Asia and Pacific > Hong Kong Special Administrative Region, People's Republic of China

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International Monetary Fund. Finance Dept. and International Monetary Fund. Statistics Dept.
This paper provides background for an initial discussion under the Fifteenth General Review of Quotas (15th Review) in line with the work plan agreed by the Executive Board. It discusses issues related to further reforms of the quota formula and realigning quota shares, based on updated quota data through 2015. A companion paper, to be discussed separately, will address issues related to the size of the Fund and mix of quota and borrowed resources. Both these papers seek to facilitate initial discussions on some of the key issues for the 15th Review. No proposals are made at this stage, recognizing that further deliberations will be needed before the issues under discussion can begin to be narrowed down.
International Monetary Fund. Fiscal Affairs Dept.


Chapter 1 of the report draws some early lessons from governments’ fiscal responses to the pandemic and provides a roadmap for the recovery. Governments’ measures to cushion the blow from the pandemic total a staggering $12 trillion globally. These lifelines and the worldwide recession have pushed global public debt to an all-time high. But governments should not withdraw lifelines too rapidly. Government support should shift gradually from protecting old jobs to getting people back to work and helping viable but still-vulnerable firms safely reopen. The fiscal measures for the recovery are an opportunity to make the economy more inclusive and greener. Chapter 2 of this report argues that governments need to scale up public investment to ensure successful reopening, boost growth, and prepare economies for the future. Low interest rates make borrowing to invest desirable. Countries that cannot access finance will, however, need to do more with less. The chapter explains how investment can be scaled up while preserving quality. Increasing public investment by 1 percent of GDP in advanced and emerging economies could create 7 million jobs directly, and more than 20 million jobs indirectly. Investments in healthcare, housing, digitalization, and the environment would lay the foundations for a more resilient and inclusive economy.

International Monetary Fund. Fiscal Affairs Dept.


Chapter 1 argues that fiscal policies are at the forefront of responding to the COVID-19 pandemic. Fiscal measures can save lives, protect the most-affected people and firms from the economic impact of the pandemic, and prevent the health crisis from turning into a deep long-lasting slump. A key priority is to fully accommodate spending on health and emergency services. Global coordination is for a universally low-cost vaccine and to support countries with limited health capacity. Large, temporary and targeted support is urgently needed for affected workers and firms until the emergency abates. As the shutdowns end, broad-based, coordinated fiscal stimulus—where financing conditions permit—will become more effective in fostering the recovery. Chapter 2 argues that fiscal policies are at the forefront of facilitating an economic recovery from the COVID-19 pandemic once the Great Lockdown ends. Policymakers can achieve this objective with IDEAS: Invest for the future—in health systems, infrastructure, low carbon technologies, education, and research; adopt well-planned Discretionary policies that can be deployed quickly; and Enhance Automatic Stabilizers, which are built-in budgetary tax and spending measures that automatically stabilize incomes and consumption. Importantly, improving unemployment benefit systems and social safety nets can protect household incomes from adverse shocks and strengthen resilience against future epidemics. Over the past decade, state-owned enterprises (SOEs) have doubled in importance among the world’s largest corporations. They often deliver basic services such as water, electricity, and loans for families and small businesses. At their best, they can help promote higher economic growth and achieve development goals. However, many are a burden to taxpayers and the economy. Chapter 3 discusses what governments can do to get the most out of SOEs. This includes ensuring the firm’s managers have the right incentives and there is effective oversight. It also requires a high degree of transparency of their activities.

