Small parties are key to averting El Salvador default

2016 ◽  
Keyword(s):  
El Salvador ◽  
Government Debt ◽  
Fiscal Crisis ◽  
Content Type ◽  
International Mediation ◽  
Governance Effectiveness ◽  
State Finance ◽  
The Government

Subject Fiscal crisis in El Salvador. Significance On October 13, ratings agency Standard & Poor's downgraded El Salvador's rating to B from B+, citing a "deterioration in our assessment of El Salvador's institutional and governance effectiveness". This followed international and domestic warnings about El Salvador's fiscal situation, which is raising fears of default. With the government and the opposition locked in a stand-off, a fiscal deal currently looks unlikely without international mediation. Impacts El Salvador's financial struggles may weigh on security spending, particularly its 'El Salvador seguro' plan. Government debt is likely to trend upwards even following the eventual resolution of the fiscal crisis. Protests by healthcare and education workers demanding salary and benefit increases will add to state finance pressure.

Perceived effectiveness of e-governance as an underlying mechanism between good governance and public trust: a case of Indonesia

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Dadang Hartanto ◽  
Juhriyansyah Dalle ◽  
A. Akrim ◽  
Hastin Umi Anisah
Keyword(s):  
Local Governments ◽  
Good Governance ◽  
Underlying Mechanism ◽  
Public Trust ◽  
The Body ◽  
Perceived Effectiveness ◽  
Content Type ◽  
Body Of Knowledge ◽  
Governance Effectiveness ◽  
The Government

Purpose This study aims to investigate the association of perceived accountability, perceived responsiveness and perceived transparency, and public trust in local government. Additionally, mediation of the perceived effectiveness of e-governance was also tested between these relationships. Design/methodology/approach Using a quantitative cross-sectional field survey, primary data was collected at local administration levels from two cities in Indonesia. The final data set of 355 respondents was then analyzed using SmartPls3 and the measurement and structural models were tested. Findings Positive results were obtained for all the hypothesized links (direct and indirect relationships). The study’s findings revealed useful insights for policymakers and researchers regarding the public’s perception of good governance and their expectations from the government, which further lead toward trust in local governments. Practical implications The study concluded that good governance practices develop and enhance the public’s trust in the government, thus provided key policy directions. Originality/value This study contributes to the body of knowledge related to good governance elements and their impact on public trust in the local government via the underlying mechanism of perceived e-governance effectiveness in developing countries in general and particularly the Indonesian context. Moreover, it is a unique study in the good governance domain while considering three good governance elements into a single theoretical framework. Previous studies have explored these elements individually with public trust, so this combined framework advances the body of knowledge. This research’s findings also contributed toward validating good governance theory with e-governance effectiveness and public trust integration in a single comprehensive framework. This research also helped answer the questions arising from past literature about declining public trust trends in local governments.

Monetary easing may quicken in Brazil this year

2017 ◽  
Keyword(s):  
Monetary Policy ◽  
Interest Rate ◽  
Interest Rates ◽  
Economic Recession ◽  
Government Debt ◽  
Domestic Demand ◽  
Private Debt ◽  
Content Type ◽  
Positive Effects ◽  
The Government

Significance At its first meeting of 2017, on January 10-11, the COPOM reduced the benchmark Selic interest rate to 13%. The 75-basis-point (bp) rate cut decision, the largest in nearly five years, accelerated the monetary easing cycle that started in October 2016. Economic recession has been relieving inflationary pressures and opening room for more intense cuts in interest rates. Impacts Further reductions of interest rates may contribute to controlling government debt. Private debt renegotiations at lower interest rates may facilitate a recovery in domestic demand and output. Any positive effects of monetary policy on activity may help contain popular dissatisfaction with the government.

