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On Panama IMF Upbeat on FinTech and Urges Sensitizing on Money Laundering Panana Papers Page Turned?

By Matthew Russell Lee

UNITED NATIONS, October 3– The International Monetary Fund was upbeat on October 3 about FinTech's potential in Panama and seems to breeze over the issues raised in the Panama Papers. At the end of its Article IV review, the IMF said that "making tax crimes a predicate offense to money laundering by approving the draft legislation under consideration without further delay and ensuring the availability of beneficial ownership and accounting records of Panamanian entities are important to avoid being listed as a non-cooperative jurisdiction, and thereby eroding the recent gains. Continued efforts to sensitize the international community on progress with financial integrity is paramount." Is that spin? "An International Monetary Fund team led by Alejandro Santos visited Panama from September 24-October 3 to conduct the discussions for the 2018 Article IV consultation. The team met with the Minister of Economy and Finance Eyda Varela de Chinchilla, Banks Superintendent Ricardo Fernandez, as well as other senior public officials and private sector representatives." The IMF concluded, "FinTech has the potential to transform Panama’s regional banking sector, with close supervision and adequate regulation of developments needed to nurture the benefits while preserving financial stability....

On Spain the IMF cautioned against Spanish banks' exposure to "emerging markets" in its Article IV Concluding Statement issued October 3: "Reinforced efforts by major banks over recent months have notably lowered the system’s nonperforming loans and foreclosed real estate assets, but some banks still need to follow suit. The ongoing economic and house price recovery is helping to mend banks’ balance sheets. And while there is no clear evidence so far of a generalized house price overvaluation, vigilance is needed as housing-related new loans and especially consumer lending continue to pick up. Thus, for the Bank of Spain to be fully equipped to counter excessive risk-taking, its macroprudential toolkit should be swiftly expanded to include borrower-based tools such as limits on loan-to-value and debt service-to-income ratios. Moreover, rigorous management of liquidity and interest rate risks is needed, in particular ahead of the eventual normalization from the ECB’s accommodative policies, and against the risk of market volatility and sudden changes in risk appetite. Spanish banks would benefit from accelerating the build-up of high-quality capital buffers to protect their business against shocks—including spillovers from more uncertain economic conditions in some emerging markets—as they still lag European peers in terms of capital ratios even though they are generally less leveraged." It's an Iberian thing - Portuguese banks do a lot of business in the country's former colonies as well. We'll have more on this. The IMF approved a $290 million four year program for Barbados on October 1, see below. But thre are questions. For the IMF's embargoed media briefing on September 20, Inner City Press submitted questions including this on Zimbabwe: "please state the status of and steps toward any IMF staff program in light of reports that 'Britain will support Zimbabwe to get on an interim IMF staff program to help the country quickly clear its foreign arrears, Britain's ambassador in Harare Catriona Laing said after paying a courtesy call on Zimbabwe's Finance and Economic Development Minister, Professor Mthuli Ncube.'" IMF Spokesperson Gerry Rice read out the question from "Matthew Lee" and replied that while the IMF is working with the Zimbabwean authorities on designing reforms, any new program would require clearing arrears to the World Bank and AfDB, and commitments from international partners. Now on October 1, this on Barbados:
"On October 1, 2018, the Executive Board of the International Monetary Fund (IMF) approved a four-year Extended Arrangement under the Extended Fund Facility (EFF) for Barbados for an amount equivalent to SDR 208 million (about US$290 million, or 220 percent of Barbados’s quota in the IMF). The Board’s decision enables the authorities to purchase the equivalent of SDR 35 million (or about US$49 million) immediately. The remainder will be available upon successful completion of seven semiannual review.
The EFF-supported program aims to help Barbados: restore debt sustainability, strengthen the external position, and improve growth prospects. Upfront fiscal consolidation, meaningful debt restructuring, and structural measures to support growth should put debt on a clear downward trajectory. The program will seek to protect vulnerable groups through strengthened social safety nets.
Following the Executive Board discussion, Mr. Mitsuhiro Furusawa, Deputy Managing Director and Acting Chair, said: “The Barbadian authorities have developed a homegrown economic program to address longstanding challenges, which will be supported under the IMF’s Extended Fund Facility. Over the last decade, Barbados’s economy has experienced low growth, while fiscal and external imbalances have gradually widened to reach an unsustainable situation, with very high debt and very low reserves. The authorities’ reform program seeks to address these challenges with a combination of front-loaded fiscal consolidation, measures to boost growth, and debt restructuring, while protecting social spending. Fiscal consolidation is key to the adjustment effort. The authorities aim to increase the primary surplus to 6 percent of GDP in FY2019/20 and maintain it at that level for several years thereafter. Reducing transfers to state-owned enterprises will be key in reaching the primary surplus targets. The program aims to reduce these transfers with a combination of much stronger oversight of state-owned enterprises, improved reporting, cost reduction, revenue enhancement, and mergers and divestment. A planned comprehensive review of tax policies is expected to lead to improvements in the tax system. The adoption of a fiscal rule and reforms in public financial management will help sustain the fiscal reform effort. A comprehensive debt restructuring will complement the fiscal consolidation. The authorities have identified parameters that would provide debt relief without jeopardizing financial stability, and an exchange offer for domestic debt (Barbados dollar-denominated) to private creditors was launched on September 7, 2018. The proposed debt restructuring includes features, including a natural disaster clause, that are expected to help the authorities stay current on their future debt obligations."
From the September 20IMF Transcript: "There is a question on Zimbabwe and I want to take that. It's from Matthew Lee who is asking can you give us the status of steps toward any IMF program in Zimbabwe in light of reports that Britain will support Zimbabwe to get an interim IMF program to help the country quickly clear its foreign arrears. MR. RICE: What I would say is we see the new administration of President Mnangagwa has expressed commitment to strong economic reforms and supporting reforms will require a comprehensive stabilization and structural reform program from the authorities and financial support from the international community to provide space for these reforms.

Where the IMF is, we stand ready to help the authorities design a reform package that can help facilitate the clearance of external payment arrears to international development banks and bilateral official creditors and that then would open the way for fresh financing from the internal community including potentially the IMF.

