Abstract
Macroeconomic conditions have improved recently. Growth appears to be picking up while inflation has declined to low single digits; foreign reserves have been increasing on the back of a strong financial account; the fiscal balance has recorded a surplus in the past two years; and credit growth remains moderate. Financial soundness indicators point to a modest improvement in the health of the financial sector.
Fund Relations
(As of April 29, 2016)
Membership Status:
Joined: September 28, 1981; Article XIV.
General Resources Account
General Resources Account
| SDR Million | % Quota | |
| Quota | 20.40 | 100.00 |
| Fund Holdings of Currency (Exchange Rate) | 15.85 | 77.72 |
| Reserve Tranche Position | 4.55 | 22.28 |
| Lending to the Fund | ||
| SDR Department: | ||
| SDR Million | % Allocation | |
| Net cumulative allocation | 5.99 | 100.00 |
| Holdings | 5.99 | 100.03 |
General Resources Account
| SDR Million | % Quota | |
| Quota | 20.40 | 100.00 |
| Fund Holdings of Currency (Exchange Rate) | 15.85 | 77.72 |
| Reserve Tranche Position | 4.55 | 22.28 |
| Lending to the Fund | ||
| SDR Department: | ||
| SDR Million | % Allocation | |
| Net cumulative allocation | 5.99 | 100.00 |
| Holdings | 5.99 | 100.03 |
Outstanding Purchases and Loans: None
Latest Financial Arrangements: None
Projected Payments to Fund 1/
(SDR million; based on existing use of resources and present holdings of SDRs):
When a member has overdue financial obligations outstanding for more than three months, the amount of such arrears will be shown in this section.
Projected Payments to Fund 1/
(SDR million; based on existing use of resources and present holdings of SDRs):
| Forthcoming | |||||
|---|---|---|---|---|---|
| 2016 | 2017 | 2018 | 2019 | 2020 | |
| Principal | |||||
| Charges/interest | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Total | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
When a member has overdue financial obligations outstanding for more than three months, the amount of such arrears will be shown in this section.
Projected Payments to Fund 1/
(SDR million; based on existing use of resources and present holdings of SDRs):
| Forthcoming | |||||
|---|---|---|---|---|---|
| 2016 | 2017 | 2018 | 2019 | 2020 | |
| Principal | |||||
| Charges/interest | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Total | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
When a member has overdue financial obligations outstanding for more than three months, the amount of such arrears will be shown in this section.
Implementation of HIPC Initiative: Not Applicable
Implementation of Multilateral Debt Relief Initiative (MDRI): Not Applicable
Implementation of Post-Catastrophe Debt Relief (PCDR): Not Applicable
Exchange System
Since its introduction in 1974, the ngultrum has been pegged to the Indian rupee at par. Bhutan continues to avail itself of transitional arrangements under Article XIV, Section 2, pursuant to which it maintains exchange restrictions in connection with: (i) the availability of foreign exchange for travel, except for medical travel abroad by Bhutanese citizens, invisibles, and private transfers; (ii) foreign exchange balancing requirement on remittances of income in convertible currencies or other foreign currencies from FDI; and (iii) the availability of foreign exchange for importers who are not able to provide the identity of the seller.
Bhutan also maintains exchange restrictions subject to Fund approval under Article VIII, Section 2(a) in connection with: (i) the FX balancing requirements for imports of capital goods (for projects involving FDI) and primary raw materials (for certain industrial projects); (ii) banning residents who do not comply with the requirement to repatriate export proceeds from accessing foreign exchange for unrelated imports; (iii) requiring foreign direct investment businesses to pay for their establishment and operational expenses from their own convertible currency resources; (iv) requiring Bhutanese companies to pay the interest on and amortization of external loans from their own convertible currency resources; (v) restricting the availability of Indian rupee for making payments and transfers to India in the following current international transactions: personal and business travel and study-abroad living arrangement, family, advance payments for imports from India and to recruit Indian workers and (vi) banning the access to Indian rupee for unrelated current international transactions for those who contravene RMA ‘s 2012 guidelines on Indian rupee transactions. On September 1, 2014, the RMA reintroduced housing and vehicle loans (after temporary suspension of access to Indian rupees to finance imports of personal vehicles and housing construction materials in March 2012).1
Staff is in the process of assessing other measures introduced by the authorities with respect to their implications to Bhutan’s obligations under Article VIII, Section 2(a) and 3.
Article IV Consultation
Bhutan is on a 24-month consultation cycle. The 2014 Article IV consultation was concluded by the Executive Board on June 20, 2014.
Technical Assistance
Technical Assistance
| Fiscal (FAD): | ||
| 1982, 1983 | − | Tax policy, budgeting, and accounting |
| 1984 | − | Tax legislation |
| 1984–86, 1988–89 | − | Technical experts assigned as General Fiscal Advisor to the Ministry of Finance |
| 1987, 1989 | − | Tax system and public enterprises |
| 1992, 2003 | − | Income taxation |
| 2003 | − | Workshop on tax auditing and revenue forecast |
| 2004 | − | Accounting (with MFD) |
| 2009 | − | Indirect tax system, scope for VAT introduction |
| 2009, 2015 | − | Sales tax/VAT |
| 2012 | − | Diagnostic mission on budget preparation |
| 2012, 2013 | − | Assistance for cash flow forecasting and cash management |
| 2013, 2016 | − | Capacity building on budget analysis through structured management review |
| 2013 | − | Treasury management |
| 2013 | − | Treasury diagnostic |
| 2013, 2014, 2016 | − | Macrofiscal capacity building |
| 2013, 2014 | − | Budget planning and analysis |
| 2015 | − | Extension of Resident Advisor |
| 2015 | − | Cash management |
| 2015 | − | Tax policy |
| 2016 | − | Treasury single account |
| Legal (LEG): | ||
| 1982–84 | - | Tax legislation |
| 2004, 2005 | − | Central banking and financial services legislation and foreign exchange regulations (with MFD) |
| 2011 | − | TA in Payments Law |
| 2015 | − | National Strategy and Structures & Tools |
| 2015, 2016 | − | Enhancing the AML/CFT Regime |
| Monetary and Financial (CBD/MAE/MFD/MCM): | ||
| 1983 | − | Set-up the Royal Monetary Authority (RMA) |
| 1980–92 | − | Technical experts assigned as General Advisors to RMA |
| 1989 | − | Financial system review |
| 1991 | − | Financial sector legislation/development of supervisory capabilities |
| − | Technical experts assigned as Advisor for Bank Supervision | |
| 1992 | − | Issuance of government securities |
| 1993–96 | − | Implementation of issuance of government securities |
| 2003 | − | Monetary and exchange operations / financial systems |
| 2004 | − | Accounting |
| 2004, 2005, 2015 | − | Central banking and financial services legislation and foreign exchange regulations |
| 2005, 2007 | − | Risk based internal audit policies and practices |
| 2006, 2007 | − | Implementation of accounting reforms |
| 2007 | − | Debt management and financial markets development |
| 2007 | − | Follow-up on excess liquidity issues |
| 2007 | − | Follow-up on reserve management |
| 2008 | − | Foreign exchange issues |
| 2013 | − | Enhancing financial sector surveillance |
| 2013 | − | Treasury and reserve management |
| 2015 | − | Cash/currency management |
| 2016 | − | Reserve Management |
| 2016 | − | Banking supervision and regulation |
| 2016 | − | Banking and accounting systems |
| Statistics (STA): | ||
| 1988 | − | Trade statistics |
| 1990 | − | Statistics database |
| 2004 | − | Multisector statistics/GDDS mission |
| 2005, 2009, 2011, 2013 | − | Balance of payments statistics |
| 2010 | − | GDDS: Metadata Development |
| 2011, 2012 | − | JSA ICP: Producer Price Index |
| 2012 | − | Module management/oversight |
| 2012 | − | National Accounts - Quarterly |
| 2011, 2013 | − | JSA ICP-SNA: Quarterly National Accounts |
| 2013 | − | Government Finance Statistics |
| 2013 | − | Consumer Price Index |
| 2013 | − | Assessment/Evaluation |
| 2016 | − | National accounts |
| 2016 | − | e-GDDS: National Summary Data Page creation |
| Resident Representative: | None. | |
Technical Assistance
| Fiscal (FAD): | ||
| 1982, 1983 | − | Tax policy, budgeting, and accounting |
| 1984 | − | Tax legislation |
| 1984–86, 1988–89 | − | Technical experts assigned as General Fiscal Advisor to the Ministry of Finance |
| 1987, 1989 | − | Tax system and public enterprises |
| 1992, 2003 | − | Income taxation |
| 2003 | − | Workshop on tax auditing and revenue forecast |
| 2004 | − | Accounting (with MFD) |
| 2009 | − | Indirect tax system, scope for VAT introduction |
| 2009, 2015 | − | Sales tax/VAT |
| 2012 | − | Diagnostic mission on budget preparation |
| 2012, 2013 | − | Assistance for cash flow forecasting and cash management |
| 2013, 2016 | − | Capacity building on budget analysis through structured management review |
| 2013 | − | Treasury management |
| 2013 | − | Treasury diagnostic |
| 2013, 2014, 2016 | − | Macrofiscal capacity building |
| 2013, 2014 | − | Budget planning and analysis |
| 2015 | − | Extension of Resident Advisor |
| 2015 | − | Cash management |
| 2015 | − | Tax policy |
| 2016 | − | Treasury single account |
| Legal (LEG): | ||
| 1982–84 | - | Tax legislation |
| 2004, 2005 | − | Central banking and financial services legislation and foreign exchange regulations (with MFD) |
| 2011 | − | TA in Payments Law |
| 2015 | − | National Strategy and Structures & Tools |
| 2015, 2016 | − | Enhancing the AML/CFT Regime |
| Monetary and Financial (CBD/MAE/MFD/MCM): | ||
| 1983 | − | Set-up the Royal Monetary Authority (RMA) |
| 1980–92 | − | Technical experts assigned as General Advisors to RMA |
| 1989 | − | Financial system review |
| 1991 | − | Financial sector legislation/development of supervisory capabilities |
| − | Technical experts assigned as Advisor for Bank Supervision | |
| 1992 | − | Issuance of government securities |
| 1993–96 | − | Implementation of issuance of government securities |
| 2003 | − | Monetary and exchange operations / financial systems |
| 2004 | − | Accounting |
| 2004, 2005, 2015 | − | Central banking and financial services legislation and foreign exchange regulations |
| 2005, 2007 | − | Risk based internal audit policies and practices |
| 2006, 2007 | − | Implementation of accounting reforms |
| 2007 | − | Debt management and financial markets development |
| 2007 | − | Follow-up on excess liquidity issues |
| 2007 | − | Follow-up on reserve management |
| 2008 | − | Foreign exchange issues |
| 2013 | − | Enhancing financial sector surveillance |
| 2013 | − | Treasury and reserve management |
| 2015 | − | Cash/currency management |
| 2016 | − | Reserve Management |
| 2016 | − | Banking supervision and regulation |
| 2016 | − | Banking and accounting systems |
| Statistics (STA): | ||
| 1988 | − | Trade statistics |
| 1990 | − | Statistics database |
| 2004 | − | Multisector statistics/GDDS mission |
| 2005, 2009, 2011, 2013 | − | Balance of payments statistics |
| 2010 | − | GDDS: Metadata Development |
| 2011, 2012 | − | JSA ICP: Producer Price Index |
| 2012 | − | Module management/oversight |
| 2012 | − | National Accounts - Quarterly |
| 2011, 2013 | − | JSA ICP-SNA: Quarterly National Accounts |
| 2013 | − | Government Finance Statistics |
| 2013 | − | Consumer Price Index |
| 2013 | − | Assessment/Evaluation |
| 2016 | − | National accounts |
| 2016 | − | e-GDDS: National Summary Data Page creation |
| Resident Representative: | None. | |
Relations With The World Bank Group
(As of April 2016)
The World Bank Group (WBG) Strategy in Bhutan
The WBG Board endorsed the new Country Partnership Strategy (CPS) for Bhutan on September 23, 2014. It supports the Royal Government of Bhutan Eleventh Five-Year Plan (11FYP) (2013–2018) approved by the Parliament in October 2013. The government focuses on Self Reliance and Inclusive Green Socio-economic Development in the Eleventh Five year Plan. Self-Reliance is interpreted as “ability to meet all national development needs as articulated through 5 year plans by 2020” and Inclusive development refers to “reducing poverty and inequality by enhancing the standard of living and the quality of life of the most vulnerable sections of the society”.
The CPS seeks to protect Bhutan’s recent gains in reducing poverty through a continued focus on improving rural livelihoods and managing urbanization, while protecting its natural assets (ongoing investment lending in all three areas). The CPS organizes activities under three results areas: (i) improving fiscal and spending efficiency, (ii) increasing private sector growth and competitiveness, and (iii) supporting green development, implemented by the IDA and the IFC, through financial, analytical and advisory support.
International Development Association (IDA) - “World Bank”
IDA Portfolio and Pipeline
The World Bank provides around $15-20 million of new IDA resources per year. There are four ongoing specific investment operations for a net commitment of $82 million of IDA. These include three country specific IDA operations: Urban Development II and additional financing, Remote Rural Communities Development; one regional IDA project: Regional Cooperation on Wildlife Protection; as well as one GEF grant operation: Sustainable financing for biodiversity conservation. In addition, the Bank manages several small grants for Bhutan on climate resilience, disaster management, public financial management, urban budget processes, REDD+.
The World Bank has also extended three development policy operations over the last six years. The most recent, Development Policy Credit (DPC-2) was approved by the World Bank’s Board of Executive Directors in August 2014 for a total of $20 million. It is the first of a two-operation series, focusing on macroeconomic and fiscal sustainability and improving the investment climate. Projects under preparation include a regional project to facilitate trade and ICT connectivity, the second and last operation of the Development Policy Credit series, a GAFSP-funded agriculture project, a regional hydromet project and a public transport project funded by GPOBA.
Analytical and Advisory Services (ASA)
Ongoing analytic work includes a Public Expenditure and Financial Assessment (PEFA), an assessment of the environmental and social impact of hydropower, a labor market study, an agribusiness note and an investment climate assessment. Recent analytic work include a policy note on the macroeconomic impact of hydropower and the role of public finance, a green growth study, a food security policy note, a poverty assessment. Technical assistance activities support an improved investment climate, mining policy, a financial sector action plan and implementation, the review of Bhutan’s tourism policy, hydromet, disaster management and climate change (Bhutan is a pilot PPCR country), a procurement review to allow Thimphu municipality to use Alternative Procurement arrangements, support to the statistical system to use CAPI solutions for surveys. A Multi-Donor Trust Fund on Public Financial Management is expected to become effective in September 2016, with the EU and ADA contributing a total of US$4m. The Bhutan Royal Monetary Authority is expected to become a member of the Reserve Advisory Management Program (RAMP) of the World Bank Treasury.
International Finance Corporation (IFC)
The IFC has a total committed investment portfolio in Bhutan of about $34 million. The portfolio consists predominantly of IFC’s investments in the financial sector and support for the expansion of a local hotel. IFC, using some of its own funds and mobilizing funds from the Global Agriculture and Food Security Program together with ADB are investing $12 million in a hazelnut plantation project. IFC’s first debt assistance of $10 million to a hotel was made in 2003 and successfully liquidated in June 2015.
The advisory portfolio includes advice in structuring PPPs, improving Bhutan’s investment climate and enhancing access to financial services. IFC is also providing assistance to the Ministry of Economic Affairs and Druk Holding and Investments to help them consider setting up a power trading company in India.
IFC continues to explore areas of assistance in the hydropower, tourism, manufacturing, agribusiness, health, and education sectors, among others. IFC’s advisory support on investment climate reforms, infrastructure development through PPPs and the financial sector is expected to continue.
Multilateral Investment Guarantee Agency (MIGA)
On October 21, 2014, Bhutan became the 181st member of MIGA. In light of Bhutan’s recent membership, MIGA has not provided guarantee coverage for investment in Bhutan to date.
Relations with the Asian Development Bank
Bhutan became a member in 1982 and ADB began its lending operations to the country in 1983. Bhutan is classified as a Group A country and is eligible for the Asian Development Fund (ADF) resources. Classified as moderately debt stressed, Bhutan has been receiving a 50:50 mix of ADF loan and ADF grant assistance since 2011. Cost-sharing ceiling has been set at 99 percent for loans, technical assistance, and other grants.
ADB assistance has followed closely Bhutan’s Five Year Plans (FYP) and been guided by ADB’s country partnership strategies (CPS) and country operations business plans (COBP). The CPS (2014-2018) and COBP (2016-2018) are currently being implemented in line with the government’s Eleventh FYP (2013–2018) and Strategy 2020—ADB’s Long-Term Strategic Framework The overarching goal of the current CPS (2014-2018) is to support three strategic pillars: inclusive economic growth, environmentally sustainable growth, and regional cooperation and integration (RCI). The core sectors of ADB operations are energy (including development of hydropower generation and transmission) finance, transport, and water and other urban infrastructure and services. The country assistance program evaluation, conducted in 2010, rated ADB country operations and programs in Bhutan successful, which were found to be well aligned with country development needs, government development priorities, and Strategy 2020.
ADB has been closely coordinating with other development partners in key sectors to avoid duplication. It provided parallel financing for urban development in Thimphu with the World Bank, and for rural electrification with the Japan International Cooperation Agency and the Austrian Development Agency. ADB also collaborated with SNV on renewable energy, and is currently supporting a pilot biogas project in southern Bhutan, which builds on the experience of SNV to create a viable biogas sector. Other examples of effective partnerships include ADB’s rural electrification loans following the Rural Electrification Master Plan, which was developed with assistance from the Government of Japan. Similarly, development partners are using the Road Sector Master Plan, which was developed with ADB assistance. ADB’s resident mission in Thimphu is helping further strengthen its partnership and coordination with development partners.
The current COBP covers the period 2016–2018. The indicative cumulative lending allocation for this period is $327.87 . The 2016-2018 lending program will help develop the South Asia Subregional Economic Cooperation (SASEC) Transport, Trade Facilitation, and Logistics Project), Air Transport Connectivity Enhancement Project, Urban Infrastructure Project, Improved Urban Environmental Infrastructure Project, Amochhu River Training and Flood Prevention Project, SASEC Green Power Investment Program. A nonlending program of $2.3 million has been programmed for 2016-2018.
Ongoing Loans and Grants
(As of 31 March 2016)
Ongoing Loans and Grants
(As of 31 March 2016)
| Project | Year of Approval | Project Amount ($ million) | Disbursements ($ million) |
| LOANS | |||
| Urban Infrastructure Project | 2011 | 18.00 | 2.42 |
| SASEC Trade Facilitation Program | 2012 | 8.30 | |
| SASEC Road Connectivity Project | 2014 | 28.41 | 0.0 |
| Second Green Power Development Project (OCR loan) | 2014 | 70.0 | 2.42 |
| Second Green Power Development Project (ADF loan) | 2014 | 25.25 | 0.00 |
| Strengthening Economic Management Program II | 2015 | 20.21 | 0.00 |
| GRANTS | |||
| Rural Renewable Energy Development Project | 2010 | 21.59 | 16.24 |
| Air Transport Connectivity Enhancement Project | 2012 | 6.92 | 4.27 |
| SASEC Road Connectivity Project | 2014 | 18.96 | 1.23 |
| Second Green Power Development Project | 2014 | 25.25 | 0.00 |
| OCR = Ordinary Capital Resources, SASEC = South Asia Subregional Economic Cooperation Notes: Loans and grants include those funded by ADF and OCR. The first tranche of both the SASEC Trade Facilitation Program and the Strengthening Economic Management Program was released in 2013, and the second/final tranche is expected to be released in 2014. | |||
Ongoing Loans and Grants
(As of 31 March 2016)
| Project | Year of Approval | Project Amount ($ million) | Disbursements ($ million) |
| LOANS | |||
| Urban Infrastructure Project | 2011 | 18.00 | 2.42 |
| SASEC Trade Facilitation Program | 2012 | 8.30 | |
| SASEC Road Connectivity Project | 2014 | 28.41 | 0.0 |
| Second Green Power Development Project (OCR loan) | 2014 | 70.0 | 2.42 |
| Second Green Power Development Project (ADF loan) | 2014 | 25.25 | 0.00 |
| Strengthening Economic Management Program II | 2015 | 20.21 | 0.00 |
| GRANTS | |||
| Rural Renewable Energy Development Project | 2010 | 21.59 | 16.24 |
| Air Transport Connectivity Enhancement Project | 2012 | 6.92 | 4.27 |
| SASEC Road Connectivity Project | 2014 | 18.96 | 1.23 |
| Second Green Power Development Project | 2014 | 25.25 | 0.00 |
| OCR = Ordinary Capital Resources, SASEC = South Asia Subregional Economic Cooperation Notes: Loans and grants include those funded by ADF and OCR. The first tranche of both the SASEC Trade Facilitation Program and the Strengthening Economic Management Program was released in 2013, and the second/final tranche is expected to be released in 2014. | |||
Statistical Issues
Statistical Issues Appendix
(as of May 20, 2016)
Statistical Issues Appendix
(as of May 20, 2016)
| I. Assessment of Data Adequacy for Surveillance | |
|---|---|
| General: Data provision – particularly timeliness - has some shortcomings, but is broadly adequate for surveillance. Most affected areas are: national accounts, balance of payments, and fiscal data. | |
| Real sector: As part of a Japan-funded technical assistance project for the Implementation of the System of National Accounts and the International Comparison Project, the Statistics Department of the IMF (STA) has been providing technical assistance to improve the national accounts and develop a producer price index. National Accounts: The accuracy and reliability of the data are affected by inadequate source data. Key shortcomings include heavy reliance on production data collected by line ministries, which often lack quality control, long lags in providing estimates, large revisions of historical data and, in certain cases, ad hoc estimation procedures. Lack of reliable data on expenditure components hampers estimation of national savings and domestic investment. The key factors contributing to the data deficiency are the shortage of qualified personnel and facilities. The National Statistical Bureau (NSB) is also constrained by the absence of a Statistics Act. Thus far, Bhutan does not produce quarterly national accounts data, and STA has been providing TA on the quarterly compilation. Annual data are provided with long lags. Price statistics: Starting in 2004, the consumer price index (CPI) is compiled on a quarterly basis, the number of commodity prices has been greatly expanded, and the geographical scope broadened. Monthly CPI series for domestic and imported goods starting from April 2013 are now being released. | |
| Government finance statistics: Despite recent improvements in the quality of government finance statistics (GFS), the fiscal data are subject to frequent and substantial revisions, particularly in the expenditure area. The compilation and dissemination of budget execution data and GFS are very limited. Only annual budget execution data are compiled and disseminated, and with a long lag. No GFS are disseminated nationally. The authorities were planning to start producing and distributing internally quarterly data, but thus far there has been little progress. There are inconsistencies between the fiscal and monetary data with regard to bank financing, stemming from differences in the definition of government. | |
| Monetary statistics: While monetary statistics are generally consistent with the Fund’s guidelines, there is room for improvement in a number of areas, specifically: (i) the valuation of financial assets is based on purchase price while market or market-price equivalents would be preferable; (ii) to avoid misclassifications, a list of government units and nonfinancial public enterprises should be prepared and shared with the reporting financial institutions; During the technical assistance mission on Monetary and Financial Statistics (MFS) in March 2010, the authorities and STA improved the timeliness of data reporting to STA to be in line with national publications. As part of the mission objectives, the Royal Monetary Authority (RMA) has also submitted to STA the Financial Soundness Indicators (FSI) for Bhutan on a quarterly basis, and the FSI have been published on the IMF’s FSI website: http://fsi.imf.org/. | |
| Balance of payments: External sector statistics has improved recently. BOP and IIP dissemination moved from annual to quarterly, to sixth BOP and IIP format. RMA is expected soon to start reporting external debt statistics to the World bank’s Quarterly External Debt Statistics Database. Coverage, accuracy and timeliness of ESS data has improved. Despite recent improvements, external statistics continue to be affected by shortcomings. These include: (i) limited coverage of services’ transactions in the current account, (ii) long lags in dissemination and lack of high frequency data. | |
| II. Data Standards and Quality | |
| Bhutan participates in the General Data Dissemination System (GDDS), and posted metadata for the first time on the Fund’s Dissemination Standard Bulletin Board (DSBB) in May 2010. After the e-GDDS superseded the GGDS in May 2015, Bhutan was assessed as Basline-2, disseminating all 15 recommended data categories. STA is providing assistance in creating a National Summary Data Page consistent with e-GDDS. | No data ROSC is available. |
Statistical Issues Appendix
(as of May 20, 2016)
| I. Assessment of Data Adequacy for Surveillance | |
|---|---|
| General: Data provision – particularly timeliness - has some shortcomings, but is broadly adequate for surveillance. Most affected areas are: national accounts, balance of payments, and fiscal data. | |
