Among 27 emerging market economies surveyed by the Institute of International Finance (IIF), many have made progress in providing capital markets with data on their economies, according to an IIF report released on January 6. None of the economies fully satisfies all the standards, but the report, Data Release Practices of Emerging Market Economies: 1999 Assessment, gives high marks to nine economies—Argentina, Colombia, the Czech Republic, Israel, Mexico, Peru, Poland, Thailand, and Turkey–for their overall performance against the IIF’s benchmark standards. The standards focus on the comprehensiveness, timeliness, and frequency of data reported in 25 areas, including the external debt, gross reserves, and balance of payments. Although the IIF does not evaluate the quality of the data, it encourages the authorities of emerging market economies to supplement their data with explanations of methodology and sources.
A number of other countries have made considerable progress in meeting the standards since 1997, when the IIF first assessed the data release practices of emerging market economies, the report states. Included in this group are Argentina, Hong Kong SAR, Malaysia, the Philippines, Poland, and Thailand. The report notes that data provision in the Asian region, in particular, improved as a result of the renewed focus on transparency that grew out of the Asian financial crisis. China, Egypt, Kuwait, Morocco, Saudi Arabia, and Tunisia have also made progress in providing more complete and timely information in a number of categories, but continue to lag behind in meeting the overall data dissemination standards.
Despite significant and continuing progress among these economies, the report states that “serious shortcomings remain in certain areas that should be a particular focus of authorities’ efforts to improve data provision.” All the economies need to provide more regular and timely information about external debt amortization schedules, which is crucial for allowing lenders and investors to judge the sustainability of an economy’s external financing position. There is also scope for improvement in the reporting of data on gross reserves, including drains on reserves, and on fiscal accounts, especially for the public sector as a whole.
The 27 economies covered in the report are among the most important emerging markets in terms of global trade and production and the most active in international capital markets. The assessments are intended to improve transparency, thereby minimizing surprises, maximizing stability, and enhancing flows in emerging market finance. In discussing the report during the press conference announcing its release, IIF Deputy Managing Director and chief economist William Cline noted that, although no correlation had been established between greater transparency and increased market access, improvements could be expected in the future.