But, again, just to stress as we said before, potential financial support from the Fund is conditional on the clearance of those arrears to the World Bank, the AFDB and financing assurances from bilateral official creditors. We are working with the Zimbabwean authorities in the meantime to provide policy advice and technical assistance that might help, could help move that process forward."
Video here from 23:24.
Inner City Press also asked: "On Guinea-Bissau, please confirm / expand upon the statement issued by the Bissau-Guinean government the the IMF during its mission which ends on 2nd October “will meet with the authorities, including those of BCEAO... to assess 'investment plans in the energy sector, compensation for fisheries products, related revenues' as well as the production and export of cashew nuts.”

On San Marino, please comment, including expressing the IMF's openness or not, to that “San Marino, whose banks are crippled by bad debts, will decide by the end of the year whether to ask the International Monetary Fund for a loan of around 300 million euros ($350 million) and to start issuing bonds, its secretary of state said.”

On Botswana, please provide IMF comment on reports that IMF says the country’s medium-term economic outlook will depend heavily on the success of structural reforms... 'In Botswana, beef and tourism are sectors that have significant potential and there are measures the government can take to promote these sectors such as removing an export monopoly on beef exports and improving the transport infrastructure.” A call to reform the beef sector has long been a contentious issue as the Botswana Meat Commission (BMC) is protected from export competition. The BMC Act grants the body a monopoly on the export of beef and prohibits the export of live cattle. Consequently, in the absence of competition from local butcheries and abattoirs, the BMC has solely benefited from the European Union market.”

On Cameroon, Inner City Press understands that a group of Internet access and human rights NGOs wrote to the Managing Director in late June stating the Cameroon's failure to inform the IMF of its Internet cuts and slow-downs violated the agreement, and that a call was held. What can the IMF now say about this, or about developments in Cameroon since then, especially now with controversial elections looming in which many may be unable to vote, with travel restrictions and bloodshed? Please comment on this.

Also if there are any updates on Yemen or Burundi." Watch this site.

 "please confirm or deny and comment on this: Pakistan is “very likely to seek an IMF program”, says Johanna Chua, Citigroup’s Head of Emerging Markets Asia Economics & Strategy Bank in a report released on Monday. The report says an approach is likely by end September." Spokesman Gerry Rice said that no request from Pakistan has been received - nor any request from Turkey. Inner City Press' other questions to the IMF: "On Ghana, please describe and explain the IMF's response to the request for transparency from the Minority in parliament via its leader Haruna Iddrisu on Ghana’s $2 billion Sinohydro deal with China.
On Kenya, please comment on / respond to this: The IMF is said to be behind the push for a 16 per cent value added tax (VAT) on petroleum products that triggered the price increase.  Observers have flagged the close relationship between the fund and Uhuru's top finance officials who have worked for the international lender in the past. Treasury Cabinet Secretary Henry Rotich worked as an economist for IMF before joining the ministry. His second in command, Kamau Thugge, worked for the institution for 21 years before becoming Uhuru's senior economic adviser. Before joining the World Bank, Geoffrey Mwau, the director general for budget, financial and economic affairs, worked for IMF. Also, what is the IMF's view of the Kenyan parliament having voted last Thursday to retain the cap on commercial interest rates?
On Zambia, please comment on this: Special Assistant to the President  Amos Chanda says if the IMF  takes 50 years to come through with a balance of payment support programme for Zambia, Finance Minister Margaret Mwanakatwe will not wait, but look elsewhere for help, including China. Chanda says President Edgar Lungu, who left for China yesterday with a huge government and private sector delegation, will remain in that country until September 7th to enhance economic ties as well as renegotiate Chinese debt.

 On Angola, will the IMF confirm and comment on this: Angola will ask the International Monetary Fund for a $4.5bn loan, highlighting the financial dire straits facing the major oil exporter even though global crude prices have recovered considerably. Talks between Luanda and the IMF will begin in October, Finance Minister Archer Mangueira said."

On Angola, Mr. Tao Zhang, Deputy Managing Director of the International Monetary Fund earlier said, "We have received a letter from the Angolan authorities for IMF staff to initiate discussions on an economic program that could be supported by the Extended Fund Facility (EFF). The request follows an IMF staff mission visit in Luanda during August 1-14, 2018 and an initial letter requesting a program to be supported by a Policy Coordination Instrument (PCI). The Government of President Lourenço has taken important steps toward improving governance and restoring macroeconomic stability. The IMF stands ready to help the authorities address Angola’s economic challenges by supporting their economic policies and reforms based on the Government’s Macroeconomic Stabilization Program and in the National Development Plan for 2018–22. We expect to initiate program discussions with the Angolan authorities as soon as feasible." Another one. On Argentina, on the morning of June 7 for the International Monetary Fund's embargoed media briefing Inner City Press submitted several questions; IMF spokesperson Gerry Rice said repeatedly the Fund's talks with Argentina were far advanced. On June 20, this: "The Executive Board of the International Monetary Fund (IMF) today approved a three-year Stand-By Arrangement (SBA) for Argentina amounting to US$50 billion (equivalent to SDR 35.379 billion, or about 1,110 percent of Argentina’s quota in the IMF)." Now on August 13, this from IMF Chief Spokesman Gerry Rice: “The Argentine authorities’ plan to accelerate the reduction of the stock of LEBACs has been carefully designed by the government. Implementation of this plan should remove an important source of vulnerability as well as help contribute to a more effective monetary policy framework. The Fund supports the authorities’ efforts in this area which are consistent with the understandings reached under the IMF-supported Stand-By Arrangement.”  Back on June 7 Inner City also asked about Barbados, Zambia, Jordan and Ukraine. IMF Spokesman Gerry Rice, after calling on those in the room on the latter two - as well as a named Ukrainian journalist - left Zambia and Barbados for last, nameless, deferred. On Barbados Inner City Press had asked, "what will the IMF do to try to ensure austerity measures don't hurt the poor and also lead to protests and political instability?" Rice answered that there is an IMF team finishing in Bridgetown and there might be a statement as early as today. And, after six pm, here it is: "At the request of the newly elected Government of Barbados, an International Monetary Fund (IMF) team led by Bert van Selm visited Bridgetown on June 5-7, to have discussions on economic policies and possible IMF financial support of the government’s economic plan. At the end of the visit, Mr. van Selm made the following statement:

“Barbados is in a precarious economic situation. International reserves have dwindled to US$220 million, while central government debt is unsustainable. The fiscal deficit has decreased over the last few years but remains large, at about 4 percent of GDP in FY2017/18. Meanwhile, the Central Bank of Barbados (CBB) is reporting a contraction of output of 0.7 percent in the first quarter of 2018 (over the same period last year).

