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Business and Economics > Production and Operations Management

You are looking at 1 - 10 of 97 items for :

  • Type: Journal Issue x
  • International Investment; Long-term Capital Movements x
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Cover IMF Working Papers
Europe’s Shift to EVs Amid Intensifying Global Competition
Philippe Wingender
,
Jiaxiong Yao
,
Robert Zymek
,
Benjamin Carton
,
Diego A. Cerdeiro
, and
Anke Weber
European countries have set ambitious goals to reduce their carbon emissions. These goals include a transition to electric vehicles (EVs)—a sector that China increasingly dominates globally—which could reduce the demand for Europe’s large and interconnected auto sector. This paper aims to size up the tradeoffs between Europe’s shift towards EVs and key macroeconomic outcomes, and analyze which policies may sharpen or ease them. Using state-of-the-art macroeconomic and trade models we analyze a scenario in which the share of Chinese cars in EU purchases rises by 15 percent over 5 years as a result of both a positive productivity shock for car production in China and a demand shock that shifts consumer preferences towards Chinese cars (given China’s dominance in the EV sector). We find that for the EU as a whole, the GDP cost of this shift is small in the short term, in the range of 0.2-0.3 percent of GDP, and close to zero over the long term. Adverse short-run effects are more significant for smaller economies heavily reliant on the car sector, mainly in Central Europe. Protectionist policies, such as tariffs on Chinese EVs, would raise the GDP cost of the EV transition. A further increase in Chinese FDI inflows that results in a significant share of Chinese EVs being produced in Central European economies, on the other hand, would offset losses in these economies by supporting their shift from supplying the internal combustion engine (ICE) production chain to that of EVs.
Keywords:
Electric vehicles; green transition; trade; tariffs; global value chains.; protectionist policy response; GDP cost; EV share; Europe's shift; shift to electric vehicles; Foreign direct investment; Productivity; Imports; Europe; Global
Cover IMF Staff Country Reports
People’s Republic of China: Selected Issues
International Monetary Fund. Asia and Pacific Dept
Selected Issues
Keywords:
service sector productivity; B. deflation vulnerability index; outward FDI; inflation expectation; emissions trading system; Foreign direct investment; Services sector; Total factor productivity; Inflation; Global
Cover IMF Staff Country Reports
Panama: Selected Issues
International Monetary Fund. Western Hemisphere Dept.
This Selected Issues paper presents the main features and weaknesses of the current Panamanian tax system and provides an international comparison of its performance. Panama’s macroeconomic performance has been notably robust. Panama’s macroeconomic performance has been notably robust, but Panama’s tax collection has been historically low. A tax system without adequate revenues led to chronic fiscal deficits and a lack of resources to invest in human capital (education and health) and promote social inclusion policies. In addition, the tax system is notably regressive, and several rules are very inefficient and distortive contradicting the overall policy objective of the country to attract investment. Taxation of the business sector is very complex. On the other hand, the system is very generous regarding benefits. Overall, the desirable reform direction is clear: A reduction in tax incentives, following their analysis, as well as stronger anti-abuse provisions, and revenues from an international minimum tax can finance reductions in the inefficient parts of the tax system, such as the multiple business taxes and the strict loss carry forward.
Keywords:
VAT indicator; directorate General; C. consumption tax; tax comparison; revenue performance; International reserves; Total factor productivity; Tax incentives; Corporate income tax; Caribbean; Central America; South America; Global; Asia and Pacific
Cover Policy Papers
Staff Guidance Note on The Implementation of The IMF Strategy for Fragile and Conflict-Affected States (FCS)
International Monetary Fund. Institute for Capacity Development
This note provides operational advice and information to help staff implement the IMF Strategy for Fragile and Conflict-Affected States (FCS) approved by the Executive Board on March 9, 2022. Topics covered include (i) the new IMF FCS classification methodology, which is aligned with that of the World Bank; (ii) the preparation of Country Engagement Strategies (CES) that will be rolled out across FCS to ensure that Fund engagement is appropriately tailored to country-specific manifestations of fragility and/or conflict; (iii) advice on tailoring the thematic focus of Article IV consultations and Fund analytics to FCS, as well as on the prioritization, design, and implementation of capacity development (CD) projects in fragile contexts; (iv) guidance on making full use of the flexibilities of the lending toolkit; (v) guidance on engaging in specific FCS situations, including building accountable institutions to exit fragility, cases of rising fragility risks, active conflict, post-conflict, and addressing the impact of external shocks and spillovers; and (v) strengthening partnerships with humanitarian, development, and peace actors, in accordance with the Fund’s mandate. Dedicated annexes provide additional information on the CES process, addressing good governance in FCS, program design, and country examples of Fund engagement in FCS.
