Small States Confront Big Challenges with Natural Disasters and Climate Change


taozhangBy Tao Zhang

Versions in 中文 (Chinese), and Français (French)

Small states are far more vulnerable than other countries to natural disasters and climate change. On average, the annual cost of disasters for small states (economies with a population of less than 1.5 million) is more than four times that for larger countries, in relation to GDP. These countries—whether landlocked nations or small island states—need a range of approaches to deal with catastrophe, including not only better disaster response but also more focus on risk reduction and preparedness. Continue reading

Commodity Commotion


By iMFdirect

Terms of trade is the price of a country’s exports relative to its imports. The commodity terms of trade refers to a country’s commodity exports relative to its commodity imports.

When the price of commodities, like oil, plummeted in 2015, economies that rely on exporting commodities had their terms of trade drop by an average of about 10 percent of GDP that year. Economies that rely more on importing commodities saw about a 2 percent of GDP benefit from the 2015 drop in prices.  Continue reading

A Shifting U.S. Policy Mix: Global Rewards and Risks


maury-obstfeld-imfBy Maurice Obstfeld

Version inعربي (Arabic),  中文 (Chinese), Français (French), 日本語 (Japanese), Русский (Russian), and Español (Spanish)

After a year marked by financial turbulence, political surprises, and unsteady growth in many parts of the world, the Fed’s decision this month to raise interest rates for just the second time in a decade is a healthy symptom that the recovery of the world’s largest economy is on track.

The Fed’s action was hardly a surprise: markets had for weeks placed a high probability on last week’s move. But market developments preceding the Fed decision did surprise many market watchers. Continue reading

China Must Quickly Tackle its Corporate Debt Problems


By Joong Shik Kang and Wojciech S. Maliszewski

Version in 中文 (Chinese)

China urgently needs to tackle its corporate-debt problem before it becomes a major drag on growth in the world’s No. 2 economy. Corporate debt has reached very high levels and continues to grow. In our recent paper, we recommend that the government act promptly to adopt a comprehensive program that would sacrifice some economic growth in the short term while rapidly returning the economy to a sustainable growth path.

Continue reading

Infrastructure Done Right


By iMFdirect

In the face of crumbling bridges and super-low interest rates, many countries are talking and planning to increase spending on infrastructure. And it’s not just about more spending; it’s about smart spending. This is something that the IMF has urged countries to consider for several years, starting with our Fall 2014 World Economic OutlookContinue reading

The IMF is Not Asking Greece for More Austerity


By Maurice Obstfeld and Poul M. Thomsen

Versions in عربي (Arabic); Français (French); Deutsch (German); ελληνικά (Greek); and Español (Spanish)

Greece is once again in the headlines as discussions for the second review of its European Stability Mechanism (ESM) program are gaining pace. Unfortunately, the discussions have also spurred some misinformation about the role and the views of the IMF. Above all, the IMF is being criticized for demanding more fiscal austerity, in particular for making this a condition for urgently needed debt relief. This is not true, and clarifications are in order. Continue reading

Why Productivity Growth is Faltering in Aging Europe and Japan


By iMFdirect

Many countries are experiencing a combination of declining birth rates and increasing longevity. In other words, their populations are aging. And graying populations pose serious issues for people, policymakers, and society.  Continue reading

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