Country Reports
2018
May 9, 2018
Malawi: Selected Issues
Description: This Selected Issues paper benchmarks Malawi’s public spending and identifies areas where there is scope to improve expenditure efficiency. Malawi performs poorly in health and education spending efficiency. Spending in these areas will need to be stepped up to achieve better living standards and higher, more inclusive growth. A rebalancing of the composition of education and health spending—including greater prioritization of low cost-high impact spending and balancing maintenance against capital spending—would yield immediate results in both health and education. Strengthening the public expenditure management chain, especially procurement and supply management, will be important. These reforms would go hand in hand with greater fiscal transparency and accountability in these sectors.
May 8, 2018
Mali: Technical Assistance Report-Public Investment Management Assessment
Description: This Technical Assistance Report assesses the state of public investment management in Mali. The institutional strength of the public investment management framework is good compared with peer countries. The assessment of the 15 institutions (or components) of the framework pictures generally good scores, at or above average levels for low-income countries in almost all components. There are four exceptions: (1) the institutional framework for public private partnerships is incomplete; (2) there is scope for improvement in accounting and valuation of assets; (3) availability of financing for investments suffers from poor commitment management and cash flow projections; and (4) project assessment is not systematic or comprehensive. These deviations from good practices are being corrected with the implementation of the new legal framework.
May 2, 2018
Ghana: Fifth and Sixth Reviews Under the Extended Credit Facility, Request for Waivers for Nonobservance of Performance Criteria, and Request for Modification of Performance Criteria-Press Release; Staff Report; and Statement by the Executive Director for Ghana
Description: Program performance improved in 2017 and macroeconomic conditions have strengthened considerably. Growth increased on the back of expanded oil production; inflation declined; the fiscal deficit was significantly reduced, leading to a primary surplus for the first time in fifteen years; the exchange rate regained stability; and the external position improved, with a large reserve build-up. Challenges remain, though, as a still elevated (albeit declining) debt burden and the economy’s exposure to risks limit policy space; and progress in meeting structural benchmarks remains mixed. Program discussions focused on policies to lock in recent gains to secure continued stability and progress beyond the Fund-supported program (in line with the authorities' goal of "irreversibility" of sound policies).
May 1, 2018
Israel: 2018 Article IV Consultation-Press Release and Staff Report
Description: Israel’s economy is growing well with inflation remaining low and the housing market cooling. Growth of about 3½ percent in 2017 helped bring unemployment below four percent in early 2018, supporting robust wage rises averaging 3¼ percent. Yet, partly owing to the appreciation of the shekel, inflation remained below the 1–3 percent target range. House price increases slowed to below two percent as proposed tax measures deterred investor interest. Prospects for the next few years are for growth to remain around 3½ percent with inflation rising gradually.
May 1, 2018
Israel: Selected Issues
Description: This Selected Issues paper analyzes the macro-fiscal implications of an increase in infrastructure spending, considering Israel’s dual economy character. The efficiency of investment is key to ensuring growth benefits are achieved and to containing increases in the public debt ratio. Selecting projects with low rates of return, managing public investment inefficiently, or raising investment faster than absorptive capacity, can lead to weaker growth benefits and higher debt ratios that reduce the room to sustain increased public investment. Growth benefits will likely be insufficient to prevent a significant increase in debt ratios, indicating a need for revenue measures, where reductions in tax benefits are preferable. Allowing the public debt ratio to rise as much as 10 percentage points appears too high as Israel faces wider uncertainties than most advanced economies and it should also preserve fiscal space to facilitate structural reforms for long-term growth. Given Israel’s very low civilian spending, the government should consider financing most of the additional investment with additional revenues. Israel’s sizable foregone revenue from various tax benefits—around 5 percent of GDP per year—suggests significant scope for revenue gains. Our analysis also suggests that reducing tax benefits is least detrimental to growth, which in turn would be most positive for debt dynamics.
April 30, 2018
Turkey: 2018 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Turkey
Description: Growth rebounded sharply in 2017, helped by strong policy stimulus in the wake of the 2016 post-coup attempt slump and by favorable external conditions. Although expansionary policies were initially warranted, they are no longer appropriate as the economy is showing clear signs of overheating. Monetary policy appears too loose and its credibility is low; and on- and off-budget fiscal policies (including credit guarantee schemes and PPP activities) are expansionary and risk undermining Turkey’s hard-earned fiscal credibility. As a result, the economy faces internal and external imbalances: a positive output gap, inflation well above target, and a current account deficit of more than 5 percent of GDP. Meanwhile, political uncertainty and regional instability remain elevated, and the integration of the many refugees poses challenges.
April 27, 2018
Chad: First Review Under the Extended Credit Facility Arrangement, and Request for a Waiver of Nonobservance of Performance Criteria - Press Release; Staff Report; and Statement by the Executive Director for Chad
Description: On April 13, 2018, the Executive Board of the International Monetary Fund (IMF) completed the first review of Chad’s economic performance under the program supported by an Extended Credit Facility (ECF) arrangement. Completion of this review enables the immediate disbursement of SDR 35.05 million (about US$51 million). This brings total disbursements under the arrangement to SDR 70.1 million (about US$ 99.8 million). The Board also approved the authorities’ request to waive the non-observance of the continuous performance criterion on the non-accumulation of new external payments arrears, and to rephase the planned disbursements.
April 26, 2018
Vanuatu: 2018 Article IV Consultation-Press Release; and Staff Report
Description: Three years after Cyclone Pam struck Vanuatu causing extensive damages, reconstruction efforts are near completion with full recovery in sight. However, capacity constraints and coordination issues have hampered the use of committed funds by donors and development partners, thereby slowing down recovery. Meanwhile, the government’s ambitious development agenda is making good progress with several major infrastructure projects completed or projected to be completed in the next year.
April 25, 2018
West African Economic and Monetary Union (WAEMU): Selected Issues
Description: Selected Issues
April 25, 2018
West African Economic and Monetary Union (WAEMU): Common Policies for Member Countries - Press Release; Staff Report; and Statement by the Executive Director for the WAEMU
Description: This report reviews the discussions between the IMF and the regional institutions of the West African Economic and Monetary Union (WAEMU). It highlights that the economic activity in the WAEMU remains strong but vulnerabilities persist. Despite lower terms of trade, social tensions, and security challenges within the region, real GDP growth is estimated to have exceeded 6 percent in 2017, underpinned by strong domestic demand. The outlook remains positive but hinges critically on the planned fiscal consolidation and implementation of structural reforms by member countries. Growth is projected to stay above 6 percent with continued low inflation over the medium term. Risks are tilted to the downside.