Angolan government will point to early reform progress

2019 ◽  
Keyword(s):  
Interest Rate ◽  
Agricultural Production ◽  
Value Added ◽  
Fiscal Consolidation ◽  
Content Type ◽  
Fuel Distribution ◽  
Oil Sector ◽  
Near Term ◽  
State Relations ◽  
The Imf

Significance The underperformance of the oil sector, coupled with a recent fuel distribution crisis, have combined to dampen growth forecasts for 2019. While President Joao Lourenco’s government has earned praise for recent fiscal consolidation efforts, economic frailties linger. Impacts The Angolan authorities will accelerate efforts to repay arrears to Portuguese companies amid improving state relations. A potential inflationary spike once value added taxation (VAT) is introduced may lessen the chance of an interest rate cut in the near term. Improving agricultural production will be a major diversification priority and agricultural spending has quadrupled in the revised budget. The IMF will maintain pressure on Luanda to reduce subsidies in sectors such as agriculture and fisheries.

Togo’s president will face mounting opposition

2018 ◽  
Keyword(s):  
Fiscal Consolidation ◽  
Political Climate ◽  
Term Limit ◽  
Content Type ◽  
Constitutional Reforms ◽  
The Imf

Subject Togolese constitutional crisis. Significance The main opposition coalition has rejected President Faure Gnassingbe's recent calls for dialogue to end a long-running political impasse over his continued tenure in office. Faure, in power since 2005 and currently in a controversial third term, has reluctantly agreed to constitutional reforms -- including the introduction of a two-round presidential vote and a two-term presidential limit. However, Faure wants the two-term limit to take effect in 2020, potentially giving him the chance to stay in power until 2030, while the opposition insists the limit must apply retrospectively. Impacts Military backing of the incumbent makes the prospect of a coup unlikely. The uncertain political climate and recurring protests could undermine a fiscal consolidation programme with the IMF. The Togolese diaspora will increase global attention on the crisis and pressure on international governments to intervene.

Near-term IMF funds are ample, but more may be needed

2020 ◽  
Keyword(s):  
Emerging Markets ◽  
Economic Crisis ◽  
Low Income ◽  
Low Income Countries ◽  
First Responder ◽  
Content Type ◽  
Near Term ◽  
Second Wave ◽  
The Imf

Subject IMF funding dynamics. Significance The disruption caused by the COVID-19 pandemic is putting emerging markets (EMs) and low-income Countries (LICs) under economic and financial stresses. The IMF has long served as the world’s first responder to crises, and some 90 countries have already turned to it, raising fears of whether it has adequate resources to play a systemic role in helping to support these countries. Impacts A second wave of COVID-19 infections and deaths would prolong the economic crisis and could sharply raise demands for IMF resources. The organisation needs a quota increase but the fastest way to raise more resources for EMs is by increasing bilateral borrowing. For low-income countries, additional IMF funding is being mobilised.

Egypt weathers COVID-19 blow but debt risks loom large

2021 ◽  
Keyword(s):  
Emerging Markets ◽  
Growth Potential ◽  
Structural Reforms ◽  
Fiscal Consolidation ◽  
Medium Term ◽  
Content Type ◽  
Bond Index ◽  
Tourism Sector ◽  
The Imf

Significance The IMF praised Egypt’s “resilience” to the COVID-19 shock and encouraged Cairo to maintain its focus on fiscal consolidation while broadening structural reforms -- mainly to ease investors’ access to key opportunities in the economy -- that will help “unleash Egypt’s enormous growth potential in the medium term”. Impacts Egypt will need to go to the market again in 2021/22 through both conventional bonds and sukuk. The return of Russian tourists could generate USD3.5bn in revenues and is seen as critical to a recovery in the battered tourism sector. Egypt's inclusion in the FTSE Russell frontier index and JP Morgan’s emerging markets bond index could trigger large currency inflows.

Rate policy may diverge in Central Europe in near term

2016 ◽  
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Central Europe ◽  
The Czech Republic ◽  
Content Type ◽  
Low Interest Rates ◽  
National Bank ◽  
Rate Policy ◽  
Near Term ◽  
Fx Market

Subject Monetary policy divergence in Central Europe in 2016. Significance At its March meeting, Hungary's National Bank (MNB) cut its benchmark interest rate to a record low of 1.2%, from 1.35%. Hungary's first interest rate cut since July 2015 came days after the ECB announced significant monetary easing measures. Deflationary conditions in much of Central Europe (CE) are heightening the likelihood of more monetary easing. Impacts Whereas Hungary will embark on a monetary easing cycle, the Czech Republic and Poland will hold rates unchanged in the short term. CPI is not expected to return within target before late 2017 or early 2018, necessitating a prolonged period of ultra-low interest rates. The return to monetary normalisation (the CNB is expected to exit the FX market during 2017) will be slow and gradual.

