Building Fiscal Institutions in Fragile States

By Katherine Baer, Sanjeev Gupta, Mario Pessoa

August 9, 2017

Version in Français (French)

A porter in the market in Kathmandu, Nepal: the country increased their tax revenues in recent years with the help of technical assistance (photo: Navesh Chitrakar/Newscom)

Fragile states face more obstacles to growth than most countries.  Their per-capita GDP is less than half of most other low-income countries, and their economies are more volatile.  Many are in conflict or going through a natural disaster, or just emerging from these.  Our study is based on 39 countries, and since completed, the number of fragile states has increased to 43. 

To grow, a country needs tax policies and tax administration, laws and institutions to formulate and execute a budget, and trained staff to implement fiscal policies, among other factors.  Our preliminary results show that fragile states that have received technical assistance, also have improved their fiscal performance.

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Stepping up the Fight Against Money Laundering and Terrorist Financing

By Christine Lagarde

July 26, 2017

Versions in ربي (Arabic),  中文 (Chinese), Français (French), Русский (Russian), and Español (Spanish)

Money laundering and terrorist financing threaten economic stability. International cooperation is vital in the fight against misuse of the financial system (photo: CraigRJD/iStock by Getty Images)


Corrupt officials, tax cheats, and the financial backers of terrorism have one thing in common: they often exploit vulnerabilities in financial systems to facilitate their crimes.

Money laundering and terrorist financing can threaten a country’s economic and financial stability while funding violent and illegal acts. That is why many governments have stepped up the fight against such practices, helped by international institutions such as the IMF.

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Heartbreak and Hardship—Finding a Way Out for Fragile States

War-torn Iraq, quake-ravaged Haiti, conflict-devastated Sierra Leone. So many countries around the world face the legacy of terrible hardships that have left them scarred and fragile. Some have questioned whether the IMF has a meaningful role to play in these countries, but they couldn’t be more wrong. A recent review found that the IMF has played an important positive role in fragile states. This doesn’t mean we always got it right. We can do better. There is plenty of scope to adapt how we engage in these countries; to be more flexible and deepen cooperation with other development partners. In this post, Dominique Desruelle discusses a few ideas that we’ll be exploring—and discussing with stakeholders—in the months ahead, including at a high-level public seminar in Washington later this month.

By | September 7th, 2011|concessional lending, IMF, International Monetary Fund, LICs, Low-income countries|
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