Corruption: A Hidden Tax on Growth


By Vitor Gaspar and Sean Hagan

(Versions in Español عربي中文Français日本語, Русскийعربي)

In recent years, citizens’ concerns about allegations of corruption in the public sector have become more visible and widespread. From São Paulo to Johannesburg, citizens have taken to the streets against graft. In countries like Chile, Guatemala, India, Iraq, Malaysia and Ukraine, they are sending a clear and loud message to their leaders: Address corruption!

Policymakers are paying attention too. Discussing corruption has long been a sensitive topic at inter-governmental organizations like the International Monetary Fund. But earlier this month at its Annual Meetings in Lima, Peru, the IMF hosted a refreshingly frank discussion on the subject.  The panel session provided a stimulating debate on definitions of corruption, its direct and indirect consequences, and strategies for addressing it, including the role that individuals and institutions such as the IMF can play. This blog gives a flavor of the discussion.

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Sovereign Wealth Funds in the New Era of Oil


By Rabah Arezki, Adnan Mazarei, and Ananthakrishnan Prasad 

(Versions in عربي and 中文)

As a result of the oil price plunge, the major oil-exporting countries are facing budget deficits for the first time in years. The growth in the assets of their sovereign wealth funds, which were rising at a rapid rate until recently, is now slowing; some have started drawing on their buffers.

In the short run, this phenomenon is not cause for alarm. Most oil exporters have enough buffers to withstand a temporary drop in oil prices. But what will happen if low oil prices persist, and how will policymakers react?

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Seeking Fairness in the Middle East and North Africa: How Taxation Can Help


Pritha MitraBy Pritha Mitra

(Versions in Français and عربي)

Aspirations for greater fairness were at the core of the protests that triggered the Arab Spring almost five years ago—and remain largely unfulfilled today. In our new paper, we show that tax reform can go a long way towards meeting those aspirations.

Taxation is a critical interface between the state and citizens. How much revenue is raised, how the tax burden is distributed, and how taxation is implemented can all powerfully affect both the reality and the perception of economic opportunities—and the degree of trust in government.

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The Global Impact of Lower Oil Prices


by iMFdirect

Remember when oil was the big story? Yeah, us too.  And we’re still thinking through the issues and what they mean for oil importers and exporters, as well as the global economy.

This week IMF economists released a new paper, and we interviewed the lead author in this podcast, that delves into the benefits of lower oil prices for consumers and for the global economy.

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Inequality’s Toll on Growth


by iMFdirect

Inequality is one of the defining issues of our time, so you may want to tune in to this interview with the authors of a new study that shows that  higher inequality leads to lower growth.  You can also read their blog here.

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Growth’s Secret Weapon: The Poor and the Middle Class


By Era Dabla-Norris, Kalpana Kochhar, and Evridiki Tsounta

(Versions in  Español中文 日本語عربي,and Русский)

The gap between the rich and the poor is at its widest in decades in advanced countries, and inequality is also rising in major emerging markets (Chart 1).  It is becoming increasingly clear that these developments have profound economic implications.

SPR Inequality SDN.chart 1rev

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Oil Prices and Public Finances: A Double-Edged Sword


By Benedict Clements and Marta Ruiz-Arranz 

(Versions in 中文, Français, 日本語Русскийعربي and Español)

Plunging oil prices have taken the public finances on an exciting ride the past six months. Oil prices have fallen about 45 percent since September (see April 2015 World Economic Outlook), putting a big dent in the revenues of oil exporters, while providing oil importers an unexpected windfall.  How has the decline in oil prices affected the public finances, and how should oil importers and exporters adjust to this new state of affairs?

In the April 2015 Fiscal Monitor, we argue that the oil price decline provides a golden opportunity to initiate serious energy subsidy and taxation reforms that would lock in savings, improve the public finances and boost long-term economic growth.

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