Welfare Effects of Uzbekistan's Foreign Exchange Regime

Publication Date:

March 1, 2000

Electronic Access:

Free Download. Use the free Adobe Acrobat Reader to view this PDF file

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

In addition to transferring about 16 percent of GDP from exporters to importers, Uzbekistan’s quasi-fiscal multiple exchange rate regime generates identifiable welfare losses of 2-8 percent of GDP on import markets and up to 15 percent on export markets. These excess burdens have increased substantially with the growing difference of exchange rates. The welfare analysis allows some conclusions regarding the optimal reform strategy: (i) welfare losses will decline overproportionally as exchange rates unify; (ii) exchange rate unification should be supplemented by changing the explicit fiscal system; (iii) at a minimum, Uzbekistan would benefit from moving to an explicit fiscal regime.

Series:

Working Paper No. 2000/061

Subject:

Central banks Exchange rates Exports Foreign exchange International trade Market exchange rates Quasi-fiscal operations

English

Publication Date:

March 1, 2000

ISBN/ISSN:

9781451848168/1018-5941

Stock No:

WPIEA0612000

Pages:

23

Please address any questions about this title to publications@imf.org