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International Monetary Fund. Research Dept.
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Keywords:
WEO; commodity; economy; emerging market; commodity exporter; commodity price; U.S. dollar; debtor economy; advanced economy; Commodity prices; Emerging and frontier financial markets; Exchange rates; Global; Middle East; North Africa; Sub-Saharan Africa; Caribbean
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Abstract

The Statistical Appendix presents historical data as well as projections. It comprises six sections: Assumptions, What’s New, Data and Conventions, Classification of Countries, Key Data Documentation, and Statistical Tables.

Statistical Appendix

The Statistical Appendix presents historical data as well as projections. It comprises six sections: Assumptions, What’s New, Data and Conventions, Classification of Countries, Key Data Documentation, and Statistical Tables.

The assumptions underlying the estimates and projections for 2015–16 and the medium-term scenario for 2017–20 are summarized in the first section. The second section presents a brief description of the changes to the database and statistical tables since the April 2015 World Economic Outlook (WEO). The third section provides a general description of the data and the conventions used for calculating country group composites. The classification of countries in the various groups presented in the WEO is summarized in the fourth section. The fifth section provides information on methods and reporting standards for the member countries’ national account and government finance indicators included in the report.

The last, and main, section comprises the statistical tables. (Statistical Appendix A is included here; Statistical Appendix B is available online.) Data in these tables have been compiled on the basis of information available through September 16, 2015. The figures for 2015 and beyond are shown with the same degree of precision as the historical figures solely for convenience; because they are projections, the same degree of accuracy is not to be inferred.

Assumptions

Real effective exchange rates for the advanced economies are assumed to remain constant at their average levels measured during the period July 27 to August 24, 2015. For 2015 and 2016, these assumptions imply average U.S. dollar/special drawing right (SDR) conversion rates of 1.402 and 1.408, U.S. dollar/euro conversion rates of 1.113 and 1.118, and yen/U.S. dollar conversion rates of 121.4 and 121.1, respectively.

It is assumed that the price of oil will average $51.62 a barrel in 2015 and $50.36 a barrel in 2016.

Established policies of national authorities are assumed to be maintained. The more specific policy assumptions underlying the projections for selected economies are described in Box A1.

With regard to interest rates, it is assumed that the London interbank offered rate (LIBOR) on six-month U.S. dollar deposits will average 0.4 percent in 2015 and 1.2 percent in 2016, that three-month euro deposits will average 0.0 percent in 2015 and 2016, and that six-month yen deposits will average 0.1 percent in 2015 and 2016.

As a reminder, with respect to introduction of the euro, on December 31, 1998, the Council of the European Union decided that, effective January 1, 1999, the irrevocably fixed conversion rates between the euro and currencies of the member countries adopting the euro are as follows:

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Established on January 1, 2008.

Established on January 1, 2011.

Established on January 1, 2001.

Established on January 1, 2014.

Established on January 1, 2015.

Established on January 1, 2009.

Established on January 1, 2007.

See Box 5.4 in the October 1998 WEO for details on how the conversion rates were established.

What’s New

  • Data for Lithuania are now included in the euro area aggregates, but they were excluded in the April 2015 WEO.

  • Projections for Greece are based on data available as of August 12, 2015.

  • As in the April 2015 WEO, data for Syria are excluded from 2011 onward because of the ongoing conflict and the related lack of data.

Data and Conventions

Data and projections for 189 economies form the statistical basis of the WEO database. The data are maintained jointly by the IMF’s Research Department and regional departments, with the latter regularly updating country projections based on consistent global assumptions.

Although national statistical agencies are the ultimate providers of historical data and definitions, international organizations are also involved in statistical issues, with the objective of harmonizing methodologies for the compilation of national statistics, including analytical frameworks, concepts, definitions, classifications, and valuation procedures used in the production of economic statistics. The WEO database reflects information from both national source agencies and international organizations.

Most countries’ macroeconomic data presented in the WEO conform broadly to the 1993 version of the System of National Accounts (SNA). The IMF’s sector statistical standards—the sixth edition of the Balance of Payments and International Investment Position Manual (BPM6), the Monetary and Financial Statistics Manual (MFSM 2000), and the Government Finance Statistics Manual 2001 (GFSM 2001)—have been or are being aligned with the SNA 2008.1 These standards reflect the IMF’s special interest in countries’ external positions, financial sector stability, and public sector fiscal positions. The process of adapting country data to the new standards begins in earnest when the manuals are released. However, full concordance with the manuals is ultimately dependent on the provision by national statistical compilers of revised country data; hence, the WEO estimates are only partially adapted to these manuals. Nonetheless, for many countries the impact, on major balances and aggregates, of conversion to the updated standards will be small. Many other countries have partially adopted the latest standards and will continue implementation over a period of years.

Composite data for country groups in the WEO are either sums or weighted averages of data for individual countries. Unless noted otherwise, multiyear averages of growth rates are expressed as compound annual rates of change.2 Arithmetically weighted averages are used for all data for the emerging market and developing economies group except data on inflation and money growth, for which geometric averages are used. The following conventions apply:

  • Country group composites for exchange rates, interest rates, and growth rates of monetary aggregates are weighted by GDP converted to U.S. dollars at market exchange rates (averaged over the preceding three years) as a share of group GDP.

  • Composites for other data relating to the domestic economy, whether growth rates or ratios, are weighted by GDP valued at purchasing power parity as a share of total world or group GDP.3

  • Unless noted otherwise, composites for all sectors for the euro area are corrected for reporting discrepancies in intra-area transactions. Annual data are not adjusted for calendar-day effects. For data prior to 1999, data aggregations apply 1995 European currency unit exchange rates.

  • Composites for fiscal data are sums of individual country data after conversion to U.S. dollars at the average market exchange rates in the years indicated.

  • Composite unemployment rates and employment growth are weighted by labor force as a share of group labor force.

