Ninth Replenishment of IFAD’s Resources Draft Resolution: Revisions made since the 2 nd Session of Consultation October 2011

Background A draft resolution on the 9 th Replenishment of IFAD’s resources was presented at the 2 nd session of the Consultation. Representatives were invited to address their technical enquiries, comments and suggestions to the General Counsel. Based on the comments so received and further internal discussions, the following revisions were made (in italics): 1

Section I(b) I. Adequacy of the resources available to the Fund (b) Available resources. The Fund’s resources at the end of the Eighth Replenishment period and the funds to be derived from operations or otherwise accruing to the Fund during the replenishment period are estimated at US$ ____. Purpose: to further clarify the sub-categories of available resources. 2

Section I(c) I. Adequacy of the resources available to the Fund (c) Target for additional contributions. Considering the total resource requirement outlined in subsection (a) above and the available resources stated in subsection (b) above, the target for additional contributions is set at the amount of US$ ____. Purpose: to address some Members’ concern that the new text drops the emphasis on “target level of replenishment” and thus does not sufficiently focus on needed donors’ contributions. 3

Section I(e) I. Adequacy of the resources available to the Fund (e) Structural gap. While maintaining the target level as specified in sub-section I(c), the structural gap may not exceed 15% of the target level. In the event that the structural gap exceeds 15% at the end of the six-month period for the creation of new votes specified in sub-section IX(a), the target level specified in sub- section I(c) shall be adjusted so that the total amount of the pledges received at that date represents at least 85% of the target level. If such an adjustment becomes necessary, the President will immediately communicate the new target level to the Governors, after which subsection I(c) shall be deemed to have been amended accordingly. Purpose: At the request of some Members the structural gap article is re-instated. 4

Section I(f) I. Adequacy of the resources available to the Fund (f) Increasing the financing available from alternative sources: The President shall undertake all efforts necessary to explore the scope for increasing the financing available from alternative sources and to submit any proposals that may result from such exploration to the Executive Board for approval. Purpose: to convey the idea that the programme of work (Section I(a)) should not be limited to what Members will be able to contribute and to explain that where necessary financing from external sources should be explored. 5

Section II(a) II. Measuring results, effectiveness and efficiency (a) During the replenishment period, the Results Measurement Framework set forth in annex ___ to the Report of the Consultation on the Ninth Replenishment of IFAD’s Resources (___) shall constitute the systematic approach to the management, monitoring and measurement to ensure that intended results have the greatest opportunity of being achieved. Purpose: to let the Results Measurement Framework constitute the systematic approach to the management, monitoring and measurement during the replenishment period. 6

Section III(e)(ii) III. Contributions (e) Special contributions (ii) The Executive Board may approve related agreements with such non-Members and shall consider for the adoption of necessary measures to ensure the participation of these non-Members in its meetings, when appropriate. Purpose: to make it clear that it will not be mandatory for the Executive Board to make arrangements for the participation in its sessions of non- Members that make special contributions. 7

Section III(f) III. Contributions (f) Special contributions made by any State or grouping of States after the adoption of this resolution shall be converted into additional contributions upon the contributor’s accession to the Fund during the replenishment period. Purpose: to enable non-Members to pledge before their accession to the Fund, but obtain votes for their contributions, once their membership is approved during the replenishment period. 8

Section III(g) III. Contributions (g) At any time, a Member may increase the amount of any of its contributions. Purpose: This is a correction of a clerical omission in the previous version. 9

Section III(h) III. Contributions (h) Exchange rates. For the purposes of section I(a), commitments and pledges made under this resolution shall be valued on the basis of the average month-end exchange rate of the International Monetary Fund over a six-month period preceding the adoption of this resolution between the currencies to be converted (dd/mm/yyyy– dd/mm/yyyy), rounded to the fourth decimal point. Purpose: to include the currency of the potential new Members who are likely to pledge in their own currency and makes it clear that these exchange rates apply to the currency in which the replenishment target is stated, i.e. the US$. 10

Section VII(e) VII. Payment of contributions (e) Encashment of promissory notes or similar obligations. In conformity with the provisions of article 4.5(c)(i) of the Agreement and regulation V of the Financial Regulations of IFAD, promissory notes or similar obligations of Members shall be encashed in accordance with the 100 per cent drawdown policy approved by the Executive Board at its seventy-first session or as agreed between the President and a contributing Member. Purpose: to further recognize the possibility of an alternative encashment arrangement in agreement with the President. 11

Section VIII VIII. Exercise of the advance commitment authority Effective 1 January 2013, when authorizing advance commitment of funds to be derived from operations pursuant to its power under article 7.2(b) of the Agreement, the Executive Board shall assess and determine the commitment capacity by matching financial obligations arising from commitments against projected cash inflows over the time horizon corresponding to the expected disbursement periods of the financing concerned. Purpose: to reflect that effective 1 January 2013, IFAD will move to the cash flow sustainability approach to authorizing advance commitment of funds. 12

Section IX(c) IX. Allocation of new votes for the replenishment (c) Communication of votes. The amount of votes created in accordance with subsection (a) above shall be communicated to all Members and reported to the Governing Council at its thirty-sixth session. Purpose: to satisfy some Members’ request for a mechanism through which the creation of new replenishment votes is communicated to the membership in order to avoid loss of information. 13

Section X X. Usage of complementary contributions Complementary contributions referred to in section III(b) of this resolution shall be used in accordance with this resolution. After the adoption of this resolution, the Executive Board may, from time to time, decide upon the use to be made of the complementary contributions so received. Purpose: This is a correction of a clerical omission in the previous version. 14

Thank you!