Posted on November 10, 2016 by iMFdirect
By Ruud de Mooij, Michael Keen, and Alexander Tieman
“The Great Distortion.” That’s what The Economist, in its cover story of May 2015¸ called the systematic tax advantage of debt over equity that is found in almost every tax system.
This “debt bias” is now widely recognized as a real risk to economic stability. A new IMF study argues that it needs to feature more prominently on tax reform agendas; it also sets out options for how to do that.
Filed under: Economic research, Finance, Fiscal policy, IMF, International Monetary Fund, Public debt, taxation | Tagged: allowance for corporate equity (ACE), debt, debt financing, equity, European Commission, European Union, finance, fiscal policy, IMF, iMFdirect blog, International Monetary Fund, taxation | Leave a comment »
Posted on October 26, 2016 by iMFdirect
The IMF’s latest regional economic outlook for Sub-Saharan Africa shows growth at its lowest level in more than 20 years. In this podcast, the African Department’s new Director, Abebe Aemro Selassie, says it’s a mixed story of struggling oil-exporters and strong performers.
Filed under: Africa, banking, developing countries, Economic research, Finance, Fiscal, growth, IMF, International Monetary Fund, LICs, monetary policy, oil, poverty, technology | Tagged: Abebe Aemro Selassie, Angola, Cote d’Ivoire, education, financial inclusion, fuel subsidies, health care, infrastructure, investment, Nigeria, senegal, South Africa, Tanzania, tax systems | Leave a comment »
Posted on August 31, 2016 by iMFdirect
by Jeff Hayden
My mother eases her car into the drive-through lane at our local bank, signs the back of her check, and places it in a metal canister. WHOOSH—the cylinder flies through a pneumatic tube to the teller inside the building.
In a few minutes, the teller squawks her thanks from the intercom speaker nearby. Another WHOOSH, and the canister returns. Inside we find a deposit receipt and a lollipop. Welcome to high-efficiency consumer banking, circa 1973.
Summer 2016. In our kitchen, I watch my oldest son rip open his paycheck and whip out his iPhone. TAP. SWIPE. CLICK. The deposit is made in an instant, thanks to an app that plugs him into an electronic banking network.
Filed under: Advanced Economies, Africa, Asia, banking, China, developing countries, Economic research, Emerging Markets, Employment, euro zone, Europe, Finance, Globalization, IMF, International Monetary Fund, technology | Tagged: Aditya Narain, Andrew Berg, Chris Wellisz, cybercrime, cybertheft, de dollarization, Edward Buffie, Felipe Zanna, Hal Varian, monetary policy, Nancy Birdsall, Peru, public-private partnerships, remittances, robots, Sanjiv Ranjan Das, Sharmini Coorey, smart machines, technology | Leave a comment »
Posted on August 16, 2016 by iMFdirect
We have a global economy, but we don’t have a global currency. Or do we?
In this podcast interview with Benjamin Cohen, professor of International Political Economy at the University of California, Cohen explains why currencies become internationalized, and examines the relationship between world currencies and State power. Continue reading
Filed under: Advanced Economies, developing countries, euro zone, Europe, Finance, IMF, International Monetary Fund | Tagged: Benjamin Cohen, China, currency, currency internationalization, International Monetary Fund, sovereignty, state power, U.S. dollar, yuan | Leave a comment »
Posted on August 4, 2016 by iMFdirect
By John C. Bluedorn and Christian Ebeke
Small businesses could be the lifeblood of Europe’s economy, but their size and high debt are two of the factors holding back the investment recovery in the euro area. The solution partly lies in policies to help firms grow and reduce debt.
Our new study, part of the IMF’s annual economic health check of the euro area, takes a novel bottom-up look at the problem. We analyze the drivers of investment using a large dataset of over six million observations in eight euro area countries, from 2003 to 2013: Austria, Belgium, Germany, France, Finland, Italy, Portugal, and Spain. Continue reading
Filed under: banking, Economic research, euro zone, Europe, Finance, Financial Crisis, IMF, International Monetary Fund, Investment, Public debt | Tagged: Austria, bank financing, banking, Belgium, credit risk, euro area, Europe, Finland, France, Germany, IMF, International Monetary Fund, investment, Italy, leverage, nonperforming loans, Portugal, public debt, small and medium-sized enterprises, Spain | Leave a comment »
Posted on April 26, 2016 by iMFdirect
By James Daniel, José Garrido, and Marina Moretti
Version in 中文 (Chinese)
China’s high and rising corporate debt problem and how best to address it has received much attention recently. Indeed, corporate debt in China has risen to about 160 percent of GDP, which is very high compared to other, especially developing, countries.
The IMF’s April 2016 Global Financial Stability Report looked at the issue from the viewpoint of commercial banks and resulting vulnerabilities. Its analysis suggests that the share of commercial banks’ loans to corporates that could potentially be at risk has been rising fast and, although currently at a manageable level, needs to be addressed with urgency in order to avoid serious problems down the road. Indeed the success in addressing this issue is important for China’s economic transition and, given its size and growing global integration, the world’s economy at large.
Filed under: China, developing countries, Economic research, Finance, IMF, International Monetary Fund, unemployment | Tagged: bank credit, capital, China, credit, debt restructuring, developing countries, IMF, International Monetary Fund, Labor, nonperforming loans, NPLs, structural reform | Comments Off on Tackling China’s Debt Problem: Can Debt-Equity Conversions Help?
Posted on April 13, 2016 by iMFdirect
By José Viñals
Versions in عربي (Arabic), 中文 (Chinese), Français (French), 日本語 (Japanese), Русский (Russian), and Español (Spanish)
Over the last six months, global financial stability risks increased as a result of the following developments:
- First, macroeconomic risks have risen, reflecting a weaker and more uncertain outlook for growth and inflation, and more subdued sentiment. These risks were highlighted yesterday at the World Economic Outlook press conference.
- Second, falling commodity prices and concerns about China’s economy have put pressure on emerging markets and advanced economy credit markets.
- Finally, confidence in policy traction has slipped, amid concerns about the ability of overburdened monetary policies to offset the impact of higher economic and political risks.
Filed under: Advanced Economies, banking, euro zone, Europe, Finance, Financial markets, IMF, International Monetary Fund, oil, U.S. | Tagged: banking, banks, China, corporate sector, debt, emerging market economies, euro area, Europe, Global Financial Stability Report, monetary policy, non-performing loans, NPLs, structural reforms | Leave a comment »