  • Composites relating to external sector statistics are sums of individual country data after conversion to U.S. dollars at the average market exchange rates in the years indicated for balance of payments data and at end-of-year market exchange rates for debt denominated in currencies other than U.S. dollars.

  • Composites of changes in foreign trade volumes and prices, however, are arithmetic averages of percent changes for individual countries weighted by the U.S. dollar value of exports or imports as a share of total world or group exports or imports (in the preceding year).

  • Unless noted otherwise, group composites are computed if 90 percent or more of the share of group weights is represented.

Data refer to calendar years, except in the case of a few countries that use fiscal years. Please refer to Table F, which lists the economies with exceptional reporting periods for national accounts and government finance data for each country.

Table A.

Classification by World Economic Outlook Groups and Their Shares in Aggregate GDP, Exports of Goods and Services, and Population, 20141

(Percent of total for group or world)

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The GDP shares are based on the purchasing-power-parity valuation of economies’ GDP. The number of economies comprising each group reflects those for which data are included in the group aggregates.

Georgia, Turkmenistan, and Ukraine, which are not members of the Commonwealth of Independent States, are included in this group for reasons of geography and similarity in economic structure.

South Sudan is omitted from the net external position groups composite for lack of a fully developed database.

Table B.

Advanced Economies by Subgroup

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On July 1, 1997, Hong Kong was returned to the People’s Republic of China and became a Special Administrative Region of China.

Table C.

European Union

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Table D.

Emerging Market and Developing Economies by Region and Main Source of Export Earnings

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Turkmenistan, which is not a member of the Commonwealth of Independent States, is included in this group for reasons of geography and similarity in economic structure.

Table E.

Emerging Market and Developing Economies by Region, Net External Position, and Status as Heavily Indebted Poor Countries and Low-Income Developing Countries

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Dot (star) indicates that the country is a net creditor (net debtor).

Dot instead of star indicates that the country has reached the completion point.

Georgia, Turkmenistan, and Ukraine, which are not members of the Commonwealth of Independent States, are included in this group for reasons of geography and similarity in economic structure.

South Sudan is omitted from the net external position group composite for lack of a fully developed database.

Table F.

Economies with Exceptional Reporting Periods1

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Unless noted otherwise, all data refer to calendar years.

For some countries, the figures for 2014 and earlier are based on estimates rather than actual outturns. Please refer to Table G, which lists the latest actual outturns for the indicators in the national accounts, prices, government finance, and balance of payments indicators for each country.

Table G.

Key Data Documentation

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Note: BPM = Balance of Payments Manual (number in parentheses following abbreviation signifies edition); CPI = consumer price index; ESA = European System of National Accounts; SNA = System of National Accounts.

BEA = U.S. Bureau of Economic Analysis; CB = Central Bank; FEO = Foreign Exchange Office; IFS = IMF, International Financial Statistics; MEP = Ministry of Economy and/or Planning; MIAC = Ministry of Internal Affairs and Communications; MoC = Ministry of Commerce; MoF = Ministry of Finance; NESDB = National Economic and Social Development Board; NSO = National Statistics Office; OECD = Organisation for Economic Co-operation and Development; PFTAC = Pacific Financial Technical Assistance Centre; PMO = Prime Minister’s Office; SAFE = State Administration of Foreign Exchange.

National accounts base year is the period with which other periods are compared and the period for which prices appear in the denominators of the price relationships used to calculate the index.

Use of chain-weighted methodology allows countries to measure GDP growth more accurately by reducing or eliminating the downward biases in volume series built on index numbers that average volume components using weights from a year in the moderately distant past.

For some countries, the structures of government consist of a broader coverage than specified for the general government. Coverage: BCG = Budgetary Central Government; CG = Central Government; LG = Local Government; MPC = Monetary Public Corporation, including Central Bank; NMPC = Nonmonetary Financial Public Corporations; NFPC = Nonfinancial Public Corporations; SG = State Government; SS = Social Security Funds; TG = Territorial Governments.

Accounting Standard: A = Accrual; C = Cash.

Nominal GDP is not measured in the same way as real GDP.

Classification of Countries

Summary of the Country Classification

The country classification in the WEO divides the world into two major groups: advanced economies and emerging market and developing economies.4 This classification is not based on strict criteria, economic or otherwise, and it has evolved over time. The objective is to facilitate analysis by providing a reasonably meaningful method of organizing data. Table A provides an overview of the country classification, showing the number of countries in each group by region and summarizing some key indicators of their relative size (GDP valued by purchasing power parity, total exports of goods and services, and population).

Some countries remain outside the country classification and therefore are not included in the analysis. Anguilla, Cuba, the Democratic People’s Republic of Korea, and Montserrat are examples of countries that are not IMF members, and their economies therefore are not monitored by the IMF. Somalia is omitted from the emerging market and developing economies group composites because of data limitations.

General Features and Composition of Groups in the World Economic Outlook Classification

Advanced Economies

The 37 advanced economies are listed in Table B. The seven largest in terms of GDP based on market exchange rates—the United States, Japan, Germany, France, Italy, the United Kingdom, and Canada—constitute the subgroup of major advanced economies often referred to as the Group of Seven (G7). The members of the euro area are also distinguished as a subgroup. Composite data shown in the tables for the euro area cover the current members for all years, even though the membership has increased over time.

Table C lists the member countries of the European Union, not all of which are classified as advanced economies in the WEO.

Emerging Market and Developing Economies

The group of emerging market and developing economies (152) includes all those that are not classified as advanced economies.

The regional breakdowns of emerging market and developing economies are Commonwealth of Independent States (CIS), emerging and developing Asia, emerging and developing Europe (sometimes also referred to as “central and eastern Europe”), Latin America and the Caribbean (LAC), Middle East, North Africa, Afghanistan, and Pakistan (MENAP), and sub-Saharan Africa (SSA).

Emerging market and developing economies are also classified according to analytical criteria. The analytical criteria reflect the composition of export earnings and a distinction between net creditor and net debtor economies. The detailed composition of emerging market and developing economies in the regional and analytical groups is shown in Tables D and E.

