fbpx 54258-001: Strengthening ADB's Collaboration with the International Monetary Fund for Macroeconomic Management in the Caucasus, Central Asia, and Mongolia | Asian Development Bank

Regional: Strengthening ADB's Collaboration with the International Monetary Fund for Macroeconomic Management in the Caucasus, Central Asia, and Mongolia

Sovereign (Public) Project | 54258-001 Status: Approved

The knowledge and support technical assistance (TA) will provide ADB's financial contribution to the new Caucasus, Central Asia, and Mongolia Technical Assistance Center (CCAMTAC) of the International Monetary Fund (IMF) that will undertake capacity development in macroeconomic-related areas for Armenia, Azerbaijan, Georgia, Kazakhstan, the Kyrgyz Republic, Mongolia, Tajikistan, Turkmenistan, and Uzbekistan. The CCAMTAC will be physically established in Almaty, Kazakhstan in mid-2021, but its remote capacity building activities will start from 1 January 2021 to respond to needs for macroeconomic policy advice amidst the COVID-19 pandemic. The first phase of the CCAMTAC runs through 2021 2026. CCAMTAC will be managed by a center coordinator (an experienced IMF staff) with strong backstop by departments concerned, guided by the Steering Committee (from the IMF, member countries, and external partners including ADB).

Project Details

Project Officer
Takamiya, Kenji Central and West Asia Department Request for information
Country
  • Regional
Sector
  • Public sector management
 
Project Name Strengthening ADB's Collaboration with the International Monetary Fund for Macroeconomic Management in the Caucasus, Central Asia, and Mongolia
Project Number 54258-001
Country Regional
Armenia
Azerbaijan
Georgia
Kazakhstan
Kyrgyz Republic
Mongolia
Tajikistan
Turkmenistan
Uzbekistan
Project Status Approved
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 6647-REG: Strengthening ADB's Collaboration with the International Monetary Fund for Macroeconomic Management in the Caucasus, Central Asia, and Mongolia
Technical Assistance Special Fund US$ 800,000.00
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Regional integration
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Knowledge solutions
Partnerships
Private sector development
Sector / Subsector

Finance / Central banking systems

Public sector management / Economic affairs management - Public expenditure and fiscal management

Gender Equity and Mainstreaming Some gender elements
Description The knowledge and support technical assistance (TA) will provide ADB's financial contribution to the new Caucasus, Central Asia, and Mongolia Technical Assistance Center (CCAMTAC) of the International Monetary Fund (IMF) that will undertake capacity development in macroeconomic-related areas for Armenia, Azerbaijan, Georgia, Kazakhstan, the Kyrgyz Republic, Mongolia, Tajikistan, Turkmenistan, and Uzbekistan. The CCAMTAC will be physically established in Almaty, Kazakhstan in mid-2021, but its remote capacity building activities will start from 1 January 2021 to respond to needs for macroeconomic policy advice amidst the COVID-19 pandemic. The first phase of the CCAMTAC runs through 2021 2026. CCAMTAC will be managed by a center coordinator (an experienced IMF staff) with strong backstop by departments concerned, guided by the Steering Committee (from the IMF, member countries, and external partners including ADB). CCAMTAC's capacity development will be delivered by its resident advisors and short-term experts.
Project Rationale and Linkage to Country/Regional Strategy

Countries in the region face significant challenges of debt management. Mongolia's external debt stock started to rise after the global financial crisis of 2008 2009, and reached over 200% of GDP by 2015. While the external debt to GDP ratio somewhat declined since then, it still stays above 200%. The oil price shock in 2014 2015 widened fiscal deficits and increased public debt and external debt in the Caucasus and Central Asia. This was particularly the case for oil exporting countries, such as Kazakhstan, but also for oil importing countries that had close link to the oil exporters as key trading partners and remittance receivers. The government gross debt for all countries in the Caucasus and Central Asia combined accounted for 17.1% of their GDP on average for 2000 2014, but it increased thereafter to reach 26.3% by 2019. In the same period, their gross total external debt increased from 54.3% to 68.2% of GDP. External debt has been rising in relation to the gross national income (Figure). These countries have been vulnerable to exogenous shocks, with profound implication on public finance and the economies at large, while their capacity to design and implement effective fiscal, monetary, and exchange rate policies and financial sector regulations and supervision to cope with this unique challenge is still limited.

More recently, the outbreak of coronavirus disease (COVID-19) and lower oil prices have put significant pressure on local currencies and sovereign spreads, revenues, and public expenditures in the Caucasus and Central Asia. Countries in the Caucasus, Central Asia, and Mongolia (CCAM) region face double challenges of addressing increased debt vulnerabilities on one hand and managing fiscal space for infrastructure and social expenditure on the other hand, with delicate expenditure control and enhanced domestic revenue mobilization. A related challenge is containing contingent liabilities that arise through lending by state-owned commercial banks to state-owned enterprises, pointing to the need for stronger banking supervision. Also, a number of economies in the region have undergone reform in monetary policy regime to allow for greater exchange rate flexibility, and the currency depreciation that followed increased the domestic currency value of external debt. Strengthening of relevant institutions, macro-fiscal frameworks and statistics will be critical to support better analysis, planning, and targeting of expenditures, risk identification and management, and communication of objectives and policies. Thus, there is a need to enhance the capacity of countries in the CCAM region for sound macroeconomic and debt management. Among multilateral institutions, the IMF has a specific mandate to address macroeconomic issues, and is best placed to address such capacity development needs in related areas.

Impact Living standards improved by achieving higher and inclusive growth in a sustainable manner
Project Outcome
Description of Outcome Robust growth with debt sustainability restored
Progress Toward Outcome
Implementation Progress
Description of Project Outputs

Core PFM functions strengthened and progressively more advanced PFM practices and systems introduced

Macroeconomic and financial statistics compilation and dissemination for decision making improved

Macroeconomic forecasting and policy analysis capacity at relevant institutions to support the economic policymaking process enhanced

Tax administration management and governance arrangements improved

Capacity of the central bank to implement monetary policy effectively in the context of the given monetary policy regime strengthened

Banking regulations and prudential norms enhanced

Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location Armenia - Nation-wide; Azerbaijan - Nation-wide; Georgia - Nation-wide; Kazakhstan - Nation-wide; Kyrgyz Republic - Nation-wide; Mongolia - Nation-wide; Tajikistan - Nation-wide; Turkmenistan - Nation-wide; Uzbekistan - Nation-wide
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Business Opportunities
Consulting Services ADB will fully delegate TA implementation to IMF, as the executing agency, who will select consultants, procure goods and services, sign and administer contracts (including payments), manage consultants and prepare the TA completion report.
Procurement ADB will fully delegate TA implementation to IMF, as the executing agency, who will select consultants, procure goods and services, sign and administer contracts (including payments), manage consultants and prepare the TA completion report.
Responsible ADB Officer Takamiya, Kenji
Responsible ADB Department Central and West Asia Department
Responsible ADB Division Regional Cooperation and Operations Coordination Div, CWRD
Executing Agencies
International Monetary Fund
Regional
Timetable
Concept Clearance 11 Sep 2020
Fact Finding 31 Aug 2020 to 31 Aug 2020
MRM -
Approval 04 Dec 2020
Last Review Mission -
Last PDS Update 07 Dec 2020

TA 6647-REG

Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
800,000.00 0.00 0.00 0.00 0.00 0.00 800,000.00 - 0.00

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

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Evaluation Documents See also: Independent Evaluation

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Related Publications

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Tenders

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Contracts Awarded

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Procurement Plan

None currently available.