“The Barbadian authorities, in close consultation with their social partners, are rapidly developing a plan to address current economic vulnerabilities. We welcome the government’s plans to urgently address infrastructure problems, and its goal of seeking to support the most vulnerable during the economic adjustment process.

“At this juncture, the IMF’s recommendations contained in the 2017 Article IV Consultation remain highly relevant to rebuild confidence and address Barbados’ current challenges. Substantial fiscal consolidation is needed to place debt on a clear downward trajectory in conjunction with the proposed debt restructuring, and to address balance of payments risks that cloud the country’s future. Since tax and revenues are relatively high, the adjustment effort should focus on the expenditure side, including by improving the efficiency and effectiveness of public services, containing wages, and reforming government pensions. Government transfers to SOEs need to be reduced by reviewing user fees, exploring options for mergers and privatization, and by providing much stronger oversight. Tax policy should be reviewed with a view to broadening the tax base and improving its progressivity, while efforts to strengthen tax administration should continue. Structural reforms are critical to improve the business climate in Barbados to attract investment, and develop the private sector.

“Fiscal consolidation will also help to reduce financing needs, in conjunction with the proposed debt restructuring. It will be important for the CBB to limit financing of the government budget given that such practice is not consistent with Barbados’ exchange rate peg; the large monetary financing over the last few years has contributed to the decline in international reserves.

“We also note the authorities’ decision to seek a restructuring of domestic debt and external debt to commercial creditors. An early and open dialogue with the country’s creditors, aiming to achieve an orderly debt restructuring process, is important.

“Overall, the team had very positive and candid discussions with the government during the visit. In the coming months, we expect to continue our close dialogue with the Barbados government with the aim of reaching understandings on economic policies that could underpin an IMF supported program. Our goal is to help Barbados achieve higher living standards and more inclusive growth for the years ahead.

