Ms. Ghada Fayad, Chengyu Huang, Yoko Shibuya, and Peng Zhao
This paper applies state-of-the-art deep learning techniques to develop the first sentiment index measuring member countries’ reception of IMF policy advice at the time of Article IV Consultations. This paper finds that while authorities of member countries largely agree with Fund advice, there is variation across country size, external openness, policy sectors and their assessed riskiness, political systems, and commodity export intensity. The paper also looks at how sentiment changes during and after a financial arrangement or program with the Fund, as well as when a country receives IMF technical assistance. The results shed light on key aspects on Fund surveillance while redefining how the IMF can view its relevance, value added, and traction with its member countries.
International Monetary Fund. Western Hemisphere Dept.
This Selected Issues paper investigates the reasons for the growth pickup in Paraguay and explores the potential for sustainable future growth. It shows that the growth acceleration over the past 15 years is the combined result of a few factors: a bounce back from the crisis in the late 1990s and the subpar growth of the two decades prior; a benevolent external environment, the commodity price boom in particular; and the improved macroeconomic stability. Also in terms of its composition, growth in the past has largely been extensive, mostly coming from capital deepening and increasing labor inputs, rather than productivity increase, though total factor productivity growth has played a bigger role in the most recent years. Despite strong growth in recent years, like most of the Latin America, seen over a longer period, Paraguay has not attained significant economic convergence with advanced economies. Empirical data shows a strong linkage between the GDP per capita of a country and its score in a composite structural indicator such as the World Competitiveness Index, which Paraguay ranked poorly on. Identifying and correcting Paraguay’s structural deficiencies that may be hampering productivity growth and capital accumulation will be crucial for sustainable growth.
La croissance économique en Afrique subsaharienne est tombée en 2015 à son plus bas niveau depuis quinze ans, avec toutefois une grande disparité entre les pays de la région. La chute des cours des produits de base de ces dernières années a ébranlé beaucoup des plus grands pays d’Afrique subsaharienne, dont des pays exportateurs de pétrole tels que l'Angola et le Nigéria, et d'autres produits exportateurs de produits de base, tels que le Ghana, l'Afrique du Sud et la Zambie. La baisse des cours pétroliers a toutefois permis à d'autres pays de maintenir une croissance vigoureuse, dont le Kenya et le Sénégal. Dans de nombreux pays, il est urgent et essentiel de prendre des mesures robustes face aux chocs sur les termes de l'échange. Le rapport aborde également la vulnérabilité de l'Afrique subsaharienne face aux chocs sur les prix de base et note les avancées spectaculaires en matière de développement du secteur financier, et plus particulièrement dans le domaine des services financiers mobiles.
Economic growth in sub-Saharan Africa as a whole has fallen to its lowest level in 15 years, though with large variation among countries in the region. The sharp decline in commodity prices has severely strained many of the largest economies, including oil exporters Angola and Nigeria, and other commodity exporters, such as Ghana, South Africa, and Zambia. At the same time, the decline in oil prices has helped other countries continue to show robust growth, including Kenya and Senegal. A strong policy response to the terms-of-trade shocks is critical and urgent in many countries. This report also examines sub-Saharan Africa’s vulnerability to commodity price shocks, and documents the substantial progress made in financial develop, especially financial services based on mobile technologies.
Peru’s fiscal framework embedded in the Fiscal Responsibility and Transparency Law (FRTL) has proved to be effective in reducing debt. The FRTL embodies some countercyclical elements in response to output or commodity price shocks. The combination of a provision for a moderate deficit on the downside, and a current expenditure cap on the upside, allows for some countercyclical policy. It still has pockets of procyclicality in the face of large shocks to output or commodity prices.
The staff report on Canada’s 2009 Article IV Consultation examines economic developments and policies. Canadian banks have weathered the crisis better than major-country peers, but the credit cycle will be challenging, particularly given high household debt. Financial instability is a tail risk, but heightened vigilance is warranted. The Bank of Canada has appropriately loosened monetary policy, bringing the policy rate target to a record-low ½ percent. Macroeconomic policies have adopted an expansionary tilt, and authorities have taken steps to safeguard financial stability.
International Monetary Fund. External Relations Dept.
Eduardo Aninat assumed the office of IMF Deputy Managing Director on December 14, 1999. Before coming to the IMF, Aninat, a native of Chile, had served as Finance Minister of Chile from 1994 and chaired the Board of Governors of the IMF and the World Bank in 1995-96. Previously, he worked in the private sector and as a consultant for the World Bank and the Inter-American Development Bank. Aninat recently met with editors of the IMF Survey to talk about his experience with the IMF and his hopes and plans for the future.