The analytical criterion source of export earnings distinguishes between categories fuel (Standard International Trade Classification [SITC] 3) and nonfuel and then focuses on nonfuel primary products (SITCs 0, 1, 2, 4, and 68). Economies are categorized into one of these groups when their main source of export earnings exceeded 50 percent of total exports on average between 2010 and 2014.

The financial criteria focus on net creditor economies, net debtor economies, heavily indebted poor countries (HIPCs), and low-income developing countries (LIDCs). Economies are categorized as net debtors when their latest net international investment position, where available, was less than zero or their current account balance accumulations from 1972 (or earliest available data) to 2014 were negative. Net debtor economies are further differentiated on the basis of experience with debt servicing.5

The HIPC group comprises the countries that are or have been considered by the IMF and the World Bank for participation in their debt initiative known as the HIPC Initiative, which aims to reduce the external debt burdens of all the eligible HIPCs to a “sustainable” level in a reasonably short period of time.6 Many of these countries have already benefited from debt relief and have graduated from the initiative.

The LIDCs are countries that were designated as eligible to use the IMF’s concessional financing resources under the Poverty Reduction and Growth Trust (PRGT) in the 2013 PRGT eligibility review and had a level of per capita gross national income less than the PRGT income graduation threshold for non–small states (that is, twice the World Bank International Development Association operational threshold, or US$2,390 in 2011 as measured by the World Bank’s Atlas method) and Zimbabwe.

Economic Policy Assumptions Underlying the Projections for Selected Economies

Fiscal Policy Assumptions

The short-term fiscal policy assumptions used in the World Economic Outlook (WEO) are based on officially announced budgets, adjusted for differences between the national authorities and the IMF staff regarding macroeconomic assumptions and projected fiscal outturns. The medium-term fiscal projections incorporate policy measures that are judged likely to be implemented. For cases in which the IMF staff has insufficient information to assess the authorities’ budget intentions and prospects for policy implementation, an unchanged structural primary balance is assumed unless indicated otherwise. Specific assumptions used in regard to some of the advanced economies follow. (See also Tables B5 to B9 in the online section of the Statistical Appendix for data on fiscal net lending/borrowing and structural balances.)1

Argentina: Fiscal projections are based on the available information regarding budget outturn for the federal government and budget plans for provinces and on IMF staff macroeconomic projections.

Australia: Fiscal projections are based on Australian Bureau of Statistics data, the 2015–16 budget documents, and IMF staff estimates.

Austria: For 2014, the creation of a defeasance structure for Hypo Alpe Adria is assumed to increase the general-government-debt-to-GDP ratio by 4.3 percentage points, and the deficit effect arising from Hypo is assumed to be 1.4 percentage points.

Belgium: Projections reflect the authorities’ 2015 budget (updated for new developments) and the 2015–18 Stability Programme objectives, adjusted for differences in the IMF staff’s macroeconomic framework.

Brazil: For 2014, outturn estimates are based on the information available as of February 2015. Projections for 2015 take into account budget performance until April 2015, adjustment measures approved by the Congress and the Senate through May 2015, and the budget freeze (contingeciamento) announced by the government at the end of May 2015. In outer years, projections are consistent with the announced primary surplus objectives.

Canada: Projections use the baseline forecasts in the Economic Action Plan 2015 and 2015 provincial budgets as available. The IMF staff makes adjustments to this forecast for differences in macroeconomic projections. The IMF staff forecast also incorporates the most recent data releases from Statistics Canada’s Canadian System of National Economic Accounts, including federal, provincial, and territorial budgetary outturns through the end of the second quarter of 2015.

Chile: Projections are based on the authorities’ budget projections, adjusted to reflect the IMF staff’s projections for GDP and copper prices.

China: The pace of fiscal consolidation is likely to be more gradual, reflecting reforms to strengthen social safety nets and the social security system announced as part of the Third Plenum reform agenda.

Denmark: Projections for 2014–15 are aligned with the latest official budget estimates and the underlying economic projections, adjusted where appropriate for the IMF staff’s macroeconomic assumptions. For 2016–20, the projections incorporate key features of the medium-term fiscal plan as embodied in the authorities’ 2014 Convergence Programme submitted to the European Union (EU).

France: Projections for 2015 reflect the budget law. For 2016–17, they are based on the multiyear budget and the April 2015 Stability Programme, adjusted for differences in assumptions on macro and financial variables, and revenue projections. Historical fiscal data reflect the statistical institute’s May 2015 revision and update of the fiscal accounts and national accounts.

Germany: The IMF staff’s projections for 2015 and beyond reflect the authorities’ adopted core federal government budget plan and the German Stability Programme: 2015 Update, adjusted for the differences in the IMF staff’s macroeconomic framework. The estimate of gross debt includes portfolios of impaired assets and noncore business transferred to institutions that are winding up, as well as other financial sector and EU support operations.

Greece: The fiscal projections for 2015 and the medium term are IMF staff estimates based on the fiscal package included in the European Stability Mechanism program agreed between Greece and its European partners and on information available as of August 12, 2015.

Hong Kong SAR: Projections are based on the authorities’ medium-term fiscal projections on expenditures.

Hungary: Fiscal projections include IMF staff projections of the macroeconomic framework and of the impact of recent legislative measures, as well as fiscal policy plans announced in the 2015 budget.

India: Historical data are based on budgetary execution data. Projections are based on available information on the authorities’ fiscal plans, with adjustments for IMF staff assumptions. Subnational data are incorporated with a lag of up to two years; general government data are thus finalized well after central government data. IMF and Indian presentations differ, particularly regarding divestment and license auction proceeds, net versus gross recording of revenues in certain minor categories, and some public sector lending.

Indonesia: IMF projections are based on moderate tax policy and administration reforms, fuel subsidy pricing reforms introduced in January 2015, and a gradual increase in social and capital spending over the medium term in line with fiscal space.