Brazil faces stagnation risk in 2017

2017 ◽  
Keyword(s):  
Government Spending ◽  
Pension Reform ◽  
Investment Decisions ◽  
Fiscal Crisis ◽  
New Wave ◽  
Short Term ◽  
Business Investment ◽  
Content Type ◽  
The Government

Subject The risk that the Brazilian economy will stagnate, rather than recover, this year. Significance The recent passage of legislation freezing government spending and the ambitious pension reform currently under discussion in Congress are the flagship policies of the government of President Michel Temer. Both seek to defuse Brazil’s fiscal time bomb in the long term. However, they offer little support to immediate expansion in an economy that not only has been in recession since the second quarter of 2014 but is also locked in a low-growth trap will few apparent short-term escape routes. Impacts Popular dissatisfaction may trigger a new wave of demonstrations, further weakening the government. As long as the fiscal crisis persists, the government’s ability to stimulate the economy will be limited. Political risk will be a crucial factor in business investment decisions in Brazil.

New Zealand budget may mask weakness

2015 ◽  
Keyword(s):  
New Zealand ◽  
Public Hospital ◽  
Government Debt ◽  
Education Funding ◽  
Content Type ◽  
Developed Economies ◽  
The Government

Significance New Zealand's low government debt and fiscal stability mark it out among developed economies. Its economy is also one of the few growing firmly: 3.3% in 2014 and 2.8% likely in 2015. The government aims to bring debt below 20% of GDP by 2020-21. Impacts The economic impulse of the fiscal settings will remain mildly contractionary through most of the next four years. This will partly offset the Reserve Bank's accommodative stance. The Bank is under pressure to cut its official cash rate but is unlikely to at its next review on June 11. Expenditure controls are straining public hospital finances and education funding and may be loosened. The budget does not stimulate diversification of the economy from its dependence on primary produce exports and tourism.

Costa Rica moves to prevent gang threat

2015 ◽  
Keyword(s):  
Costa Rica ◽  
El Salvador ◽  
Urban Areas ◽  
Organised Crime ◽  
Content Type ◽  
Judicial Investigation ◽  
Security Concerns ◽  
The Government ◽  
Criminal Groups

Subject Security concerns. Significance Although Costa Rica has long avoided the crime problems of its northern neighbours, a report released in June by its Judicial Investigation Agency found that the number of criminal groups operating in the country has increased over the last decade, with members of gangs (or 'maras') from the Northern Triangle countries of Guatemala, Honduras and El Salvador establishing a presence in Costa Rica. While the country remains one of the safest in the region, mara activity has had an impact on crime levels, pushing the government to take action. Impacts Increased mara activity may cause conflict with local gangs, particularly in urban areas. Initial successes in dismantling gangs may encourage other groups to try to fill the power vacuum. Pre-emptive action will slow the development of organised crime, but could encourage gangs to move to neighbouring countries.

High US government debt does not itself raise risks

2021 ◽  
Keyword(s):  
Economic Growth ◽  
Financial Markets ◽  
Interest Rates ◽  
Federal Reserve ◽  
Government Debt ◽  
Business Investment ◽  
Content Type ◽  
Us Government ◽  
Deficit Spending ◽  
The Government

Significance Some economists are suggesting that, over the longer term, this could cause financial markets to stop buying US debt and charge prohibitively high rates, and cause the dollar to crash. Other economists argue that more deficit spending could fuel output and so keep relative debt levels in check. Impacts The government retirement trust funds will continue to be major buyers of government debt. In the recovery and beyond, financing the debt could raise private borrowing costs, reduce business investment and slow economic growth. High and rising debt might constrain policymakers in their ability to respond to unforeseen events. A higher debt path that boosts interest rates would give the Federal Reserve more flexibility in implementing monetary policy.

scholarly journals Local government debt and regional economic growth in China

2019 ◽  
Vol 2 (2) ◽  
pp. 330-353
Author(s):  
Shiyi Chen ◽  
Wang Li
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
Theoretical Model ◽  
Local Government ◽  
Regional Differences ◽  
Government Debt ◽  
Eastern Region ◽  
Content Type ◽  
The Government ◽  
The Impact

