Alternative Measures of Feasible Primary Surpluses
(Nonfinancial public sector, in percent of GDP)
|Actual primary balance:1 (a)||n.a.||n.a.||−5.6||−0.2||2.7||−1.2||−2.1||0.5||−2.0||3.0||5.5||4.2||6.2||6.5||1.0|
|Predicted primary balance: (b)||−0.8||−1.4||0.0||−1.5||0.4||−0.1||0.7||1.6||−0.2||1.8||0.4||1.7||2.0||2.3||0.6|
|Relative adjustment effort:2|
|Measures of feasible surplus:|
|(b) + maximum effort over 1993–2003||4.2||3.6||5.1||3.6||5.5||4.9||5.7||6.6||4.9||6.9||5.5||6.8||7.1||7.3||5.7|
|(b) + average positive effort 1993–2003||1.9||1.3||2.7||1.3||3.2||2.6||3.4||4.3||2.6||4.5||3.2||4.5||4.7||5.0||3.4|
|(b) with “ambitious” fiscal reforms4||1.9||1.3||2.8||1.3||3.2||2.6||3.4||4.3||2.6||4.6||3.2||4.5||4.8||5.0||3.4|
|(b) + average positive effort 1993–2003, and “ambitious” fiscal reforms||4.7||4.1||5.5||4.1||5.9||5.4||6.2||7.1||5.3||7.3||6.0||7.3||7.5||7.8||6.1|
|(b) + average positive effort 1993–2003, and fiscal reforms5||3.2||2.7||4.1||2.6||4.5||3.9||4.8||5.6||3.9||5.9||4.5||5.8||6.1||6.3||4.7|
|Memo items: Total revenue||22.8||24.1||25.3||25.6||23.7||24.6||27.1||29.6||32.1||39.4||38.8||34.3||34.8||…||30.5|
|Average fixed effect in primary surplus equation||−1.8|
|Turkey fixed effect in primary surplus equation||−2.8|
|Expected Turkey fixed effect on the basis of revenues||−1.3|
Targeted surplus for 2004 as in the “program baseline” of the fiscal strategy note.
The average is based only on positive efforts.
The average fiscal effort is calculated based on the positive numbers only.
The potential effect of “ambitious” fiscal reforms on the surplus-generating capacity is estimated as (minus) the country’s fixed effect in the primary surplus model.
The primary surplus effect of fiscal reforms is estimated as the difference between the country fixed effect and the predicted fixed effect on the basis of revenues (see Figure 7.2).