Back Matter

Back Matter

Author(s):
Olaf Unteroberdoerster
Published Date:
February 2014
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Index

Page numbers followed by b, f, n, or t refer to boxed text, figures, footnotes, or tables, respectively.

A

Agriculture sector, growth in, 18–19

Anti-money laundering and combating financing of terrorism (AML/CFT), 138t

ASEAN free trade area, 92, 104

Asian economies

  • average investment-to-GDP, 17f
  • control of corruption, 36f
  • crop yields, 19f
  • export diversification, 20f
  • infrastructure, 18f
  • public spending on education, 20f
  • regulatory quality, 36f
  • rule of law, 36f
  • See also Emerging Asia

Asia’s rebalancing, 77, 78–80b, 80–81

Asset substitution, 120–122

Audit activities, need for, 108–110

B

Balance sheet risks, 35

Banking system

  • concentrated, 54
  • corporate governance of, 138t
  • features of, 52–54
  • financial soundness indicators for, 141t
  • overbanking issues, 55–58
  • structure of, 67–68
  • supervision and regulation, 137t
  • See also Financial system

Basel Core Principles, 138, 139, 140

Broad money, 27, 28f, 38, 44

Budget classification, 95, 99b, 102

Business taxpayers, 111, 112

C

Cambodia

  • Asia’s rebalancing and, 77, 78–80b, 80–81
  • banking system of, 52, 53f
  • credit growth in, 58
  • cross-border exposure to, 73f
  • deposit rate spread in, 37f, 44
  • economic integration by region, 68f
  • external demand sources in, 69f
  • federal funds rate and, 41–42, 44, 48
  • financial soundness indicators, 141t
  • financial stability issues, 51
  • foreign and domestic assets in, 58, 59f
  • global competitive indices, 80t
  • governance indicators, 36f, 37
  • growth spillover analysis for, 71b
  • lending rate spread in, 37f, 44
  • microfinance institutions in, 68, 132–133
  • overbanking issues, 55–58
  • policy options for, 39–41
  • revenue norm estimate for, 93–94b
  • See also Dollarization; Financial system

Cambodian Stock Exchange, 4, 147

Capital and foreign exchange markets, 123–124

Capital flows

  • Asia’s rebalancing and, 77, 80
  • decline in, 60
  • financial stability and, 64n
  • foreign banks and, 58

Capital income tax, 113t, 115

Capital markets, 123–124, 133

Capital spending, 95, 101

Capital stock, 11, 14

Cash management, 99, 101

China’s rebalancing, 77, 78–80b, 80–81

Cholesky method, 44

Competition

  • Asia’s rebalancing and, 81
  • financial stability and, 56b

Credit growth

  • cross-country comparison of, 76f
  • in emerging Europe, 59–60b
  • financial depth and, 76f
  • financial system and, 72–73, 75, 77
  • foreign banks and, 58
  • too fast, 74–75b

Credit reporting system (CRS), 139

Credit risk management, 136, 138–139

Crisis management framework, 138t, 143–147

Currency substitution, 120–122

D

Debt collection, 109t, 110

Debt management, 87, 88, 89, 96, 101

Dedollarization

  • communicating about, 129–130
  • conclusion about, 130
  • financial development initiatives and, 122–124
  • international experience with, 37–39
  • as prerequisite, 127–128
  • promoting credibility of, 125

Deposit insurance system, 40, 67, 146

Deposit rate spread, 37f, 44

Developing economies, 9, 10n, 23, 81

Direct taxes, 88f, 90, 112, 116

Dollarization

  • Cambodian experience with, 29–32, 35–37
  • causes of, 29
  • conclusion about, 41
  • costs and risks of, 31–32, 35
  • cross-country comparison of, 67f
  • different guises of, 121f
  • exchange rate and, 35, 39–40, 71
  • financial system and, 66–67
  • increase in, 27, 28f
  • See also Dedollarization

Donor support, 92, 98, 99b, 101, 109t

Double tax agreements (DTAs), 117

E

Education, public spending on, 19, 20f

Efficiency principle, 112

El Salvador, tax reforms in, 106b

Emerging Asia

  • exports and imports, 68–69, 78b
  • growth spillover from, 70b, 71b

Emerging Europe, banking lessons from, 59–60b

Equity principle, 112

Exchange rate, 39–40, 44, 71

Excise tax, 100, 113t, 114

Export diversification, 19, 21, 65, 66, 82

F

Factor accumulation, 13, 14

Federal funds rate

  • effects of changes in, 41–42
  • shock to, 36, 44, 48

Financial channel, 41, 42, 46f

Financial development initiatives

  • capital and foreign exchange markets, 123–124
  • interbank market, 122–123
  • sequencing, 124–130