Purpose With China’s economic growth slowing down and the growth rate of fiscal revenue decreasing, the pressure on local government debts is further increasing. Under this background, it is of great significance to clarify the relation between local government debts and China’s economic growth in order to give full play to the positive role of local debts in stabling growth. The paper aims to discuss this issue. Design/methodology/approach Therefore, this paper explores the impact of Chinese local government debt on economic growth from theoretical and empirical aspects, respectively, and compares the regional differences between different debts and economic growth dynamics. Findings In the theoretical model part, this paper constructs a three-sector dynamic game model, under the two circumstances of whether local government is subject to debt constraints, and examines the relation between local government debt and economic growth and other variables through numerical simulation. Research shows that when the government is not constrained by debt, there is an inverted “U” relation between government debt and economic growth. When the government is constrained by debt, the economic growth rate gradually decreases as the government debt increases. Originality/value In the theoretical analysis part, this paper tries to estimate the amount of local debts under different calibers and examines the impact of different types of local government debts on China’s economic growth and their regional differences. The results show that excessive accumulation of government hidden debts in the eastern region is not conducive to economic growth, while explicit debts in the central and western regions significantly contribute to local economic growth. The results of empirical analysis are basically consistent with the predictions of the theoretical model.

Fiscal crisis will undermine Nigeria's stimulus plan

2016 ◽  
Keyword(s):  
Interest Rate ◽  
Niger Delta ◽  
The State ◽  
Fiscal Crisis ◽  
Content Type ◽  
The Government ◽  
Oil Company ◽  
The Imf

Significance The IMF predicts the economy will shrink by 1.8% during 2016, having contracted 0.4% in the first quarter. The slowdown is hurting revenues: On July 14, budget minister Udoma Udo Udoma said the government had collected only 55% of its revenue target. Impacts Talks between Abuja and the Movement for the Emancipation of the Niger Delta are unlikely to halt attacks on oil infrastructure. With inflation at 16.5% -- the highest rate in a decade -- the CBN may be forced to enter an interest rate hiking cycle. The new head of the state oil company, Maikanti Kacalla Baru, will be tasked with reforming the conglomerate to increase revenues.

El Salvador gang proposal will not bring dialogue

2017 ◽  
Keyword(s):  
El Salvador ◽  
Political Ideology ◽  
Local Level ◽  
Public Dialogue ◽  
Content Type ◽  
Public Finances ◽  
Mara Salvatrucha ◽  
National Leadership ◽  
The Government ◽  
The Cost

Subject Outlook for gang dialogue. Significance On January 16, the Surenos faction of the Barrio 18 gang announced its desire to join proposed dialogue between the government and its rival gang, the Mara Salvatrucha (MS-13). The remarks, reported in online magazine El Faro, follow calls by the MS-13 for negotiations that the gang says could ultimately lead it to disband. This comes amid continuing high levels of violence and increasing recognition that the government's hard-line approach to security is not working. Impacts The absence of a political ideology would make it difficult for the government to engage in public dialogue with gangs. Public finances would struggle to cope with the cost of any gang demobilisation process. Any moves from the MS-13 national leadership to end gang activities would be extremely difficult to implement at the local level.

Fiscal crisis will undermine Suriname's new president

2020 ◽  
Keyword(s):  
External Debt ◽  
Oil Industry ◽  
Fiscal Crisis ◽  
Social Unrest ◽  
Content Type ◽  
Debt Issuance ◽  
Fiscal Austerity ◽  
The Government ◽  
One Year

Significance Barely four months into President Chandrikapersad Santokhi’s presidency, the scale of the fiscal crisis facing Suriname has forced him to introduce unpopular fiscal austerity measures and seek a restructuring of external debt. These measures should help improve Suriname’s fiscal position, but also risk increased social unrest. Impacts Two debt restructurings in one year mean that Suriname would be unlikely to find buyers for any potential 2021 debt issuance. The government will heavily promote investment in the oil industry as a means of attracting funds into the economy. Failure to reach an IMF agreement would put severe pressure on the economy next year.

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