Abdullah Al-Hassan, Mary E. Burfisher, Mr. Julian T Chow, Ding Ding, Fabio Di Vittorio, Dmitriy Kovtun, Arnold McIntyre, Ms. Inci Ötker, Marika Santoro, Lulu Shui, and Karim Youssef
Deeper economic integration within the Caribbean has been a regional policy priority since the establishment of the Caribbean Community (CARICOM) and the decision to create the Caribbean Single Market and Economy (CSME). Implementation of integration initiatives has, however, been slow, despite the stated commitment of political leaders. The “implementation deficit” has led to skepticism about completing the CSME and controversy regarding its benefits. This paper analyzes how Caribbean integration has evolved, discusses the obstacles to progress, and explores the potential benefits from greater integration. It argues that further economic integration through liberalization of trade and labor mobility can generate significant macroeconomic benefits, but slow progress in completing the institutional arrangements has hindered implementation of the essential components of the CSME and progress in economic integration. Advancing institutional integration through harmonization and rationalization of key institutions and processes can reduce the fixed costs of institutions, providing the needed scale and boost to regional integration. Greater cooperation in several functional policy areas where the region is facing common challenges can also provide low-hanging fruit, creating momentum toward full integration as the Community continues to address the obstacles to full economic integration.
This paper presents a structural model of crime and output. Individuals make an occupational
choice between criminal and legal activities. The return to becoming a criminal is
endogenously determined in a general equilibrium together with the level of crime and
economic activity. I calibrate the model to the Northern Triangle countries and conduct
several policy experiments. I find that for a country like Honduras crime reduces GDP by
about 3 percent through its negative effect on employment indirectly, in addition to direct
costs of crime associated with material losses, which are in line with literature estimates.
Also, the model generates a non-linear effect of crime on output and vice versa. On average I
find that a one percent increase in output per capita implies about ½ percent decline in crime,
while a decrease of about 5 percent in crime leads to about one percent increase in output per
capita. These positive effects are larger if the initial level of crime is larger.
International Monetary Fund. Monetary and Capital Markets Department
This technical note on Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) regime in France summarizes the findings of a targeted review of France’s AML/CFT framework with respect to measures to prevent and combat terrorist financing (TF), risk-based supervision of banks, real estate agents, company service providers and lawyers, measures to tackle cross-border crimes, and fintech. It provides a factual update on the key measures taken by the authorities since France’s previous assessment. Authorities are recommended to promote stronger AML/CFT controls by enhancing supervision of lawyers and the real estate sector and providing more guidance on cross-border money laundering threats. French banks are employing increasingly sophisticated tools, including machine learning, to carry out their due diligence obligations with respect to TF. More systematic guidance on TF-related indicators and timely feedback may help banks’ detection of potential of TF and to reduce risks of financial exclusion.
Ms. Kimberly Beaton, Mr. Roberto Garcia-Saltos, and Mr. Lorenzo U Figliuoli
Abstract: Accelerating economic growth in Central America, Panama and the Dominican Republic (CAPDR) remains an elusive task. While the region performed relatively well in the post-global financial crisis period, over the last five years obstacles to growth have become more evident and new challenges have emerged. In response, the region has strengthened macro-financial frameworks but more progress will be required to pave the way to sustained growth and prosperity. This book considers the structural factors underlying the region’s growth outlook and assesses its macroeconomic and financial challenges to help shape the policy agenda going forward. The book first identifies the structural determinants of growth in the region related to: capital formation; employment; demographic factors, including immigration; productivity; and violence. It then highlights the importance of creating fiscal space through the design and implementation of fiscal rules and mechanisms to increase accountability (better quality of public spending, adequate policies to reduce income inequality and sustainable retirement plans). Finally, it presents recent evidence on the importance of a supportive financial sector for growth (including through financial inclusion and development).