“During the visit, the team met with Prime Minister Mia Mottley, Minister of Finance, Economic Affairs and Investment, CBB Governor Haynes, and other key officials. The team also had good opportunities for exchange of views with social partners, including labor unions and the private sector. The team would like to thank the Barbados government for open and candid discussions, and to express its desire to continue to work closely with Barbados in the period ahead.”" But what about austerity? He defended it with regard to Jordan, tying the protests there to the situation in and from neighboring Syria. On Argentina he said the economy would be stronger with an IMF program and that he expects Madame Lagarde to speak with Macri in Canada this weekend. On Ukraine he said the IMF doesn't comment on personalities (Inner City Press had asked about Oleksandr Danyliuk), but that the institutional role of the Finance Ministry is key. On Zambia, Rice answered Inner City Press' question with a statement that talks remain suspended due to official borrowing plans. And there it was over. Inner City Press' Cameroon and other questions were again not answered. Onward. On Somalia back on May the IMF offered some praise and support, after conducting a visit not to the country but to next door Kenya. On May 17 for the IMF's embargoed media briefing, Inner City Press asked among other things, "In Somalia, the Central Bank says it has requested from the IMF an Assessment Letter needed in order to issue a new currency. Please describe the process, and status. And, IMF gives go-ahead to source $41m to issue new bank notes, but how can printing of counterfeit notes be stopped before this time?" IMF Spokesperson Gerry Rice read out the question then said Somalia debt relief is a priority for the IMF, that all preparatory steps for the new currency have been taken, with the first step being replacing the counterfeit shillings. But what if new counterfeit is created in the meantime? Rice said the IMF would revert bilatally; Inner City Press also asked about price rises of the metro in Egypt, and of fuel in Sri Lanka. The latter, Rice defended as an attempt to eliminate subsidies that benefit the rich and not the poor - like the reported 130% rise in the price of kerosene? Most of the May 17 briefing was devoted to Argentina, on which the IMF Executive Board has a May 18 informal meeting on what Rice called Macri's request for a "high access stand by arrangement." Watch this site. On Somalia the IMF on May 15 said, "An International Monetary Fund (IMF) team, led by Mohamad Elhage, visited Nairobi, Kenya, from May 7—14, to conduct discussions on the second review of the second Staff-Monitored Program (SMP II) and to agree on SMP III. The team met with the Somali authorities to discuss recent economic developments, review progress on the implementation of reforms under SMP II, and discuss a follow-up SMP to consolidate reforms. At the conclusion of the visit, Mr. Elhage issued the following statement: 'The Federal Government of Somalia (FGS) successfully completed the third Article IV Consultations with the IMF and first review under its second SMP (SMP II) in February 2018... Performance under SMP II was satisfactory.  However, despite the important reforms implemented since the first SMP I (May 2016-April 2017), significant challenges remain. Growth is too low to make a significant dent in Somalia’s widespread poverty, high youth unemployment, and large social needs. The economy is vulnerable to shocks and lacks buffers needed to develop resilience. The external public debt is high, and there is no capacity to service public debt obligations. Without proper compliance with the AML/CFT international standards, Somalia will continue to suffer from pressures related to the reduction in correspondent banking relationships. This could result in lower and volatile remittances inflows, which are Somalia’s lifeline. SMP III will help maintain reform the momentum and macroeconomic stability. It will also continue to support the authorities’ broad reform agenda. In particular, it will focus on (1) enhancing public financial management and revenue mobilization; (2) completing Phase I of the currency reform, which consists of exchanging all Somali Shilling currently in circulation with a new national currency; (3) putting the foundation of financial sector reforms to foster financial development, inclusion, and stability, while strengthening compliance with the anti-money laundering and combating the financing of terrorism (AML/CFT); and (4) improving data reporting. Strengthening the procurement framework and improving governance and transparency are important features of SMP III, which will be support by technical assistance from the IMF... During the visit, the team met with Finance Minister, Mr. Abdirahman Duale Beileh; the Minister of Fisheries and Marine Resources, Mr. Abdirahman M. Abdi Hashi; Central Bank Governor, Mr. Bashir Issa Ali; Assistant to the President and Special Advisor, Hussein A. Gendisch; Representative of the Prime Minister’s office, Mr. Abdi Abdullahi; and other officials. The team also met representatives from development partners." Who might that be? By contrast when the IMF reviews developed countries' banking sectors, particularly in Europe, some banks' participation in predatory lending gets over looked. Consider Deutsche Bank, and today's IMF assessment of the Germany banking sector, just out from under embargo as of this publication: "The German banking and life insurance sectors should accelerate their restructuring to bolster profitability and reduce risks. In the banking sector, the regulatory capital ratio has increased, but the cost-to-income ratio and leverage remain high. The high cost structure, alongside low net interest margins, provisions for compliance violations, and the need to adjust to the new regulatory environment, continue to weigh on profitability. Restructuring is ongoing in the banking sector, but the process must be accelerated through faster implementation of restructuring plans, continued development of fee-based income, and further consolidation. In the life insurance sector, low interest rates have dented solvency ratios, and further progress is needed to reduce reliance on guaranteed return products. In this context, supervisory attention to interest rate risk and progress in implementing restructuring plans both in banking and insurance should continue." What about abuse of consumers, participation in predatory lending schemes and other abuses? What about Greece? What about Deutsche bank as the riskiest bank? The IMF announced a press conference, but apparently no live stream: "At the conclusion of the 2018 IMF Article IV mission to Germany, the mission chief Julie Kozack will hold a press conference at the Bundesbank offices in Berlin to present the missions’ Concluding Statement and answer questions from media.
When: Monday, May 14, 2018 at 1 pm CET.
Where: Deutsche Bundesbank, Hauptverwaltung in Berlin und Brandenburg Leibnizstr. 10, Berlin-Charlottenburg
Participants:  Julie Kozack, Assistant Director, European Department
How: Journalists interested in participating should register with Bundesbank e-mail christiane.engellandt-kranen."We'll have more on this.
When the IMF held its Middle East press conference at its Spring Meetings on April 20, Inner City Press submitted this question: "On Yemen, what are the IMF's predictions and what are its current actions, for example in ensuring the payment of public servants? Relatedly, what is the impact of the war on Yemen on the Saudi economy? -Matthew Russell Lee, Inner City Press." Spokesperson Wafa Amr read the question, from Matthew Lee, to Jihad Azour, the Director of the IMF's Middle East and Central Asia Department, who said (full audio here), "The situation in Yemen has inflicted a big humanitarian toll. The Fund is helping the Yemeni authorities, the Central Bank, in designing and managing the financial framework to distribute salaries... and import goods and medicines. With the government, we try to help them preserve the Central Bank and the ministry of finance. We are in dialogue with global community, providing assessment of the challenges and the best instruments that could help." Afterward, the IMF sent Inner City Press an email that "Yemen is suffering deep humanitarian and economic crisis. Outlook is very uncertain and will be dependent on security developments. Recession in Yemen continued in 2017 and GDP fell by 14 percent. We expect zero growth in 2018, under the assumption that the conflict will end end of the year." It's appreciated, but there was no answer about the impact on the Saudi economy. On May 7, the IMF issued this, on vicious censor Sisi of Egypt: "Following a meeting with Egypt’s President Abdel Fattah El Sisi in Cairo today, Mr. David Lipton, First Deputy Managing Director of the International Monetary Fund (IMF), issued the following statement: ;President El Sisi and I discussed Egypt’s economic outlook and progress in Egypt’s reform program supported by the IMF. The reforms have started to reap results, especially with regard to Egypt’s macroeconomic stabilization: growth is at the highest rate since 2008, inflation has rapidly declined, foreign exchange reserves are at record levels, exports are growing and unemployment has declined. We also discussed the outcome of the Inclusive Growth and Job Creation Conference [link to the PR announcing the conference], co-organized by the Egyptian authorities and the IMF in Cairo May 5-6. I was encouraged by the determination, shared by policy makers, the private sector, members of the parliament and civil society. There was consensus that Egypt needs to lock in the gains in macroeconomic stabilization and shift gears towards the implementation of a home-grown structural reform agenda to achieve more inclusive and private sector-led growth. This will help create jobs, which is the best way to reduce poverty and improve living standards. In this context, the conference also benefited from the participation of former senior policymakers from Korea, India and Malaysia who shared their reform experiences. I thanked President El Sisi, Prime Minister Sherif Ismail, Governor of the Central Bank of Egypt Tarek Amer and the Minister of Finance Amr El Garhy for co-hosting the conference. As we continue our partnership, we stand ready to help Egypt achieve a better future for its people.” Watch this site. When the IMF held its biweekly embargoed briefing on March 29, Inner City Press submitted questions about South Korea, Myanmar and Jamaica, see below. Spokesman Gerry Rice read out Inner City Press' South Korea question. From the IMF transcript: "on South Korea. This is from Matthew Lee. The U.S. says it's Treasury Department is finalizing an understanding with South Korea to avoid practices that provide an unfair competitive advantage. What does the IMF think of such bilateral forex arrangements? There are other questions on trade, so let me just take that. On the U.S.-Korea discussions on trade, I don't have the details of that. So, you know, I wouldn't speculate on that. What I would say more generally is that we believe bilateral and regional agreements can bring important benefits by building on a strong multilateral trade system that promotes transparency and includes well-enforced trade rules that promote even-handed competition, is what I would say on that one." Rice spent much of the briefing trying to correct "commentary" - that is, coverage - of Madame Lagarde's CFC proposal; he added as the final online question that an IMF team will be in Brazzaville in early April. This comes after the IMF praised another long time family run government in Gabon. He promised very "products and events" for the upcoming Spring meetings. Inner City Press asked: 1) "In the IMF's Myanmar statement it is said that “the direct economic impacts of the humanitarian crisis in Rakhine state have been largely localized.” Can you explain? How local? 2) In Jamaica, the Tourism Enhancement Fund (TEF) says it was following the orders of the IMF when it cut off funding to the Nuh Dutty Up Jamaica Campaign implemented by the Jamaica Environment Trust (JET), leaving its future in doubt. What is the IMF's response?" Watch this site - the IMF has yet to respond on some previous questions. On Cameroon, with the government continuing to cut and/or slow the Internet in the Anglophone parts of the country amid border incursions into Nigeria and "refoulement" of refugees there, what is the IMF's estimate of the costs, and comment on continuing to support and this government and its actions?
On March 7 Inner City Press asked an IMF press conference about the Nigerian economy this question: "What does the IMF think the economic impact will be of CITES' inquiry into the irregular export of endangered rosewood to China, and new restrictions imposed on such exports from Nigeria?" We'll have more on this. (Inner City Press also asked Amine Mati, Senior Resident Representative and Mission Chief for Nigeria and Lucie Mboto Fouda, "On the Nigerian banking sector, did the IMF consider the allegations of fraud, from the account in First Bank Nigeria Plc of NNPC and Agip, to the non-payment of interest by Standard Chartered Bank, Fidelity Bank, Stanbic IBTC, Access Bank, FCMB, Skye Bank, Sterling Bank, Zenith Bank and Unity Bank after the sale of  Power Holding Company of Nigeria?   