A four-member delegation of the International Monetary Fund (IMF)’s ROSC (Report on Standards and Codes) will be in Israel on July 6-17, 2003, to conduct an appraisal of Israel's fiscal transparency.
The delegation will meet with the Minister of Finance, the governor of the Bank of Israel, senior officials in the ministries of finance, interior, housing, education, defense, State Comptroller, National Insurance, Central Bureau of Statistics, Bank of Israel and the Knesset Finance Committee.
In the wake of the financial crises in Asia, Russia and Latin America, the international financial institutions headed by the International Monetary Fund (IMF) and the World Bank (WB) together with the Organization of Economic Cooperation and Development (OECD), Bank for International Settlements (BIS) and other entities, decided to expand the cooperation between them.
They prepared an expanded set of rules for eleven different spheres as well as to increase the transparency in these spheres, which include: Rules of accounting, Rules of auditing, Rules of banking, Good governance, Data dissemination, Fiscal transparency, Insolvency and credit rights systems, Insurance regulation, Monetary and financial transparency policies
Payments systems, Securities market regulation.
Several years ago Israel joined the standard for data dissemination (SDDS). In 2000 a team from IMF and WB conducted an examination in Israel on the subject of FSSA - financial system stability assessment, and as part of this an assessment was made regarding compliance with the rules and the stability of the supervision of insurance and pensions, supervision of the banks, Securities Exchange authority, the clearing system in the central bank and also the transparency of the monetary policy and the transparency of the policy of the capital market and insurance division.
This examination, in spheres no. 3,8,9,10 and 11 as detailed in item 6 to this letter, and published in 2001, no doubt helped Israel maintain its financial stability during 2002.
Large investment bodies in the American and European markets are examining compliance with ROSC. Two years ago a large pension fund from California asked the British research body Oxford Analytica to examine Israel's standing regarding ROSC, as part of the requirements of the pension fund's board of directors to meet the criteria for investment/ continued investment in order to ensure proper transparency.
Oxford Analytica prepared a report on the subject of Israel with the assistance of the Ministry of Finance and the Bank of Israel and as a result of this report and further examination, the pension fund decided to continue investing in Israel.
Standards in some of the spheres have been determined by the OECD and Israel will have to adopt these standards and implement them upon acceptance to the OECD. Starting to implement them today will facilitate the preparation for acceptance to the OECD and will underscore Israel's serious intentions regarding membership.
The duration of the examinations by the IMF teams regarding standards, preparing a report on Israel in the various ROSC spheres and implementing them in a gradual and prudent manner will enhance the reliability of Israel's economy in the eyes of investors and will help increase investments in Israel.
The IMF, WB, OECD and FATF have agreed to enact an additional code regarding the prohibition of money laundering and to add to all the IMF delegations that are preparing the report according to article IV a team that will prepare ROSC regarding anti-money laundering and combating the financing of terrorism. The IMF team visited Israel in November 2002 and prepared a report on the prohibition of money laundering in Israel. — (menareport.com)
© 2003 Mena Report (www.menareport.com)
