Posted on August 8, 2013 by iMFdirect
By Murtaza Syed
(Version in 中文)
Anticipation of the U.S. Federal Reserve’s exit from quantitative easing has dominated headlines in recent weeks. Half a world away, less conspicuously, but no less importantly, China, the globe’s second largest economy, is designing its own policy adjustments: firstly, unwinding the fiscal and monetary stimulus that helped shield it from the Great Recession and lifted global growth (but which also created some vulnerabilities), and secondly transitioning out of a growth model that has generated spectacular growth over the last three decades, but which is now running out of fuel.
Managed well, these twin adjustments would allow China to prolong its economic miracle in a sustainable way, with a significant positive impact for the rest of the world.
Filed under: Asia, Economic Crisis, Emerging Markets, Employment, Finance, Financial Crisis, Fiscal policy, growth, IMF, International Monetary Fund, Public debt | Tagged: China, credit, interest rate-growth differential, investment, Labor, Murtaza Syed, reform | 5 Comments »
Posted on April 12, 2011 by iMFdirect
By Carlo Cottarelli
Undertaking a sizable fiscal adjustment is a lot like driving up a tall mountain: it’s hard work, it can take a long time, and you don’t want to run out of fuel partway up the incline. Countries are starting the climb, cutting back government deficits and debt levels, but according to our analysis often current plans aren’t enough to get countries where they need and want to go.
The plans in place are large by historical standards, which brings with it difficult choices, and particular risks and uncertainties. Let me fill you in on what these are. Continue reading
Filed under: Economic Crisis, Fiscal policy, International Monetary Fund, Public debt | Tagged: bank recapitalization, cyclically adjusted balance, debt sustainability, fiscal adjustment, fiscal consolidation, Fiscal Monitor, fiscal sustainability, government debt, interest rate-growth differential, medium-term fiscal consolidation, primary budget balance, public debt, sovereign risks | 1 Comment »