Separately, what about Nigerian banks' service to SMEs?" Back in February, Inner City Press asked the IMF of Zimbabwe, Iraq, Sierra Leone, Cameroon and Hungary. Spokesman Gerry Rice took Inner City Press' Zimbabwe question, including the word usurious, then provided assurances that Madame Lagarde met the new president in Davos and the IMF stands ready to help - when other arrears are paid off. The IMF did not (yet?) answer these Inner City Press questions: On Iraq, please comment and clarify: MP Abbas Bayati has rejected reports that the IMF has said loans to the central government will be issued on the condition Baghdad guarantees a minimum portion of the national budget for the Kurdistan Region. He said IMF does “not investigate the details of the loans [spent] by Iraq.” True? In Hungary, Norbert Maxin and Bela Bukta have been cleared of handing over damaging information to, or spying for, the IMF. What is the IMF's comment, and its interactions with the two, now that the case is over and the IMF can (and should) speak? Follow up on Sierra Leone, where it's said the IMF instead of using the word “stop” used a softer diplomatic word “delay” of payments... what the Minister of Finance and Baratay are doing is spin the fact. If they win the elections, they will now begin to implement the IMF conditions at the detriment of the ordinary people. In the first place, they agreed on the conditions at the detriment of the ordinary people of this country; their only motive was to receive the money for themselves and use the remainder to fund the elections so that they can stay in power." Back on February 1 on Sierra Leone, Inner City Press asked: "please specify the status of IMF's payments under the $224 million program to the government as relates to the upcoming elections and conditions such as cutting subsidies on rice and fuel." Deputy IMF Spokesman William Murray replied that a review that had been slated to be concluded in December has not been; he dodged on the relation to the election but it definitely calls into question the denials of Sierra Leone's finance minister and his demand that Africa Confidential get fact checkers. On Zimbabwe, Inner City Press asked, "On Zimbabwe, please specify the IMF's advice for clearing foreign debt. Is it, as reported, cuts to public sector wages, reducing farm subsidies, improving transparency in the mining sector & reaching an agreement on compensating farmers?" Murray talked up Managing Director Lagarde's meeting(s) in Davos but said the country still has a ways to go. Transcript and video soon. Back on January 18, Inner City Press asked the IMF about Yemen, Somalia, Tunisia and Cameroon. On Yemen, it asked "With continuing holes in the Yemeni Central Bank, what if anything is the IMF doing?" IMF Spokesperson Gerry Rice read out Inner City Press' question and then said that the IMF is helping to build the Central Bank's capacity amid the humanitarian crisis. Transcript to come. On Somalia, Inner City Press asked of reports that “Somalia owes around $4bn making it almost impossible for Mogadishu to access new funds from the IMF.” The IMF puts the figure at $5.1 billion. What explains the difference, and how could Somalia access new IMF funds?" Rice replied that records were lost in the war and are being reconstructed; for now $5.1 billion is the figure. Again, transcript to come,  - and more on Cameroon and the continued undermining of the Internet and the economy by this big IMF recipient, Paul Biya's government. Before Rice's long Tunisia answer, Inner City Press had asked: "On Tunisia, what is the IMF's comments on its role in imposing austerity on the country since the popular uprising of January 2011? Did the IMF exerted sustained pressure on the Tunisian Central Bank to stop intervening in the currency markets to defend the value of the Tunisian dinar, increasing imports?" The IMF was prepared for this, emphasizing for example that cooking oil will not be subject to the VAT, but sweets and alcohol will. Video and transcript to come. Back on November 30, Inner City Press asked about critiques of the IMF from the Caribbean, about Yemen, Zambia and Kenya. The first three of these were answered. IMF Spokesperson Gerry Rice read out Inner City Press' question: "Saint Lucia’s Prime Minister Allen Chastanet has said of the IMF, 'If you care about the Caribbean, you must change the rules of engagement and allow us to help ourselves.' He's said the billions of dollars in Caribbean loans should be reclassified by the IMF. What is the IMF's response?" Rice said Managing Director Lagarde is aware of the criticism from the Caribbean forum a few weeks ago and that a study is underway including of catastrophe bonds but, he said, the IMF cannot currently do the requested reclassifications to make countries eligible for concessionary financing. On Zambia, Rice notes that Inner City Press at the UN had asked, "Treasury Secretary Fredson Yamba has said Zambia expects to host an IMF mission before the end of the year and hopes to have a $1.3 billion loan deal in place in early 2018. 'Come 2018, we must have a final (IMF) programme. It has taken a long time because the parameters have been changing.' What is the IMF's status with Zambia?" Rice said after the pause in August, progress has been made, the interest is there, but some information and clarifications are still awaited. "We are waiting for further data and details on the government's external borrowing plans," he said. On Inner City Press' Yemen question, Rice said the IMF "donor grants will be needed" for the payment of wages and social assistance and that the IMF is willing to help with macro-stability once the conflict is over. But when will that be? Here was and is Inner City Press' Kenya question: In Kenya, IMF rep Jan Mikkelsen is quoted that “discussions about the current programme and what will follow after the expiration in March are expected to begin soon, with the new government taking office. The authorities have indicated that they are interested to continue a programme relationship with the IMF."Has the IMF taken note of, and what is its comment on, the critique of the election by Raila Odinga and the NASA Coalition? Would the IMF also confer with the opposition?" We'll have more on this.  Back on September 28, Inner City Press asked among other things about the IMF negotiating with a reputed money launder in Congo-Brazzaville, and about corruption charges against Finance Minister Ishaq Dar of Pakistan, also in IMF talks. On the former, IMF Deputy Spokesman William Murray said the IMF is again in Brazzaville, for the third time, having a “series of contacts” on financial assessment. He declined to confirm or deny the IMF is talking with Orion Oil's Lucien Ebata, but this is widely known, as is his dealings in cash, via the Panama Papers. We'll have more on this. Inner City Press' Pakistan question was and is: “On Pakistan, it is reported that “the IMF said it had been told by Pakistani officials that the restrictions [on luxury imports] would be removed within a year but Mr Abbasi now says his government was planning to impose more.” Also, what is the IMF comment on the corruption charges against Finance Minister Ishaq Dar?” But when re-submitting through the IMF's online form, with allows only 300 characters, Inner City Press took out “[on luxury imports]” thinking the IMF would know what restrictions were being referred to, since they imposed them. They did not, and did not address the Ishaq Dar corruption allegations. Yet. Watch this site. When the International Monetary Fund re-started its biweekly embargoed press briefings on September 14, Inner City Press submitted questions about Hurricane Irma and moratoria, Mozambique, DR Congo and Ghana: "what is the IMF's response to civil society saying 'the Finance Minister, in particular, is facing conflict of interest investigation with USA SEC, Ghanaian SEC and the Commission on Human Rights and Administrative Justice (CHRAJ) in Ghana... We are losing hope as the IMF seems not concerned about all these developments”? The first two got answered, during the briefing, then this on Ghana, from an IMF Spokesperson: "We are aware of the allegations raised in Parliament and the related debates that have been reported on by the media. The Minister of Finance testified before Parliament to clarify the issue. Since the approval of the ECF arrangement we have been working with the authorities on strengthening debt management and improving governance and transparency of government operations. The enactment and ongoing implementation of the Public Financial Management Act, along with the implementation of the debt management strategy, indicate progress in these areas."  Inner City Press asked: "On Antigua and Barbuda, and Hurricane Irma impacted countries more generally... will there be no moratoria? What is the IMF doing?" IMF spokesperson Gerry Rice said, "There's a question from Matthew Lee on moratorium... on that, I would refer to what Mme Lagarde said a few days ago, of course the IMF has tremendous sympathy. She also said we stand ready to help. There are a number of options we can look at in that context. At the moment we are still trying to make an assessment. As a factual member, none of our members including Antigua and Barbuda have formally requested assistance from the Fund." Oh. On Mozambique, he called again for the publication of the full audit. Inner City Press also asked, "On the DR Congo, what is the IMF's response to civil society requests it has received that the Fund end its dealings with the National Petroleum Company of the Congo (SNPC), specifically that “if the IMF obtained the dissolution of Cotrade, a subsidiary of the SNPC, it can also demand and obtain the dissolution of the SNPC and the major works”? Watch this site and see IMF's July 20, 2017 transcript: , with Inner City Press' question at that time: "Ghana President, Nana Akufo-Addo, on Tuesday said the country will not extend its three-year aid program with the IMF beyond April 2018. The IMF had urged it to do so to give it time to complete the program’s goals. Did the IMF so urge? A step back real quick for some context. Right now, we’re in the process of completing the fourth review of Ghana’s ECF program. We’ve made significant progress in program discussions, and we expect to reach understandings in all remaining issues in the coming days. The discussions are going to continue and as a result of these continuing discussions, a Board discussion to complete the fourth review probably won’t take place until late August. Again, Media Relations will get back to everyone on the exact timing. But it’s probably late August when Ghana’s fourth review will be taken up by the Executive Board.
Now, the question that was just posed was regarding a comment about extension of the ECF next year when it’s scheduled to expire. The President made it clear that he would like to move Ghana beyond aid. And successful completion of the IMF-supported program could be instrumental in achieving this goal by restoring macroeconomic stability in Ghana. A request for program extension is essential for our ability to complete the review of this program overall. And given the significant fiscal slippages from last year, it will also take longer to bring debt onto a clearly declining path, which explains the need for the program to cover performance into later next year. This was something that was outlined in a press release issued by the finance minister on July 18th. Mozambique: the IMF’s Mr. Lazare, our mission chief, has said that, quote, “critical information gaps remain unaddressed regarding the use of loans, proceeds”, close quote. Please be more specific about what the IMF sees as the information gaps, and how they can be filled, with what information and in what detail? First of all, we welcomed and continue to welcome the fact that the delivery of an international forensic audit on three companies to the office of the public prosecutor of Mozambique has taken place. We commend Mozambique public prosecutor for undertaking this important audit and for releasing the summary of the report. Transparency and good governance are key conditions for sustainable, inclusive growth, and that applies to all countries. Now we look forward to the publication of the entire audit report in due course. At that point, we will be able to provide an informed view on the audit and its implication
s. Still U
Nanswered: "
On Zambia, Fitch has “said the key risk stemming from the current political tension if it escalated could jeopardize an IMF aid package as well as other lender's willingness to provide the southern African nation with external financing” and that “progress towards an IMF program has remained slow and may be delayed further by domestic political events, adding that expectation of an IMF program was key to Zambia's B/negative sovereign rating.” Please comment on if progress is slow and on these risks. In Sri Lanka, Joint Opposition’s Parliamentarian Bandula Gunawardana on July said that the country's Inland Revenue Act, in accord with the agreement arrived at with the IMF, is “an attempt to sabotage all forms of tax relief provided by former President Mahinda Rajapaksa during his tenure as the Finance Minister, and clarified that state-sponsored relief was also included under the new Act.” Is that the IMF's understanding of the Inland Revenue Act? Please comment. If there is an updated view about the Internet cut off (lifted only after 94 days) and other restrictions in the Anglophone regions of Cameroon injuring “Silicon Mountain." Back on June 22 Inner City Press submitted questions about Zambia, Cameroon and Haiti, where it was. During the embargoed briefing, IMF Spokesperson Gerry Rice read out Inner City Press' Zambia question and said, "implementation of the remaining actions in the next few weeks will enable us to present the authority's request for an Extended Credit Facility arrangement to the Board, and we expect that to be in August of this year." But this Haiti question has yet to be answered: "Chris Walker said reconstruction from the effects of Hurricane Matthew, and investments in health, education, and social services... will be achieved in part through the elimination of excessive subsidies, including subsidies for retail fuel sales. Please specify the IMF's thinking on time timing and range of subsidy elimination and ideas for EDH utility." On this and Cameroon (see below), we'll have more.  On Cameroon, Inner City Press has repeatedly asked for the IMF's "updated view about the Internet cut off (lifted only after 94 days) and other restrictions in the Anglophone regions of Cameroon injuring 'Silicon Mountain.'" Watch this site: we'll stay on this. The next IMF briefing is July 13. From the IMF's May 11 transcript, of its Deputy Spokesperson Willam Murray: "I’ve got a question from Inner City Press on Sri Lanka. Do recent government moves on the Inland Revenue Act make it more likely the IMF Board will act on the request for completion of the second loan review in June and make a third disbursement? Again, it’s a question about Sri Lanka and the Inland Revenue Act and the likelihood of completing the second review. We had a staff level agreement in Sri Lanka on May 3rd, last week. We noted in announcing that agreement that it’s subject to completion of a prior action by the authorities, which is submission of the Inland Revenue Act to Parliament. And that was a prior action that was agreed earlier this year. Our legal experts are still analyzing the content of the new draft bill, and are in discussions with the Sri Lankan authorities. That’s where we stand at the moment on Sri Lanka." The answer's appreciated.  Back on April 12 when at its Spring Meetings the IMF held its Middle East and Central Asia press conference, Inner City Press submitted this question: "Please describe the IMF's view and possible plans on Yemen, given the crisis there, including on President Hadi's proposed moving of the Central Bank out of the capital to Aden. What is the IMF's view of and any assistance to the Central Bank's performance?" After the briefing, the IMF provided this answer: "The humanitarian and economic impact of the conflict has been devastating; it has caused many deaths, depressed economic activity, and destroyed much of Yemen’s infrastructure. There is now even a tangible risk that the conflict could lead to famine in some parts of Yemen. Yemenis food supply relies largely on imported staples, like wheat and rice. Yemen needs urgently foreign exchange grants from donors to pay for imported food. But Yemenis also need to be able to buy the food that is imported. Resuming paying public salaries and social assistance grants in all of Yemen is therefore also urgently needed. Given these needs, the Central Bank of Yemen (CBY) could be the pivotal player for facilitating food imports and for resuming paying public salaries and social assistance grants in all of Yemen. But to play this humanitarian role, the central banks in Aden and Sana’a need urgently to find a way to cooperate in the interest of providing sufficient food to all Yemenis.  Fund engagement is currently limited. We support the Yemeni authorities and the international community to the best of our abilities.The Fund stands ready to re-engage more fully as soon as the conflict is resolved to help rebuild economic institutions, jumpstart growth, and stabilize the economy."

