New measures will provide temporary relief for Greece

2021 ◽  
Keyword(s):  
Public Debt ◽  
Labour Force ◽  
Structural Reforms ◽  
Medium Term ◽  
Short Term ◽  
Content Type ◽  
Temporary Relief ◽  
Growth Prospects ◽  
Better Than ◽  
Public Opposition

Significance The new forecast is based on strong results in the second quarter, better-than-expected tourism revenues over the summer months and the approval of the Greek Recovery and Resilience Plan by the European Commission in July. Mitsotakis also announced several new measures, including tax cuts to stimulate spending. Impacts High unemployment (14.2% of the labour force) and structural labour market weaknesses will constrain growth. Structural reforms lost momentum during the pandemic, dampening medium-term economic growth prospects. Public opposition to vaccination might necessitate new movement restrictions by year-end, inhibiting growth. Availability of a EUR30bn liquidity buffer will support sovereign ratings and investor interest in the short term. Short- and medium-term public debt refinancing risks remain low as 75% of debt stock is held by the official sector.

Angolan oil sector reform will require innovation

2018 ◽  
Keyword(s):  
Exchange Rate ◽  
Foreign Exchange ◽  
Oil Price ◽  
Structural Reforms ◽  
Medium Term ◽  
Short Term ◽  
Sector Reform ◽  
Content Type ◽  
Oil Sector ◽  
Oil Company

Subject Sonangol priorities. Significance Early structural reforms by new President Joao Lourenco and more positive economic projections for 2018 suggest a potential uptick in Angola’s fiscal fortunes. Since assuming power in September, Lourenco has overhauled the leadership of state-owned oil company Sonangol and dismissed several prominent officials associated with his predecessor Jose Eduardo dos Santos. Separately, Lourenco has moved to tackle the overvalued kwanza. While this will raise debt-servicing costs, this will be partly ameliorated by the recent oil price of over 60 dollars per barrel. Impacts Scrapping the dollar currency peg will help ease the foreign exchange crisis and end payment constraints in the aviation and oil sectors. A more realistic exchange rate will fuel inflation in the short term but will likely improve medium-term economic prospects. Urban support for the People's Movement for the Liberation of Angola (MPLA) could decline further if reforms remain elite-focused.

Czech vote may raise chances of new ANO-led government

2018 ◽  
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
Household Consumption ◽  
Capacity Constraints ◽  
Consumer Confidence ◽  
Structural Reforms ◽  
Medium Term ◽  
Short Term ◽  
Public And Private ◽  
Content Type

Significance Now that Zeman has successfully retaken the presidency with 152,000 more votes than his pro-Western rival Jiri Drahos after a campaign that was dominated by domestic issues, attention will focus once again on forming a majority government after the largest parliamentary party, ANO 2011, lost a vote of confidence on January 16. Impacts Consumer confidence may strengthen in the short term as the old ANO-CSSD government’s policies take effect, providing an economic boost. Robust household consumption and public- and private-backed investment may also contribute to stronger GDP this year. Although monetary policy is set to tighten, in response to signs of overheating, interest rates will remain at historic lows. The outlook for the economy in the short term is upbeat, with a strong outturn expected for the fourth quarter of 2017. Structural reforms will be required over the medium term to reduce the risk of capacity constraints, especially in industry.

Economic orthodoxy will face challenges in Argentina

2020 ◽  
Keyword(s):  
Risk Exposure ◽  
Structural Reforms ◽  
Economic Policies ◽  
High Poverty ◽  
Medium Term ◽  
Short Term ◽  
Social Unrest ◽  
Content Type ◽  
Fiscal Adjustment ◽  
Primary Deficit

Significance The 2021 budget implies a significant fiscal adjustment, with the primary deficit falling from 7-8% of GDP in 2020 to 4.5% in 2021, mainly due to the end of the pandemic relief package, a reduction of energy and transport subsidies and slower pension increases. These measures are in line with recent moves towards more orthodox economic policies. Impacts More prudent policies could ease fears of populism, but investors will remain reluctant to increase their risk exposure. Given high poverty rates, austerity may drive social unrest, affecting the government’s prospects in 2021 mid-term ballots. While fiscal adjustment and structural reforms could aid medium-term sustained economic growth, they will cut short-term growth.

Is money the creation of the state or the market? (On the “modern monetary theory” as described in the textbook by W. Mitchell, L. R. Wray and M. Watts “Macroeconomics”)

2020 ◽  
pp. 121-134
Author(s):  
S. A. Andryushin
Keyword(s):  
Public Debt ◽  
Scientific Community ◽  
Full Employment ◽  
Term Effect ◽  
Scientific Concept ◽  
Monetary Theory ◽  
Left Wing ◽  
Medium Term ◽  
Short Term ◽  
Stimulation Of

In 2019, a textbook “Macroeconomics” was published in London, on the pages of which the authors presented a new monetary doctrine — Modern Monetary Theory, MMT, — an unorthodox concept based on the postulates of Post-Keynesianism, New Institutionalism, and the theory of Marxism. The attitude to this scientific concept in the scientific community is ambiguous. A smaller part of scientists actively support this doctrine, which is directly related to state monetary and fiscal stimulation of full employment, public debt servicing and economic growth. Others, the majority of economists, on the contrary, strongly criticize MMT, arguing that the new theory hides simple left-wing populism, designed for a temporary and short-term effect. This article considers the origins and the main provisions of MMT, its discussions with the mainstream, criticism of the basic tenets of MMT, and also assesses possible prospects for the development of MMT in the medium term.