Ireland: Fiscal projections are based on the 2015 budget, adjusted for differences between the IMF staff’s macroeconomic projections and those of the Irish authorities.

Italy: IMF staff estimates and projections are based on the fiscal plans included in the government’s 2015 Budget, April 2015 Economic and Financial Document, and subsequently approved measures. Estimates of the cyclically adjusted balance include the expenditures to clear capital arrears in 2013, which are excluded from the structural balance. After 2015, the IMF staff projects convergence to a structural balance in line with Italy’s fiscal rule, which implies corrective measures in some years, as yet unidentified.

Japan: The projections include fiscal measures already announced by the government, including consumption tax increases, earthquake reconstruction spending, and the stimulus package.

Korea: The medium-term forecast incorporates the government’s announced medium-term consolidation path.

Mexico: Fiscal projections for 2015 are broadly in line with the approved budget; projections for 2016 onward assume compliance with rules established in the Fiscal Responsibility Law.

Netherlands: Fiscal projections for the period 2015–20 are based on the authorities’ Bureau for Economic Policy Analysis budget projections, after differences in macroeconomic assumptions are adjusted for. Historical data were revised following the June 2014 Central Bureau of Statistics release of revised macro data because of the adoption of the European System of National and Regional Accounts (ESA 2010) and the revisions of data sources.

New Zealand: Fiscal projections are based on the authorities’ 2015–16 budget documents and on IMF staff estimates.

Portugal: For 2014, the general government fiscal balance does not include a one-off transaction arising from banking support, pending a decision on statistical classification by the Instituto Nacional de Estatística (INE)/Eurostat. The projection for 2015 reflects the authorities’ 2015 budget and first-half outturn; projections thereafter are based on IMF staff’s macroeconomic forecast, under the assumption of unchanged policies.

Russia: Projections for 2015–20 are based on the oil-price-based fiscal rule introduced in December 2012, with adjustments by the IMF staff.

Saudi Arabia: IMF staff projections of oil revenues are based on WEO baseline oil prices. On the expenditure side, wage bill estimates incorporate 13th-month pay awards every three years in accordance with the lunar calendar; projections assume that, to adjust to lower oil prices, capital spending falls as a percentage of GDP over the medium term as large-scale projects currently being implemented are completed and that spending in the January and April 2015 fiscal packages is not repeated.

Singapore: For fiscal years 2014/15 and 2015/16, projections are based on budget numbers. For the remainder of the projection period, the IMF staff assumes unchanged policies.

South Africa: Fiscal projections are based on the authorities’ 2015 Budget Review.

Spain: For 2015 and beyond, fiscal projections are based on the measures specified in the Stability Programme Update 2014–17, the 2015 budget plan issued in October 2014, and the 2015 budget approved in December 2014.

Sweden: Fiscal projections take into account the authorities’ projections based on the Spring Fiscal Policy Bill 2015. The impact of cyclical developments on the fiscal accounts is calculated using the Organisation for Economic Co-operation and Development’s 2005 elasticity to take into account output and employment gaps.

Switzerland: The projections assume that fiscal policy is adjusted as necessary to keep fiscal balances in line with the requirements of Switzerland’s fiscal rules.

Turkey: Fiscal projections assume that both current and capital spending will be in line with the authorities’ 2014–16 Medium Term Programme based on current trends and policies.

United Kingdom: Fiscal projections are based on the U.K. Treasury’s 2015 Summer Budget, published in July 2015. However, on the revenue side, the authorities’ projections are adjusted for differences between IMF staff forecasts of macroeconomic variables (such as GDP growth) and the forecasts of these variables assumed in the authorities’ fiscal projections. IMF staff data exclude public sector banks and the effect of transferring assets from the Royal Mail Pension Plan to the public sector in April 2012. Real government consumption and investment are part of the real GDP path, which, according to the IMF staff, may or may not be the same as projected by the U.K. Office for Budget Responsibility.

United States: Fiscal projections are based on the August 2015 Congressional Budget Office baseline adjusted for the IMF staff’s policy and macroeconomic assumptions. The baseline incorporates the key provisions of the Bipartisan Budget Act of 2013, including a partial rollback of the sequester spending cuts in fiscal years 2014 and 2015. The rollback is fully offset by savings elsewhere in the budget. In fiscal years 2016 through 2021, the IMF staff assumes that the sequester cuts will continue to be partially replaced, in proportions similar to those agreed upon under the Bipartisan Budget Act for fiscal years 2014 and 2015, with back-loaded measures generating savings in mandatory programs and additional revenues. Fiscal projections are adjusted to reflect the IMF staff’s forecasts for key macroeconomic and financial variables and different accounting treatment of financial sector support and of defined-benefit pension plans and are converted to a general government basis. Historical data start at 2001 for most series because data compiled according to the 2001 Government Finance Statistics Manual (GFSM 2001) may not be available for earlier years.

Monetary Policy Assumptions

Monetary policy assumptions are based on the established policy framework in each country. In most cases, this implies a nonaccommodative stance over the business cycle: official interest rates will increase when economic indicators suggest that inflation will rise above its acceptable rate or range; they will decrease when indicators suggest that inflation will not exceed the acceptable rate or range, that output growth is below its potential rate, and that the margin of slack in the economy is significant. On this basis, the London interbank offered rate (LIBOR) on six-month U.S.-dollar deposits is assumed to average 0.4 percent in 2015 and 1.2 percent in 2016 (see Table 1.1). The rate on three-month euro deposits is assumed to average 0.0 percent in 2015 and 2016. The interest rate on six-month Japanese yen deposits is assumed to average 0.1 percent in 2015 and 2016.

Australia: Monetary policy assumptions are in line with market expectations.

Brazil: Monetary policy assumptions are consistent with gradual convergence of inflation toward the middle of the target range over the relevant horizon.

Canada: Monetary policy assumptions are in line with market expectations.

China: Monetary policy will remain broadly unchanged from its current status, consistent with the authorities’ announcement of maintaining stable economic growth.

