IMF Managing Director Kristalina Georgieva has urged countries to spend what they need but keep the receipts for accountability especially with regards to the relief packages they received from the Fund.
According to her, accountability cannot take a back seat in this crisis.
She made these remarks whilst speaking at the 19th International Anti-Corruption Conference on Tuesday, December 1, 2020.
“Countries must also commit to enhanced monitoring of COVID-related spending and to conduct an audit of crisis-related spending. This will be the moment to check the receipts.
“For example, countries such as Guatemala, Honduras, and Rwanda are using Financial Management Information Systems to track COVID-related expenditure. And in Sierra Leone, the Supreme Audit Institution is already undertaking an interim audit of COVID-19 funds”.
She paid tribute to James Wolfensohn who is known for his many contributions to development especially in his famous 1996 speech about the cancer of corruption, in which he talked about how “…corruption diverts resources from the poor to the rich, increases the cost of running businesses, distorts public expenditures, and deters foreign investors… it erodes the constituency for aid programs and humanitarian relief. And we all know that it is a major barrier to sound and equitable development.”
She noted that It is especially important to zero in on corruption amid this crisis—the worst health and economic crisis of our lifetimes. Also, she stated that there is so much suffering that every penny counts towards saving lives and protecting livelihoods.
She pointed out that it is also a time when if people don’t trust the government, they will not follow the recommended health and containment measures.
“Corruption corrodes this trust and it weakens the impact of policies and public spending”.
At the IMF, we know what is at stake and we are taking action to help fight corruption both during the crisis and in the longer term.
“Some of you may have heard me saying, spend what you need but keep the receipts. Accountability cannot take a back seat in this crisis”.
She pointed out specifically that the IMF in its emergency lending has provided financial lifelines to 78 countries. She recommended certain measures that must be taken by countries to ensure transparency and accountability.
“…All countries receiving emergency financing from the IMF must accept a safeguards assessment of the central bank. This is an IMF assessment of a central bank’s governance and control framework to ensure that it can manage IMF resources properly.
“We have asked countries to commit to specific anti-corruption measures such as publishing crisis-related procurement contracts and information about the beneficial owners of winning companies.
“…we are recommending that special attention be paid to transparency and accountability of exceptional measures undertaken during the crisis. We also disseminate good practice examples – so countries can learn from each other”.
She noted that it is the poorest and most vulnerable people that are at the highest risk from the pandemic and the economic consequences of the pandemic.
“And we know that among low-income countries, the share of the budget dedicated to education and health is one-third lower in highly corrupt countries. Corruption keeps children out of school, and it stops people who are sick from getting the treatment they need”.
She quoted Pope Francis who once said “corruption is paid by the poor.”
She pointed out that the efforts to tackle corruption must continue over the long term – because fixing governance vulnerabilities requires time and perseverance.
“We help our members strengthen anti-corruption efforts in six key areas – fiscal governance, financial sector oversight, central bank governance, market regulation, rule of law, and anti-money laundering.
“We also look at transnational aspects through assessments of national frameworks to limit opportunities for corruption through foreign bribery or laundering of proceeds of corruption.
“…we urge citizens to keep track of how public money – their money – is spent”.
