Fiscal Policy Response to External Crises the Case of Moldova 1998-2010

Author/Editor:

Driton Qehaja

Publication Date:

March 1, 2012

Electronic Access:

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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:

External shocks pose major challenges to fiscal policy makers through lower output and large fiscal imbalances. This paper analyzes the case of Moldova, which faced parallel crises a decade apart: the Russian crisis of 1998 and the global financial crisis of 2008-2009. The country went through large fiscal adjustments during these crises and launched important fiscal reforms. The paper reviews the crises and reform experience. In particular, it aims to explain the motivation for reforms, describe reform design and implementation, and provide an understanding of their outcomes. The paper also catalogues the form and size of international assistance for Moldova.

Series:

Working Paper No. 12/82

Subject:

Development assistance External shocks Financial crisis Fiscal policy Fiscal reforms Global Financial Crisis 2008-2009 Government expenditures Moldova Revenue sources Structural fiscal balance Tax policy

English

Publication Date:

March 1, 2012

ISBN/ISSN:

9781475502343/1018-5941

Stock No:

WPIEA2012082

Format:

Paper

Pages:

33

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