Africa's 'oil price winners' face mixed prospects

2015 ◽  
Keyword(s):  
Southern Africa ◽  
Oil Prices ◽  
Oil Price ◽  
Political Space ◽  
Medium Term ◽  
Short Term ◽  
Economic Diversification ◽  
Content Type ◽  
Civil Unrest ◽  
Sub Saharan

Subject Africa's oil price winners. Significance Despite traditionally being winners during periods of oil price decline, the medium-term outlook is mixed for sub-Saharan Africa's (SSA) oil importing countries -- reflected in the IMF's recent downgrade of its SSA outlook from 5.75% to 4.9%. Short-term gains reduce the fuel import bill, but uncertainty looms over energy investments in eastern African, while idiosyncratic risks cloud the outlook for southern Africa. While oil exporters may also reap some benefits, much will depend on the degree of oil dependency, political space to make the necessary policy retrenchments, and the extent of government financial buffers. Impacts If sustained, low oil prices could provoke civil unrest, rather than reforms, in oil exporting countries. Most oil exporters will struggle to maintain macroeconomic stability if oil remains low for more than a year. However, economic diversification to some degree helps to shield the region from sharp global slowdowns.

Geothermal drives Kenya power sector boost

2015 ◽  
Keyword(s):  
Electricity Generation ◽  
Dominant Role ◽  
Infrastructure Investment ◽  
Power Sector ◽  
Medium Term ◽  
Content Type ◽  
Grid Systems ◽  
Growth Prospects ◽  
Domestic Power

Subject Kenya power outlook. Significance The government's geothermal generation programme is driving a structural change in the power sector. Plans are for electricity generation to roughly double to 3,000 megawatts (MW) over the next few years, with hydroelectricity losing its dominant role. Kenya's medium-term economic growth prospects turn on the success of the government's rising spending on infrastructure investment in the energy and transport sectors. Impacts Focus on industry sources (diesal, gas, coal) obscures the dominant role of bio-energy (firewood, charcoal) in the energy mix. Increasing the role for natural gas in domestic power sectors will be pushed by regional governments with new offshore finds. Policymakers will continue to advocate the efficacy of mini grid or off-grid systems to augment the limited reach of 'national' grids.

Politics set to slow Pakistan's divestment drive

2016 ◽  
Keyword(s):  
Public Sector ◽  
Economic Reform ◽  
Prime Minister ◽  
Structural Reforms ◽  
Short Term ◽  
Content Type ◽  
Reform Agenda ◽  
Political Patronage ◽  
The Government ◽  
Core Condition

Subject Pakistan's divestment drive. Significance Prime Minister Nawaz Sharif's government describes divestment of public sector enterprises (PSEs), involving 69 firms, as an essential part of its 2013-18 economic reform agenda. Progress thus far is limited, but the government faces rising pressure from the IMF, which made divestment a core condition of its 6.6-billion-dollar, three-year loan in September 2013. Impacts Another government led by Sharif would continue gradual divestments after 2018. Since PSEs are an important vector for distributing political patronage, structural reforms will face stiff resistance. Divestment of profitable PSEs defeats the purpose of the exercise, but the government will use them for a short-term cash boost.

Nigerian government's self-sufficiency goals will lag

2018 ◽  
Keyword(s):  
Small Scale ◽  
Structural Reforms ◽  
Farming Practices ◽  
Medium Term ◽  
Content Type ◽  
Core Inflation ◽  
Parboiled Rice ◽  
Self Sufficiency ◽  
Grey Market ◽  
The Government

Subject Nigerian self-sufficiency push. Significance The government has renewed efforts to prioritise food self-sufficiency and modernise farming practices. However, despite the impetus to drive sector growth and diversify away from oil, necessary wider structural reforms have stalled. Impacts Big-ticket programmes will attract most international focus despite the investment potential in Nigeria's mainly small-scale holdings. Growth in agricultural output will remain low in the medium term as inefficiencies persist and core inflation remains elevated. The government’s import ban may aid domestic production targets but will further encourage a flourishing ‘grey market’ (eg, parboiled rice).

South African 2020 budget may delay Moody's downgrade

2020 ◽  
Keyword(s):  
South African ◽  
Civil Servants ◽  
Structural Reforms ◽  
Short Term ◽  
Content Type ◽  
Political Contention

Significance While the measures have been welcomed by investors, they depend on Pretoria reaching a deal with civil servants, whose unions have denounced the government’s plans. Impacts Despite commitments to a series of growth-boosting structural reforms outlined last year, progress will likely remain halting. Renewed funding for embattled South African Airways (SAA) will be a recurring source of public and political contention over the short term. Debt costs could rise further if a ratings downgrade sees investors demand even higher yields on South African debt.

Prospects for South Africa in 2020

2019 ◽  
Keyword(s):  
South Africa ◽  
Public Debt ◽  
Local Elections ◽  
Strategic Manoeuvring ◽  
Content Type ◽  
Rating Agency ◽  
Growth Prospects ◽  
Leadership Changes ◽  
Opposition Parties

Subject Prospects for South Africa in 2020. Significance Fiscal woes and muted growth prospects are weighing heavily on President Cyril Ramaphosa’s government as it attempts to stabilise ailing state-owned enterprises (SOEs) and rein in public debt amid the prospect of further rating agency downgrades. Anti-corruption reforms are gaining momentum, while opposition parties undertake leadership changes and strategic manoeuvring ahead of the 2021 local elections.

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