by Stephanie Segal, Senior Associate, E3G

What is IMF surveillance?

When the International Monetary Fund (IMF) is in the headlines, it’s often in reports of a lending program with one of its members. While such programs rightfully garner media attention, the IMF’s work to monitor and advise on the economic and financial policies of its members contributes as much (and possibly more) to global economic and financial stability. This monitoring work, known formally as “IMF surveillance,” applies to all 191 of its members, making the policies guiding IMF surveillance consequential to the entire membership.

The IMF’s surveillance mandate is grounded in its Articles of Agreement, which call on each IMF member to “collaborate with the Fund and with other members” and “endeavor to direct its economic and financial policies toward the objective of fostering orderly economic growth with reasonable price stability, with due regard to its circumstances.” The Articles empower the Fund to “oversee the international monetary system … [and] the compliance of each member with its obligations,” providing the legal foundation for IMF surveillance. At the country level, such IMF oversight is known as “bilateral surveillance,” while at the regional and global level, it’s known as “multilateral surveillance.”

How has IMF surveillance evolved over the years?

Policies on the conduct of IMF surveillance, including specific coverage areas, are periodically updated with policy reviews and IMF Executive Board decisions and then operationalized via formal Guidance Notes to IMF staff. The next review is scheduled for completion ahead of the Annual Meetings in October 2026. Not surprisingly, changes to IMF surveillance tend to occur in the wake of a significant global shock. For example, following the 2008/09 Global Financial Crisis, IMF surveillance was updated with the 2012 Integrated Surveillance Decision (ISD), which highlighted the focus of bilateral surveillance on policies that can significantly influence a member’s present or prospective balance of payments and domestic stability. The ISD identified exchange rate, fiscal, monetary, and financial sector policies as areas that will always be the subject of bilateral (Article IV) surveillance. It also articulated the link between bilateral and multilateral surveillance, along with the concept of “cross-country spillovers,” reflecting both the role of global imbalances in contributing to asset bubbles, and the fact that a crisis in the U.S. mortgage market spilled over (and temporarily froze) global financial flows.

Less than a decade later, the 2021 Comprehensive Surveillance Review (CSR) took place against the backdrop of a global economy struggling to recover from the COVID-19 pandemic. That review reflected a newfound appreciation for the impact of “non-core” issues on economic and financial outcomes and led to a further evolution in IMF surveillance. Specifically, the review identified “digital technology, climate change, inequality, demographics, and geopolitics” as affecting economic sustainability, and called for such issues to be incorporated into IMF surveillance when they were determined to be “macro-critical.” The subsequent staff Guidance Note for Article IV Surveillance, issued in 2022, defined an issue as “macro-critical” based on whether it significantly influences present or prospective balance of payments or domestic stability, in line with the ISD, and called for coverage of such issues in bilateral surveillance provided the Fund has expertise in the specific issue area.

What will the 2026 CSR focus on?

The upcoming review of IMF surveillance, the 2026 CSR, comes at a time of rising geopolitical tension and disruption to the rules-based international order and amidst criticism from the IMF’s largest shareholder that it has deviated from its core mandate. In a speech on the margins of the 2025 Spring Meetings of the World Bank and IMF, U.S. Treasury Secretary Scott Bessent called out the IMF (along with the World Bank) for “mission creep [that] has knocked these institutions off course.” In particular, he criticized the IMF’s work on “climate change, gender, and social issues” for crowding out its work on critical macroeconomic issues. His statement from the 2026 Spring Meetings contained similar criticism but also praised the Fund’s recent efforts to better calibrate the scope of surveillance. He welcomed the CSR as “an opportunity to reinvigorate the IMF’s analysis of external sector issues, notably imbalances and cross-border spillovers” and called for the former to consider industrial and other policies that restrict domestic demand. The focus on industrial policy, as well as support for greater use of scenario-based analysis in response to contingencies, is likely to garner support from the IMF’s membership.

According to the IMF, the comprehensive surveillance review will “specifically focus on the new areas for which strategies have been approved by the Executive Board after the 2021 CSR, namely climate change, digital money, and gender.” Importantly, the CSR will need to evaluate whether these issues impact a country’s balance of payments and domestic economic stability—thereby meeting the definition of macro-criticality—and also demonstrate IMF expertise in these areas, for example, how the Fund’s analytical tools can integrate such issues into the analysis of a member’s macroeconomic outlook and in its advice to country authorities. An added challenge stems from the fact that macro analysis is necessarily bespoke given the variation—for example, in natural resource endowments, skills and training capacity, vulnerability to natural disasters, etc.—across the membership. Such variation calls on IMF country teams to have access to common tools, scenarios, and templates to assess macro impacts but not necessarily to prioritize issues equally in each country case.

In addition, new issues not explicitly prioritized in the 2021 CSR, such as artificial intelligence (AI) and energy security, have clear macroeconomic and financial stability implications that should feature in the upcoming review. The addition of new issues further underscores the importance of a prioritization framework and the need for adequate resources for the Fund to meet both its members’ needs and its mandate.

The Fund’s unique role in the international system is indisputable. Given the constant evolution of the global economy, IMF surveillance must also evolve. The upcoming surveillance review provides an opportunity to assess where past reforms have pushed in the right direction and where there is a need for course correction and/or new work to fill emerging gaps. Given recent developments impacting the global economy and the perception of heightened risk stemming from non-core areas, this latest CSR will no doubt garner attention.

Featured author:

Stephanie Segal, Senior Associate, E3G