in reaching the completion point because of problems in policy implementation, the Trustee may reassess that member’s eligibility and qualification for assistance, including the amount of assistance committed at the decision point.
  • (iv) former paragraph (c) shall become paragraph (d), and the following sentence shall be added at the end of the paragraph:
  • For the purposes of this paragraph, references to the commitment of assistance at the decision point will be deemed to include any adjustment of the amount of such assistance in accordance with (c) above.
  • (v) former paragraph (d) shall become paragraph (e).
  • (vi) former paragraph (e) shall become paragraph (f).

Decision No. 11861-(98/131) ESAF

December 18, 1998

D. Supplemental Reserve Facility (SRF)

(a) Amendment to System of Increases of Rate of Charge

In the first sentence of paragraph 8 of Decision No. 11627- (97/123) SRF,17 “from the date of approval of financing under this Decision” shall be replaced by “from the date of the first purchase financed under this Decision.”

Decision No. 11895-(99/ll) SRF

January 25,1999

(b) Disposition of Net Operating Income

(See Section B above, Fund’s Income Position, subsection (d) for the full text of this Decision.)

E. Multiple Currency Practices—Approval Period

The Policy on Multiple Currency Practices, Decision No. 6790- (81/43),18 adopted March 20,1981, shall be amended to replace the last sentence in paragraph 5 with the following: “Consistent with the cycle of consultations under Article IV, approval will be granted for periods of approximately one year, in order to provide for a continual review by the Executive Board, except where the practice is maintained only for existing arrangements and for a specified period of time.”

Decision No. 11728-(98/56)

May 21,1998

F. Operational Budget

(a) Review of Guidelines for Allocation of Currencies

1. Pursuant to Decision No. 11386-(96/107), adopted December 2, 1996, the Fund has reviewed the guidelines for the use of currencies in the General Resources Account approved by Decision No. 10279-(93/19),19 adopted February 10, 1993. The Executive Board approves the new guidelines set out below:

2. Currencies to be used for transfers in the operational budget will be allocated in proportion to members’ quotas.

3. Currencies to be used for receipts in the operational budget will be allocated in such a way as to promote over time balanced positions in the Fund in relation to quotas. Receipts in currencies will be allocated to members with positions in the Fund above the average of all members included in the operational budget. The amount allocated in each currency shall be in proportion to the difference between the member’s position in the Fund and the projected average of all members included in the operational budget, expressed as a percent of quota, at the end of the budget period.

4. A member’s “position in the Fund” shall be defined as its reserve tranche position plus any outstanding loans to the Fund by the member or an institution of the member under credit arrangements that are judged by the Fund to provide it, on a continuing basis, with the ability to finance uses of its resources by members on terms comparable to those applicable to the Fund’s use of its currency holdings for this purpose.

5. The Fund’s holdings of a member’s currency in terms of quota resulting from allocations of currencies for transfers shall not be reduced below a floor of one-half of the projected average level, in percent of quota, of the Fund’s holdings of usable currencies at the end of the budget period.

6. The Fund will seek to maintain adequate working balances of each member’s currency included in the operational budget for transfers of not less than 10 percent of the quotas of these members.

7. These guidelines will enter into effect with the operational budget for the period December 1998-February 1999. Their operation will be reported to the Executive Board in the context of the quarterly operational budgets.

8. The guidelines will be reviewed by the Executive Board not later than December 31, 2000.

Decision No. 11837-(98/121)

November 30, 1998

(b) Specification of Currencies

Paragraph 3 of Decision No. 6274-(79/158),20 adopted September 14, 1979, is abrogated.

Decision No. 11838-(98/121)

November 30, 1998

G. European Economic and Monetary Union and the IMF

(a) SDR Valuation and SDR Interest Rate

1. SDR Valuation Basket—Amendment

With effect on January 1, 1999, references in Decision No. 11073-(95/92) G/S,21 September 25, 1995 to the deutsche mark and the French franc shall be replaced by references to the euro as the currency of Germany and France, respectively.

Decision No. 11801-(98/101) G/S

September 21, 1998

2. Amendment to Rules O-l and T-l (c)

With effect on January 1, 1999, references in Rule O-l and T-l(c) to the deutsche mark and the French franc shall be replaced by references to the euro as the currency of Germany and France, respectively.

Decision No. 11802-(98/101) G/S

September 21, 1998

3. Guidelines for Conversion into Currency Amounts of Euro of Currency Amounts of Deutsche Mark and French Franc

The Fund notes that with the introduction of the euro on January 1, 1999, the currency amounts of the deutsche mark and the French franc in the SDR valuation basket will be automatically replaced by the euro as the currency of Germany and France, respectively, and decides that such conversion shall be made in accordance with the principles set out in the guidelines for the calculation of the currency amounts in the SDR valuation basket established by Decision No. 8160- (85/186) G/S,22 adopted December 23, 1985.

Decision No. 11803-(98/101) G/S

September 21, 1998

(b) Members of Euro Area—Surveillance Over Monetary and Exchange Rate Policies

The Executive Board approves the modalities for conducting surveillance over the monetary and exchange rate policies of the members of the euro area.

Decision No. 11846-(98/125

December 9, 1998

Effective December 11, 1998

(c) Freely Usable Currencies

Pursuant to Article XXX(/), and after consultation with the members concerned, the Fund determines that, effective January 1, 1999 and until further notice, the euro, Japanese yen, pound sterling, and U.S. dollar are freely usable currencies.

