Factsheet

Thematic Funds for Capacity Development (CD)

March 3, 2021

Improving revenue mobilization, fiscal and natural resource management

Revenue Mobilization Thematic Fund (RMTF): The RMTF was launched in 2011 to support low-income and lower-middle-income countries as they design and administer effective tax systems. Well-designed tax systems help generate sustainable revenue to pay for essential infrastructure and the social spending needed to meet growth and development objectives. The RMTF’s second phase began in 2016, and current partners include Australia, Belgium, Denmark, the European Union, France, Germany, Japan, Korea, Luxembourg, the Netherlands, Norway, Sweden, Switzerland, and the United Kingdom.

Tax Administration Diagnostic Assessment Tool (TADAT): TADAT was launched in 2014 to provide an objective and standardized performance assessment of a country’s tax administration system. By helping identify administrative strengths and weaknesses and facilitating shared views among all stakeholders, the tool helps develop a reform agenda that can manage, monitor, and evaluate progress. TADAT’s second phase began in May 2019, and its current partners are France, Germany, Japan, the Netherlands, Norway, Switzerland, and the United Kingdom.

Managing Natural Resource Wealth (MNRW): Many resource-rich countries face challenges to realize the full development potential of their natural resource wealth. The MNRW was launched in 2011 to support resource-rich countries in their efforts to mobilize and manage their natural resource wealth effectively. The MNRW also helps build capacity to design and implement macroeconomic and macroprudential policies in countries that are highly dependent on large and volatile resource revenues. This thematic fund’s second phasebegan in 2017 with Australia, the European Union, the Netherlands, Norway, Switzerland, and the United Kingdom as partners.

Promoting financial integrity, financial sector stability and access, and addressing debt issues 

Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT): Money laundering and the financing of terrorist activitiescan undermine the soundness and stability of financial institutions and systems, discourage foreign investment, and distort international capital flows. Established in 2009, this thematic fund supports countries as they strengthen the integrity and stability of their financial sectors, which facilitates their integration into the global financial system, improves fiscal governance, and boosts revenue mobilization. The AML/CFT thematic fund has completed its second phase. With continued strong demand for capacity development on the AML/CFT, the new third phase for this thematic fund launched on November 1, 2020 and will last until October 31, 2026. Current partners are Canada, France, Germany, Japan, Luxembourg, the Netherlands, Qatar, Saudi Arabia, and Switzerland.

Financial Sector Stability Fund (FSSF):The FSSF was launched in November 2017 to support low- and lower-middle-income countries as they assess and address risks and vulnerabilities in the financial sector, and to help promote financial development and inclusion. The FSSF supports Financial Sector Stability Reviews (FSSRs)—a standardized diagnostic assessment that can yield valuable technical guidance—and provides capacity development to enhance financial sector statistics. Current partners include China, Germany, Italy, Luxembourg, Saudi Arabia, Sweden, Switzerland, the United Kingdom, and the European Investment Bank.

Debt Management Facility III (DMF III):DMF III, which helps countries adapt to emerging debt management challenges, was launched in July 2019 and is a joint IMF-World Bank thematic fund that builds on the successes of DMF I and II (launched in 2008 and 2014, respectively). Partners include Austria, the European Union, France, Germany, Japan, the Netherlands, Norway, Switzerland,  the United Kingdom, the United States, and the African Development Bank.  With support from the DMF, more than 75 countries have assessed and strengthened their debt management capacities, actively planned for future debt operations, and ensured that their debt levels are sustainable. Given increasing concerns about debt transparency, DMF III has expanded in scale and launched new activities in support of debt transparency, including a focus on fiscal risks and contingent liabilities.

Financial Sector Reform and Strengthening Initiative (FIRST):The FIRST is a joint IMF-World Bank thematic fund that promotes financial sector development in low- and middle-income countries. Established in 2002, FIRST supports a broad range of financial sector reforms, including banking, insurance, capital markets, pensions, and crisis preparedness. Current partners include Germany and Switzerland.

Strengthening economic decision making through better statistics

Data for Decisions (D4D): Improving the availability, quality, coverage, timeliness, and dissemination of macroeconomic statistics enables better policy making. Launched in June 2018, the D4D Fund has been supporting low- and lower-middle-income countries in these efforts, particularly by working with them to develop the necessary infrastructure to compile and report on many Sustainable Development Goals indicators with around one third of the activities focused on fragile states. It also delivers the Financial Access Survey, that includes gender-disaggregated data used as the source for one indicator measuring progress for sustained and inclusive growth. The D4D Fund is also developing a 10-course online learning curriculum for economic statistics to provide high-quality training to data compilers, but also to educate NGOs and the general public as high-quality data is essential for transparency and government accountability. The first three courses launched—on debt, fiscal and external statistics—have already registered over 3,000 participants. The D4D Fund is supported by China, the European Union, Germany, Japan, Korea, Luxembourg, the Netherlands, Norway, and Switzerland.

Thematic funds supporting fragile states

Fragile State Country Funds: Building sound economic institutions and developing skills are key priorities for fragile states. Somalia has a dedicated fund to strengthen its operating and technical capacity to make economic and financial institutions more effective, transparent, and accountable. The Somalia Country Fund started its first phase in 2015 and is currently supported by Canada, the European Union, Italy, the United Kingdom, the United States, and the Arab Fund for Economic and Social Development. Its second five-year phase is expected to start in 2021.  In parallel, the IMF also utilizes its regional capacity development centers to provide flexible and targeted capacity development support to fragile states members.