| Real sector: As part of a Japan-funded technical assistance project for the Implementation of the System of National Accounts and the International Comparison Project, the Statistics Department of the IMF (STA) has been providing technical assistance to improve the national accounts and develop a producer price index. National Accounts: The accuracy and reliability of the data are affected by inadequate source data. Key shortcomings include heavy reliance on production data collected by line ministries, which often lack quality control, long lags in providing estimates, large revisions of historical data and, in certain cases, ad hoc estimation procedures. Lack of reliable data on expenditure components hampers estimation of national savings and domestic investment. The key factors contributing to the data deficiency are the shortage of qualified personnel and facilities. The National Statistical Bureau (NSB) is also constrained by the absence of a Statistics Act. Thus far, Bhutan does not produce quarterly national accounts data, and STA has been providing TA on the quarterly compilation. Annual data are provided with long lags. Price statistics: Starting in 2004, the consumer price index (CPI) is compiled on a quarterly basis, the number of commodity prices has been greatly expanded, and the geographical scope broadened. Monthly CPI series for domestic and imported goods starting from April 2013 are now being released. | |
| Government finance statistics: Despite recent improvements in the quality of government finance statistics (GFS), the fiscal data are subject to frequent and substantial revisions, particularly in the expenditure area. The compilation and dissemination of budget execution data and GFS are very limited. Only annual budget execution data are compiled and disseminated, and with a long lag. No GFS are disseminated nationally. The authorities were planning to start producing and distributing internally quarterly data, but thus far there has been little progress. There are inconsistencies between the fiscal and monetary data with regard to bank financing, stemming from differences in the definition of government. | |
| Monetary statistics: While monetary statistics are generally consistent with the Fund’s guidelines, there is room for improvement in a number of areas, specifically: (i) the valuation of financial assets is based on purchase price while market or market-price equivalents would be preferable; (ii) to avoid misclassifications, a list of government units and nonfinancial public enterprises should be prepared and shared with the reporting financial institutions; During the technical assistance mission on Monetary and Financial Statistics (MFS) in March 2010, the authorities and STA improved the timeliness of data reporting to STA to be in line with national publications. As part of the mission objectives, the Royal Monetary Authority (RMA) has also submitted to STA the Financial Soundness Indicators (FSI) for Bhutan on a quarterly basis, and the FSI have been published on the IMF’s FSI website: http://fsi.imf.org/. | |
| Balance of payments: External sector statistics has improved recently. BOP and IIP dissemination moved from annual to quarterly, to sixth BOP and IIP format. RMA is expected soon to start reporting external debt statistics to the World bank’s Quarterly External Debt Statistics Database. Coverage, accuracy and timeliness of ESS data has improved. Despite recent improvements, external statistics continue to be affected by shortcomings. These include: (i) limited coverage of services’ transactions in the current account, (ii) long lags in dissemination and lack of high frequency data. | |
| II. Data Standards and Quality | |
| Bhutan participates in the General Data Dissemination System (GDDS), and posted metadata for the first time on the Fund’s Dissemination Standard Bulletin Board (DSBB) in May 2010. After the e-GDDS superseded the GGDS in May 2015, Bhutan was assessed as Basline-2, disseminating all 15 recommended data categories. STA is providing assistance in creating a National Summary Data Page consistent with e-GDDS. | No data ROSC is available. |
Table of Common Indicators Required for Surveillance
(as of May 20, 2016)
Any reserve assets that are pledged of otherwise encumbered should be specified separately. Also, data should comprise short-term liabilities linked to a foreign currency but settled by other means as well as the notional values of financial derivatives to pay and to receive foreign currency, including those linked to a foreign currency but settled by other means.
Both market-based and officially-determined, including discount rates, money market rates, rates on treasury bills, notes and bonds.
Monthly CPI data for domestic and imported goods is available from April 2013 onward.
Foreign, domestic bank, and domestic nonbank financing.
The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds) and state and local governments.
Including currency and maturity composition.
Includes external gross financial asset and liability positions vis-à-vis nonresidents.
Daily (D), Weekly (W), Monthly (M), Quarterly (Q), Annually (A), Irregular (I); Not Available (NA).
