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Lessons in Fiscal Consolidation for the Successor States of the Soviet Union
Author:
Mr. George Kopits
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Series:
IMF Working Papers
Volume/Issue:
Volume 1993: Issue 054
Language:
English
Publication Date:
01 Jun 1993
DOI:
https://doi.org/10.5089/9781451847444.001
ISBN:
9781451847444
ISSN:
1018-5941
Pages:
26
Keywords:
WP; break; CEE economy; government; economy; CEE experience; governments in CEE; government operation; contingent government liability; CEE experience point; single-enterprise industry; market economy; nonfinancial enterprise; interest-yielding government paper; Budget planning and preparation; Government debt management; Fiscal consolidation; Baltics
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IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper reviews lessons in fiscal consolidation for the former Soviet Union that emerge from the experience of Central and Eastern European economies in transition. A central lesson is the need to support the macroeconomic stabilization with a front-loaded fiscal adjustment. Consistent with this adjustment path, structural reform in the tax and expenditure areas should be aimed at allocative efficiency and fairness, and its sequencing be predicated largely on administrative constraints. In the face of the uncertainty of fiscal projections, formulation of contingency measures is necessary. In addition, elimination of submerged fiscal imbalances, stemming from quasi-fiscal activities of state-owned nonfinancial enterprises and financial institutions, is just as important as correcting the measured budget deficit.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund