International Monetary Fund. Middle East and Central Asia Dept.
Countries in the Middle East, North Africa, Afghanistan, and Pakistan (MENAP) region and those in the Caucasus and Central Asia (CCA) responded to the COVID-19 pandemic with swift and stringent measures to mitigate its spread and impact but continue to face an uncertain and difficult environment. Oil exporters were particularly hard hit by a “double-whammy” of the economic impact of lockdowns and the resulting sharp decline in oil demand and prices. Containing the health crisis, cushioning income losses, and expanding social spending remain immediate priorities. However, governments must also begin to lay the groundwork for recovery and rebuilding stronger, including by addressing legacies from the crisis and strengthening inclusion.
Marco A Espinosa-Vega, Ms. Kazuko Shirono, Mr. Hector Carcel Villanova, Miss Esha Chhabra, Ms. Bidisha Das, and Ms. Yingjie Fan
This departmental paper marks the 10th anniversary of the IMF Financial Access Survey (FAS). It offers a retrospective of the FAS database, along with some reflections as to its future directions.
Since its 2009 launch, the FAS has provided granular data on access to and use of financial services. It is a supply-side database with annual global coverage based on data sourced directly from financial service providers—aimed at supporting policymakers to target and evaluate financial inclusion policies. Its data collection has kept pace with financial innovation, such as the rise of mobile money and growing demand for gender-disaggregated data—and the FAS must continue to evolve.
Amine Hammadi, Marshall Mills, Nelson Sobrinho, Mr. Vimal V Thakoor, and Ricardo Velloso
Countries in Sub-Saharan Africa (SSA) tend to lag those in most other regions in terms of
governance and perceptions of corruption. Weak governance undermines economic
performance through various channels, including deficiencies in government functions and
distortions to economic incentives. It thus stands to reason that SSA countries could
strengthen their economic performance by improving governance and reducing corruption.
This paper estimates that strengthening governance and mitigating corruption in the region
could be associated with large growth dividends in the long run. While the process would
take considerable time and effort, moving the average SSA country governance level to the
global average could increase the region’s GDP per capita growth by about 1-2 percentage
This paper provides an empirical analysis of how the frequency and severity of terrorism affect
government revenue and expenditure during the period 1970–2013 using a panel dataset on
153 countries. We find that terrorism has only a marginal negative effect on tax revenue
performance, after controlling for economic and institutional factors. This effect is also not
robust to alternative specifications and empirical strategies. On the other hand, we find strong
evidence that terrorism is associated with an increase in military spending as a percent of GDP
(and a share of total government expenditure). Our estimations reveal that this impact is
greater when terrorist attacks are frequent and result in a large number of fatalities. Empirical
findings also support the view that public finances in developing and low-income countries
are more vulnerable to terrorism than those in countries that are richer and diversified.
The estimated spillover of the global crisis to emerging market (EM) economies in the Middle East and North Africa (MENA) indicates that nearly two-thirds of the increased financial stress in MENA EM countries after the Lehman shock is attributable to direct or indirect spillovers of financial stress in advanced economies. Moreover, the estimated models suggest that the increased financial stress and slowdown in economic activity in advanced economies can explain about half of the drop in real GDP growth in MENA EM countries after the Lehman shock.
This paper discusses key findings of the Report on the Observance of Standards and Codes on Data Module for Pakistan. Based on the review of Pakistan’s statistical practices, recommendations are made that are aimed at strengthening Pakistan’s adherence to the internationally accepted practices, as well as at enhancing the usefulness of its monetary statistics. For the central bank’s survey, it is recommended to revalue the State Bank of Pakistan’s Fund positions and gold assets on a monthly basis at end-month market exchange rates and market gold prices.
This paper presents three empirical approaches to forecasting inflation in Pakistan. The preferred approach is a leading indicators model in which broad money growth and private sector credit growth help forecast inflation. A univariate approach also yields reasonable forecasts, but seems less suited to capturing turning points. A vector autoregressive (VAR) model illustrates how monetary developments can be described by a Phillips-curve type relationship. We deal with potential parameter instability on account of fundamental changes in Pakistan's economic system by restricting our sample to more recent observations. Gregorian and Islamic calendar seasonality are addressed by using 12-month moving averages.
International Monetary Fund. External Relations Dept.
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