Table of Common Indicators Required for Surveillance
(as of May 20, 2016)
| Date of Latest Observation | Date Received | Frequency of Data6 | Frequency of Reporting8 | Frequency of Publication8 | |
| Exchange rates | 03/2016 | 03/2016 | D | D | D |
| International reserve assets and reserve liabilities of the Monetary Authorities1 | 02/2016 | 05/2016 | M | M | M |
| Reserve/base money | 02/2016 | 05/2016 | M | M | M |
| Broad money | 02/2016 | 05/2016 | M | M | M |
| Central bank balance sheet | 02/2016 | 05/2016 | M | M | M |
| Consolidated balance sheet of the banking system | 02/2016 | 05/2016 | M | M | M |
| Interest rates2 | 03/2016 | 05/2016 | M | M | M |
| Consumer price index3 | 02/2016 | 05/2016 | Q/M | M | M |
| Revenue, expenditure, balance and composition of financing4 – general government5 | 2013/14 | 06/2015 | A | A | A |
| Revenue, expenditure, balance and composition of financing3– central government | 2013/14 | 06/2015 | A | A | A |
| Stocks of central government and central government-guaranteed debt6 | 6/2015 | 12/2015 | A | A | A |
| External current account balance | 09/2015 | 05/2016 | Q | Q | Q |
| Exports and imports of goods and services | 09/2015 | 05/2016 | Q | Q | Q |
| GDP/GNP | 2014 | 12/2015 | A | A | A |
| Gross external debt | 12/2015 | 05/2015 | Q | Q | Q |
| International investment position7 | 09/2015 | 05/2016 | Q | Q | Q |
Any reserve assets that are pledged of otherwise encumbered should be specified separately. Also, data should comprise short-term liabilities linked to a foreign currency but settled by other means as well as the notional values of financial derivatives to pay and to receive foreign currency, including those linked to a foreign currency but settled by other means.
Both market-based and officially-determined, including discount rates, money market rates, rates on treasury bills, notes and bonds.
Monthly CPI data for domestic and imported goods is available from April 2013 onward.
Foreign, domestic bank, and domestic nonbank financing.
The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds) and state and local governments.
Including currency and maturity composition.
Includes external gross financial asset and liability positions vis-à-vis nonresidents.
Daily (D), Weekly (W), Monthly (M), Quarterly (Q), Annually (A), Irregular (I); Not Available (NA).
Table of Common Indicators Required for Surveillance
(as of May 20, 2016)
| Date of Latest Observation | Date Received | Frequency of Data6 | Frequency of Reporting8 | Frequency of Publication8 | |
| Exchange rates | 03/2016 | 03/2016 | D | D | D |
| International reserve assets and reserve liabilities of the Monetary Authorities1 | 02/2016 | 05/2016 | M | M | M |
| Reserve/base money | 02/2016 | 05/2016 | M | M | M |
| Broad money | 02/2016 | 05/2016 | M | M | M |
| Central bank balance sheet | 02/2016 | 05/2016 | M | M | M |
| Consolidated balance sheet of the banking system | 02/2016 | 05/2016 | M | M | M |
| Interest rates2 | 03/2016 | 05/2016 | M | M | M |
| Consumer price index3 | 02/2016 | 05/2016 | Q/M | M | M |
| Revenue, expenditure, balance and composition of financing4 – general government5 | 2013/14 | 06/2015 | A | A | A |
| Revenue, expenditure, balance and composition of financing3– central government | 2013/14 | 06/2015 | A | A | A |
| Stocks of central government and central government-guaranteed debt6 | 6/2015 | 12/2015 | A | A | A |
| External current account balance | 09/2015 | 05/2016 | Q | Q | Q |
| Exports and imports of goods and services | 09/2015 | 05/2016 | Q | Q | Q |
| GDP/GNP | 2014 | 12/2015 | A | A | A |
| Gross external debt | 12/2015 | 05/2015 | Q | Q | Q |
| International investment position7 | 09/2015 | 05/2016 | Q | Q | Q |
Any reserve assets that are pledged of otherwise encumbered should be specified separately. Also, data should comprise short-term liabilities linked to a foreign currency but settled by other means as well as the notional values of financial derivatives to pay and to receive foreign currency, including those linked to a foreign currency but settled by other means.
Both market-based and officially-determined, including discount rates, money market rates, rates on treasury bills, notes and bonds.
Monthly CPI data for domestic and imported goods is available from April 2013 onward.
Foreign, domestic bank, and domestic nonbank financing.
The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds) and state and local governments.
Including currency and maturity composition.
Includes external gross financial asset and liability positions vis-à-vis nonresidents.
Daily (D), Weekly (W), Monthly (M), Quarterly (Q), Annually (A), Irregular (I); Not Available (NA).
This measure removed the previous exchange restrictions found on the access to Indian rupee for imports of certain construction materials and vehicles from India. Staff also found that the exchange restriction on access to Indian rupees for salary remittances by non-residents has been removed. For a description of the measures which lead to the remaining findings of exchange restrictions outlined above, please see IMF Country Report No. 14/179 (Informational Annex).