Ireland’s Participation in
the
International
Monetary Fund and the
World Bank
Annual Report
2015
‘The Department’s mission is to manage
Government finances and play a central role in the
achievement of the Government’s economic and
social goals having regard to the Programme for
Government. In this way we will play a leadership
role in the improvement of the standards of living for
our citizens’.
Statement of Strategy 2015-2017, Department of Finance
Page | ii
Contents
3
Foreword
23
3.2 Financial Activities of the
Central Bank as agent of the
Minister for Finance under
the Breton Woods Act, 19571999
5
Introduction
25
3.3 Ireland’s Contribution to
World Bank Group Trust
Funds
6
1.1 The International
Monetary Fund in
2015
26
APPENDIX
A:
Further
information on the IMF and
World Bank Group
8
1.2
Ireland’s
Participation in the
IMF in 2015
31
APPENDIX B: Statement by
Governor Honohan at the
IMF and World Bank,
October 2015
11
1.3 Joint EU – IMF
Financial Assistance
Programme
for
Ireland
36
APPENDIX
C:
Ireland’s
Voting Record in 2015 –
Board of Governors
13
2.1 The World Bank
in 2015
37
APPENDIX
D:
Ireland’s
shareholding and voting
power in IBRD, IDA, IFC and
MIGA
15
2.2
Ireland’s
Participation in the
World Bank in 2015
38
APPENDIX E: Irelands IMF
Quota
19
2.3 Contributions to
World Bank Trust
Funds
39
APPENDIX F: Links
Further Information
21
2.4
Global
Environment Facility
22
3.1 Bretton Woods
Institutions - 2015
Exchequer Payments
and Receipts
Unless otherwise stated, statistics in this report in relation to the World Bank and IMF relate to the institutions’
Fiscal Year 2015, which runs from 1 July 2014 to 30 June 2015 and 1 May 2014 to 30 April, 2015, respectively.
to
Acronym Index
DC
Development Committee
EFF
Extended Fund Facility
EFSF
European Financial Stability Facility
EFSM
European Financial Stability Mechanism
EMDCs
Emerging Market and Developing Countries
FCL
Flexible Credit Line
FY
Financial Year
FSAPs
Financial Sector Assessment Programmes
G20
Group of Twenty
GCI
General Capital Increase
GFSR
Global Financial Stability Report
GEF
Global Environment Facility
IBRD
International Bank for Reconstruction and Development
ICSID
International Centre for Settlement of Investment Disputes
IDA
International Development Association
IFC
International Finance Corporation
IFIs
International Financial Institutions
IMF
International Monetary Fund
MDGs
Millennium Development Goals
MIGA
Multilateral Investment Guarantee Agency
ODA
Official Development Assistance
PCL
Precautionary Credit Line
PRGF
Poverty Reduction and Growth Facility
SCI
Selective Capital Increase
SDR
Special Drawing Right
WBG
World Bank Group
WEO
World Economic Outlook
Page | 2
Foreword
In accordance with Section 10 of the Bretton Woods Agreements (Amendment) Act,
1999, I am pleased to present to Dáil and Seanad Éireann the annual Report of
Ireland's Participation in the International Monetary Fund and the World Bank for the
year 2015.
During 2015, both developed and developing countries continued to pursue, with
mixed success, their economic recovery, reform efforts and growth paths following
the global financial crisis. Stimulating and sustaining viable economic growth have
been, and remain, critical factors in implementing countries' economic goals and
development plans. Both the IMF and the World Bank play vital roles in this regard with
the former's main objective being the management of international financial stability
(including through policy advice and lending) while the latter concentrates its efforts
on promoting long-term economic development and poverty–reduction in generally
poorer countries (including through grants and concessional loans).Together, these
Institutions, mandated by virtually all the countries of the world which constitute their
membership, play a dominant role in supporting the world's economic and financial
structure.
The past year has shown the challenges and obstacles which may emerge to countries'
goals and the efforts of the International Institutional architecture to act in concert to
support and assist their members. While there was a modest if uneven recovery in
advanced economies during 2015, the situation generally in emerging market
economies was more challenging, affected in particular by the slowdown in economic
activity in China and by lower commodity prices. In these circumstances, the activities
of the IMF and the World Bank during the past year illustrate the value of continued,
concerted global action and of the commitment of both institutions to developing
integrated policy approaches, alongside the work of other international financial
institutions. During 2015, both the IMF and the World Bank continued with their reform
efforts to enhance their representativeness and to respond to and influence the
current global financial and development landscape.
At the IMF, the headline event in 2015 was the announcement in December that the
US Congress had conditionally approved ratification of the Fund's quota and
governance reforms which had been approved by the IMF Board in 2010. These
reforms have three closely-related aims of: improving the relative voting share of
emerging economies at the IMF; doubling the funding available to the Fund through
an increase in the quota of its members; and reforming of the electoral process to
the IMF Executive Board. Apart from their broader impact, implementation of the
reforms means that Ireland's own quota or share at the IMF has increased
substantially which will help to increase our influence at the Fund. Consequent
changes to the Fund's lending framework and policies come at a time of ongoing
reviews of the IMF's financial resources and capacity, a process in which Ireland is
fully engaged to help ensure that these changes improve the strategic outlook and
policies of the Fund while adequately reflecting the priorities of Ireland, the EU and
the broader global membership.
As regards the World Bank, this institution continued in its efforts to implement inhouse reforms in 2015 as it strove organisationally to make the transition to become
Page | 3
a 'One World Bank Group' and a 'solutions Bank' as part of its World Bank Group
Strategy, introduced the previous year. During 2015, the Bank played an important
role in assisting countries faced with natural disasters and fragile situations while
continuing to exercise its principal, pivotal role in promoting strong, sustainable and
inclusive economic growth among the world's poorest countries. Sustainable
development is key to the work of the World Bank and the latter played an important
part in this process through its involvement in, and support for, the seminal
Sustainable Development Goals that were adopted in New York in September of 2015,
and which cover the economic, social and environmental dimensions of development
out to 2030.
The past year has shown the importance of coordinated and concerted action by the
IMF and World Bank, often in conjunction with other financial and development
partners, as well as with their member countries. Both Institutions collaborate
regularly including through their joint spring and Annual meetings which provide an
opportunity for interaction and consultation at the highest levels. Ireland, stands
ready, as it has before, to support the two Institutions in promoting sustainable global
growth, resilience and progress.
This Report for 2015 summarises the major developments at the IMF and the World
Bank over the past calendar year and sets out the details of Ireland's participation as
a member of each Institution.
Mr Michael Noonan T.D.
Minister for Finance
Page | 4
Introduction
The International Monetary Fund and the World Bank were established in July, 1944, at an
international conference which was convened in the town of Bretton Woods, New Hampshire,
USA. The conference was attended by representatives of 45 countries and its goal was to
establish a framework for economic cooperation and development that would lead to a more
stable and prosperous global economy. While this goal remains central to both institutions,
their work is constantly evolving in response to new economic developments and challenges.
The IMF promotes international monetary cooperation and provides policy advice, technical
assistance and loans to help countries build and maintain strong economies. The mandate of
the World Bank is to promote long-term economic development and poverty reduction by
providing technical and financial support to help countries reform particular sectors or
implement specific projects.
Ireland joined the IMF and the World Bank in 1957 as part of a process of deepening
engagement and integration with the global economy. The legislation governing Ireland’s
membership of the institutions is the Bretton Woods Act, 1957, which has been amended on
a number of occasions.
This report summarises the major developments at the IMF and the World Bank over the past
year. It sets out the details of Ireland’s participation as a member and reports on past and
present goals and strategic actions which guide Ireland’s relationship with both institutions.
Further details on the structures, working arrangements, resourcing and work of the IMF and
the World Bank are set out at Appendix A of this report. It should be noted that the World Bank
today is in fact made up of five component organisations collectively known as the World Bank
Group.
Page | 5
1.1 The International Monetary Fund in 2015
Through its core activities of lending, surveillance and capacity development, the IMF
continued to play its lead role in promoting financial stability and growth through 2015.
Specifically, significant focus has been on boosting global growth and employment,
recognising the high degree of interconnectedness and spill-overs. In order to ensure that the
IMF is fit for purpose and meeting the needs of its members, it is constantly reviewing and
updating its policy approach, which is touched on below.
IMF Lending
Over recent years, IMF lending to members, which increased rapidly in response to the crisis,
has been trending downward as some major borrowers, most notably Ireland, repaid early. At
end December, 2015, outstanding loans totalled SDR 57.3 billion, of which SDR 50.8 billion
was normal IMF lending and SDR 6.6 billion was concessional lending to low-income
countries. To put this in perspective, credit outstanding peaked at SDR 99.7 billion in 2012.
Policy Reviews
Most Fund policy reviews take place in the context of a regular cycle, for example, the Fund’s
income policies are reviewed on a bi-annual basis. However, in order to ensure that IMF
advice and lending assistance remains appropriate for an evolving environment, there are also
ad-hoc reviews of policy and indeed, of the focus and application of Fund resources. Major
policy developments over the course of 2015 are discussed below, the most significant of
which relates to quota and governance reform.
Quota and governance Reform
After prolonged delays, the 14th review of quotas (agreed in 2010), was passed by the US
Congress in December, 2015. This effectively provided for a doubling, on average, of IMF
members' quotas and an amendment of the Articles of Agreement to provide for an all-elected
Executive Board { Formal ratification by the Executive Board took place in January,
2016}. The impact of these quota reforms on Ireland will be discussed in the next section of
the Report but from a macro perspective, it provides the Fund with greater permanent
resources with which to deliver on its mandate of ensuring the stability of the international
monetary system. The Fund will now move on to considering the next round and the 15th