 Back on April 6 when the IMF held its biweekly embargoed press briefing, Inner City Press asked Spokesperson Gerry Rice about South Africa, Zambia, Bosnia, Nigeria and the UN, Cameroon and other issues. On Zambia, Inner City Press asked, "On Zambia, please state if a sale / privatization of Zambia Telecommunications Company (Zamtel) is no longer a condition for an IMF program with the country, as inferred from the recent list of conditions issued by the IMF's Tsidi Tsikata."  After the briefing, an IMF Spokesperson replied to Inner City Press that "We have made progress towards reaching understandings on an economic program that could be supported by an IMF arrangement. There is broad agreement on key objectives, targets, and policies. We have agreed to continue discussions at the forthcoming April 2017 Spring Meetings of the IMF and World Bank here in Washington D.C. At this stage, it is premature for us to get into specifics on policy actions such as sales of parastatals."

  On South Africa, Inner City Press asked "does the IMF have any comment on the recent firing of the finance minister? Separately, have there been any discussions of a possible program with South Africa?" Rice said that no request for a program has been received -- "the South African authorities have not requested a program from the IMF" -- and that the IMF normally does not comment on "domestic politics." He went ont to say, "it's important that institutions remain strong and the government can be united on policies for inclusive growth for all South Africans." We'll have more on this.