Kenya tax bill may prove an unpopular compromise

2018 ◽  
Keyword(s):  
Interest Rate ◽  
Content Type ◽  
Fuel Tax ◽  
Administrative Reforms ◽  
Development Agenda ◽  
Political Unrest ◽  
Fiscal Space ◽  
The Government ◽  
External Borrowing ◽  
The Imf

Significance With an ambitious development agenda to fund amid mounting debt, and under pressure from the IMF to rationalise revenues, the government aims to increase fiscal space with a set of long-overdue tax and administrative reforms. However, implementing the proposed measures could trigger political unrest. Impacts If parliament overrules the fuel tax proposal, VAT on other goods could be increased from 16% to 18% to cover the fiscal shortfall. Even with a tax on fuel, the IMF could reject a new arrangement if interest-rate caps on commercial lending are maintained. External borrowing requirements of almost 3 billion dollars will keep the government engaged with the Fund.

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.

IMF deal offers mixed Ghana economic outlook

2015 ◽  
Keyword(s):  
Commodity Price ◽  
Fiscal Deficit ◽  
Structural Constraints ◽  
Fiscal Consolidation ◽  
Content Type ◽  
Social Pressures ◽  
2016 Election ◽  
The Government ◽  
Economic Outlook ◽  
The Imf

Subject Ghana economic outlook. Significance The government has presented a revised 2015 budget that lowers the growth target from 3.9% to 3.5%. The fiscal deficit target has been widened from 6.5% of GDP to 7.3%. The downward revisions underline the economy's structural constraints, which the IMF financial bailout deal will not overcome. Despite a promising start on fiscal consolidation, the economy continues to be plagued by the effects of commodity price dependence. Impacts The recent reduction in fuel and utility subsidies has been made easier given lower oil and product prices. However, social pressures will build around the 2016 election, potentially spurring policy reversals. Negotiations moderating spending in next year's budget will be tougher, especially on wages.

Prospects for Argentina to end-2018

2018 ◽  
Keyword(s):  
Public Spending ◽  
Economic Effects ◽  
Lower Growth ◽  
Content Type ◽  
Perceived Impact ◽  
Near Term ◽  
The Imf

Subject Prospects for Argentina to end-2018. Significance Both political and economic prospects in the second half will be dominated by the newly announced stand-by agreement (SBA) with the IMF and its real and perceived impact. The return to the Fund is generally unpopular and may become more so if the near-term economic effects include lower growth and public spending.

Argentina's domestic woes dictate diplomatic prudence

2020 ◽  
Keyword(s):  
Foreign Policy ◽  
Foreign Trade ◽  
Considerable Influence ◽  
Debt Restructuring ◽  
International Context ◽  
Content Type ◽  
Economic Relations ◽  
Near Term ◽  
Foreign Ministry ◽  
The Imf

Significance Fernandez is currently focusing diplomatic efforts on garnering support for a major debt restructuring proposal which is to be launched next month and requires the backing of the IMF and creditors. With debt and investment areas of key concern, the foreign ministry has recovered considerable influence over economic relations and foreign trade. Impacts Failure to show results on debt and investment could undermine efforts to pursue a pragmatic foreign policy. Debt talks are likely to advance but investment will be slow to follow. The international context will be largely unfavourable to Argentina in the near term at least.

Zambian economy will suffer further setbacks

2020 ◽  
Keyword(s):  
Economic Crisis ◽  
Food Crisis ◽  
Fiscal Consolidation ◽  
Mining Sector ◽  
Content Type ◽  
The Imf

Subject Zambian economic crisis. Significance Despite evidence of a renewed commitment to fiscal consolidation and apparently improving relations with the IMF, a power and food crisis are set to slow faltering growth even further. Deteriorating relations with Western states and investors reflect the increasingly embattled status of President Edgar Lungu and his Patriotic Front (PF) government. Impacts China’s presence in Zambia’s mining sector will likely increase in lieu of debt repayments. Lungu’s unpopularity is bringing his candidacy for 2021 into question, but an anti-Lungu PF faction may struggle for traction. The enduring economic malaise continues to threaten PF support in its former strongholds.

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