public finances – Page 2

Fiscal Policy in Latin America: Prudence Today Means Prosperity Tomorrow

IMFBlog2017-04-14T02:13:03-04:00December 11, 2013|

Public finances in most Latin American countries strengthened significantly before the global financial crisis. Since 2009, countries have generally increased public deficits, drawing down on their fiscal coffers.

These expansionary policies continue and are yet to be reversed. With further pressures likely to build over the period ahead—as economic growth has slowed, commodity prices have softened, and external funding costs are bound to rise—now is the right time to rethink fiscal policies across the region.

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Europe’s Choice: Risk Stagnation or Pursue Integration

IMFBlog2017-04-14T02:15:43-04:00October 11, 2013|

By Nemat Shafik

Europe faces a stark choice: risk stagnation or pursue integration. It can continue to muddle through, and hope that growth in the world economy will eventually pick up enough steam to pull its economy out of the doldrums. Or it can make a decisive push to revitalize its economy and complete the reforms needed to achieve a fully integrated economic and monetary union

Five years into the crisis, recovery in the euro area remains fragile. Important actions at both the national and euro-wide levels have tackled the immediate threats to the single currency. These include the European Central Bank’s announcement in 2012 that it stands ready to undertake outright monetary transactions in secondary sovereign bond markets, the completion of the European Stability Mechanism, which created a financial firewall around the euro area, and efforts to restore the health of public finances and implement structural reforms.

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Strengthening the Foundations for Fiscal Policymaking: A New Fiscal Transparency Code

IMFBlog2017-04-15T13:35:07-04:00July 3, 2013|

By Min Zhu

In the last two decades, countries have come a long way in shedding greater light on their public finances. The global economic crisis has reminded us, however, that we need to do more to ensure fiscal policymaking is based on reliable data on fiscal outcomes, credible forecasts of fiscal prospects, and a comprehensive assessment of fiscal risks. Working with civil society, governments, and others, the IMF has just presented a revised draft of its Fiscal Transparency Code, and we would like to know what you think of it so we can improve it further. You can comment here.

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Growing Pains: Europe’s Dilemma

IMFBlog2017-04-15T14:16:44-04:00October 21, 2011|

By Bas Bakker

(Versions in Español and Français )

As the crisis in Europe deepens, it is worth asking how it all went wrong in the first place. In the past decade there have been stark differences in per capita GDP growth in Europe. Growth rates have ranged from close to zero in Italy and Portugal to more than 4 percent in the best performers. Why do some countries in Europe grow much faster than others? And how can those falling behind catch up before it is too late?

In part, these differences reflect “convergence”. It is much easier for poor countries to grow faster than it is for rich countries because they can import technology they do not already have. It is much more difficult to grow fast if you are already rich and at the technology frontier—now you can only get richer by innovation.

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Subsidies—Love Them or Hate Them, It’s Better to Target Them

IMFBlog2017-04-15T14:24:20-04:00May 10, 2011|

For decades, countries in the Middle East and North Africa have relied heavily on food and fuel price subsidies as a form of social protection. And, understandably, governments have recently raised subsidies in response to hikes in global commodity prices and regional political developments. Like many things, there may be a time and a place for using subsidies. But, they need to be better targeted. And, often, there will be better alternatives. Alternatives that do a better job of protecting the poor. Subsidies enjoyed by all are typically poorly targeted, so they are not the most cost-effective way to provide social protection. They really should be regarded as stop-gap measures. But, better targeting subsidies or replacing them with more effective social safety nets is a complex process, so buy-in from the public is crucial to success.