The Overwhelming Case for a Carbon Tax in China

Posted on July 27, 2016 by iMFdirect

By Ian Parry and Philippe Wingender

Version in 中文 (Chinese)

A single policy could do it all for China. A carbon tax—an upstream tax on the carbon content of fossil fuel supply—could dramatically cut greenhouse gases, save millions of lives, soothe the government’s fiscal anxieties, and boost green growth. Continue reading →

Filed under: Asia, China, climate change, health, IMF, International Monetary Fund, technology, trade | Tagged: , , , , , , , , , , , , , , , , , | Leave a comment »

Getting into Higher Gear: Why Structural Reforms Are Critical for Revving Up Global Growth

Posted on July 25, 2016 by iMFdirect

David Lipton 2016-1By David Lipton

Versions in عربي (Arabic), Español (Spanish)

Almost a decade after the start of the global financial crisis, the world economy is still trying to achieve escape velocity. The IMF’s recent forecast for global growth is a disappointing 3.1 percent in 2016 and 3.4 percent in 2017. And the outlook remains clouded by increased economic and political uncertainty, including from the impact of the Brexit vote.

Policymakers have taken forceful macroeconomic policy action to support growth, such as fiscal stimulus and appropriately accommodative monetary policy. But a lasting recovery remains elusive. Continue reading →

Filed under: Advanced Economies, Financial Crisis, Fiscal policy, G-20, International Monetary Fund | Tagged: , , , , , , , , , , , | Leave a comment »

Reducing Inequality in Asia: Sharing the Growth Dividend

Posted on May 24, 2016 by iMFdirect

By Sonali Jain-Chandra, Kalpana Kochhar and Tidiane Kinda

Versions in 中文 (Chinese), 日本語 (Japanese)

Asia continues to be the world’s growth leader, but the gains from growth are less widely shared than before. Until about 1990, Asia grew rapidly and secured large gains in poverty reduction while simultaneously achieving a fairly equitable society. Since the early 1990s, however, the region has witnessed widening income inequality that has accompanied its robust expansion—a break from its own remarkable past.

This matters because elevated levels of inequality are harmful for the pace and sustainability of growth. What can be done? Our research finds that policies could substantially reverse the trend of rising inequality. In particular, given limited social safety nets, well-designed fiscal policies may be able to alleviate inequality without stifling the region’s wealth-creating growth.

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Filed under: Asia, China, Emerging Markets, Employment, Fiscal, Fiscal policy, Government, growth, IMF, India, Inequality, International Monetary Fund, Investment, Reform | Tagged: , , , , , , , , , | Leave a comment »

Addition by Subtraction: How Diasporas Can Boost Home-Country Growth

Posted on May 18, 2016 by iMFdirect

Pritha Mitra-blogpicBy Pritha Mitra

Version in عربي (Arabic)

Every year, millions of people leave their countries of birth in search of better opportunities abroad. Often, these migrants are among the most talented workers in their home countries. At first glance, this is a loss for the home countries, which invested considerable time and money in educating and developing these people, only to watch them leave. But look again.

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Filed under: developing countries, Emerging Markets, Employment, Government, growth, International Monetary Fund, Investment, Migration, refugees, technology | Tagged: , , , , , , , , , , , , , , , , , , | Leave a comment »

Make in India: Which Exports Can Drive the Next Wave of Growth?

Posted on May 5, 2016 by iMFdirect

By Rahul Anand, Kalpana Kochhar, and Saurabh Mishra

The expansion of India’s exports of services between 1990 and 2013 has been nothing short of spectacular, putting India on a par with the world’s high-income economies in terms of service-product sophistication and as a share of total exports. This has created unique opportunities for continued growth. By contrast, when it comes to exports of manufactured goods, India has lagged behind its emerging-markets peers, both in quality and as a percentage of the total export basket, leaving substantial room for improvement.

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Filed under: Advanced Economies, developing countries, Emerging Markets, India, International Monetary Fund, trade, U.S. | Tagged: , , , , , , , , , , | Leave a comment »

It’s Mostly Food: How to Tame Indian Inflation

Posted on March 10, 2016 by iMFdirect

By Rahul Anand and Paul Cashin

After being low for decades, inflation in India trended higher from the mid-2000s. It reached 10–11 percent by 2008, and remained elevated at double digits for several years. Even though inflation fell by almost half in 2014, inflation expectations have remained high.

High and persistent inflation in recent years has presented serious macroeconomic challenges in India, increasing the country’s domestic and external vulnerabilities. As Reserve Bank of India Governor Raghuram Rajan pointed out at the 8th R.N. Kao Memorial Lecture in 2014, “inflation is a destructive disease … we can’t push inflation under the carpet as a central banker. We have to deal with it.”

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Filed under: Asia, Emerging Markets, IMF, Inequality, inflation, International Monetary Fund, LICs | Tagged: , , , , , , , , , , | Leave a comment »

Bad Debt in Emerging Markets: Still Early Days

Posted on November 9, 2015 by iMFdirect

by John Caparusso, Yingyuan Chen, Evan Papageorgiou and Shamir Tanna

(Versions in 中文, Português, Русский, and Español)

Emerging markets have had a great run. The fifteen largest emerging market economies grew by 48% from 2009 to 2014, a period when the Group of Twenty economies collectively expanded by 6%.

How did emerging markets sustain this growth? In part, they drew upon bank lending to drive corporate credit expansion, strong earnings, and low defaults. This credit boom, combined with falling commodity prices and foreign currency borrowing, now leaves emerging market firms vulnerable and financial sectors under stress, as we discuss in the latest Global Financial Stability Report.

Continue reading →

Filed under: Economic Crisis, Economic outlook, Economic research, Emerging Markets, Financial Crisis, Fiscal policy, IMF, International Monetary Fund, Reform | Tagged: , , , , , , , , , , , , , , , | Leave a comment »

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