Country Reports
2022
April 8, 2022
United Kingdom: Financial Sector Assessment Program-Detailed Assessment of Observance of Insurance Core Principles Issued by the International Association of Insurance Supervisors
Description: The regulatory framework for insurance supervision in the United Kingdom is sophisticated and the authorities are leaders in supervisory techniques. Observance with the Insurance Core Principles (ICPs) is very high compared to peers with 17 ICPs observed and only 6 out of 24 ICPs determined to be largely observed and 1 partly observed.
April 8, 2022
United Kingdom: Financial Sector Assessment Program-Banking Supervision and Issues in Financial Stability
Description: The Financial Sector Assessment Program (FSAP) carried out a targeted evaluation of issues relating to the effectiveness of banking regulation and supervision in the United Kingdom. It leverages on the 2016 FSAP which concluded that the United Kingdom (U.K.) had a high degree of compliance with the 2012 Basel Core Principles (BCPs) with some shortcomings. The 2021 FSAP reviewed the progress in addressing them and examined the main supervisory and regulatory developments since the last FSAP. The FSAP evaluation also focuses on steps taken to minimize disruptions in the U.K. banking system at the end of the Brexit transition period, and on the regulatory and supervisory measures introduced to contain spillovers from the ongoing COVID-19 pandemic on the U.K. banking system.
April 8, 2022
United Kingdom: Financial Sector Assessment Program-Financial Stability and Managing Institutional, Technology, and Market Transitions
Description: There has been a very smooth post-Brexit transition, with no material disruption nor any crystalized financial stability risks. This was the result of the U.K. authorities’ (and in some cases the EU authorities) and firms’ extensive preparations. The U.K. authorities have been proactively engaging with the industry, monitored risks, and consistently provided necessary legal certainty in a timely manner. This approach should continue, to the extent that any risks and uncertainties from Brexit remain.
April 8, 2022
Zimbabwe: 2022 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Zimbabwe
Description: Zimbabwe experienced severe exogenous shocks (cyclone Idai, protracted drought, and the COVID-19 pandemic) during 2019-20, which along with policy missteps in 2019, led to a deep recession and high inflation. Real GDP contracted cumulatively by 11.7 percent during 2019-20 and inflation reached 837 percent (y/y) by July 2020. Reflecting good rainfall and relaxation of containment measures, real GDP rose by 6.3 percent in 2021. A tighter policy stance since mid-2020 (relative to 2019) has contributed to reducing inflation to 60.7 percent (y/y) at end-2021. However, high double-digit inflation and wide parallel foreign exchange (FX) market premia persist. The economic downturn and high inflation increased the financial system vulnerabilities. Extreme poverty has risen and about a third of the population is at risk of food insecurity. The international community seeks improvements in domestic political conditions and economic policies to initiate reengagement with Zimbabwe. The authorities have started token payments to external creditors in a bid to revive international reengagement.
April 8, 2022
Botswana: Technical Assistance Report-Price Statistics
Description: A technical assistance (TA) mission was conducted by the International Monetary Fund’s (IMF) Regional Technical Assistance Center for Southern Africa (AFS)1 during November 22–26, 2021 to continue assisting Statistics Botswana (SB) with developing the producer price index (PPI). Due to ongoing COVID-19 related travel restrictions, this mission was conducted remotely using Microsoft Teams, WhatsApp, and email. Previous missions to assist with developing price indexes were held in February 2019 and October 2020.
April 8, 2022
Benin: Technical Assistance Report—Fiscal Transparency Evaluation
Description: This report provides an evaluation of fiscal transparency practices (FTE) in Benin according to the standards defined by the IMF’s Fiscal Transparency Code. The evaluation focuses on 36 principles covering three pillars of the Code: (I) fiscal reporting; (II) fiscal forecasting and budgeting; and (III) fiscal risk analysis and management. To take account of different levels of institutional capacity in each country, the Code distinguishes three levels of practices for each principle: basic, good, and advanced. A practice is considered “not met” if it has not met the Code’s requirements for basic level.
April 7, 2022
Jordan: Technical Assistance Report-Forecasting Framework for Currency in Circulation
Description: The currency in circulation forecasting model presently used by the Central Bank of Jordan is aligned with international practices and provides a solid basis for liquidity management. The central bank uses an Auto Regressive Integrated Moving Average (ARIMA) model with many indicator variables to model binary seasonality and to capture special events. The ARIMA model is fitted on daily currency in circulation data using a standard maximum likelihood estimator. This ARIMA approach is aligned with the models traditionally used by central banks in emerging and middle-income countries.
April 6, 2022
Japan: 2022 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Japan
Description: Pre-COVID-19, economic policies under “Abenomics” helped ease financial conditions, exit deflation, and raise labor market participation, but fell short on the deep reforms needed to raise productivity and achieve inclusive and sustainable growth. The Japanese economy is now recovering from the pandemic amid strong policy support that has helped to mitigate the downturn. Japan had substantially lower rates of COVID-related infections and deaths than most advanced economies.
April 4, 2022
Colombia: Financial System Stability Assessment
Description: The pandemic led to Colombia’s largest recession on record, but the economy bounced back strongly in 2021. The banking system has so far weathered the shock well, with the help of a strong policy and support response and strong initial position. Colombia is exposed to elevated external financing risks and the further prolongation of the pandemic. Large and complex financial conglomerates with increasing cross-border exposures dominate the financial system. The consumer-credit portfolio deserves attention as it has been growing fast and had high impairment rate during the pandemic.