Posted on September 28, 2015 by iMFdirect
By Vitor Gaspar and Alejandro Werner
(Versions in Español and Português)
Latin America under stress
After a period of strong growth, economic activity in Latin America has slowed sharply. Growth among the six larger, financially-integrated economies—Brazil, Chile, Colombia, Mexico, Peru, and Uruguay—is expected to be negative this year. With heightened financial market pressures and limited policy space, the credibility of policy makers is being seriously tested. In this challenging environment, policy-makers in these six countries face some difficult questions: how to strike the right balance between smoothing the adjustment and strengthening credibility? What role should fiscal policy play in this new, uncertain and rapidly evolving environment?
These and other questions will be addressed at the Annual Meetings in Lima, Peru next week. As we prepare for these meetings, we offer our thoughts on some of the pressing issues for Latin America.
Filed under: Advanced Economies, Annual Meetings, Economic Crisis, Economic outlook, Emerging Markets, Español, Financial Crisis, Fiscal policy, Globalization, growth, IMF, International Monetary Fund, Investment, Latin America | Tagged: Annual Meetings, Brazil, Chile, Colombia, commodiity prices, fiscal policy, Latin America, macroeconomic policy, Mexico, Peru, Uruguay | Leave a comment »
Posted on September 24, 2015 by iMFdirect
By Shekhar Aiyar and Anna Ilyina
Problem loans are clogging the arteries of Europe’s banking system. The global financial crisis and subsequent recession have left businesses and households in many countries with debts that they cannot repay. Nonperforming loans as a share of total loans in the EU have more than doubled since 2009, reaching €1 trillion—over 9 percent of the region’s GDP—by end-2014. These loans are particularly high in the southern part of the euro area, as well as in several Eastern and Southeastern European countries. Only a handful of countries have managed to lower their nonperforming loan ratio to below its post-crisis peak.
Filed under: Advanced Economies, Economic Crisis, Economic research, Europe, Financial Crisis, Fiscal policy, growth, IMF, International Monetary Fund, Investment, Reform | Tagged: debt, euro area, Europe, European Central Bank, non-performing loans, recession | Leave a comment »
Posted on September 15, 2015 by iMFdirect
By Ratna Sahay, Martin Cihak, Papa N’Diaye, Adolfo Barajas, and Srobona Mitra
(Version in Français, Español, عربي)
A growing number of policymakers see financial inclusion—greater access to financial services throughout a country’s population—as a way to promote and make economic development work for society. More than 60 countries have adopted national financial inclusion targets and strategies. Opening bank accounts for all in India and encouraging mobile payments platforms in Peru are just two examples. Evidence for individuals and firms suggests that greater access to financial services indeed makes a difference in investment, food security, health outcomes, and other aspects of daily life. Our study looks at the benefits to the economy as a whole.
Filed under: Advanced Economies, Economic research, Emerging Markets, Finance, Financial regulation, Fiscal policy, growth, IMF | Tagged: banks, economic growth, finance, financial inclusion, growth, India, inequality, infrastructure, Middle East, Peru, United States, women | Leave a comment »
Posted on September 10, 2015 by iMFdirect
By Joong Shik Kang and Shi Piao
(version in 日本語)
Japanese-brand cars have become everyday, household items in the United States, and it’s hard to drive in the country without seeing one on the roads. These cars may be manufactured by Japanese firms, but about 70 percent of these vehicles are actually produced in North America. Globally, in 2014, about two-thirds of Japanese cars were produced on assembly lines outside of that country. Despite the increase in overseas demand for Japanese vehicles, this hasn’t been mirrored by an expansion in investment, and the building of factories in Japan to meet that demand.
Against this background, our IMF Working Paper looks at possible reasons for this sluggish recovery of corporate investment in Japan, focusing on the role of Japanese firms overseas.
Filed under: Advanced Economies, Asia, Economic Crisis, Economic research, Financial Crisis, growth, IMF, International Monetary Fund, Investment, Reform, 日本語 | Tagged: Abenomics, Bank of Japan, energy, investment, Japan, labor force, manufacturing, structural reform | Leave a comment »
Posted on August 31, 2015 by iMFdirect
For a man who declared on his arrival at the IMF “I do not blog,” Olivier Blanchard, our soon-to-be former Chief Economist, is one hell of a blogger.
Prolific and popular. A demi-god: half economist, half artist. Blanchard writes the way he thinks: sharp, frank, and intellectual, while pushing against the edges of his métier with the creativity and honesty of a singular economist.
Filed under: Advanced Economies, Economic Crisis, Economic outlook, Emerging Markets, Europe, Financial Crisis, Fiscal policy, International Monetary Fund, Multilateral Cooperation | Tagged: Greece, IMF Annual Research Conference, IMF chief economist, jobs, Latvia, macroeconomic policy, oil prices, Olivier Blanchard | 1 Comment »
Posted on August 24, 2015 by iMFdirect
By Giovanni Ganelli and Naoko Miake
(Version in 日本語)
Take a walk in Tokyo, and you will see the sign スタッフ募集中, or “Staff Wanted”, outside many restaurants and convenience stores. These businesses often find it impossible to recruit the workers they need. According to recent statistics, for each job seeker in Japan applying to work as a waiter, there are more than three available positions. Home helpers and long-term caregivers are equally in demand. If you want to work as a security guard, you can choose from around five openings, and for some positions in the construction business the job-to-applicant ratio is over six.
Japan’s labor shortages are the result of both a shrinking population—which limits the overall pool of workers—and skill mismatches. The reduced supply of labor is one of the factors bringing down medium-term potential growth, which the International Monetary Fund estimates at just 0.6 percent. Labor market shortages are also bad for short-term growth, because they reduce the effectiveness of the monetary and fiscal stimulus that the authorities are using to try to boost demand.
Filed under: Advanced Economies, Asia, Economic outlook, Economic research, Emerging Markets, Employment, Fiscal policy, growth, IMF, Inequality, International Monetary Fund, Investment, Reform, unemployment | Tagged: Abenomics, female labor participation, immigration, investment, Japan, jobs, labor market, women | Leave a comment »