review of quotas has been scheduled for agreement by the 2017 Annual Meetings, which will
take place in October, 2017.
Inclusion of RMB into SDR Basket
As part of its regular five-year review of the basket of currencies that make up the Special
Drawing Rights (SDR), the reserve currency of the IMF, the Executive Board decided that the
Chinese renmimbi (RMB) met all existing criteria for inclusion in the SDR basket and, effective
October 1, 2016, the RMB will form part of the SDR basket. The inclusion of the RMB will
enhance the attractiveness of the SDR by diversifying the basket and making it more
representative of the world’s major currencies. As has been the case previously, the
SDR interest rate will continue to be determined as a weighted average of the interest rates
Page | 6
on short-term financial instruments in the markets of the currencies in the SDR basket. The
RMB will be the fifth currency in the SDR basket, along with the U.S. dollar, the euro, the
Japanese yen and the British pound. Importantly, the effective inclusion date of October 1,
2016, will provide sufficient lead time for the Fund, its members and other SDR users to adjust
to these changes.
Focus on commodities
The recent volatility observed in commodity markets, has had a significant and differentiated
impact across the IMF membership. The decline of commodity prices provided some support
to growth in oil importing countries, but also has weighed on economic activity among oilexporting nations. Given the magnitude of these impacts, the Fund allocated considerable
resources to researching the fiscal and economic impact of commodity price movements, with
a particular focus on emerging markets. The key policy takeaways are the importance and
indeed necessity of structural reforms, including revenue mobilization (e.g. base broadening,
ensuring an appropriately efficient revenue and expenditure system), to underpin long-term
sustainability. The results of these efforts are evident in the economic and fiscal advice of the
Fund, both at a global (flagship reports - the World Economic Outlook, the Global Financial
Stability Report and the Fiscal Monitor – published in twice yearly) as well as individual country
level surveillance reports such as the annual Article IV reviews.
Page | 7
1.2 Ireland’s Participation in the IMF in 2015
Quota/Voting Power
Overview
An IMF member’s shareholding at the Fund is referred to as its quota. The SDR is an
international reserve currency used by the IMF in which all of its members’ quotas are
denominated. As noted in previous reports, reforms in relation to quota share of members and
Executive Board representation had been approved in 2010 by the IMF Board but not
implemented. However, on 18 December, 2015, the US Congress agreed to ratify the 2010
IMF quota and governance reform package. Its main purposes are to: (i) increase the relative
voting share of emerging economies at the IMF; (ii) double the amount of permanent funding
available to the Fund through an increase in the quotas of its members; and (iii) reform the
Executive Board electoral process. These are part of an on-going process to provide greater
fairness in the voting power and representation accorded to countries across the full
membership and to take account of changing global realities.
The new arrangements will significantly increase the voice and representation of Emerging
Market and Developing Countries (EMDCs) at the Fund. As regards Ireland, its quota share
increases from SDR 1,257.6 million to SDR 3,449.9 million and its voting share at the IMF
increases from 0.528 percent to 0.723 percent.
{By way of footnote, the reform package was agreed to by the IMF Board at its meeting on 20
January, 2016, thereby enabling the quota reforms to be implemented with effect from 26
January, 2016.Consequential on the agreement, a number of changes are being made to the
lending framework policies of the IMF}.
Fifteenth Review of Quota
IMF Quota Reviews normally take place at five-year intervals and the Fifteenth Review should
therefore have been completed by December, 2015. Due to the delay with the Fourteenth
Review however, preparations are only now being made for the subsequent Review. IMF Staff
have outlined the aim of completing this Review by the Annual Meetings in October, 2017.
Annual and Spring Meetings 2015
The then Governor of the Central Bank, Patrick Honohan, and the Second Secretary General
of the Department of Finance, Ann Nolan, attended the joint IMF-World Bank spring meetings
on 17-19 April, 2015, in Washington. For the IMF-World Bank annual meeting on 9-11
October, 2015, in Lima, Governor Honohan led Ireland’s delegation and Second Secretary
Ann Nolan of the Department of Finance once again represented the Minister for Finance. On
both occasions, officials from the Department of Finance and Central Bank participated in a
range of meetings, representing Ireland’s views and discussing key issues and global
developments.
Page | 8
Constituency Office
The current 188 country membership of the IMF is represented at the Executive Board by 24
constituency offices, each headed by an Executive Director. Ireland is a member of a
Canadian-led Canada-Ireland-Caribbean constituency. The constituency has a full-time
Canadian Executive Director, Mr Serge Dupont, and a full-time Irish Alternate Executive
Director, Mr Michael J. McGrath. The Constituency Office is assisted by a small number of
advisors and administrative staff based in Washington D.C., including one Irish Advisor - Mr
Michael Hough, appointed in November, 2012. Both the Irish Alternate Executive Director and
the Advisor were nominated by the Minister for Finance in his capacity as Governor for Ireland
of the IMF. {In January, 2016, the term of Mr Hough came to an end and he was succeeded
by Mr Niall Feerick from the Department of Finance}. In addition to representing the interests
of the overall constituency at the Board, and dealing with the general work of Fund policy, the
Irish officials liaise with the Irish authorities and IMF staff and management on issues of direct
interest to Ireland.
Article IV Review, 2015
The IMF Article IV Review of Ireland took place during the period 20-27 January, 2015. The
Review is so-called because it is required by Article IV of the IMF's Articles of Agreement.
Ireland, like all other IMF member countries, is normally examined under this process or
surveillance tool on a standard 12-month cycle.
The Article IV consultation is separate to the post-Programme monitoring function which has
been in place since Ireland exited the Troika Programme of Assistance in December, 2013.
The Article IV consultation is more strategic in its focus and considers medium to longer-term
policy issues. The return of the Article IV consultation to a standard 12-month cycle is a further
sign of the normalisation of Ireland’s relations with the Fund. The Consultation took place in
Dublin during the week of 20-27 January, 2015, during which a small team of IMF staff met
with Minister Noonan and Minister Howlin, Governor Honohan, relevant officials and a broad
range of public and private sector bodies.
IMF Staff prepared a Report which was then discussed and approved by the IMF Executive
Board. The Report dealt with a broad range of issues including the current position of the
economy and its medium-to-long term prospects, medium-term fiscal policy, as well as
financial and banking policy. During the Board discussion, Directors commended Ireland’s
economic and fiscal performance, and noted progress in reducing the volume of nonperforming loans and enhancing mortgage macro-prudential measures in relation to the
domestic mortgage market. The Executive Board acknowledged the consolidation efforts and
the sustained progress achieved by Ireland over the previous eight years, and noted the
economy’s strong performance during 2014. The Board encouraged the Government to
maintain a phased and steady adjustment path towards its fiscal goals, while developing and
implementing measures to sustain the recovery.
Commenting on the publication of the Article IV consultation, Minister Noonan and Minister
Howlin stated: “With the completion of the Article IV process, and following on the constructive
engagements with IMF Staff and the Executive Board over recent weeks, we look forward to
considering further the IMF’s recommendations in the context of our overall policy
development in the medium term”.
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The next regular Article IV Review of Ireland is scheduled to take place during May, 2016.
Page | 10
1.3 Joint EU- IMF Financial Assistance Programme for Ireland
Post Programme Monitoring
As is normal Fund policy, post-programme monitoring (PPM) now applies to Ireland, following
exit from the EU/IMF financial assistance programme in 2013. Post-programme monitoring is
a long standing feature of IMF assistance programmes. It usually take place twice yearly. The
purpose of PPM is stated by the IMF to be:
“to ensure the continued viability of a country's economic framework and provide early
warning of policies that could jeopardize the country's external viability and, hence, its
capacity to repay the IMF. Should it become necessary, IMF staff will advise on policy
actions to correct macroeconomic imbalances.”
There were two PPM reviews in 2015. The 3rd PPM mission ran from April 27th to May 1st.
The 4th PPM took place from November 9th to 13th. These reviews were conducted in
conjunction with the EU’s Post Programme Surveillance. At each review the IMF, together
with Commission, ECB, IMF and the ESM, have the aim of evaluating the continued viability
of a country’s economic framework and have constructive engagement on the key issues
which affect its ability to repay the loans that it has received.
The country visit is the first stage in the IMF monitoring process. The second stage involves
the preparation of a staff report which is discussed and agreed subsequently at the IMF
Executive Board. Following approval, the report is then published.
IMF Post-Programme monitoring will continue until the outstanding IMF loans fall below the
threshold of 100 percent of quota.
Early repayment of IMF Loans
Following agreement with its EU and bilateral lenders, and the completion of all necessary
approval procedures, Ireland concluded a phased repayment of approximately SDR 15.7
billion of its IMF loans in March, 2015. Ireland repaid the first SDR 7.6 billion in two payments
- in December, 2014 (SDR 5.6 billion on 10 December and SDR 2.0 billion on 17 December,
2014). Further repayments in February and March, 2015, completed the early repayment.
Some 81 percent of Ireland’s original €22.5 billion IMF loan has now been repaid early and
this will deliver savings of over €1.5 billion over the lifetime of the loan.
IMF post-programme monitoring continues for the initially envisaged period – i.e. up to mid2021.
Background
On 28 November, 2010, the Irish Government agreed to a programme of financial support for
Ireland: from the European Union through the European Financial Stability Facility (EFSF) and
the European Financial Stabilisation Mechanism (EFSM); through bilateral loans from the UK,
Sweden and Denmark; and from the IMF, on the basis of specified programme conditions.
Page | 11
The overall EU/IMF programme of financial support for Ireland amounted to €85 billion. Of this
amount, €17.5 billion of this was provided from Ireland’s own resources, with €67.5 billion
being provided from European Union sources and by the IMF.
The external funding of €67.5 billion was sourced as follows:



European Union:
o European Financial Stabilisation Mechanism (EFSM)
o European Financial Stability Facility (EFSF)
International Monetary Fund (IMF)
Bilateral loans:
o UK
o Sweden
o Denmark
€22.5 billion
€17.7 billion
€22.5 billion
€ 3.8 billion
€ 0.6 billion
€ 0.4 billion
€67.5 billion
Total External Funding
This external funding was provided subject to compliance with the conditionality set out in the
programme documents.
IMF Support
The IMF provided a three-year Extended Fund Facility (EFF) arrangement for Ireland. The
Fund arrangement amounted to SDR 19.5 billion or about €22.5 billion. The final drawdown
of IMF funds under the programme was completed subsequent to the approval of the 12th and
final review in December, 2013.
Programme Exit
Following steadfast implementation of its commitments under the programme, Ireland exited
the EU-IMF programme of financial support on 15th December, 2013. The programme met its
key objectives, namely to put the public finances back on a sustainable path, to restore
financial sector viability, to return Ireland to financial market funding and to raise growth
potential. While challenges remain, exiting the EU-IMF programme was an important
milestone in Ireland’s economic recovery
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2.1 The World Bank in 2015
Fiscal Year 2015
For the Fiscal Year 2015 (July 1st, 2014 – June 30th 2015), the World Bank committed of the
order of $60 billion in loans, grants, equity investments and guarantees to its members and
private businesses.