Denmark: The monetary policy is to maintain the peg to the euro.

Euro area: Monetary policy assumptions for euro area member countries are in line with market expectations.

Hong Kong SAR: The IMF staff assumes that the currency board system remains intact.

India: The policy (interest) rate assumption is consistent with an inflation rate within the Reserve Bank of India’s targeted band.

Indonesia: Monetary policy assumptions are in line with a reduction of inflation to within the central bank’s targeted band by the end of 2015.

Japan: The current monetary policy conditions are maintained for the projection period, and no further tightening or loosening is assumed.

Korea: Monetary policy assumptions are in line with market expectations.

Mexico: Monetary assumptions are consistent with attaining the inflation target.

Russia: Monetary projections assume increasing exchange rate flexibility as part of the transition to the new full-fledged inflation-targeting regime, as indicated in recent statements by the Central Bank of Russia. Specifically, policy rates are assumed to remain at the current levels, gradually reducing the number of interventions in the foreign exchange markets.

Saudi Arabia: Monetary policy projections are based on the continuation of the exchange rate peg to the U.S. dollar.

Singapore: Broad money is projected to grow in line with the projected growth in nominal GDP.

South Africa: Monetary projections are consistent with South Africa’s 3–6 percent inflation target range.

Sweden: Monetary projections are in line with Riks-bank projections.

Switzerland: Monetary policy variables reflect historical data from the national authorities and the market.

Turkey: Broad money and the long-term bond yield are based on IMF staff projections. The short-term deposit rate is projected to evolve with a constant spread against the interest rate of a similar U.S. instrument.

United Kingdom: Projections assume no change in monetary policy or the level of asset purchases until 2016, consistent with market expectations.

United States: With employment conditions improving but wage growth yet to exert significant price pressure, the IMF staff expects the federal funds target to remain near zero until the end of 2015.

1 The output gap is actual minus potential output, as a percentage of potential output. Structural balances are expressed as a percentage of potential output. The structural balance is the actual net lending/borrowing minus the effects of cyclical output from potential output, corrected for one-time and other factors, such as asset and commodity prices and output composition effects. Changes in the structural balance consequently include effects of temporary fiscal measures, the impact of fluctuations in interest rates and debt-service costs, and other noncyclical fluctuations in net lending/borrowing. The computations of structural balances are based on IMF staff estimates of potential GDP and revenue and expenditure elasticities. (See Annex I of the October 1993 WEO.) Net debt is calculated as gross debt minus financial assets corresponding to debt instruments. Estimates of the output gap and of the structural balance are subject to significant margins of uncertainty.

List of Tables

Balance of Payments and External Financing

Medium-Term Baseline Scenario

Table A1.

Summary of World Output1

(Annual percent change)

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Real GDP.

Data for Lithuania are included in the euro area aggregates but were excluded in the April 2015 World Economic Outlook.

Excludes the United States, euro area countries, and Japan.

Georgia, Turkmenistan, and Ukraine, which are not members of the Commonwealth of Independent States, are included in this group for reasons of geography and similarity in economic structure.

Table A2.

Advanced Economies: Real GDP and Total Domestic Demand1

(Annual percent change)

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In this and other tables, when countries are not listed alphabetically, they are ordered on the basis of economic size.

From the fourth quarter of the preceding year.

Data for Lithuania are included in the euro area aggregates but were excluded in the April 2015 World Economic Outlook.

Owing to the unusual macroeconomic uncertainty, quarterly real GDP projections are not available.

Excludes the G7 (Canada, France, Germany, Italy, Japan, United Kingdom, United States) and euro area countries.

Table A3.

Advanced Economies: Components of Real GDP

(Annual percent change)

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Data for Lithuania are included in the euro area aggregates but were excluded in the April 2015 World Economic Outlook.

Excludes the G7 (Canada, France, Germany, Italy, Japan, United Kingdom, United States) and euro area countries.

Changes expressed as percent of GDP in the preceding period.

Table A4.

Emerging Market and Developing Economies: Real GDP

(Annual percent change)

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Data for some countries refer to real net material product (NMP) or are estimates based on NMP. The figures should be interpreted only as indicative of broad orders of magnitude because reliable, comparable data are not generally available. In particular, the growth of output of new private enterprises of the informal economy is not fully reflected in the recent figures.

Georgia, Turkmenistan, and Ukraine, which are not members of the Commonwealth of Independent States, are included in this group for reasons of geography and similarity in economic structure.

Data are based on the 2008 System of National Accounts. The revised national accounts data are available beginning in 2000 and exclude Crimea and Sevastopol from 2010 onward.

In this table only, the data for Timor-Leste are based on non-oil GDP.

The data for Argentina are officially reported data as revised in May 2014. On February 1, 2013, the IMF issued a declaration of censure, and in December 2013 called on Argentina to implement specified actions to address the quality of its official GDP data according to a specified timetable. On June 3, 2015, the Executive Board recognized the ongoing discussions with the Argentine authorities and their material progress in remedying the inaccurate provision of data since 2013, but found that some specified actions called for by the end of February 2015 had not yet been completely implemented. The Executive Board will review this issue again by July 15, 2016, and in line with the procedures set forth in the IMF legal framework.

For Iran, data and forecasts are based on GDP at market prices. Corresponding data used by the IMF staff for GDP growth at factor prices are 3.0 percent, −1.9 percent, and −6.8 percent for 2014/15, 2013/14, and 2012/13, respectively.

Data for 2011 exclude South Sudan after July 9. Data for 2012 and onward pertain to the current Sudan.

Data for Syria are excluded for 2011 onward because of the ongoing conflict and related lack of data.

The Zimbabwe dollar ceased circulating in early 2009. Data are based on IMF staff estimates of price and exchange rate developments in U.S. dollars. IMF staff estimates of U.S. dollar values may differ from authorities’ estimates. Real GDP is in constant 2009 prices.

Table A5.

