Country Reports
2024
April 25, 2024
Eastern Caribbean Currency Union: 2024 Staff Report for the 2024 Article IV Consultation on Common Policies of Member Countries of the Eastern Caribbean Currency Union-Press Release and Staff Report
Description: After successive external shocks—first, the pandemic and later higher commodity prices after Russia’s invasion of Ukraine—the region’s output has surpassed its pre-pandemic level boosted by a strong tourism rebound and investment. Inflation is moderating from its peak. Fiscal and external balances have improved, but public debt and current account deficits remain high. The financial system has been stable and liquid, although it continues to be confronted with asset quality weaknesses and rising risks in the non-bank financial sector. Longstanding structural challenges affecting private investment and employment create a drag on growth going forward. The region’s outlook is heavily dependent on uncertain Citizenshipby- Investment (CBI) inflows, and susceptible to volatility in commodity prices, a slowdown in major tourism source countries, and the recurrent threat of natural disasters.
April 24, 2024
Republic of Kazakhstan: Financial Sector Assessment Program-Technical Note on Regulation and Supervision of Crypto Assets
Description: Kazakhstan saw a significant increase in crypto mining in 2021 following a ban on mining in China. Volatility in crypto markets and energy shortages, coupled with a prohibition on the circulation of crypto assets in Kazakhstan, reduced the size of the market by the following year. While retail and institutional crypto holdings are limited, growing public sector experiments with distributed ledger technology, a pilot project to allow the circulation of crypto in the Astana International Financial Centre (AIFC), and mandates for crypto miners to store a proportion of their mining rewards in AIFC registered exchanges has the potential to increase the size of the sector. If incentives grow for users and firms to circulate crypto, the existing prohibition – which has dampened market growth, could become untenable. Although not a regulatory priority, the broad prohibition on crypto assets should be replaced by a robust regulatory framework, contingent on market growth, upskilling supervisors, and a globally coordinated move to implementing conduct and prudential regulation.
April 24, 2024
Republic of Kazakhstan: Financial Sector Assessment Program-Technical Note on Climate-Related Risks and Financial Stability
Description: Kazakhstan is vulnerable to transition risk due to the importance of its energy- and emissions-intensive sectors. Domestic and global climate policies would negatively affect Kazakhstan’s economy, its firms, industries, and banks, with heterogenous impacts across industries and banks. Using both micro and macro modeling approaches, the climate risk analysis suggests Kazakhstani banks are exposed to significant transition risk from domestic and, more importantly, global climate policies. The risk is especially higher for carbon intensive sectors, such as fossil fuel extraction, refining, and electricity generation. Banks with large exposure to emissions-intensive sectors experience up to 30 percent additional losses under a disorderly 1.5°C scenario over a 5-to-7-year horizon, compared to the baseline. Banks with a small share of portfolio with emissions-intensives sectors may still experience losses, as climate change mitigation actions affect the economy at large and the financial health of individual consumers, businesses, and industries.
April 22, 2024
Côte d’Ivoire: Request for an Arrangement Under the Resilience and Sustainability Facility-Press Release; Staff Report; and Statement by the Executive Director for Côte d’Ivoire
Description: Côte d’Ivoire is highly exposed to climate change through rising temperatures and sea levels as well as rain pattern changes. Economic vulnerabilities to climate change are mostly due to the country’s heavy reliance on agriculture, and the concentration of industrial and services activity in coastal areas. Agriculture employs about half of the workforce and contributes about 17 percent of GDP and 10 percent of tax revenues. At the same time, greenhouse gas emission and pollution in urban areas are growing, albeit from a low level.
April 17, 2024
West African Economic and Monetary Union: Selected Issues
Description: Selected Issues
April 17, 2024
West African Economic and Monetary Union: Staff Report on Common Policies for Member Countries-Press Release; Staff Report; and Statement by the Executive Director for the West African Economic and Monetary Union
Description: The WAEMU has seen strong growth and rising living standards over the past decade. Economic growth averaged 5.4 percent in 2013-2019 and 5.8 percent in 2021-2023. Policy efforts from regional and national authorities have cushioned the impact of several external and internal shocks, prompting a solid economic recovery since the COVID-19 pandemic, despite increasing security issues. Meanwhile, the Human Development Index has increased from 0.44 in 2013 to 0.48 in 2021.
April 12, 2024
Algeria: Selected Issues
Description: This Selected Issues paper examines the macroeconomic and fiscal implications of climate change in Algeria. It highlights a range of risks associated with the projected shifts in weather patterns and Algeria’s own hydrocarbon-reliant growth model in the context of the global energy transition. The projected shift in climate patterns over the coming decades poses risks to prosperity, food security, and social development in the region, with most of its population already living under challenging climate conditions. The paper also discusses fiscal policy options to achieve Algeria’s climate goals. An analysis based on the joint IMF-World Bank Climate Policy Assessment Tool suggests that even partial elimination of existing energy subsidies would help Algeria achieve its greenhouse gases emission reduction goals, boost fiscal revenue, encourage the expansion of renewable energy, and generate considerable environmental and public health benefits. Those reforms would create fiscal space for priority budget spending including on targeted social transfers and investment in adaptation to climate change. Strengthening public finance management would enable Algeria to maximize the growth and green dividend of public spending.
April 12, 2024
Algeria: 2023 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Algeria
Description: The 2023 Article IV Consultation discusses that the Algerian economy is estimated to have grown by 4.2 percent in 2023, a robust performance owing to a rebound in hydrocarbon production and strong performance in the industry, construction, and service sectors. The near-term outlook is broadly positive, but inflation remains a concern. Medium-term economic prospects hinge on efforts to diversify the economy and the ability to attract private investment, and are subject to several risks. The reforms embodied in the Monetary and Banking Law could be an impetus to strengthen the credit market infrastructure, develop long-term savings products, and advance financial inclusion. Sustained and bold reforms would tap the potential of the private sector as driver of sustained growth and job creation. The implementation of the Investment Law and the enactment of a new Land Law aim at fostering private sector initiative and investment and should be complemented with reforming the state-owned enterprises sector and making product and labor market more flexible.
April 8, 2024
Kingdom of the Netherlands–The Netherlands: Selected Issues
Description: Selected Issues
April 8, 2024
Kingdom of the Netherlands–The Netherlands: 2024 Article IV Consultation-Press Release; and Staff Report
Description: The economy has cooled, but signs of overheating remain. After two years of strong recovery, growth decelerated in 2023, reflecting the energy shock, tighter financial conditions, and a slowdown in key trading partners, particularly Germany. Still, core inflation remains elevated, reflecting a tight labor market, robust wage growth, and healthy profit margins. Fragmented results in November elections are leading to a prolonged government formation, with possible implications for pro-growth and climate policies.