Decision No. 11857-(98/130)

December 17, 1998

(d) Determination of Representative Exchange Rate for Euro

1. The Fund finds, after consultation with the authorities of Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, The Netherlands, Portugal, and Spain, that the representative exchange rate for the euro, under Rule O-2(b)(i) of the Fund’s Rules and Regulations, is the rate against the U.S. dollar as published daily by the European Central Bank.

2. The European Central Bank will communicate to the Fund the representative exchange rate for the euro daily and will promptly inform the Fund of any changes in the exchange arrangements that may affect the determination of the representative exchange rate.

Decision No. 11858-(98/130) G/S

December 17, 1998

(e) Rates for Computations and Maintenance of Value

Decision No. 5590-(77/163),23 adopted December 5, 1977, effective April 1, 1978, shall be amended as follows:

“Current paragraphs 2(d) and 2(e) shall become paragraphs 2(c) and 2(f), respectively, and a new paragraph 2(d) shall be added to read as follows:

“(d) with respect to the euro, on the last business day of each month,”

Decision No. 11859-(98/130)

December 17,1998

H. Resources in Connection with Debt- and Debt-Service-Reduction Operations

Upon the fulfillment of the requirement for effectiveness of the increases in quotas under the Eleventh General Review of Quotas specified by paragraph 3 of the Resolution of the Board of Governors No. 53-2, the limit for additional resources under Stand-By or Extended Arrangements in support of debt- and debt-service-reduction operations shall be changed from 30 percent of quota to 20 percent of quota. Moreover, the amount that could be set aside under a Stand- By or Extended Arrangement for the same purpose may be about 15 percent instead of about 25 percent of actual access under the arrangement.

Decision No. 11877-(99/2)

January 6, 1999

I. Eleventh General Review of Quotas

(a) Effectiveness of Increases in Quotas

1. The Executive Board determines that members having 85 percent of the total of quotas on December 23,1997 have consented to the increases in their quotas under the Eleventh General Review. This determination is effective on January 22, 1999.

2. The Secretary is authorized and directed to dispatch to members a communication on January 22, 1999, the text of which is set out in the Attachment.

Decision No. 11887-(99/9)

January 22,1999

Attachment Communication to All Members

The International Monetary Fund has determined that members having 85 percent of the total of Fund quotas as of December 23, 1997 have consented to increases in their quotas under the Eleventh General Review of Quotas. This is to advise you, therefore, that the participation requirement of the Eleventh General Review of Quotas under Board of Governors Resolution No. 53-2 has been met. Your attention is drawn to the following points of timing and procedure.

First, members that have not as yet consented to their quota increases may still consent but their consent must be received in the Fund not later than 6:00 p.m., Washington time, on January 29, 1999. The Executive Board may extend this period for consent.

Second, each member that has already consented to the quota increase as of January 22, 1999 must pay to the Fund this increase within 30 days thereafter, that is, not later than February 21, 1999.24 Members that consent later than January 22, 1999 must pay the increase within 30 days after the date on which the Fund is duly notified of their consent. The Executive Board may also extend the payment period.

Third, a member with overdue repurchases, charges or assessments to the General Resources Account may not consent to nor pay for the increase in its quota until it becomes current with these obligations.

The Treasurer’s Department will continue to be in touch with the fiscal agencies of members regarding the modalities of the payments for these quota increases.

(b) Period for Consent to Increases—Extensions

Pursuant to Paragraph 4 of the Resolution of the Board of Governors No. 53-2, “Increase in Quotas of Fund Members—Eleventh General Review,” the Executive Board decides that notices of consent from members to increases in their quotas must be received in the Fund before 6:00 p.m., Washington time, on July 30, 1999.

Decision No.11896-(99/12)

January 29,1999

J. European Central Bank—Observer Status

1. The European Central Bank (ECB) shall be invited to send a representative to meetings of the Executive Board on:

  • Fund surveillance under Article IV over the common monetary and exchange rate policies of the euro area;
  • Fund surveillance under Article IV over the policies of individual euro-area members;
  • role of the euro in the international monetary system;
  • world economic outlook;
  • international capital markets reports; and
  • world economic and market developments.

2. In addition, the ECB shall be invited to send a representative to meetings of the Executive Board on agenda items recognized by the ECB and the Fund to be of mutual interest for the performance of their respective mandates.

3. At Executive Board meetings, the representative of the ECB will have the status of observer and, as such, will be able to address the Board with the permission of the Chairman on matters within the responsibility of the ECB.

4. The Fund shall communicate to the ECB (i) the agenda for all Board meetings and (ii) the documents for the Executive Board meetings to which the ECB has been invited.

5. The decision shall become effective upon receipt by the Fund of a certification by the ECB that it will preserve the confidentiality of all information and documents communicated by the Fund to the ECB, as specified by the Fund, and that any such information and documents shall be solely for the internal use of the ECB.

6. This decision shall be reviewed before January 1, 2000.

Decision No. 11875-(99/l)

December 21, 1998

K. Access to the IMF’s Archives—Review and Amendment of Policy

The first sentence of Decision No. 11192-(96/2),25 adopted January 17, 1996, shall be amended to read as follows:

The Executive Board decides that outside persons, on request, will be given access to documentary materials maintained in the Fund’s archives that are over 30 years old until September 8, 1999, after which access will be given to Executive Board documents that are over 5 years old and to other documentary materials maintained in the Fund’s archives that are over 20 years old, provided, however, that access to Fund documents originally classified as “Secret” or “Strictly Confidential” will be granted only upon the Managing Director’s consent to their declassification.

Decision No. 11915-(99/23)

March 8, 1999

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