IBRD commitments totalled $23.5 billion;
IDA commitments totalled $19.0 billion;
IFC provided $17.7 billion in financing, of which $7.1 billion was sourced from
investment partners; and
MIGA issued $2.8 billion in risk and credit enhancement guarantees underpinning
various investments.
Strategy and Organization
The World Bank Group (WBG) is made up of five components as set out in Appendix A.
The World Bank Group’s (WBG) activities are directed towards the achievement of its two
important development strategic goals: (1) ending extreme poverty by decreasing the
percentage of people living on less than $1.90 a day to no more than 3 per cent by 2030; and
(2) promoting shared prosperity by fostering the income growth of the bottom 40 per cent for
every country.
2015 was a pivotal year for development with the agreement at the UN of the Sustainable
Development Goals (SDGs). In the lead up to this agreement, the Bank engaged with a
number of partners, including the United Nations, the G-20, the IMF and other multilateral
development banks (MDBs) on the 2030 Agenda for Sustainable Development, which
established the Sustainable Development Goals (SDGs). The WBG played a lead role in 2015
in developing a joint vision of what MDBs and the IMF can do, within their respective
institutional mandates, to support and finance the achievement of the SDGs. This commitment
is articulated in From Billions to Trillions: MDB Contributions to Financing for Development, a
joint paper which outlines how MDBs can collaborate with countries, government, civil society
partners and the private sector in order to dramatically scale up the volume of development
financing to implement the SDGs.
The new World Bank operating model which was launched in July, 2014, stabilized during
2015 with some adjustments being made as the model was rolled out. The operating model
was designed to enhance the WBG’s ability to share solutions globally and to better integrate
country, regional and global engagements. The WBG also implemented a new joint WBG
approach to country engagement to further support the achievement of its goals. This model
uses a Systematic Country Diagnostic (SCD) to provide a comprehensive and integrated
analysis of growth, poverty, inclusion and sustainability, focusing on constraints to achieving
the goals in each country. Using this, the new Country Partnership Framework (CPF) draws
on findings of the SCD, the country’s own development goals and the WBG’s comparative
advantage to set out a selective program of WBG engagement that will support countries to
Page | 13
achieve their goals. This model makes it easier for WBG institutions to work together both with
governments and with the private sector.
Looking further ahead at the role of the WBG and following a requests by the Governors at
the 2015 Annual Meeting in Lima, the Executive Directors and the WBG management have
initiated a “Forward Look” exercise on which to build a shared understanding of the medium
to long term WBG role and help inform future decisions around voice, IDA replenishment, and
IBRD and IFC financial capacity. Furthermore, following the completion of an IBRD and IFC
shareholding review in 2015, Governors requested the development of a dynamic formula for
shareholding allocation in the WBG aiming to conclude by the 2016 Annual Meetings with an
interim progress report in spring, 2016.
2015 was also an important year for ongoing discussions relating to the safeguards
review. Since 2012, the WBG has been reviewing, updating and strengthening its
environmental and social safeguard policies. The Bank is committed to developing an
environmental and social framework that is better for people, the environment and borrowers,
and builds on the Bank’s already high standards. Following two rounds of global consultations,
the World Bank’s Board of Directors authorized the launch of a third phase of consultations
on a revised draft of the proposed Environmental and Social Framework. The next review
phase will focus on implementing the safeguards framework in borrowing countries and on
resolving outstanding issues.
In July, 2015, Executive Directors approved a new policy governing procurement in investment
projects financed by the WBG. The new Procurement Framework allows the World Bank to
better respond to the needs of client countries, while preserving robust procurement standards
throughout Bank-supported projects. The new Framework included establishing standardised
bid preparation timelines to improve the quality of submissions, reducing delays in the bid
assessment process, and providing technical support to borrowing countries to improve the
transparency and quality of their bid assessments and help reform the overall procurement
processes.
Finally, as part of its broader reform efforts earlier this year, the WBG also implemented a
comprehensive consultation plan for renewing its operational strategy for gender equality. A
series of multi-stakeholder face-to-face meetings were held around the world and an online
platform has allowed for an open and transparent consultation process, which concluded with
the adoption of the new gender equality strategy in December, 2015. The new gender equality
strategy will support countries to close the gender gap as one fundamental way towards
achieving lasting poverty reduction, safety and prosperity.
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2.2 Ireland’s Participation in the World Bank Group in 2015
Constituency Office
The organizations that make up the World Bank Group are effectively owned by the
governments of member nations which have the ultimate decision-making power within these
organizations on all matters, including policy, financial or membership issues. Member
countries govern the World Bank Group through the Boards of Governors and the Boards of
Executive Directors. Each Executive Director heads up a Constituency of member countries.
Ireland is a member of the Canadian-led Canada-Ireland-Caribbean constituency.
Mr Alister Smith is the Executive Director for this Constituency and has held the position since
January, 2014. In addition to the Executive Director, the Constituency Office comprises one
Alternate Executive Director (AED), and a team of advisors, two of whom are Irish - Ms Mary
O’Dea at Senior Advisor level and Mr Niall Cassidy1 at Advisor level. These appointments are
made by the Executive Director of the Constituency on nomination by the Minister for Finance.
The Irish Advisors have specific responsibilities for highlighting Ireland’s positions on WBG
policies and projects, promoting Irish initiatives within the Bank and helping to communicate
the work of the WBG within Ireland. They liaise closely with the Irish authorities, in particular
the Department of Finance, Irish Aid, the Central Bank and Enterprise Ireland.
Doing Business (DB) Report
The Doing Business Report is a flagship publication of the World Bank which is published on
an annual basis and which assesses regulations and the ease of doing business in 189
economies. It makes an important contribution as it encourages countries to achieve more
efficient regulation; encourages the deepening of the reform agenda; provides measurable
benchmarks for reform; and serves as a source of information for governments, investors and
firms.
Due to the continued reform and adjustment of the Report’s methodology over recent years,
it is not possible to directly compare the published results of successive Reports. This applies
in the case for Doing Business 2016 which was published in October, 2015, and in which
Ireland ranked 17th, and the previous year’s Report in which Ireland ranked 13th.To attempt
comparability between these outcomes nevertheless, the World Bank ‘back-calculated’ results
for the 2015 Report using the newer methodology that applied in the 2016 Report. On this
basis, Ireland would have in fact ranked 19th in the 2015 report. Hence, in adjusted terms,
Ireland moved from 19th to 17th position between the 2015 and 2016 Reports.
In DB 2016, Ireland performed strongly and was ranked 4th in the Euro Area and 7th in the
EU overall. Ireland performed particularly well on indicators including: Protecting Minority
Investors; Paying Taxes; Resolving Insolvency; and Starting a Business. This was a positive
result for Ireland overall and it is evidence that the implementation of high-level reforms and
1
The term of Niall Cassidy as Advisor came to an end in January 2016 and he was replaced by Mr Alex
Lalor.
Page | 15
other efficiencies and improvements are reflected in the business and regulatory environment.
It also highlights sustained work and reforms in restructuring the economy and it demonstrates
the importance of continuing to reform and improve competitiveness.
From the broader perspective, DB 2016 incorporated an expansion in the indicators used to
measure performance so as to include not just efficiency but also the quality of business
regulations. This represented a continuation of the reform of the Report’s scope and
methodology over recent years. The Department of Finance has engaged closely with the
Doing Business Report Team throughout this process, as well as with the relevant
stakeholders in Ireland, and will continue to adapt to the ongoing changes to the Doing
Business Report.
Visits and Engagements
On 26th June, 2015, Dr Jim Yong Kim, President of the World Bank, made his first official trip
to Ireland. During the official visit, President Kim met with President Michael D. Higgins at Aras
an Uachtarain. President Kim also met with the Minister for Finance, Michael Noonan TD, in
the Minister’s capacity as Governor for Ireland at the World Bank Group, and with the Minister
for Foreign Affairs and Trade, Charlie Flanagan TD.
During the visit, President Kim delivered a lecture at Iveagh House entitled ‘Building the New
Global Agenda for Shared Prosperity’. President Kim’s speech highlighted the challenges in
developing plans for global action and the global threats which push people into poverty and
undermine prosperity.
The discussions held during the visit covered a broad range of issues reflecting the extensive
remit of the World Bank Group and Ireland’s long history as an engaged member of the Bank.
The visit took place at an important time as the World Bank Group continues its process of
reform and reorganisation as well as its strategic review on its mandate and its role in the everchanging global economic, financial and development landscape.
Earlier in the year (February 2015), Minister for Agriculture, Mr Simon Coveney T.D,
addressed the World Bank on the topic of “From Famine to Abundance”, outlining Ireland’s
agri-food journey from the Great Famine of the 1840s to today’s modern and dynamic agrifood sector. Minister Coveney highlighted how the Irish agri-food sector has evolved towards
new and innovative food products, with higher value added. Minister Coveney highlighted his
ambition that Ireland should be, and be seen to be, a global leader in sustainable food
production.
Tánaiste & Minister for Social Protection, Ms Joan Burton T.D, also visited the Bank in March,
2015, to discuss the Bank’s work on social protection and job creation amongst the youth,
while separately briefing officials about Ireland’s experience in this area in recent years.
Asset Management Workshop
During the IMF-World Bank Spring Meetings in April, 2015, Second Secretary at the
Department of Finance, Ms. Ann Nolan, spoke at an Asset Management Workshop organized
Page | 16
by the World Bank Group. Ms Nolan was joined at this event by Mr Dwayne Price, from the
Central Bank of Ireland, and Mr Martin Whelan from the National Asset Management Agency
(NAMA).
This workshop was held in reflection of the World Bank’s role in providing advisory services
and training to official sector investment managers in developing countries in order to assist
these countries in efficiently managing foreign currency reserves and other investment
portfolios
The workshop aimed to raise awareness of policy makers of (i) the importance of resolving a
banking crisis in an efficient and stable manner, using all the instruments/institutions needed
to guarantee the stability of the system and creating viable institutions that are sustainable
and can help to restore economic growth; (ii) the relevance of an Asset Management Company
(AMC) in this context in order to address high non-performing loans in the banking sector; and
(iii) the critical design issues to make an AMC successful and challenges in its implementation.
The audience included Finance Ministers of the Eastern Caribbean countries and World Bank
Governors and staff of the Eastern Caribbean Central Banks, as well as representatives from
the IMF, World Bank and Caribbean Development Bank.
IDA-17 Midterm review / IDA-18 commencement
The midterm review of the 17th replenishment of the International Development Association
(IDA) was held between 16th and 20th of November, 2015, in Dakar, Senegal. The midterm
review takes place at the mid-point of each replenishment (which operates on three-year
cycles) and it provides IDA Donors with the opportunity to engage with IDA Management and
to review the performance and implementation of the relevant replenishment at that point.
Officials from the Department of Finance participated in the midterm review on behalf of
Ireland.
For the IDA17 period (July 1, 2014 - June 30, 2017), IDA operations are placing a special
emphasis on four thematic areas: climate change, fragile and conflict-affected countries,
gender equality and inclusive growth. The overarching theme is ‘maximising development
impact’.
Updates on IDA17 implementation outlined that the work of IDA had re-focused and aligned
with the themes for the replenishment. IDA Donors welcomed this progress and encouraged
IDA Management to concentrate further on the efficiency of the use of funding and to begin
advance planning for the 18th replenishment of the Fund (IDA18) to support a good start to
that replenishment cycle.
Donors also considered options to potentially leverage the
finances of the IDA using private sector finance and the skillsets of the IBRD and the IFC.
There was also a review by Donors of the Crisis Response Window, a reaction vehicle created
at the beginning of IDA17 and which had been activated for the earthquake in Nepal and the
Ebola outbreaks in West Africa. The costs associated with these and views on the
appropriateness of IDA involvement were key considerations and the review of the Crisis
Response Window will continue during the IDA18 replenishment discussions.
The IDA-18 Replenishment cycle commenced in early 2016 and there will be a further review
of progress of IDA-17 and a consideration of the themes and strategic priorities for the IDAPage | 17
18 period (July 1, 2017–June 30, 2020). This will take account of emerging global economic,
financial and development challenges, as well as development agendas and processes,
including the Addis Ababa Action Agenda and Financing for Development, as well as the
continued review of the role and mandate of the broader World Bank Group in the global
landscape.
Page | 18
2.3 Contributions to World Bank Trust Funds
In addition to financial contributions to the component organisations of the World Bank, there
are a number of Trust Funds administered by the Bank for development activities to which the
Department of Foreign Affairs and Trade contributes.
The main funds to receive funding from Irish Aid in 2015 included:

