IMF Staff Completes Governance and Corruption Diagnostic Mission to Nepal

Washington, DC – May 7, 2026: At the request of the Government of Nepal, an IMF capacity development team led by Jonathan Pampolina visited Kathmandu and Birgunj from April 20 to May 6, 2026, to conduct a Governance and Corruption Diagnostic (GCD). Building on the scoping mission last January 12–21, 2026 and the structural reform agenda under the current Extended Credit Facility, the GCD marks a significant milestone in Nepal’s engagement with the IMF to strengthen governance, reduce corruption vulnerabilities, and advance macroeconomic stability and inclusive growth.

The GCD is designed to identify macro-critical governance weaknesses in institutions, policies, and practices that can undermine economic performance, fiscal sustainability, business and investment climate, and public trust. The GCD will provide concrete, well-sequenced, and prioritized reform recommendations to address corruption risks, that are binding constraints on Nepal’s economic development. Following the election of a single majority government with a strong reform mandate, Nepal has a unique window of opportunity to advance a transformative governance agenda and unlock stronger, more inclusive medium-term growth.

Reflecting the breadth of the GCD, the mission brought together experts from several IMF departments, including Fiscal Affairs, Monetary and Capital Markets, and Legal. The team worked closely with government counterparts and other stakeholders to assess governance and corruption vulnerabilities across core state functions, consistent with the IMF’s 2018 Governance Framework.

The team held extensive discussions with Nepali authorities responsible for public financial management (including budget, public investment management, state-owned enterprises, and public procurement), revenue administration (tax and customs), financial sector oversight, anti-money laundering, and rule of law. Engagements with anti-corruption and oversight institutions focused on the effectiveness of legal and institutional frameworks to prevent, detect, and address macro-critical corruption risks.

The team also consulted broadly with representatives from civil society organizations, academicians, think tanks, private sector, business associations, and international development partners. These discussions provided valuable perspectives on governance challenges, reform priorities, and opportunities to strengthen accountability, transparency, and trust in public institutions.

The IMF team would like to thank the Nepali authorities and all stakeholders for their strong engagement, gracious welcome, and open, candid, and constructive dialogue.

Collaboration on the GCD will continue after the main mission. A draft report setting out the findings and proposing a sequenced and prioritized reform plan is expected to be shared with the authorities for further input in the coming months. The final report will be published, upon authorities’ consent.

See the IMF’s Frequently Asked Questions on Governance Diagnostics.