"The IMF staff, and the IMF board, are (too) polite. I’m a Midwesterner. I love politeness. But Keynes is reported to have said that the IMF had to serve as a 'ruthless truth teller.' And I agree that it should do so even when it is uncomfortable, whether for borrower countries with programs or for their official creditors," says Brent Neiman, Assistant Secretary for International Finance.
"For example, the Fund often lends based on promises made by official bilateral creditors to forgive debt or to offer new financing, promises referred to as financing assurances. But even though this financing can be central to hold the IMF program together, the details on financing assurances – who gave them, when, in what form, and any failures to deliver on these commitments – are not always publicly disclosed."
"The Fund is also sometimes too polite in its surveillance responsibilities. For example, as described in its Articles of Agreement, the IMF was established in part to 'facilitate the expansion and balanced growth of international trade' and to 'maintain orderly exchange arrangements among members, and to avoid competitive exchange depreciation.' However, if you read the Fund’s Article IV Reports, you will find that these sorts of topics get less attention than they deserve, including in globally significant economies like China’s. For example, the IMF does not publicly comment on the role of state-owned banks in managing China’s exchange rate or on why changes in the People’s Bank of China’s (PBOC’s) balance sheet don’t line up with reserve transactions in China’s balance of payments data. And while the Fund has built admirable expertise in compiling alternative measures of China’s local government debt, far beyond what authorities publish, it has neglected to apply this same analytical rigor to quantifying China’s industrial policies."
