Operational Aspects of Fiscal Policy in Oil-Producing Countries
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Summary:
Oil-producing countries face challenges arising from the fact that oil revenue is exhaustible, volatile, and uncertain, and largely originates from abroad. Reflecting these challenges, the paper proposes some important general principles for the formulation and assessment of fiscal policy in these countries. The main findings can be summarized in some key guidelines: the non-oil balance should feature prominently in the formulation of fiscal policy; it should generally be adjusted gradually; the government should strive to accumulate substantial financial assets over the period of oil production; and, where necessary, strategies should aim at breaking procyclical fiscal responses to volatile oil prices.
Series:
Working Paper No. 2002/177
Subject:
Commodities Expenditure Fiscal policy Fiscal stance Oil Oil prices Oil, gas and mining taxes Prices Taxes
English
Publication Date:
October 1, 2002
ISBN/ISSN:
9781451858884/1018-5941
Stock No:
WPIEA1772002
Pages:
35
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