1. The global financial crisis (GFC) and international efforts to address preferential tax regimes triggered a major crisis that ended San Marino’s banking business model. This was based on an oversized financial sector servicing nonresident. The banking crisis had major spillovers on the nonfinancial sector that were magnified by the blacklisting of San Marino as a jurisdiction with a preferential tax regime during 2010–14. The crisis lasted from 2008 to 2014 when the financial sector lost 80 percent and the nonfinancial sector lost 15 percent of the value added.
The authorities of the Republic of San Marino express their appreciation for the cooperative discussions held with Fund staff during the Article IV consultation. They broadly concur with the staff’s analysis and will continue to rely on the Fund’s recommendations to strengthen economic growth, safeguard financial stability and maintain sound public finances. The authorities welcome the staff’s recognition that their policy efforts have been instrumental to boosting long-term growth perspectives and increasing the resilience of the economy to shocks.
Measuring reserves and assessing international reserves adequacy in fully dollarized