Financial dollarization, 120, 123, 126

Financial Management Information System (FMIS), 98, 99b, 101–102

Financial Sector Assessment Program (FSAP), 134, 137–138t

Financial stability

  • in Cambodia, 51
  • capital flows and, 64n
  • competition and, 56b
  • foreign banks and, 58–60
  • overbanking impact on, 56–58
  • small banks and, 57b

Financial system

  • banking institutions and, 131–132
  • challenges to, 140–146
  • conclusion about, 146–147
  • ensuring sound, 4–5
  • foreign exchange market and, 133–134, 135b
  • fragmented, 2
  • insurance sector and, 133
  • introduction to, 2
  • legal framework for, 144–145b
  • microfinance institutions and, 132–133
  • rapid growth in, 132t
  • securities market and, 133
  • structure of, 132f
  • transformation of, 134, 136, 138–140
  • See also Dollarization

Fiscal buffers, 81, 87n, 88, 90

Fiscal challenges

  • composition of spending and, 92, 94
  • debt sustainability and, 96–98
  • medium-term, 90–91
  • near-term, 89–90
  • public financial management and, 98
  • spending reforms and, 94–96
  • tax revenue and, 92

Fiscal policy, 77, 87, 94

Fiscal space

  • creating and safeguarding, 3–5
  • fiscal challenges and, 89–98
  • fiscal setting and, 87–89
  • limited, 69–70
  • policy priorities and, 98–102

Fiscal sustainability, 3, 104

Foreign assets, 29, 58, 59f

Foreign banks, 58–60, 74, 75, 132

Foreign currency

  • dedollarization and, 38
  • demand for, 29
  • deposits, 28f, 125n

Foreign exchange markets, 123–124, 133–134, 135b

Foreign exchange reserves, 51, 81

Foreign investment, 15, 30, 78b, 94, 143

G

Garment exports, 1, 30, 31f, 36, 66f, 69

GDP growth

  • average, 28f
  • by selected regions, 68f
  • shock to, 71b

General Department of Taxation (GDT), 103

Global financial crisis of 2008–09, 1, 59–60b

Governance, strengthening, 100, 107t, 117–118

Governmental deposits

  • fiscal revenue and, 87, 88f
  • low level of, 70–71, 89–90

Government securities, 38, 87, 127

Grants, 91f, 92, 94f

Growth spillovers

  • analysis of, 71b
  • external shocks and, 69
  • variance decomposition analysis and, 70b

H

Human resource development, 100, 109t, 110, 140

Hyperinflation, 29, 38

I

Imports, 68–69

Impulse response functions, 44, 45f, 48, 71f

Inflation

  • average, 28f
  • dedollarization and, 38
  • dollarization and, 29
  • macroeconomic stability and, 39
  • output gap and, 12, 42

Information technology (IT) system, 109t, 111

Infrastructure

  • Asian economies, 18f
  • gaps and investment, 17, 18f, 22t
  • improvements issues, 22, 23
  • legal, 144–145b

Insurance sector, 133

Interbank market, 122–123, 128, 129

Interest rates

  • currency risks and, 37
  • dollarization and, 32
  • domestic liquidity and, 57
  • federal funds rate and, 36, 44

International reserves, 32, 35, 41

International taxation, 117

Investment

  • Asian economies, 18f
  • ease of doing business and, 17
  • hindrance to, 18f
  • infrastructure gaps and, 22t
  • potential growth and, 15, 16

K

Kalman filtering, 11, 13

Khmer Rouge regime, 27, 29–30

Korean Stock Exchange, 133

L

Labor growth, 13, 14f

Land as a type of collateral, 144–145b

Large Taxpayer Department (LTD), 103, 108–110

Law on Banks and Financial Institutions, 144b, 146

Lender of the last resort, 32, 35, 51, 119

Lending rate spread, 37f, 44

Low-income countries

  • grants to, 94f
  • seigniorage loss in, 33–34t
  • tax collection in, 91f
  • vulnerability analysis in, 63–65

M

Macroeconomic instability, 29, 38

Macroeconomic stability, 39–40, 87, 119, 121

Macroeconomic variables, 41–42, 44, 48

Macro-financial stability, 58–60

Memoranda of understanding (MoUs), 142, 143

Microfinance institutions, 68, 132–133

Mining and petroleum agreements, 116

Monetary policy

  • in Cambodia, 35–36
  • dollarization and, 71
  • effectiveness of, 120–122
  • elements of, 125t
  • federal funds rate and, 41–42
  • transparency of, 138t