Global Fund for AIDS, TB and Malaria (GFATM): Irish Aid contributed €11.5 million
to GFATM in 2015. This fund is an international financing institution which invests its
resources to fight AIDS, tuberculosis and malaria. It channels almost 90 percent of
total international financing for TB eradication, 60 percent for the elimination of
malaria and 22 percent to combat AIDS. It also funds health systems’ strengthening,
as inadequate health systems are one of the main obstacles to scaling up
interventions to secure better health outcomes in relation to HIV, TB and malaria.
The Global Fund aspires to contribute substantially to international goals by saving
10 million lives and preventing 140-180 million new infections from AIDS,
tuberculosis and malaria from 2012 to 2016.

The Global Partnership for Education (GPE): Irish Aid contributed €4 million to
GPE in 2015. Established in 2002, as a trust fund within the World Bank, the Global
Partnership for Education galvanizes and coordinates the global effort to provide a
good quality education to children, prioritizing the poorest and most vulnerable.
During its 13 year life-span, it has made a significant contribution to international
education. Since its inception, GPE has helped low income countries increase the
percentage of children completing primary school from 63 to 72 percent and 13 million
fewer primary-aged children were out of school in 2013 across all GPE partner
countries compared to 2002. $4.4 billion in grants have been allocated to education by
GPE since 2003, most of them in Africa. The contribution of €4m in 2015 is the first
instalment of Ireland’s pledge in 2014 to provide €16m over the period 2015-2018.

Consultative Group on International Agricultural Research (CGIAR): In 2015, Irish
Aid contributed €3.5m to CGIAR research programmes and centres through fund
Windows 2 and 3 respectively. Irish Aid and the CGIAR share a similar mission which
is to reduce hunger and enable poor people, especially women, to increase their
agricultural productivity and resilience, share in economic growth and conserve natural
resources in the face of climate change and other threats, as set out in Ireland’s policy
for international development, One World, One Future, and the new CGIAR strategic
results framework adopted in 2015. CGIAR research centres work in close
collaboration with hundreds of partner organizations, including national and regional
research institutes, civil society organizations, academia, and the private sector. The
CGIAR governance system is currently being reformed, but will continue to operate
with the World Bank as the trustee of the CGIAR Trust Fund, which was established
in December 2010 as a Financial Intermediary Fund
Page | 19

World Bank Group Facility for Investment Advisory Services (FIAS): In 2015
Ireland provided € 600,000 to FIAS, a service of the World Bank Group (International
Finance Corporation (IFC), the Multilateral Investment Guarantee Agency (MIGA), and
the World Bank (IBRD)) which advises developing countries on how to improve their
business environments to increase private sector activity and encourage inward and
domestic investment.

International Finance Corporation (IFC) Conflict-Affected States in Africa (CASA)
Initiative: In 2015, Ireland provided € 300,000 to the Conflict-Affected States in Africa
(CASA) Initiative to encourage the development of private enterprise in these
countries. The CASA Initiative takes into account the particular obstacles faced by the
private sector in fragile and post-conflict countries.

Comprehensive Africa Agriculture Development Programme (CAADP): CAADP
is the joint African Union and NEPAD initiative for the development of African
agriculture as a core driver of poverty reduction and wider economic and social
development. It aims to support AU member states to develop and implement national
policies for inclusive and sustainable agricultural development and intensification. The
2014 AU Malabo Declaration on Accelerated Agricultural Growth and Transformation
for Shared Prosperity and Improved Livelihoods has reinforced the commitments to
delivering the appropriate policies and resources. The CAADP Multi Donor Trust Fund
is a capacity-building resource fund which aims to support the development of national
and regional agricultural investment plans. In line with the recommendations of the
Hunger Task Force on improvement of smallholder productivity as a means of reducing
hunger by improving output and income levels, Irish Aid has contributed €2.6 million to
the CAADP Multi Donor Trust Fund since 2009. While no new contribution was made
in 2015 the operations of the Fund have been extended until June 2016 and an
evaluation being currently undertaken will inform decisions on future Irish Aid funding.
A number of additional contributions were made through Irish Aid key partner countries:

The Productive Safety Net Programme (PSNP) in Ethiopia supports the needs of
chronically food insecure households in a more systematic and predictable way by
providing cash or food transfers to very poor households for six months of the year in
exchange for their participation in community public works. The programme ensures
that families can feed themselves throughout the year while at the same time helping
communities to mitigate and adapt to climate change through soil and water
conservation public works activities. Irish Aid contributed €200,000 in 2015 for the
PSNP Coordination and Redesign Team.