International Monetary Fund. Western Hemisphere Dept.
This paper describes the proposed Canada Infrastructure Bank (CIB) that will be allocated Can$35 billion over an 11-year period. It will add to, and not replace, existing methods of financing public infrastructure at all levels of government, including the Federal Government’s Can$187 billion Investing in Canada plan covering 12 years. The CIB will be a wholly government-owned Crown corporation, subject to provisions of the Financial Administration Act (FAA), including the requirement to prepare a corporate plan, operating budget, and capital budget, for approval by the Government. The CIB and its investments will be on the federal government’s balance sheet. However, the infrastructure-related special purpose vehicles (SPVs) in which the CIB invests will not be on the government’s balance sheet. Attracting private capital requires offering a rate of return acceptable to the investor. Worldwide, there are trillions of dollars looking for safe returns over the long-term. The risk-adjusted rate of return sufficient to attract an investor is not known with precision ex-ante. Investors will seek the highest rate of return possible above its minimum threshold.
Allan Dizioli, Mr. Benjamin L Hunt, and Wojciech Maliszewski
China’s transition to a new growth model continues and the impact has been felt across the globe. Several trends contribute to the ‘maturing’ of China’s economy: i) structural slowing on the convergence path; ii) on-shoring deepening; and iii) demand rebalancing from investment towards consumption. In the short term, financial stress may lead to a cyclical slowdown. This paper discusses and quantifies spillovers to the global economy from these different developments. The analysis is undertaken using the APDMOD and G20MOD, both modules of the IMF’s Flexible System of Global Models. For plausible values of these developments, the overall impact on the global economy is not large. However, the impact on China’s closest trading partners and commodity exporters can be notable.
Mr. Rabah Arezki, Mr. Patrick Bolton, Sanjay Peters, Frederic Samama, and Joseph Stiglitz
This paper investigates the emerging global landscape for public-private co-investments in infrastructure. The creation of the Asian Infrastructure Investment Bank and other so-called “infrastructure investment platforms” are an attempt to tap into the pool of both public and private long-term savings in order to channel the latter into much needed infrastructure projects. This paper puts these new initiatives into perspective by critically reviewing the literature and experience with public private partnerships in infrastructure. It concludes by identifying the main challenges policy makers and other actors will need to confront going forward and to turn infrastructure into an asset class of its own.
International Monetary Fund. European Dept.
This Selected Issues paper identifies episodes of large and sustained current account surpluses in advanced economies (AEs) and compares Germany’s ongoing surplus with those episodes. In doing so, the paper aims to put Germany’s external position in a historical and cross-country context drawing from 55 years of data across 20 AEs. The comparison shows that the real growth of all domestic demand components, particularly of private investment, was remarkably weak during the latest sustained surplus episode in Germany in comparison with both “normal times” and other AE surplus episodes. Neither Germany’s nor a typical AE surplus episode has been accompanied by visible, broad-based competitiveness or terms of trade gains.
International Monetary Fund. Middle East and Central Asia Dept.
This Selected Issues paper focuses on the real estate market and Expo 2020 in the United Arab Emirates. It discusses the measures that could mitigate risks associated with the real estate cycle and the international experience with real estate booms and hosting large events such as World Expos, Olympic Games, and World Cup tournaments. The paper discusses the recent developments in the segments of the real estate market in Abu Dhabi and Dubai, focusing on changes in sales prices, rents, and supply in the market. It also takes stock of measures the authorities have introduced recently to reduce the potential for speculative pressure in the real estate market.
International Monetary Fund
The IMF staff has updated individual member country data for the variables used in the quota formula for the period 2000-12. The updated database also incorporates the recently released 2011 International Comparison Program (ICP) global estimates for purchasing power parity rates (PPP) rates. The staff paper also presents updated calculated quota shares based on the current quota formula. The current quota formula includes a GDP variable, which is a blend of GDP at market rates and GDP at purchasing power parity (PPP), openness, variability, and international reserves. The International Monetary and Financial Committee has called for agreement on a new quota formula as part of the 15th General Review of Quotas. The paper presents a limited set of illustrative simulations of possible reforms of the quota formula using the updated quota data. These simulations are purely illustrative and do not represent proposals. The new data tables that can be downloaded via the below link include also the comparable value of each variable for the previous quota dataset, which was based on data covering the period 1999-2011. The information is presented in millions of SDRs (Table A1) and in percent of their respective global totals (Tables A2 and A3). A table showing calculated quota shares based on the current quota formula is also included (Table A4). Data sources and a description of the quota variables are discussed in Quota Formula – Data Update and Further Considerations - Statistical Appendix; IMF Policy Paper; July 2014. Download Quota Data: Updated IMF Quota Formula Variables - July 2014