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Africa > Uganda

You are looking at 1 - 10 of 23 items for :

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Cover IMF Staff Country Reports
Uganda: Selected Issues
International Monetary Fund. African Dept.
This Selected Issues Paper analyzes potential macro-financial risks from cross-sectoral exposures in Uganda by leveraging on the Balance Sheet Approach framework. It presents evidence on the macro-financial linkages in Uganda using the Network Map and Financial Input-Output approaches. On the one hand, the Network Map analysis shows the cross-sectoral exposures in which potential build-up of macro-financial vulnerabilities may arise. On the other hand, the Financial Input-Output tool simulates relevant scenarios in the context of Ugandan economy such as currency depreciation and increases in government interest payments on debt held by banks. The purpose of the scenario exercises is to strengthen the monitoring of the developments in key economic sectors in Uganda. While the banking sector, which dominates the Ugandan financial system, remains fundamentally sound, there are pockets of vulnerabilities resulting from the growing sovereign-bank nexus and cross-border exposures of the Near Field Communication technology sector which require close vigilance.
Keywords:
B. monetary policy framework; reducing job search time; policy rate; youth employment trend; NFC sector; C. youth employment trend; Policy rate response; bank Lending rate; Central bank policy rate; Exchange rates; Women; Sub-Saharan Africa
Cover IMF Working Papers
The Role of Structural Fiscal Policy on Female Labor Force Participation in OECD Countries
Miyoko Asai
,
Qiaoe Chen
,
Mr. Jiro Honda
,
Xingwei Hu
, and
Qianqian Zhang
This paper examines the role of structural fiscal policies to promote female labor force participation and reduce gender gaps in labor markets in 26 OECD countries from 2000 to 2019. As both female labor force participation and many explanatory/control variables clearly exhibit non-stationarity (potentially leading to spurious regression results), we employ a panel vector error-correction model, in contrast with most previous empirical studies on this matter. Our analyses confirm statistically significant positive impacts of government spending on (1) early childcare and education, (2) active labor market programs, and (3) unemployment benefits, all of which would help encourage women to enter the labor force, while (4) an increase in relative tax rate on second earner could have negative impact on female labor force participation.
Keywords:
Fiscal Policy; Gender; Labor Force; OECD; panel unit root; panel vector error-correction model; robustness test; panel VECM result; female LFPR; age group; regression analysis; positive correlation; standard deviation; Women; Active labor market policies; Gender diversity; Unemployment benefits; Global
Cover IMF Working Papers
Search Externalities in Firm-to-Firm Trade
I develop a model of firm-to-firm search and matching to show that the impact of falling trade costs on firm sourcing decisions and consumer welfare depends on the relative size of search externalities in domestic and international markets. These externalities can be positive if firms share information about potential matches, or negative if the market is congested. Using unique firm-to-firm transaction-level data from Uganda, I document empirical evidence consistent with positive externalities in international markets and negative externalities in domestic markets. I then build a dynamic quantitative version of the model and show that, in Uganda, a 25% reduction in trade costs led to a 3.7% increase in consumer welfare, 12% of which was due to search externalities.
Keywords:
Firm-to-Firm Trade; VAT Data; Search-and-Matching; Importing; transport cost reduction; buyer-supplier search; search externality; welfare gains from trade; consumer welfare; Imports; Labor market frictions; Search models; Value-added tax; East Africa; Global
Cover IMF Staff Country Reports
Uganda: Selected Issues
International Monetary Fund. African Dept.
This Selected Issues paper tries to answer the question of how to promote employment in Uganda. It also discusses key stylized facts including labor market challenges, an overview of the labor market, and employment characteristics. Although issues relating to the determinants of employment are gaining momentum in Uganda, the literature is largely based on economic reports and qualitative studies. Uganda has implemented some social programs aimed at creating employment specifically for youth and women, though coverage is limited. These programs aim at providing an enabling environment for the private sector to create jobs and build the skills and requisite knowledge to make youth and women more employable. The existing social programs are good initiatives to address some of the labor market issues, though their coverage remains limited with funding constraints identified as one of the main challenges. Creating quality jobs will require comprehensive policies to promote headline growth and ensure inclusive growth, including measures to improve education and address challenges in gender and youth.