In 2015, Irish Aid contributed €3.5 million to the Malawi Agricultural Sector Wide
Approach Support Project Multi-Donor Trust Fund managed by the World Bank.
Irish Aid also provided €185,000 to another World Bank managed multi-donor trust
fund, the Malawi Public Finance and Economic Management Reform Programme.
Page | 20
2.4 Global Environment Facility (GEF)
The Global Environment Facility was established in 1991 to provide new and additional grant
and concessional funding to developing countries to meet the agreed incremental costs of
measures to achieve agreed global environmental benefit, with contributions mainly
emanating from the developed world. The GEF's portfolio of activities is wide-ranging:
reducing the risk of climate change, conserving and sustainably using biological diversity,
protecting the ozone layer, safeguarding international waters, eliminating persistent organic
pollutants and promoting sustainable land management.
The GEF is jointly administered by the United Nations Development Programme, the United
Nations Environment Programme and the World Bank. Ireland made contributions to the GEF
totalling IR£1.7m (€2.16m) over the four-year period 1994 to 1997; IR£3.69m (€4.69m) over
the four-year period 1998 to 2001; €5.73m over the four-year period 2002 to 2005; €5.73m
over the four year period 2006 to 2009; and €5.73m over the four-year period 2010 to 2014.
In 2014, the Government approved a new 6th round of funding (GEF 6) to the GEF for the
four-year period 2014 to 2017, totalling €5.73m. The first contribution under this funding round
was made in October, 2014, in the sum of €1.47m. The second GEF 6 contribution, in the sum
of €1.42m, was made in September 2015.
The Least Developed Country Fund: €1 million was provided by the Department of Foreign
Affairs and Trade to the Least Developed Country Fund (LDCF) in August 2015. Ireland has
contributed to this Fund since 2003 and provided a total of USD$16.5 million. The LDCF has
provided support for National Adaptation Programmes of Action and is supporting
implementation of national plans to respond to climate change.
Page | 21
3.1. Bretton Woods Institutions - 2015 Exchequer Payments and
Receipts
Payments
The following are the details of payments from the Central Fund to the Bretton Woods
Institutions in 2015:
€
Enabling Legislation
IDA 16th Replenishment
14,580,000
Development Banks Act 2005
IDA 17th Replenishment
6,030,000
Development Banks Act 2005
Total
20,610,000
Page | 22
3.2 Financial Activities of the Central Bank as agent of the Minister for
Finance under the Bretton Woods Agreements Acts, 1957 – 1999
Under the Bretton Woods Agreement Acts, the Central Bank2 of Ireland is the fiscal agent for
the Minister for Finance and, in this capacity, it is responsible for conducting financial
transactions with the IMF. The transactions with the IMF are recorded in the Central Bank’s
financial statements. The majority of IMF financial transactions are conducted through the
IMF’s General Resource Account (GRA3) and the Special Drawing Rights (SDR4) Department.
IMF General Resources Account (GRA)
The activities carried out during the period 1 January, 2015, to 31 December, 2015, are set
out in Table 1.
Table 1 - IMF Holdings of Ireland’s Own Currency (in SDR equivalent)
Table 1 – IMF Holdings of Ireland’s Own Currency (in SDR equivalent)
31 December, 2015
31 December, 2014
SDR 998,897,520
SDR 998,897,520
Special Drawing Rights (SDR) Account
Special Drawing Right (SDR) holdings are recorded as an asset on the Central Bank’s balance
sheet and net cumulative SDR allocations are recorded as a liability. The IMF pays interest to
members when their SDR holdings are above their net cumulative SDR allocations;
conversely, it levies a charge when members’ SDR holdings are less than their net cumulative
SDR allocations. Ireland’s SDR holdings (of SDR 650.9 million on 31 December, 2015) were
less than the net cumulative SDR allocations (of SDR 775.4 million), so a net charge of SDR
62,333 was levied in 2015, as shown in Table 2.
Table 2 - SDR Holdings and Net Charge Levied
2
Central Bank refers to Central Bank of Ireland.
members’ financial relations with the Fund are largely reflected in the General Resources
Account (GRA). Members pay a subscription (quota) to the IMF, with 25% payable in SDRs or freely usable
currency, and the remainder payable in the member’s own currency (i.e. for Ireland this is the euro).
3The SDR is an international reserve asset created by the IMF in 1969 to supplement its member countries’ official
reserves. Its value is based on a basket of four key international currencies: the euro, Japanese yen, pound sterling,
and U.S. dollar. SDRs can be exchanged for freely usable currencies.
3IMF
Page | 23
Table 2 – SDR Holdings and Net Charge Levied
31 December, 2015
31 December, 2014
Net Charge Levied in 2015
(charge less interest)
SDR 650,941,837
SDR 651,175,826
SDR 62,333
Remuneration Received During 2015
Ireland received remuneration of SDR102,510 on its “Reserve Tranche Position (RTP)” in
2015. The RTP is the difference between Ireland’s IMF quota in 2015 (SDR 1,257.6 million)
and the IMF’s holdings of Ireland’s own currency, excluding holdings that reflect the use of
IMF credit, (SDR 998.9 million on 31 December, 2015) – this amounted to SDR 258.7 million
on 31 December, 2015, which is shown in Table 3.
Table 3 - Reserve Tranche Position at the IMF and Remuneration
Table 3 – Reserve Tranche Position at the IMF and Remuneration
31 December, 2015
31 December, 2014
Remuneration Received in
2015
SDR 258,702,480
SDR 258,702,480
SDR 102,510
Repayments to the IMF in 2015
A total of SDR 8,049,054,077, or approximately €10 billion, accounting for roughly 41 per cent
of borrowings under the IMF share of the EU-IMF Programme (total IMF loan SDR 19.5 billion),
was repaid in 2015 in advance of scheduled repayments.
Date of Repayment
10-Feb-15
23-Mar-15
TOTAL
SDR Value
SDR2.83 billion
SDR5.22 billion
SDR 8.05 billion
Page | 24
3.3
Ireland’s Contribution to World Bank Group Trust Funds
Payment Amount
Trust Fund
€
Global Fund for AIDS, TB and Malaria
(GFATM)
11,500,000
The Global Partnership for Education (GPE)
4,000,000
Consultative
Group
on
International
Agricultural Research (CGIAR)
5,700,000
Facility for Investment Climate Advisory
Services (FIAS)
600,000
Private Enterprise Partnership Africa:
Conflict Affected States in Africa Initiative
(CASA)
300,000
Ethiopia Productive Safety Net Programme
(PSNP) PSNP Coordination and Redesign
Team
200,000
Malawi Agricultural Sector Wide Approach
Support Project Multi-Donor Trust Fund
3,500,000
Malawi Public Finance and
Management Reform Program.
Economic
185,000
25,985,000
Total
Page | 25
APPENDIX A: Further information on IMF and World Bank Group
Role of the IMF
The IMF is a cooperative intergovernmental institution and its stated objectives are to:
 provide a forum for cooperation on international monetary problems;
 facilitate the growth of international trade, thus promoting job creation, economic growth,
and poverty reduction;
 promote exchange rate stability and an open system of international payments;
 lend countries foreign exchange when needed, on a temporary basis and under adequate
safeguards, to help them address balance of payments problems.
Current IMF membership stands at a near-global 188 countries. On joining the IMF, each
member country is assigned a quota, based broadly on its relative size in the world economy,
which represents its subscription of “capital” to the IMF. Members' quotas, in addition to
providing the IMF with the financial resources it needs to lend to members in financial difficulty,
are also a factor in determining members' representation on the Executive Board and their
voting power in the IMF.
Governance Structure of the IMF
The chart on the next page shows the basic structure of the IMF. The Board of Governors, on
which each member country has a representative (in Ireland’s case, the Minister for Finance),
is the highest decision-making body of the IMF. The Governors meet formally once a year at
the joint Annual Meetings of the IMF and World Bank. The Annual Meetings usually include
two days of plenary sessions, during which Governors consult with one another and present
their countries' views on current issues in international economics and finance. During the
Annual Meetings, the Board of Governors also makes decisions on how current international
monetary issues should be addressed and approve corresponding resolutions.
Decisions required of the Governors may be taken by written procedure but the greater part
of the decision-making is entrusted by Governors to the Executive Board consisting of 24
Executive Directors (EDs), resident in Washington D.C. The Executive Board takes care of
the day-to-day business of the IMF and meets several times a week. It is structured on a
constituency basis, with most EDs representing a number of countries. The views of member
countries are fed into the Board through the constituency offices.
The views of members are also made known to the two committees at Ministerial level which
meet twice a year (at the Spring and Annual Meetings) and which are also structured on a
constituency basis: the International Monetary and Financial Committee (IMFC), and the
Development Committee (DC), which is a joint committee of the IMF and the World Bank. The
IMFC discusses matters of common concern affecting the international economy and also
advises the Fund on the direction of its work. The Development Committee advises the IMF
and World Bank on issues related to economic development in emerging and developing
countries. At the end of the Meetings, each Committee issues a joint communiqué
summarising its views. The IMFC communiqué provides guidance for the IMF's work program
during the six months leading up to the next Spring or Annual Meetings. There is no formal
voting at the IMFC, which operates by consensus.
Page | 26
IMF ORGANIZATION CHART
Page | 27
Role of the World Bank
The World Bank is made up of five component organisations collectively known as the
World Bank Group as shown in the diagram below.
World Bank Group
International Bank for
Reconstruction and
Development (IBRD)
International
Development
Association (IDA)
International Finance
Corporation (IFC)
Multilateral
Investment Guarantee
Agency (MIGA)
International Centre
for Settlement of
Investment Disputes
(ICSID)
International Bank for Reconstruction and Development (IBRD)
The IBRD was established in 1944 as the original institution of the World Bank Group. The
range of Bank involvements in developing countries is an extensive one. Because of the
diverse needs of its clients, the Bank customises its products to the particular requirements of
each. The IBRD aims to reduce poverty in middle-income and creditworthy poorer countries
by promoting sustainable and equitable development through loans, guarantees, risk
management products, and (non-lending) analytical and advisory services.
The range of IBRD involvements in developing countries is extensive. Because of the diverse
needs of its clients, the Bank customises its products to the countries’ requirements. Nearly
73% of the world’s poor (defined as people who earn less than approximately $1.90 per day),
live in middle-income countries. These countries borrow from the IBRD and have large social