Summary of Inflation

(Percent)

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Data for Lithuania are included in the euro area aggregates but were excluded in the April 2015 World Economic Outlook.

Excludes the United States, euro area countries, and Japan.

Based on Eurostat’s harmonized index of consumer prices.

Georgia, Turkmenistan, and Ukraine, which are not members of the Commonwealth of Independent States, are included in this group for reasons of geography and similarity in economic structure.

Excludes Argentina. See note 6 to Table A7.

Data are missing because of Argentina, which accounts for more than 30 percent of the weights of the group. See note 6 to Table A7.

Table A6.

Advanced Economies: Consumer Prices1

(Annual percent change)

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Movements in consumer prices are shown as annual averages.

Monthly year-over-year changes and, for several countries, on a quarterly basis.

Based on Eurostat’s harmonized index of consumer prices.

Data for Lithuania are included in the euro area aggregates but were excluded in the April 2015 World Economic Outlook.

Table A7.

Emerging Market and Developing Economies: Consumer Prices1

(Annual percent change)

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Movements in consumer prices are shown as annual averages.

Monthly year-over-year changes and, for several countries, on a quarterly basis.

For many countries, inflation for the earlier years is measured on the basis of a retail price index. Consumer price index (CPI) inflation data with broader and more up-to-date coverage are typically used for more recent years.

Georgia, Turkmenistan, and Ukraine, which are not members of the Commonwealth of Independent States, are included in this group for reasons of geography and similarity in economic structure.

Starting in 2014 data exclude Crimea and Sevastopol.

Consumer price data from December 2013 onward reflect the new national CPI (IPCNu), which differs substantively from the preceding CPI (the CPI for the Greater Buenos Aires Area, CPI-GBA). Because of the differences in geographical coverage, weights, sampling, and methodology, the IPCNu data cannot be directly compared to the earlier CPI-GBA data. Because of this structural break in the data, the average CPI inflation for 2014 is not reported in the October 2015 World Economic Outlook. Following a declaration of censure by the IMF on February 1, 2013, the public release of a new national CPI by the end of March was one of the specified actions in the IMF Executive Board’s December 2013 decision calling on Argentina to address the quality of its official CPI data. On June 3, 2015, the Executive Board recognized the ongoing discussions with the Argentine authorities and their material progress in remedying the inaccurate provision of data since 2013, but found that some specified actions called for by the end of February 2015 had not yet been completely implemented. The Executive Board will review this issue again by July 15, 2016, and in line with the procedures set forth in the IMF legal framework.

Data for 2011 exclude South Sudan after July 9. Data for 2012 and onward pertain to the current Sudan.

Data for Syria are excluded for 2011 onward because of the ongoing conflict and related lack of data.

The Zimbabwe dollar ceased circulating in early 2009. Data are based on IMF staff estimates of price and exchange rate developments in U.S. dollars. IMF staff estimates of U.S. dollar values may differ from authorities’ estimates.

Table A8.

Major Advanced Economies: General Government Fiscal Balances and Debt1

(Percent of GDP unless noted otherwise)

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Note: The methodology and specific assumptions for each country are discussed in Box A1. The country group composites for fiscal data are calculated as the sum of the U.S. dollar values for the relevant individual countries.

Debt data refer to the end of the year and are not always comparable across countries. Gross and net debt levels reported by national statistical agencies for countries that have adopted the System of National Accounts (SNA) 2008 (Australia, Canada, Hong Kong SAR, United States) are adjusted to exclude unfunded pension liabilities of government employees’ defined-benefit pension plans. Fiscal data for the aggregated Major Advanced Economies and the United States start in 2001, and the average for the aggregate and the United States is therefore for the period 2001–07.

Percent of potential GDP.

Figures reported by the national statistical agency are adjusted to exclude items related to the accrual-basis accounting of government employees defined-benefit pension plans.

Data for Lithuania are included in the euro area aggregates but were excluded in the April 2015 World Economic Outlook.

Excludes one-time measures based on the authorities’ data and, in the absence of the latter, receipts from the sale of assets.

Includes equity shares; nonconsolidated basis.

Table A9.

Summary of World Trade Volumes and Prices

(Annual percent change)

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Average of annual percent change for world exports and imports.

As represented, respectively, by the export unit value index for manufactures of the advanced economies and accounting for 83 percent of the advanced economies’ trade (export of goods) weights; the average of U.K. Brent, Dubai Fateh, and West Texas Intermediate crude oil prices; and the average of world market prices for nonfuel primary commodities weighted by their 2002-04 shares in world commodity exports.

Georgia, Turkmenistan, and Ukraine, which are not members of the Commonwealth of Independent States, are included in this group for reasons of geography and similarity in economic structure.

Percent change of average of U.K. Brent, Dubai Fateh, and West Texas Intermediate crude oil prices.

Percent change for manufactures exported by the advanced economies.

Table A10.

Summary of Current Account Balances

(Billions of U.S. dollars)

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Data for Lithuania are included in the euro area aggregates but were excluded in the April 2015 World Economic Outlook.

Excludes the United States, euro area countries, and Japan.

Georgia, Turkmenistan, and Ukraine, which are not members of the Commonwealth of Independent States, are included in this group for reasons of geography and similarity in economic structure.

Indonesia, Malaysia, Philippines, Thailand, Vietnam.

Table A11.

Advanced Economies: Balance on Current Account

(Percent of GDP)

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Data for Lithuania are included in the euro area aggregates but were excluded in the April 2015 World Economic Outlook; corrected for reporting discrepancies in intra-area transactions.

Data for Lithuania are included in the euro area aggregates but were excluded in the April 2015 World Economic Outlook; calculated as the sum of the balances of individual euro area countries.

Table A12.

Emerging Market and Developing Economies: Balance on Current Account

(Percent of GDP)

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Georgia, Turkmenistan, and Ukraine, which are not members of the Commonwealth of Independent States, are included in this group for reasons of geography and similarity in economic structure.

