Government policies matter when it comes to public health. And when a country’s economy is suffering a severe economic crisis, the decisions become even more critical. Over the past few decades, protecting social programs and spending on health has been a cornerstone of the IMF’s support for countries.
(Version in Türk)
Turkey is going through a time of economic transition, with slowing growth that risks the country being caught in a “middle-income trap,” unable to join the ranks of high income economies.
The country grew at 6 percent per year on average in the period 2010-13, with policies supportive of domestic consumption. This has generated a large current account deficit, mostly financed by short-term capital flows. The reliance on consumption at the expense of investment, slow export growth, and sizable investment needs have hurt potential growth, with the economy already growing more modestly. Moreover, Turkey’s low domestic savings and competitiveness challenges have limited investment as well as exports, which have also suffered from the slow growth in Europe.
With current policies, Turkey's economy is expected to grow only 3.5 percent annually over the next five years. Going forward, the economy must be rebalanced to make it more competitive and to restore output and employment growth.
By Anoop Singh
Emerging economies in Asia have weathered the global financial crisis relatively unscathed and appear to be on track for continued strong growth this year and the next. Perhaps because the region has been doing rather well, policymakers’ concerns have increasingly shifted towards medium-term risks: could growth and fast convergence to living standards in advanced economies—come to an end?
In fact, while the economic performance of emerging economies in Asia remains undoubtedly strong in international comparison, it has already shown signs of gradual weakening.
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.