Keywords:
ISCR; CR; Uganda; wage; labor market; text; IMF staff calculation; employment sector; employment characteristic; employment opportunity; employment elasticity; Uganda UBOS report; women engagement; agriculture employment; Employment; Women; Labor markets; Sub-Saharan Africa; Global
Cover IMF Staff Country Reports
Uganda: Selected Issues
International Monetary Fund. African Dept.
This Selected Issues paper describes Uganda’s experience under the 2013 Policy Support Instrument (PSI). The current 2013 PSI was approved by the IMF’s Executive Board in June 2013 with an initial duration of three years. Overall, performance under this PSI has been assessed to be satisfactory. Most quantitative assessment criteria were met, and macroeconomic stability maintained. However, the pace of structural reforms slowed down compared with the past, and only about half of the structural benchmarks were ultimately met. The experience shows the importance of ensuring commitment to the reforms, explaining them better, and getting broad-based buy-in to achieve progress.
Keywords:
ISCR; CR; Uganda; debt; IMF-World Bank debt sustainability framework; baseline debt projection; exchange rate; interest rate; government debt; IMF staff; PSI focus; Financial sector development; Double taxation; Tax incentives; Public investment and public-private partnerships (PPP); Global; Sub-Saharan Africa; Africa
Cover IMF Working Papers
Long-Run Biological Interest Rate for Pay-As-You-Go Pensions in Advanced and Developing Countries
Mr. Masahiro Nozaki
How much of an internal rate of return would a sustainable pay-as-you-go pension system offer current and future generations equally? The answer is the sum of the Long-Run Biological Interest Rates (LBIR), the real-world equivalent of Samuelson’s (1958) biological interest rate, and future productivity growth. Reflecting global population ageing, the median LBIR across 172 countries is as low as 1 percent per year. The LBIRs are particularly low in advanced countries, estimated to be negative in many of them, and require ample financial reserves today or future productivity growth to maintain participation in pension schemes. On the other hand, the LBIRs in less developed regions, such as in sub-Saharan Africa, are relatively high, indicating a potential to use a pay-as-you-go scheme to expand the coverage of public pensions. Raising the retirement age by five years brings up the LBIR by 40 basis points, significantly improving the long-run budget constraint of a pension scheme.
Keywords:
WP; rate of return; life expectancy; LBIR estimate; Pay-as-you-go pension; internal rate of return; pension reform; contribution rate; LBIR level; RCR decrease; replacement rate; medium-fertility variant; median LBIR; Pensions; Aging; Pension spending; Productivity; Retirement; Sub-Saharan Africa; Middle East; Europe; North Africa; East Africa
Cover IMF Working Papers
Are African Households Heterogeneous Agents?: Stylized Facts on Patterns of Consumption, Employment, Income and Earnings for Macroeconomic Modelers
Ms. Louise Fox
This paper reviews the evidence on how households in Sub-Saharan Africa segment along consumption, income and earning dimensions relevant for quantitative macroeconomic policy models which incorporate heterogeneity. Key findings include the importance of home-grown food in the income and consumption of house-holds well up the income distribution, the lack of formal financial inclusion for all but the richest households, and the importance of non-wage income. These stylized facts suggest that an externally-generated macroeconomic shock and the short-term policy response would mainly affect the behavior and welfare of these richer urban households, who are also more likely to have the means to cope. Middle class and poor households, especially in rural areas, should be insulated from these external shocks but vulnerable to a wide range of structural factors in the economy as well as idiosyncratic shocks.