and developmental needs.
International Development Association (IDA)
The IDA was established in 1960 as the World Bank Group's agency for concessional financial
assistance to the poorest of the developing countries. The IDA concentrates on the world’s
poorest countries. It is the world’s largest source of concessional financial assistance to the
developing world. It provides long-term loans at zero interest to the poorest countries in its
mission to reduce poverty and improve quality of life. In recent years, grants are also provided
to countries at risk of debt distress. IDA contributes to development by supporting projects that
improve living standards and by promoting equitable access to the benefits of economic
growth.
Page | 28
IDA eligibility is based on an assessment of an individual country's per capita income (less
than $1,215 per annum). The amount of IDA assistance available to a country depends on
certain performance factors which are assessed annually. IDA offers interest–free loans to
countries at risk of debt distress for terms of 20, 35 and 40 years.
IDA is funded largely by contributions from the governments of its richer member countries.
Additional funds come from the IBRD's and IFC’s income, and from borrowers' repayments of
earlier IDA credits. Donors meet every three years to replenish IDA funds and review IDA’s
policies.
Ireland joined the IDA in 1960. The total value of Ireland’s IDA subscriptions and contributions
as of 30 June, 2015, was $709.2 million. Our support for IDA is mainly in the form of
contributions to periodic replenishments of IDA resources.
International Finance Corporation (IFC)
The IFC5 was established in 1956 to encourage private sector activity in developing countries.
The IFC’s objective is to foster sustainable economic development in developing countries by
financing private sector investment, mobilising private capital in local and international
financial markets and providing advisory and risk mitigation services to business and
governments. It is the largest multilateral financial institution investing in private enterprises in
emerging markets, with activities in 103 countries. Ireland joined the IFC in 1958. Our
subscription to the IFC’s capital amounts to some $1.29 million, all of which is paid-in.
Multilateral Investment Guarantee Agency (MIGA)
MIGA6 was established in April, 1988, and provides non-commercial guarantees (insurance)
for foreign direct investment in developing countries. It addresses concerns about the
investment environment and perceptions of risk, which often inhibit investment, by providing
political risk insurance. MIGA’s guarantees offer investors protection against non-commercial
risks such as expropriation, currency inconvertibility, breach of contract, war, and civil
disturbance. MIGA also provides advisory services to help countries attract and retain foreign
investment, mediates investment disputes to keep current investments intact and to remove
possible obstacles to future investment, and disseminates information on investment
opportunities to the international business community.
Ireland has been a member of the MIGA since its establishment in 1988, and ratified the MIGA
convention on 5 July, 1989. Following the implementation of the 1998 capital increase,
Ireland’s shareholding on June 30th, 2015, stood at 650 shares, representing total subscribed
capital of US$7.0 million, US$1.3 million7 of which is classified as paid-in capital, with the
remainder being subject to call.
5Extensive
information on IFC is available at www.ifc.org
6
Extensive information on MIGA is available at www.miga.org
Of the $1.3 million paid-in capital, $0.9 million was paid in cash, with the remainder lodged in the form of a
promissory note at the time of the initial capital subscription. While this is recorded by MIGA as paid-in capital,
events have been overtaken by the 1998 capital increase and in reality it is highly unlikely that any cash payment
will have to be made on foot of the promissory note.
7
Page | 29
International Centre for the Settlement of Investment Disputes (ICSID)
ICSID is an international institution sponsored by the World Bank and founded in 1966. It was
designed to facilitate the settlement of investment disputes between foreign investors and host
states. It encourages foreign investment by providing neutral international facilities for
conciliation and arbitration of investment disputes, thereby helping foster an atmosphere of
mutual confidence between states and foreign investors. Many international agreements
concerning investment refer to ICSID’s arbitration facilities. ICSID also conducts research and
publishing activities in the areas of arbitration law and foreign investment law.
Ireland signed the Convention establishing ICSID in 1966 and ratified it in 1980 with the
passing of the Arbitration Act, 1980. The Minister for Finance, as Governor of the World Bank
for Ireland, is an ex-officio member of the Administrative Council of ICSID. There is no direct
subscription or contribution to ICSID, whose expenses are met from IBRD resources. ICSID
maintains a Panel of Conciliators and a Panel of Arbitrators to service proceedings under the
Convention on the Settlement of Investment Disputes between States and Nationals of Other
States and Ireland, as a member of ICSID, designates four persons to each Panel.
As of December 17th, 2015, 160 States were signatories to the ICSID Convention. Of these,
152 States are ICSID Contracting States by virtue of their having deposited instruments of
ratification, acceptance or approval of the ICSID Convention
Page | 30
Appendix B: Statement by Governor Patrick Honohan, Alternate
Governor for Ireland at the IMF-World Bank Annual Meeting, 9th October
2015.
I welcome the opportunity to make this statement to the IMF-World Bank Annual Meetings on
behalf of the Government of Ireland.
During the past year, both developed and developing countries continued to respond to
challenges relating to the aftermath of the global financial crisis while also striving to develop
paths towards renewed economic growth and employment.
The past year has again shown the value of coordinated and concerted action by IMF and the
World Bank, and their member countries. This has been demonstrated in responses to
managing the Ebola crisis in West Africa, with strong and effective actions being taken by both
institutions. In addition, there has been close cooperation, again between the both institutions
and their members, in strategic policy areas including the Post-2015 development agenda and
the financing of this agenda. This demonstrates integrated action and joined-up thinking, and
it is important that both institutions continue to work alongside their members and other
international financial institutions.
Irish Economic Developments
I would like to take this opportunity to provide a brief update on developments in the Irish
economy. The Irish economy is continuing to grow strongly and there are signs that the
economic recovery is broadly-based. In the second quarter of 2015, real GDP increased by
1.9 per cent relative to the first quarter, and 6.7 per cent compared with the same quarter in
2014. GDP per capita has now exceeded its pre-crisis peak. Significantly, employment grew
by 3.0 per cent year-on-year to the second quarter of 2015, marking an 11th successive quarter
of employment growth, and unemployment decreased by 17.0 per cent over the same period.
Domestic demand has made a strong positive contribution to growth in the second quarter
with consumer spending and investment both increasing. In addition, strong export growth of
13.6 per cent year-on-year was recorded on the back of continued and sustained
competitiveness improvements, and healthy FDI inflows in recent years. This strong
performance was well ahead of consensus expectations and follows strong performance in
2014 which saw annual GDP increasing by 5.2 per cent.
Although below our domestic forecasts, we welcome the World Economic Outlook’s projection
of 4.8 per cent GDP growth in Ireland for 2015. Based on the latest macroeconomic forecasts,
GDP is expected to expand by 6.2 per cent in 2015 and by 4.2 per cent in 2016. These
forecasts have been revised upwards, significantly, since the forecasts provided with Ireland’s
Stability Programme Update in April 2015. The forecasts for 2015 and 2016 have also been
endorsed by the Irish Fiscal Advisory Council – the independent statutory body established as
part of a wider agenda of reform of Ireland’s budgetary architecture.
These upward revisions are based on the strong performance of the economy throughout
Page | 31
2015. Domestic demand has stabilised and is showing encouraging signs of growth.
Consumer spending is improving as confidence returns, while firms are investing in plant and
machinery once again, and SME trading conditions are continuing to improve.
These encouraging macroeconomic data are mirrored in the total revenue receipts to endSeptember 2015 which were 5.8 per cent ahead of target and up 8.7 per cent on the same
period in 2014. Labour market recovery has continued during 2015. Employment has
increased in each of the last 11 quarters representing an increase of over 3 per cent since the
same point in 2014.
This employment growth was almost exclusively driven by increases in full-time employment
and was broadly based with gains recorded in almost all sectors of the economy. In line with
this, the unemployment rate stood at 9.4 per cent in September, down from a peak of 15.1 per
cent in early 2012. While this is still unacceptably high, it is certainly moving in the right
direction.
Moving forward, domestic demand will be very important for Ireland’s continued growth, and
the strong performance of consumer spending and private investment shows encouraging
signs of future growth and stability. Due to its relatively small domestic market, Ireland’s growth
model must be export oriented. Exports are expected to continue to increase in 2016, as
demand in Ireland’s main export markets, particularly the UK, and as work on opening up
further export markets continues to improve.
In relation to the public finances, there are continued encouraging signs that the position is
moving in the right direction. Targets to reduce the underlying General Government deficit
have been over achieved to date. Reflecting the continued prudent budgetary stance, the
General Government deficit for 2015 is now likely to be of the order of 2.3 per cent of GDP,
which will see Ireland exit the excessive deficit procedure. This is down from 8 per cent of
GDP in 2012 and follows the achievement of a General Government deficit for 2014 of 4.0
per cent of GDP, comfortably below the ceiling of 5.1 per cent of GDP. The General
Government Debt to GDP ratio peaked at 120.0 per cent of GDP in 2013 and fell to 107.6
per cent of GDP in 2014. It is expected, with increasing certainty, that the debt ratio will fall
below 100 per cent of GDP in 2016.
Global developments and outlook
As always, the Annual Meetings are an important milestone in advancing consideration of
global economic and financial challenges and provide an invaluable opportunity for an
exchange of views on critical issues for the global economy and for the Fund and Bank
membership.
