July 28, 2017
We have just released our latest assessments of external positions for the 29 largest economies. As discussed in this year’s External Sector Report, excess current account imbalances—that is, those beyond the levels warranted by country fundamentals—were broadly unchanged in 2016. They represented about one-third of total actual surpluses and deficits, with only small shifts in 2016. Continue reading “Global Imbalances: Avoiding a Tragedy of the Commons” »
By Poul Thomsen
July 27, 2017
In many ways, Central, Eastern, and Southeastern Europe is an incredible success story. In less than a generation, countries moved from centrally-planned economies to market-based ones—transforming their legal systems, public administrations, and economic policies, to name a few key elements. Yet, for the sake of higher growth in the future, countries need to continue enhancing institutions and good governance.
Enhancing institutions and good governance—the efficient governing of a country—remains at the core of the reform agenda to raise prosperity to advanced European living standards. Many countries have joined the European Union, a vital anchor toward these goals, and others are aspiring to join. Continue reading “Central, Eastern, and Southeastern Europe: Harnessing the Power of Good Governance” »
July 25, 2017
After disappointing growth over the past few years, economic activity in Latin America remains on track to recover gradually in 2017–18 as recessions in a few countries—notably Argentina and Brazil—are coming to an end. Our latest projections show the region growing by 1 percent in 2017 and 1.9 percent in 2018.
But amid low confidence, domestic demand continues to remain weak across most economies, and is expected to only recover slowly as actual output catches up to potential and internal sources of growth build strength, based on a decline in political and policy uncertainty across some major economies. Some countries in the region will need clear strategies to adjust further following a permanent loss in commodity revenues. Continue reading “Latest Outlook for The Americas: Back on Cruise Control, But Stuck in Low Gear” »
July 17, 2017
Vietnam’s demographic dividend is fast turning into a handicap.
For decades, working-age Vietnamese made up an expanding share of the population, boosting economic growth and helping to keep retirement and health spending in check. Continue reading “Chart of the Week: A Golden Aging for Vietnam?” »
July 14, 2017
Corruption can lead to pervasive distrust in government, generating violence, civil strife, and conflict. And the results are devastating for people.
Another problem is that corruption is costly—particularly for those who are already worse off. IMF research shows that in countries with greater levels of corruption, infant mortality and dropout rates are especially high, partly due to less spending on health and education. Reduced investment in these areas tends to hurt poor people the most, and contributes to higher inequality. Continue reading “Corrosive and Costly Corruption” »
June 26, 2017
Current account imbalances can be healthy or a sign of macroeconomic and financial stress—which makes their evaluation tricky. In line with its mandate of promoting international monetary cooperation, the IMF conducts annual external assessments for the world’s largest economies. The objective is to alert the global community to potential risks that countries need to address together.
Countries, like households, may spend above their incomes sometimes, and below them at other times. A country that spends above its income imports more goods and services than it exports and is said to have a current account deficit. It finances this deficit by incurring liabilities to the rest of the world, or by borrowing from it. Continue reading “Assessing Global Imbalances: The Nuts and Bolts” »
June 20, 2017
When you send an email, it takes one click of the mouse to deliver a message next door or across the planet. Gone are the days of special airmail stationery and colorful stamps to send letters abroad.
International payments are different. Destination still matters. You might use cash to pay for a cup of tea at a local shop, but not to order tea leaves from distant Sri Lanka. Depending on the carrier, the tea leaves might arrive before the seller can access the payment. Continue reading “Fintech: Capturing the Benefits, Avoiding the Risks” »
June 12, 2017
Some of the world’s top policymakers and investors are gathering in Berlin to discuss a new initiative that could help reshape Africa’s economic future.
Millions of citizens could see tangible economic benefits from the recently launched Group of Twenty advanced and emerging economies' initiative, known as the “Compact with Africa.” The goal is to boost private investment by harnessing the expertise and resources of governments, investors, and international organizations.
The Compact is about facilitating projects that can lift productivity and living standards. It is about creating fresh opportunities on a continent where 70 percent of the population is under 35 years of age.
June 9, 2017
As Managing Director of the IMF, Christine Lagarde travels the world engaging with country officials, civil society, nongovernmental organizations, and media representatives. Lagarde also makes a point to engage with women and youth groups, to listen to their concerns, and to discuss their vision for their countries.