Keywords:
WP; wage employment; wage income; labor market; union wage effect; wage job; Sub-Saharan Africa; Inequality; macroeconomics; household heterogeneity; Macro Models; Macroeconomic Stabalization; Labor Economics; Informal Labor Market; Mobility; off season; wage earnings variation; low income; wage sector; Income; Personal income; Wages; Employment; Africa; West Africa
Cover IMF Working Papers
Identifying Constraints to Financial Inclusion and Their Impact on GDP and Inequality: A Structural Framework for Policy
Ms. Era Dabla-Norris
,
Yan Ji
,
Robert M. Townsend
, and
Ms. Filiz D Unsal
We develop a micro-founded general equilibrium model with heterogeneous agents to identify pertinent constraints to financial inclusion. We evaluate quantitatively the policy impacts of relaxing each of these constraints separately, and in combination, on GDP and inequality. We focus on three dimensions of financial inclusion: access (determined by the size of participation costs), depth (determined by the size of collateral constraints resulting from limited commitment), and intermediation efficiency (determined by the size of interest rate spreads and default possibilities due to costly monitoring). We take the model to a firm-level data from the World Bank Enterprise Survey for six countries at varying degrees of economic development—three low-income countries (Uganda, Kenya, Mozambique), and three emerging market countries (Malaysia, the Philippines, and Egypt). The results suggest that alleviating different financial frictions have a differential impact across countries, with country-specific characteristics playing a central role in determining the linkages and tradeoffs between inclusion, GDP, inequality, and the distribution of gains and losses.
Keywords:
WP; participation cost; Gini coefficient; cost of capital; intermediation cost; Financial inclusion; inequality; income distribution; hetergenous agents; optimal contract; credit regime; lending interest rate; Self-employment; Credit; Income inequality; Collateral
Cover IMF Working Papers
The Short-Run Macroeconomics of Aid Inflows: Understanding the Interaction of Fiscal and Reserve Policy
Luis-Felipe Zanna
,
Mr. Andrew Berg
,
Mr. Tokhir N Mirzoev
, and
Mr. Rafael A Portillo
We develop a tractable open-economy new-Keynesian model with two sectors to analyze the short-term effects of aid-financed fiscal expansions. We distinguish between spending the aid, which is under the control of the fiscal authorities, and absorbing the aid-using the aid to finance a higher current account deficit-which is influenced by the central bank's reserves policy when access to international capital markets is limited. The standard treatment of the transfer problem implicitly assumes spending equals absorption. Here, in contrast, a policy mix that results in spending but not absorbing the aid generates demand pressures and results in an increase in real interest rates. It can also lead to a temporary real depreciation if demand pressures are strong enough to threaten external balance. Certain features of low income countries, such as limited participation in domestic financial markets, make a real depreciation more likely by amplifying demand pressures when aid is spent but not absorbed. The results from our model can help understand the recent experience of Uganda, which saw an increase in government spending following a surge in aid yet experienced a real depreciation and an increase in real interest rates.
Keywords:
WP; central bank; exchange rate
Cover IMF Staff Country Reports
Kenya: Selected Issues and Statistical Appendix
International Monetary Fund
Like most Sub-Saharan African countries, Kenya’s economic growth appears to have been primarily driven by factor accumulation. The Selected Issues paper and Statistical Appendix for Kenya examines economic developments and policies. During the last two decades, Kenya has been plagued by pervasive problems of internal conflicts, constitutional crises, and corruption scandals. The governance agenda focuses on several reforms, including upgrading the public budget and financial management systems, strengthening the anticorruption institutions, and improving the judicial framework.
Keywords:
ISCR; CR; Kenya; pay; inflation; TFP growth; wage bill; Reduced-Form inflation equation; development objective; governance agenda; growth performance; bill-to-domestic revenue; Tariffs; Total factor productivity; Wages; Real exchange rates; Imports; Sub-Saharan Africa; Middle East; Africa; East Asia; Central and Eastern Europe