Starting in 2014 data exclude Crimea and Sevastopol.

Calculations are based on Argentina’s official GDP data. See note 5 to Table A4.

Data for 2011 exclude South Sudan after July 9. Data for 2012 and onward pertain to the current Sudan.

Data for Syria are excluded for 2011 onward because of the ongoing conflict and related lack of data.

The Zimbabwe dollar ceased circulating in early 2009. Data are based on IMF staff estimates of price and exchange rate developments in U.S. dollars. IMF staff estimates of U.S. dollar values may differ from authorities’ estimates.

Table A13.

Summary of Financial Account Balances

(Billions of U.S. dollars)

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Note: The estimates in this table are based on individual countries’ national accounts and balance of payments statistics. Country group composites are calculated as the sum of the U.S. dollar values for the relevant individual countries. Some group aggregates for the financial derivatives are not shown because of incomplete data. Projections for the euro area are not available because of data constraints.

Data for Lithuania are included in the euro area aggregates but were excluded in the April 2015 World Economic Outlook.

Excludes the G7 (Canada, France, Germany, Italy, Japan, United Kingdom, United States) and euro area countries.

Georgia, Turkmenistan, and Ukraine, which are not members of the Commonwealth of Independent States, are included in this group for reasons of geography and similarity in economic structure.

Table A14.

Summary of Net Lending and Borrowing

(Percent of GDP)

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Note: The estimates in this table are based on individual countries’ national accounts and balance of payments statistics. Country group composites are calculated as the sum of the U.S. dollar values for the relevant individual countries. This differs from the calculations in the April 2005 and earlier issues of the World Economic Outlook, in which the composites were weighted by GDP valued at purchasing power parities as a share of total world GDP. The estimates of gross national savings and investment (or gross capital formation) are from individual countries’ national accounts statistics. The estimates of the current account balance, the capital account balance, and the financial account balance (or net lending/net borrowing) are from the balance of payments statistics. The link between domestic transactions and transactions with the rest of the world can be expressed as accounting identities. Savings (S) minus investment (I) is equal to the current account balance (CAB) (S - l = CAB). Also, net lending/net borrowing (NLB) is the sum of the current account balance and the capital account balance (KAB) (NLB = CAB + KAB). In practice, these identities do not hold exactly; imbalances result from imperfections in source data and compilation as well as from asymmetries in group composition due to data availability.

Data for Lithuania are included in the euro area aggregates but were excluded in the April 2015 World Economic Outlook.

Includes the G7 (Canada, France, Germany, Italy, Japan, United Kingdom, United States) and euro area countries.

Georgia, Turkmenistan, and Ukraine, which are not members of the Commonwealth of Independent States, are included in this group for reasons of geography and similarity in economic structure.

Table A15.

Summary of World Medium-Term Baseline Scenario

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Data refer to trade in goods and services.

London interbank offered rate on U.S. dollar deposits minus percent change in U.S. GDP deflator.

GDP-weighted average of 10-year (or nearest-maturity) government bond rates for Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States.

World Economic Outlook Selected Topics

World Economic Outlook Archives

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I. Methodology—Aggregation, Modeling, and Forecasting

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II. Historical Surveys

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III. Economic Growth—Sources and Patterns

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IV. Inflation and Deflation and Commodity Markets

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V. Fiscal Policy

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VI. Monetary Policy, Financial Markets, and Flow of Funds

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VII. Labor Markets, Poverty, and Inequality

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VIII. Exchange Rate Issues

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IX. External Payments, Trade, Capital Movements, and Foreign Debt

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X. Regional Issues

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XI. Country-Specific Analyses

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XII. Special Topics

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IMF Executive Board Discussion of the Outlook, September 2015

The following remarks were made by the Chair at the conclusion of the Executive Board’s discussion of the World Economic Outlook, Global Financial Stability Report, and Fiscal Monitor on September 21, 2015.

Executive Directors broadly shared the assessment of global economic prospects and risks. They noted that global growth remains modest and uneven across countries and regions, while financial market volatility has increased in recent months. Downside risks to the global outlook have risen, with emerging market and developing economies particularly exposed to the declining commodity prices and tighter global financial conditions. Directors observed that persistent weak growth in advanced economies and the fifth consecutive year of growth declines in emerging market economies reflect both country-specific developments and common forces of a medium- and long-term nature. Forceful policy action on all fronts, as well as enhanced international cooperation, has become more crucial than ever to reverse this trend and promote stronger, more balanced global growth.

Directors broadly concurred that, in advanced economies, the foundations for a modest recovery in 2015–16 are still intact, while financial stability has generally improved. They noted that a sustained recovery in the euro area, a return to positive growth in Japan, and continued robust activity in the United States are positive forces, although increased market volatility may pose financial stability challenges in the near term. Medium-term prospects remain subdued, reflecting unfavorable demographics, weak productivity growth, and high unemployment, as well as legacy issues from the crisis—including high indebtedness, low investment, and financial sector weakness. A key risk is a further decline of already-low growth that could turn into near stagnation, especially if slower growth in emerging market economies dampens global demand. In this context, persistent below-target inflation could become more entrenched.

Directors noted that the overall outlook for emerging market and developing economies is generally weakening, reflecting tighter global financial conditions, China’s transition toward consumption-driven sustainable growth, a weaker commodity market outlook, and geopolitical tensions. However, growth prospects differ considerably across countries. Emerging market economies are vulnerable to shifts in exchange rates and a reversal of capital flows. Meanwhile, further declines in commodity prices could weaken the outlook for commodity exporters. While China’s transition and the ensuing slowdown have long been anticipated, a sharper-than-expected growth decline, if it materialized, could generate considerable spillovers and risks for other countries.

