EU and IMF sign an Agreement for a €8 million Fiscal Reforms Program in Southeastern Europe

The FINANCIAL — The European Union (EU) and the International Monetary Fund (IMF) signed a grant agreement for a €8 million (US$9 million) capacity development program on fiscal reforms in Southeastern Europe (SEE).

IMF Deputy Managing Director Carla Grasso made the following statement: “We are extremely grateful for the EU’s support for this program, which will benefit Albania, Bosnia and Herzegovina, Kosovo1, the former Yugoslav Republic of Macedonia, Montenegro, and Serbia. The IMF’s engagement with these countries since the beginning of their transition process has included technical assistance on public financial management and domestic resource mobilization in particular revenue administration, both by IMF headquarters staff and short- and long-term advisors in these countries. Partnering with the EU will provide the IMF with more resources to respond to the capacity development needs of the region, thus helping governments to better implement policies and manage their budgets in a more efficient and effective manner to benefit their citizens.”

“Strengthening public financial management (PFM) is one of the core priorities of the EU’s strategy on enlargement. It is essential to deliver macro-economic stability, improve transparency and effectiveness in managing public funds and delivering better services to citizens, and is a pre-condition for sustainable growth. Given the IMF’s expertise and track record on economic governance, I am delighted to team up with them under this program. This cooperation will enable us to achieve our joint objectives and further help the countries in the region as they seek EU membership,” Johannes Hahn, Commissioner for Neighborhood Policy and Enlargement Negotiations, said.

Background Information

Supporting macroeconomic and public finance institutions and policies in member and partner countries has long been a common objective of the IMF and the EU. The EU/IMF partnership has intensified in the last five years with the organizations supporting each other’s work. Both organizations engage in regular consultations at the staff and management levels, and recent collaborations include the development of an EU exogenous shocks facility and the Tax Administration Diagnostic Assessment Tool.