June 1998 - Article - SA's subscription to the IMF's SDDS
Last Modified Date:
2020-10-01, 09:31 PM
Quarterly Bulletins > Articles and Notes
The current arrangements pertaining to the International Monetary Fund’s (IMF's) surveillance over members’ policies were formalised in 1977. In terms of Article IV, Section 3, of the IMF's Articles of Agreement, the IMF has the mandate to oversee each member's efforts to direct its economic and financial policies towards the objective of fostering orderly economic growth with reasonable price stability, to promote orderly underlying economic and financial conditions and a monetary system that does not tend to produce erratic disruptions, and to follow exchange rate policies compatible with these obligations. To fulfil this mandate, the IMF has adopted several surveillance procedures over the years. These procedures include regular consultation with all IMF members and semi-annual Executive Board discussions of member countries' policies. However, the rapid development in international financial markets in the past decade and the importance which international capital markets attach to timely, accurate and reliable information has created a need for a more robust, on-line system of surveillance.In attempting to meet the new challenges posed by a changing global environment, the IMF adopted new initiatives in the past two years which are aimed at increasing the effectiveness of its surveillance responsibilities. In the wake of the 1994/95 Mexican financial crisis, the IMF’s Executive Board was requested to establish standards which would increase the effectiveness of surveillance and guide IMF member countries in the provision of economic and financial data to the public.In April 1995 the Interim Committee called on the IMF's Executive Board to establish standards to guide members in disseminating economic and financial data. The Group of Seven industrial countries, which met shortly thereafter in Halifax, made a similar request. A year later, in April 1996, the IMF's Managing Director reported to the Interim Committee that the IMF’s Special Data Dissemination Standard (SDDS) had been established and that invitations to subscribe had been sent to members. In co-operation with the official agencies of member countries, international rating agencies and institutional investors, the IMF identified and defined quality standards for macroeconomic statistics as well as a system for providing "information on data". The Managing Director of the IMF expressed his expectation that, by enhancing access to timely and comprehensive statistics, the SDDS would contribute to the formulation of sound macroeconomic policies and also to the improved functioning of financial markets. Countries which signed up voluntarily for the SDDS are expected to make the necessary changes to statistical practices to meet the data coverage, periodicity and timeliness requirements of the standard during a transition period, which ends on 31 December 1998.This article discusses South Africa’s subscription to the SDDS. The first section of the article describes the so-called dimensions of the SDDS, and the second section provides a fairly detailed presentation of the specific macroeconomic data which the SDDS targets. Subsequent sections cover South Africa’s reasons for subscribing to the SDDS, the progress being made in the implementation of the SDDS, the transition plans which have to ensure observance of the standard by the end of 1998, the IMF’s Dissemination Standards Bulletin Board and the hyperlinking initiative which has opened up access to the national data sites of certain subscribing member countries. The final section contains summarising comments.