Directors acknowledged that the global financial outlook is clouded by increased emerging market vulnerabilities, legacy issues from the crisis in advanced economies, and concerns about weak market liquidity. They noted in particular high corporate leverage and foreign-currency exposures in emerging market economies, headwinds from balance sheet weaknesses in advanced economies, and remaining gaps in the euro area financial architecture. In the context of rising policy rates, the global financial system may see adjustment as financial conditions tighten and risk premiums rise from historically low levels. Directors recognized that interest rate normalization in the United States driven by robust activity will benefit the world economy and also reduce uncertainty—and hence should take place in a timely, data-dependent manner.

Directors underscored that raising both actual and potential output continues to be a policy priority, requiring mutually reinforcing measures for demand support and structural reforms. They concurred that the main policy recommendations are appropriate, although the right balance of policy mix will vary from country to country. A collective effort is needed to boost trade growth, avoid trade protectionist measures, refrain from competitive devaluations, and reduce the persistent global imbalances.

Directors agreed with the policy priorities for full employment and stable inflation in advanced economies. Accommodative monetary policy remains essential, particularly in Japan and the euro area, while efforts should continue, where needed, to enhance policy transmission and address financial system risks through continued balance sheet repair and macro-prudential policies. Fiscal policy should remain prudent, yet flexible and growth friendly, anchored in sound medium-term strategies. Countries with fiscal space and sizable output gaps or significant current account surpluses should ease their fiscal stance in the near term, especially by increasing investment in high-quality, high-return infrastructure projects. Structural reforms should aim to strengthen labor force participation and trend employment, facilitate labor market adjustment, tackle legacy debt overhang, and lower barriers to entry in product markets, especially in services.

Directors recognized that emerging market and developing economies in general are now better prepared for the current, less favorable environment—with stronger fundamentals, buffers, and policy frameworks. Nevertheless, they face a difficult trade-off between supporting demand and reducing vulnerabilities. The scope for further easing macroeconomic policies varies considerably across countries, depending on the extent of economic slack and inflationary pressures and fiscal space, as well as external, financial, and fiscal vulnerabilities. Directors agreed that exchange rate flexibility, where feasible, in the context of a well-specified policy framework, can help absorb external shocks. They stressed that, in many countries, structural reforms are urgently needed to raise productivity and remove bottlenecks to production.

Directors concurred that, in a more difficult external environment, developments in low-income countries should be given particular attention. Many of these countries are commodity exporters whose initial conditions have already been strained, fiscal and external balances are deteriorating, and absorptive capacity is limited. Appropriate policy advice and adequate financial assistance from development partners, including the Fund, will be essential to support low-income countries in their adjustment efforts and advancement toward the Sustainable Development Goals. Their priorities generally include economic diversification, domestic revenue mobilization, and financial sector deepening.

Directors highlighted the importance of preserving financial stability, safeguarding against market illiquidity, and maintaining confidence in policymaking. For advanced economies, priorities should include continued clear and effective communication of monetary policy intentions, and a comprehensive strategy to tackle nonperforming loans and complete the financial architecture in the euro area. Liquidity conditions, especially for nonbanks, should be closely monitored, and market structure solutions to liquidity shortages should be explored. Completing the global financial regulatory reform agenda requires further progress on implementation, finalization of outstanding reforms, and addressing emerging risks.

Directors emphasized the need to address both cyclical and structural challenges in emerging market economies. They agreed that policymakers should rely on micro- and macro-prudential tools to discourage the buildup of excessive leverage, strengthen provisioning by banks, and improve regulations on credit quality classification. Foreign-currency exposures warrant special attention and the reform of corporate insolvency regimes should continue. Rebalancing and deleveraging in China will require a careful pacing and sequencing of market-based reforms, a further strengthening of the financial system, and strong implementation of the reform agenda.

Directors noted that lower oil prices present both opportunities and challenges. In many oil-importing countries, lower oil prices have eased the burden on monetary policy and created some fiscal policy space. Exporters of oil and other commodities with worsening terms of trade will need to adjust public spending in the face of lower commodity-related revenue. These countries should also continue to upgrade their fiscal policy frameworks and provide a longer-term anchor to guide policy decisions. Reforms of energy subsidies and taxation remain an important priority for many countries.

1

Many countries are implementing the SNA 2008 or ESA 2010, and a few countries use versions of the SNA older than 1993. A similar adoption pattern is expected for the BPM6. Please refer to Table G, which lists the statistical standards adhered to by each country.

2

Averages for real GDP and its components, employment, GDP per capita, inflation, factor productivity, trade, and commodity prices are calculated based on the compound annual rate of change, except in the case of the unemployment rate, which is based on the simple arithmetic average.

3

See “Revised Purchasing Power Parity Weights” in the July 2014 WEO Update for a summary of the revised purchasing-power-parity-based weights, as well as Box A2 of the April 2004 WEO and Annex IV of the May 1993 WEO. See also Anne-Marie Gulde and Marianne Schulze-Ghattas, “Purchasing Power Parity Based Weights for the World Economic Outlook,” in Staff Studies for the World Economic Outlook (Washington: International Monetary Fund, December 1993), pp. 106–23.

4

As used here, the terms “country” and “economy” do not always refer to a territorial entity that is a state as understood by international law and practice. Some territorial entities included here are not states, although their statistical data are maintained on a separate and independent basis.

5

During 2010–14, 19 economies incurred external payments arrears or entered into official or commercial bank debt-rescheduling agreements. This group is referred to as economies with arrears and/or rescheduling during 2010–14.

6

See David Andrews, Anthony R. Boote, Syed S. Rizavi, and Sukwinder Singh, Debt Relief for Low-Income Countries: The Enhanced HIPC Initiative, IMF Pamphlet Series 51 (Washington: International Monetary Fund, November 1999).

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Cover World Economic Outlook, October 2015
World Economic Outlook, October 2015
Adjusting to Lower Commodity Prices
Author:
International Monetary Fund. Research Dept.
ISBN:
9781513520735
ISSN:
0256-6877
Publication Date:
06 Oct 2015
Publisher:
International Monetary Fund
DOI:
https://doi.org/10.5089/9781513520735.081
Pages:
228