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Business and Economics > Information Management

You are looking at 1 - 2 of 2 items for :

  • Type: Journal Issue x
  • Commodity Markets x
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Cover IMF Working Papers
Global Shocks Unfolding: Lessons from Fragile and Conflict-affected States
Jocelyn Boussard
,
Chiara Castrovillari
,
Tomohide Mineyama
,
Marta Spinella
, and
Maxwell Tuuli
This paper investigates the consequences of global shocks on a sample of low- and lower-middle-income countries with a particular focus on fragile and conflict-affected states (FCS). FCS are a group of countries that display institutional weakness and/or are negatively affected by active conflict, thereby facing challenges in macroeconomic policy management. Examining different global shocks associated with commodity prices, external demand, and financing conditions, this paper establishes that FCS economies are more vulnerable to these shocks compared to non-FCS peers. The higher sensitivity of FCS economies is mainly driven by procyclical fiscal responses, aggravated by the lack of effective spending controls and timely access to financial sources. External financing serves as a source of stability, partially mitigating the adverse impact of global shocks. This paper contributes to a better understanding of how conditions of fragility, which are on the rise in many parts of the world today, can amplify the effects of negative exogenous shocks. Its results highlight the diverse nature of underlying sources of vulnerabilities, spanning from fiscal and external buffers to institutional quality and economic structure, with lessons applicable to a broader set of countries. Efficient and timely external financial support from external partners, including international financial institutions, should help countries’ counter-cyclical responses to mitigate adverse shocks and achieve macroeconomic stability.
Keywords:
Global shocks; external financing; low-income countries; Fragile and conflict-affected states (FCS); FCS economy; Commodity tot shock; FCS list; shock variable; decline shock; Technology transfer; Exports; Commodity prices; Commodity price fluctuations; Global
Cover IMF Working Papers
The Adjustment to Commodity Price Shocks in Chile, Colombia, and Peru
Mr. Francisco Roch
This paper presents a comparative analysis of the macroeconomic adjustment in Chile, Colombia, and Peru to commodity terms-of-trade shocks. The study is done in two steps: (i) an analysis of the impulse responses of key macroeconomic variables to terms-of-trade shocks and (ii) an event study of the adjustment to the recent decline in commodity prices. The experiences of these countries highlight the importance of flexible exchange rates to help with the adjustment to lower commodity prices, and staying vigilant in addressing depreciation pressures on inflation through tightening monetary policies. On the fiscal front, evidence shows that greater fiscal space, like in Chile and Peru, gives more room for accommodating terms-of-trade shocks.
Keywords:
WP; commodity price; commodity; Chile; Peru; Commodity Prices; Fiscal Policy; Flexible Exchange Rates; Colombia; Peru t; commodity exporters' emerging economies; oil price decline; large commodity price shock; shock to commodity price; country-specific commodity price index; propagation mechanism of commodity price shock; contribution of commodity price; effects of commodity-price fluctuation; Colombia t; adjustment to commodity price; Commodity price shocks; Current account; Technology transfer; Current account deficits; Sub-Saharan Africa