We find ourselves at a juncture of an ever-changing global economy where strategies and
policies for growth are made difficult by lagging growth and emerging risks and spillovers. The
latest WEO forecasts suggest global growth for 2015 will be 3.1 per cent, 0.3 per cent lower
than 2014. Encouragingly, global growth is forecast to be 3.6 per cent in 2016, though this is
a slight reduction of 0.2 per cent from the April forecasts.
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Emerging economies have become more resilient but remain vulnerable to changing financial
and monetary policies of advanced economies. This is particularly concerning due to the
contribution which these emerging economies made to global growth during the aftermath of
the global financial crisis. It is also of concern due to potential spillovers which could in turn
affect advanced economies in which growth is taking hold and is showing greater signs of
potential to strongly contribute to global growth prospects in the medium-term.
The progress made by advanced economies has been achieved through the implementation
of careful and prudent macroeconomic planning and use of monetary policy to stimulate
productivity, demand and growth. We are in the midst of shifting phases of macroeconomic
and monetary policies, with the expected tightening of monetary policy in the US and UK, at
the same time as the ECB have engaged in Quantitative Easing and the launch of the
EU’s stimulus policy, the European Fund for Strategic Investment. It is important that we
ensure that the IMF and World Bank stand ready to support emerging economies and
advanced economies in the implementation of strategies and policies which can stimulate and
sustain global growth prospects.
As a small open economy, Ireland will work to secure its continued economic recovery by
ensuring that its policies stimulate domestic demand and investment, while simultaneously
remaining attractive for FDI and positioning itself to address emerging challenges to, and
opportunities for, growth. As a proactive participant in matters of global importance, Ireland
has been a strong supporter of the OECD’s important BEPS project which we see as the best
approach to aggressive tax planning and the aim of which is aligned with
Ireland’s own tax strategy.
IMF issues
Turning to matters related specifically to these meetings, I welcome the IMF’s continued
important role in promoting financial stability and growth. Its work on surveillance, spillovers
and financial stability, as evidence by its flagship reports, makes clear the importance of
dialogue between policymakers in order to minimize unintended distortions arising from policy
initiatives. The IMF’s focus on policies that support growth and jobs is the correct one as this
is where the success or failure of policy efforts will be seen by all.
Against the background of challenges persisting since the financial crisis, particularly slowerthan-expected growth, the key messages from the Fund focus on the importance of
implementing growth friendly-policies and macro-critical structural reforms; advancing
measures designed to boost actual and potential economic growth; promoting appropriate
regulation and vigilant financial sector supervision; and enhancing dialogue and international
cooperation to support coherence across the policy spectrum.
Turning towards governance, Ireland, along with other EU states, is concerned over the
continued non-implementation of the 2010 Quota and Governance reforms. These reforms
are vital for the Fund’s financial strength and capacity, while the implementation of the reforms
and conclusion of the 2010 Quota and Governance review would protect and sustain the
Fund’s legitimacy and credibility. We urge members that have not yet ratified the reforms to
do so as soon as possible. Separate to any measures which may be taken to reinforce the
Fund’s capacity over the medium-term, we consider it to be vital that the 2010 reforms are
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completed as a signal to, and in reflection of, the Fund’s important role in the international
financial system.
World Bank Issues
Turning to World Bank issues, Ireland welcomes the World Bank Group’s continued efforts in
working side-by-side with developing countries and indeed all those countries which are
dealing with significant challenges. The past year has shown that the global landscape is an
unpredictable one – as seen more recently with the Ebola crisis in West Africa - and the events
which cross our paths must be faced together and with resilience.
The World Bank has played a leading role in the UN process on the Sustainable Development
Goals and Financing for Development Agenda. Together, these processes aim to outline a
clear path and strategy for the development agenda up to 2030 and, importantly, the financing
of this development agenda. We welcome the leadership shown by President Kim throughout
this process and we encourage him to continue to work with other international financial
institutions. Critical to this will be the role of IDA and how it continues to support the world’s
most vulnerable countries in the evolving and challenging development landscape. We urge
the World Bank to continue to be creative and innovative in the use of its resources so that
support can be provided to countries in transition, while the primary focus remains on those in
most challenging and impoverished circumstances.
In addition, countries experiencing particularly difficult and cross-cutting challenges will
continue to require resources to be targeted specifically on these issues. Innovative
approaches require a fundamental review of the current use of resources throughout the World
Bank and the flexibility for using these resources better, and the expected demand from
borrowing countries in the coming years – to which extensive scenario testing should be
applied. This should feed into future consideration of the resource capacity of the World Bank,
which in turn supports a review of its overarching strategies and direction.
Development Issues
An example of Ireland’s leadership in the evolving development landscape is the 2030
Agenda, co-facilitated by Ireland and Kenya and adopted last month at the largest gathering
of Heads of State and Government in the history of the UN is the second of three major
agreements that will be concluded this year and which, taken together, have the potential to
deliver a truly transformative agenda that can end poverty and promote sustainable
development. The first of these is the Addis Ababa Action Agenda on the means of
implementing the new SDGs which was agreed in July, and the third, the climate agreement,
should be concluded in Paris in December.
The 17 Sustainable development Goals (SDGs) at the heart of the new development
framework will guide the actions of all countries in their efforts to eradicate poverty and hunger
and achieve sustainable development over the next fifteen years. Ireland attaches great
importance to these new goals and to their implementation. While they are challenging and
ambitious, we have been heartened by the level of commitment to their implementation
expressed by world leaders at the recent Summit in New York.
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Ireland is determined that our aid programme which is central to our foreign policy will continue
to focus on ending poverty in the poorest countries in the world.
As we embark in implementing the SDGs, we must ensure that scarce development resources
are focused on the world’s most vulnerable and poorest, with a strong emphasis on women
and marginalised groups.
We welcome the leadership the World Bank and the IMF have shown, in particular on
Financing for Development, and call on the institutions to focus now on implementation of the
Addis agreement and of the 2030 Agenda.
The World Bank and the IMF have a key role in assisting developing countries in leveraging
the resources need to implement the SDGs, including through building fair and equitable
taxation systems; helping to create a flourishing private sector based on environmental and
social sustainability; and mitigate and adapt to the challenges posed by climate change.
Ireland believes the World Bank is uniquely placed to drive the 2030 Agenda by helping to
eradicate extreme poverty and promote shared prosperity globally.
Conclusion
Developments in the global economy continue to underline the pivotal role of institutions such
as the IMF and the World Bank. Ireland will continue to aim to play a key role in work to help
ensure that both institutions are well placed to respond to ongoing and emerging challenges
in the most effective way.
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APPENDIX C – Ireland’s Voting Record in 2015
International Monetary Fund - Board of Governors
Date
Resolution
Vote
18 February 2015
2010 Reforms and Fifteenth General Review of
Quotas
Approve
14 August 2015
Direct Remuneration of Executive Directors and their
Alternates
Disapprove
26 August 2015
Indonesia as location for 2018 Annual Meetings of
IMF and World Bank
Approve
6 November 2015
Membership for Nauru
Approve
World Bank - Board of Governors
Date
Resolution
Institution
Vote
9 June 2015
Transfer from Surplus to Replenish the
Trust Fund for Gaza and West Bank
IBRD
Approve
14 August 2015
Direct Remuneration of Executive Directors
and their Alternates
IBRD
Disapprove
26 August 2015
Indonesia as location for 2018 Annual
Meetings of IMF and World Bank
IBRD
Approved
6 November 2015
Membership for Nauru
IBRD
Approved
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APPENDIX D – Ireland’s Shareholding and voting power in IBRD, IDA, IFC
and MIGA
Ireland’s Capital Subscription as at 30 June, 2015
IBRD
IDA
IFC
MIGA
(US$ millions)
Total Capital
subscription
Amount paid in and
committed
840.8
–
49.4
709.24
1.29
1.335
Uncalled Portion
791.4
As above
–
5.7
Subscription share
(%)
0.33
N/A
0.05
-
Voting power (%)
0.34
0.37
0.08
0.40
7.033
Note: Figures are from the 2015 financial statements and annual reports for the World
Bank, IFC and MIGA respectively.
IDA figure represents Ireland’s cumulative contributions. Subscriptions and
Contributions committed (source IDA Financial Statement 2014)
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APPENDIX E – Ireland’s Quota at the IMF
Quota share
(%)
Quota
subscription
(SDRs millions)
Pre-2008 Quota
0.385
838.4
Post 2008 Reform Quota
(i.e. Pre 2010 Quota Reform)
0.528
1,257.60
Post-2010 Quota Reform
0.723
3,449.90
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APPENDIX F– Further information
Useful Links
 Department of Finance:
www.finance.gov.ie

The Central Bank of Ireland:
www.centralbank.ie

Irish Aid:
www.irishaid.gov.ie

The World Bank:
www.worldbank.org

The IMF:
www.imf.org

Relevant documents from the 2015 Spring and Annual Meetings can be found at:
https://www.imf.org/external/spring/2015/
https://www.imf.org/external/am/2015/

Website of the World Bank Executive Board including minutes, calendars and work
programme:
http://go.worldbank.org/PNWBV6U3S0

Contact us:
International Financial Institutions Division, Department of
Government Buildings, Upper Merrion Street, Dublin 2
Tel: +353 1 676 7571 | LoCall: 1890 66 10 10 | Fax: +353 1 678 9936
Email: [email protected]
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Finance,