N

National Bank of Cambodia (NBC)

  • credit growth and, 74–75b
  • credit risk management and, 136, 138–139, 143–147
  • foreign exchange market and, 135b
  • interbank market and, 40
  • limited influence of, 31
  • liquidity risk and, 32, 35
  • reserve requirement and, 40
  • risk-based supervision by, 139–140, 142
  • seigniorage loss and, 31–32
  • supervisory and licensing capacity and, 142–143
  • See also Financial system

National payment system, 134, 136b

Negotiable certificates of deposit (NCDs), 122–124, 126–129

Nonbank financial sector, 137t

O

Output gap, 11, 13, 13n, 42, 48

Overbanking financial system, 55–58

P

Personal income tax, 91, 100, 113t, 115

Potential growth

  • adverse scenarios, 15–16
  • baseline projection, 13, 14f
  • breakdown of, 13, 14f
  • conclusion about, 23
  • estimating, 10–16
  • growth diagnostic and, 16–23
  • growth dividends and, 21–23
  • introduction to, 9
  • with investment boost, 22f
  • main findings about, 24b

Production function approach, 10n, 10, 11

Productivity gains, 13, 15, 19, 21, 23

Productivity growth, 9, 14f, 16, 18, 24

Property tax, 113t, 115–116

Public Financial Management Reform Program (PFMRP), 88, 98, 99, 101, 102

Public spending, 19, 20f, 96

R

Rebuilding and recovery, 1–2

Reserve requirement, 31n, 40, 74b, 125n

Resource-based taxation, 116

Revenue administration, 100, 107–112

Revenue collection

  • audit activities for, 108–110
  • progress related to, 111–112
  • reforms for increasing, 106–107b
  • tax revenue and, 92

Revenue forecasting, 109t, 111

Revenue mobilization

  • approach for, 99–100, 104–107
  • improving, 106–107b
  • policy actions for, 100–101, 107t
  • revenue administration and, 107–112
  • strengthening governance for, 117–118
  • tax policies and, 112–117

Revenue performance, 69, 70, 88, 93b

Riel

  • increase in deposits of, 30
  • interbank market and, 122–123
  • promoting use of, 39–41
  • stock market in, 123
  • swap contracts and, 124
  • See also Negotiable certificates of deposit (NCDs)

Risk-based supervision, 139–140

S

Securities market, 41, 123, 133

Seigniorage loss

  • dollarization and, 31–32, 119
  • in low-income countries, 33–34t

Simplicity principle, 112

Small banks

  • overbanking and, 56–57
  • Vietnam’s experience with, 57b

Small macro model, 11–16

Spending

  • capital, 95, 101
  • composition of, 92, 94
  • public, 19, 20f, 96
  • reforms related to, 94–96

State-space structure, 10, 11, 13

Statistical filtering approach, 10, 11

Stock market. See Securities market

Swap contracts, 124, 125

T

Tanzania, tax reforms in, 106b

Tax collections, 91f, 106, 109t, 112

Tax exemptions, 90, 103, 107t

Tax incentives, 113t, 114–115, 117

Taxpayer services, 100, 108, 109t, 110

Tax policies

  • implementing fair, 112
  • improving transparency in, 118
  • medium-term priorities, 114–117
  • near-term priorities, 112–114

Tax reforms, 103, 106–107b

Tax regimes, 112, 113t, 114, 115, 116

Tax revenue

  • fiscal challenges and, 90–91
  • improving, 92
  • indicators, 91f

Tourism sector, 1, 2, 30, 31f, 69f

Trade balance, 42, 48

Trade channel, 41, 42, 46f, 48

Trade shocks, 63, 64

Trade taxes, 92, 104, 111

U

United States

  • contribution to variation in growth, 70b
  • dollarized Cambodia and, 35–36
  • GDP growth, 68f

V

Value-added tax (VAT)

  • fiscal challenges and, 90, 91
  • revenue mobilization and, 106b
  • tax policy and, 100, 112, 113t, 115

VAR approach, 42, 43f, 44, 71b

Variance decompositions

  • economic activity variation and, 70b
  • federal funds rate and, 47f, 48

Vector autoregression model (VAR) approach, 42, 43f, 44, 71b

Vietnam

  • bank concentration in, 54f
  • small banks and, 57b
  • tax reforms in, 106–107b

Vulnerability

  • conclusion about, 82
  • fiscal, 77
  • in low-income countries, 63–65
  • mitigation strategy, 81–82
  • sectoral, 72–73, 75, 77, 80–81
  • sources of, 65–71, 80

W

World Bank’s Country Policy and Institutional Assessment, 98

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