Transparency International, an international anti-corruption non-governmental organization, and a number of international partners have asked the IMF to take anti-corruption measures within the assistance provided to several countries, including Kyrgyzstan, to mitigate the economic impact of COVID-19. Letter of the organization says.
As noted, the IMF is playing a leading role in mitigating the economic impacts of COVID-19 and has committed to put its $1 trillion lending capacity toward that end. More than 90 countries have already requested emergency assistance including through the IMF’s Rapid Credit Facility (RCF), Rapid Financing Instrument (RFI) programs, and Catastrophe Containment and Relief Trust (CCRT). All three of these programs are characterized by their speed and flexibility, as well as limited transparency and conditionality.
According to Transparency International, based on the public information available on the programs the IMF has already approved the organization has serious concerns that the programs lack even minimal anti-corruption measures.
On March 27, the IMF Executive Board approved a US$120.9 million disbursement to the Kyrgyz Republic to address the COVID-19 pandemic. In the publicly available materials related to this decision, we were only able to find one anti-corruption commitment from the government.
“To ensure the quality of emergency spending in the health sector, the authorities commit to subject the procurement of urgently needed medical supplies to an ex-post audit by the Audit Chamber, of which the results will be published on the website of the Ministry of Finance,” the letter says.
“This single measure is woefully insufficient in light of the governance concerns the IMF highlighted in its July 2019 Article IV review of the country,” the organization says.
Transparency International stresses the need to take measures to ensure the transparent and accountable use of funds received from the IMF to reduce the risk of misuse and corruption.
In particular, the organization recommends the IMF:
- To articulate and demonstrate commitment to the fight against corruption;
- To ensure transparency in public procurement;
- To introduce a requirement for audits by internal audit bodies and third parties;
- To implement existing anti-corruption and anti-money laundering frameworks.
«We trust the IMF will take these concerns seriously and support its member countries in devoting proper attention, and resources where possible, to support critical transparency and accountability measures,” the letter says.