The most recent decade has seen a growing presence of banks headquartered in advanced economies (AEs) expanding into emerging markets (EMs). These expansions have brought some benefits to both home and host countries, but the global financial crisis has also unmasked significant vulnerabilities inherent in such relationships.
In keeping with past cross-cutting themes papers, this paper focuses on the experiences of four medium-sized ?home countries,? each with significant retail banking links to EMs—Austria, Belgium, the Netherlands, and Spain. These countries were chosen because of their banks' diverse approaches to EM expansion (including the centralization of their funding models) and equally diverse crisis outcomes (fears over Eastern European exposures resulted in extraordinary policy efforts to maintain bank lending), providing fertile ground for analysis and for drawing lessons in the future.
In light of the multilateral effort to ensure the adequacy of the financial resources available to the International Monetary Fund, and with a view to supporting the Fund’s ability to provide timely and effective balance of payments assistance to its members, the National Bank of Belgium agrees to lend to the Fund an SDR denominated amount up to the equivalent of EUR 4.74 billion, on the terms and conditions set out in this policy paper.
Effective November 12, 2012, the Fund, as Trustee of the Poverty Reduction and Growth Trust (PRGT), entered into a borrowing agreement (the “Agreement”) with the National Bank of Belgium, by which Belgium will provide new loan resources of up to SDR 350 million (see attachment). With this Agreement, the Fund has concluded fourteen new borrowing agreements providing total resources of SDR 9,811 million in the context of fundraising under the 2009 Low-Income Countries (LICs) financing package.
International Monetary Fund. Strategy, Policy, & and Review Department
"The first data and statistics strategy for the Fund comes at a critical time. A fast-changing data landscape, new data needs for evolving surveillance priorities, and persisting data weaknesses across the membership pose challenges and opportunities for the Fund and its members. The challenges emerging from the digital revolution include an unprecedented amount of new data and measurement questions on growth, productivity, inflation, and welfare. Newly available granular and high-frequency (big) data offer the potential for more timely detection of vulnerabilities. In the wake of the crisis, Fund surveillance requires greater cross-country data comparability; staff and authorities face the complexity of integrating new data sources and closing data gaps, while working to address the weaknesses noted by the IEO Report (Behind the Scenes with Data at the IMF) in 2016.
The overarching strategy is to move toward an ecosystem of data and statistics that enables the Fund and its members to better meet the evolving data needs in a digital world. It integrates Fund-wide work streams on data provision to the Fund for surveillance purposes, international statistical standards, capacity development, and data management under a common institutional objective. It seeks seamless access and sharing of data within the Fund, enabling cloud-based data dissemination to support data provision by member countries (e.g., the “global data commons”), closing data gaps with new sources including Big Data, and improving assessments of data adequacy for surveillance to help better prioritize capacity development. The Fund also will work with policymakers to understand the implications of the digital economy and digital data for the macroeconomic statistics, including new measures of welfare beyond GDP."
Immediately following the effectiveness of the decisions on the Multilateral Debt Relief Initiative (MDRI) and the Exogenous Shocks Facility (ESF), debt relief totaling SDR 2.3 billion was delivered to 19 qualifying members, including 17 countries under the enhanced Heavily Indebted Poor Countries (HIPC) Initiative and two non-HIPCs, on January 6, 2006, with financing from the HIPC Umbrella sub-accounts and the newly established MDRI Trusts.
Provides the basis for the semi-annual decision on the adequacy of the Reserve Account of the PRGF Trust. It also updates the status of resources for financing PRGF operations and the HIPC Initiative and bilateral contributions to the subsidization of emergency assistance.
In March 2009, the Fund established a new Framework Administered Account to administer external financial resources for selected Fund Activities (the “SFA Instrument”). The financing of activities under the terms of the SFA Instrument is implemented through the establishment and operation of a subaccount within the SFA. This paper requests Executive Board approval to establish the Belgium Subaccount for Selected Fund Activities (the “Subaccount”) under the terms of the SFA instrument.
Risks to macroeconomic stability posed by excessive private leverage are significantly amplified by tax distortions. ‘Debt bias’ (tax provisions favoring finance by debt rather than equity) has increased leverage in both the household and corporate sectors, and is now widely recognized as a significant macroeconomic concern.
This paper presents new evidence of the extent of debt bias, including estimates for banks and non-bank financial institutions both before and after the global financial crisis. It presents policy options to alleviate debt bias, and assesses their effectiveness. The paper finds that thin capitalization rules restricting interest deductibility have only partially been able to address debt bias, but that an allowance for corporate equity has generally proved effective. The paper concludes that debt bias should feature prominently in countries’ tax reform plans in the coming years.