  On Bosnia, Inner City Press asked the IMF, among other things: "what the IMF's comment on opposition, from farmers and the Republika Srpska to the excise tax on fuel which it is reported is a condition for the IMF's program?" Early on April 6, prior to the embargoed briefing but there reiterated at it, the IMF's mission chief for Bosnia and Herzegovina (BiH), Mr. Nadeem Ilahi, said: "The IMF took note that the BiH parliament did not adopt the amendments to the law on excise tax and the new law on deposit insurance during a session held on April 5, 2017. This will have implications for mobilizing external financing for much needed infrastructure projects and for the authorities’ efforts to modernize banking sector legislation. Both are key requirements of the authorities’ program, supported by the IMF under the Extended Fund Facility (EFF). We now expect a significant delay in completion of the first review of the program.   In recent months, the authorities have made good progress in implementing economic reforms supported by the EFF, particularly by strengthening fiscal discipline, safeguarding financial stability, and improving business environment. We stand ready to assist the authorities in continuing the implementation of structural reforms to unlock growth potential and maintain macroeconomic stability, including through IMF advice and technical assistance.The authorities need more time to make further progress in a number of key areas of their program, such as securing financing for key infrastructure project, modernizing banking sector legislations, and improving corporate governance of state owned enterprises. In the period ahead, we will maintain close dialogue with the authorities and remain committed to assist them in their efforts.” We'll have more on this.