Keywords:
fragility; conflict; fragile and conflict-affected states; political economy; inclusive growth; macroeconomic policy; absorptive capacity; balance of payments; country engagement strategies; capacity development; surveillance; partnerships; governance; FCS staff development; FCS strategy; FCS list; FCS classification; FCS circumstances; Balance of payments need; Capacity utilization; Climate change; West Africa; Sub-Saharan Africa; Global
Cover IMF Working Papers
On the Capacity to Absorb Public Investment: How Much is Too Much?
Daniel Gurara
,
Mr. Kangni R Kpodar
,
Mr. Andrea F Presbitero
, and
Dawit Tessema
While expanding public investment can help filling infrastructure bottlenecks, scaling up too much and too fast often leads to inefficient outcomes. This paper rationalizes this outcome looking at the association between cost inflation and public investment in a large sample of road construction projects in developing countries. Consistent with the presence of absorptive capacity constraints, our results show a non-linear U-shaped relationship between public investment and project costs. Unit costs increase once public investment is close to 10% of GDP. This threshold is lower (about 7% of GDP) in countries with low investment efficiency and, in general, the effect of investment scaling up on costs is especially strong during investment booms.
Keywords:
WP; marginal cost; cost function; public investment; investment drive; investment program; investment acceleration; portfolio mix; investment inefficiency; Public investment spending; Public investment and public-private partnerships (PPP); Absorptive capacity; Capacity utilization; Infrastructure; Global; Unit costs; Investment efficiency
Cover IMF Working Papers
Managing the Tide: How Do Emerging Markets Respond to Capital Flows?
Mr. Atish R. Ghosh
,
Mr. Jonathan David Ostry
, and
Miss Mahvash S Qureshi
This paper examines whether—and how—emerging market economies (EMEs) respond to capital flows to mitigate their untoward consequences. Based on a sample of about 50 EMEs over 2005Q1–2013Q4, we find that EME policy makers respond proactively to capital inflows by using a combination of policy tools: central banks raise the policy interest rate to address economic overheating concerns; intervene in the foreign exchange market to resist currency appreciation pressures; tighten macroprudential measures to dampen credit growth; and deploy capital inflow controls in the face of competitiveness and financial-stability concerns. Contrary to conventional policy advice to EMEs, we find no evidence of counter-cyclical fiscal policy in the face of capital inflows. Overall, policies are more likely to respond, and used in combination, during inflow surges than in more normal times.
Keywords:
WP; capital control; capital flow; inflow control; exchange rate; outflow control; capital flows; policy toolkit; capital controls; emerging market economies; FX intervention; prudential measure; Capital inflows; Central bank policy rate; Output gap; Global
Cover IMF Staff Country Reports
Slovak Republic: Selected Issues
International Monetary Fund. European Dept.
This Selected Issues paper uses the case of the Slovak Republic to investigate how European Union (EU) countries can make optimal use of EU funds to reduce regional disparities. The findings suggest that high-quality government and a more educated population lead to better absorption of EU funds. There is also evidence that absorption increases when spending is more decentralized. Regions with a sufficient level of human capital and adequate institutions are more likely to spend the allocated funds efficiently and to experience growth as a result. With appropriate administrative and governance capacities, fighting corruption should therefore be the priority to speed absorption and allow for higher-quality projects.
Keywords:
ISCR; CR; Slovakia; expenditure; EU funds; EU transfer; B. EU; EU Cohesion Policy; EU allocation; Pension spending; Aging; Health care spending; Total factor productivity; Absorptive capacity; Global; Europe
Cover IMF Staff Country Reports
Burkina Faso: Selected Issues
International Monetary Fund. African Dept.
This Selected Issues paper examines the impact of scaled-up public investment in Burkina Faso. The results suggest that “big-push” investment efforts, while designed to accelerate growth, are likely to run up against significant absorption-capacity constraints. These constraints will diminish the efficiency of investment spending and result in lower public capital accumulation and productivity growth than under a more measured approach. The empirical evidence from the experience of many countries also suggests that the results of aggressive scaling-up initiatives are mixed.
Keywords:
ISCR; CR; pay; investment; wage bill; government; sustainability risk; investment efficiency; Ivoirian authorities; investment scaling-up; investment project; bill in Burkina Faso; GDP ratio; Public investment spending; Wages; Wage adjustments; Public employment; Civil service; West Africa; Sub-Saharan Africa
Cover Finance & Development
Finance and Development, June 2016
International Monetary Fund. External Relations Dept.
Finance and Development, June 2016
Keywords:
FD; F&D; economy; Africa Rising story; banknote paper; paper bill; commodity exporter
Cover Finance & Development
Finances & Développement, juin 2016
International Monetary Fund. External Relations Dept.
Finances & Développement, juin 2016
Keywords:
FD; F&D; economy; Africa Rising story; banknote paper; paper bill; commodity exporter