  Back on March 23 when the International Monetary Fund held its previous biweekly embargoed press briefing, Inner City Press asked Spokesperson Gerry Rice about Dominica, Belarus, Cameroon and other issues. On Dominica, Inner City Press asked: "the IMF's Mr. Guerson has referred to 'high Citizenship-By-Investment (CBI) revenues.' What is the IMF's view of fraud and / or AML dangers in that CBI program? Mr Guerson also called for the 'operationalization of the Eastern Caribbean Asset Management Company.” Can you say more: by when, and on what assets?" Shortly after the briefing, an IMF spokesperson responded to Inner City Press that "seaking more generally and not on Dominica specifically, the IMF has conducted extensive research on citizenship programs in the Caribbean including on the regulatory and governance challenges related to these programs. As a general principle, the Fund has stressed the importance of transparency in the design and implementation of these programs. When properly run, these programs can be an important source of additional revenue. Generally speaking we have called for receipts to be held for future generations, debt repayments and not to be used for regular operating expenses." Some in Domenica have asked if the Skerrit government's program is meeting this standard, for example with regard to Macau-based businessman Ng Lap Seng now facing a UN-related bribery trial in the US District Court for the Southern District of New York. But to emphasize: the IMF's answer is general.

  On Cameroon, Inner City Press asked: "the IMF's Mr. Selassie said: 'there will be significant fiscal reforms that need to be effected as well as reforms to promote growth and we are working on developing those with a number of the CEMAC countries.' Please provide further specifics, particularly regarding Cameroon and the continuing financial impact of the now 65-day Internet shut down to the Anglophone areas including “Silicon Mountain” in Buea." We hope to have more on this.

Earlier in March, Inner City Press asked both the International Monetary Fund and the UN Security Council's president about the crisis in Cameroon's Anglophone areas on March 9 and heard that while the IMF acknowledges the financial risk, the Security Council does not see it as a threat to international peace and security. But the UN's Resident Coordinator Najat Rochdi has said nothing about the crisis, and blocks on Twitter the Press which asks about it. Is the UN system failing, in its new Secretary General's promise of increased preventative diplomacy?

 When the IMF's spokesperson Gerry Rice took questions on March 9, Inner City Press asked about Cameroon, specifically the crackdown in the northwest and southwest of the country. Inner City Press asked, "On Cameroon, after the mission led by Corinne Delechat, what is the status of talks for a program, and since the IMF cited “civil unrest in the neighboring Central African Republic,” please state the IMF's awareness of civil unrest and arrests in Northwest and Southwest Cameroon, also known as the Anglophone areas, and their impact." Rice read out the question and then said, among other things, that the risk factors for 2017 include a continuation of the "social and political events" in the "so-called Anglophone" areas of Cameroon. Interim video here.  On IMF site, here, from 34:56. IMF transcript below.

  But a few hours later when Inner City Press asked the month's UN Security Council president Matthew Rycroft of the UK, who had just been in Cameroon, about the crisis, he said it is not a threat to international peace and security. From the UK transcript:

Inner City Press: In Cameroon there’s an issue that has been existing since November in Anglophone areas which have no internet for 52 days, there’s been teachers arrested, no schools. So I’m wondering as one Council member said, it did somehow come up in meetings, but was the issue raised at all, and what response was given by the government to this ongoing cut off of internet and abuse in this area?
Amb Rycroft: It came up informally in our contacts with members of the Government of Cameron but as far as I recall it did not come up in any formal meeting, and I think that makes sense because we were going there to look at the threat to international peace and security, and Boko Haram, and related issues, but in private, informal discussions with ministers in the Government of Cameroon it came up and they gave us the benefit of their perspective on the issue.
Inner City Press: Is there any Security Council role that can be played in trying to preventively deal with this issue?
Amb Rycroft: I don’t think it’s an issue on our agenda per se, we keep our eye on our radar across the world, but we have to make a judgement about whether something is a threat to international peace and security, and at the moment, I think our judgement would be that issue is an issue that is confined within Cameroon without international aspects.

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From the IMF's March 9 transcript:

"There is a question of Cameroon, from Matthew Lee, "After the Mission what is the status of talks for a program; and since the IMF cited civil unrest in the neighboring Central African Republic, please state the IMF's awareness of civil unrest and arrests in Northwest and Southwest Cameroon? And also known as the Anglophone areas, and their impact?"

So, the background here is, I think important the context. So, the Fund's engagement here in the CEMAC Region, CEMAC is the six Central African Economic nations that comprise the Central African Economic and monetary community. They met in Yaoundé on December 23rd. The Managing Director was there. And in that meeting, heads of state discussed the economic situation, the severe shocks that have hit that CEMAC region in recent years, including the sharp decline in oil prices, and decided to act collectively and in a concerted manner. And the heads of state requested the assistance of the IMF to design economic reforms needed to reestablish macroeconomic stability in each country and in the region as a whole.

So, again, context: I can tell you that the funders already sent missions to Gabon, Republic of Congo. And a reminder to you, that we already have programs with Central African Republic and Chad. Okay?

Now, we also have sent a mission to Cameroon, which is the question. And we did issue a press statement, which the question referred to, just on Tuesday. That was the Corrine Delechat reference.

So, the specific question, to turn to that. We are indeed aware of the events in the so-called Anglophone regions of Cameroon. The macroeconomic impact of any event that could affect production and/or consumption, is typically felt with a certain lag. So, these events started in November last year, and thus are likely to have not had a significant impact on production in 2016.

For 2017, the risks to our growth outlook include a combination of external and domestic factors, including continuation of the sociopolitical events in the northwest and southwest regions of Cameroon. And as our press release the other day indicated, our view is that the medium-term outlook for the Cameroonian economy remains positive, subject to the implementation of appropriate policies."

We'll have more on this. Watch this site.


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