countries face similar challenges to create jobs and foster more inclusive growth. The current environment of likely durable low oil prices has exacerbated these challenges. The non-oil private sector remains relatively small and, consequently, has been only a limited source of growth and employment. Because oil is an exhaustible resource, new sectors need to be developed so they can take over as the oil and gas industry dwindles. Over-reliance on oil also exacerbates macroeconomic volatility. Greater economic diversification would unlock job-creating growth, increase resilience to oil price volatility and improve prospects for future generations. Macro-economic stability and supportive regulatory and institutional frameworks are key prerequisites for economic diversification...
Using narrative-based country-case studies, war episodes in the Middle East were examined to assess their economic impact on conflict and neighboring economies. The paper found that conflicts led to a contraction in growth, higher inflation, large fiscal and current account deficits, loss of reserves, and a weakened financial system. Post-conflict recovery depended on the economic and institutional development of the country, economic structure, duration of the war, international engagement, and prevailing security conditions. The net economic impact on neighboring countries varied according to their initial economic conditions, number and income level of refugees they hosted, economic integration, and external assistance.
Iraq showed good progress in undertaking strong macroeconomic policies and implementing economic reforms under the Stand-By Arrangement (SBA). Executive Directors welcomed this, and noted that low investment and stagnating output in the oil sector continue to hamper economic growth. They stressed that the new SBA should maintain macroeconomic stability, facilitate higher investment and output in the oil sector, and move forward with key reforms that were initiated under the previous arrangement. They also emphasized for reduction in inflation, increase in international reserves, and implementation of structural reforms.
This 2007 Article IV Consultation highlights that Iraq’s economic growth has been slower than expected at the time of the last Article IV Consultation, mainly because the expected expansion of oil production has not materialized. Following a decline in oil production and real GDP in 2005, economic growth is estimated at 6¼ percent in 2006. Progress in implementing the structural reforms has been made. Official fuel prices have been increased to levels in other oil-exporting countries in the region, and private sector importation of fuel products has been liberalized.
The Annual Report 2006 to the Board of Governors reviews the IMF’s activities and policies during the financial year (May 1, 2005, through April 30, 2006). The main sections cover the Fund’s Medium-Term Strategy; country, global, and regional surveillance; strengthening surveillance and crisis prevention; IMF program support and crisis resolution; the Fund’s role in low-income countries; technical assistance and training; financial operations and policies; and governance and management of the IMF. Besides the full financial statements for the year, appendixes cover international reserves, financial operations and transactions, principal policy decisions, press communiqués of advisory committees, Executive Directors and their voting power, and changes in the Executive Board’s membership.
This paper discusses Iraq’s request for Stand-By Arrangement for 15 months from December 2005 through March 2007, which they intend to treat as precautionary. The authorities’ policies have succeeded in promoting overall macroeconomic stability despite the extremely difficult security environment. Economic growth in 2005 is estimated at 2.6 percent, following the rebound of almost 50 percent recorded in 2004. Inflation pressures have moderated in 2005, though prices remain volatile. The medium-term outlook for Iraq is favorable, but subject to many risks.
This paper provides background information to the paper “MFD Technical Assistance to Recent Post-Conflict Countries.” The paper presents case studies on eight countries: Afghanistan, Cambodia, the Democratic Republic of the Congo, Iraq, Kosovo, Serbia, Sierra Leone, and Timor-Leste.
This 2003 Article IV Consultation highlights that after a contraction in GDP of more than 4 percent in 2001 and only a marginal expansion in 2002, the pace of economic growth in St. Lucia accelerated in 2003 to 3.7 percent, driven by a rebound in tourism of close to 17 percent. Despite the pickup in growth, the overall economic situation remained difficult in 2003, as an ongoing recovery in the tourism sector has not spilled over to the whole economy. Unemployment remained high, and bank credit to the private sector is declining.
This 2004 Article IV Consultation highlights that the Luxembourg authorities are adjusting policies to the growth slowdown, although major new initiatives are on hold in the run-up to the June 2004 general election. Tax cuts, high expenditure, and weak activity are estimated to have caused a general government deficit in 2003. Executive Directors have welcomed indications that real GDP growth is rebounding, following an unusually long period of sluggish activity. However, they have stressed that medium-term growth prospects are now less buoyant in comparison with the exceptional growth performance of the past decade.
Turkey showed strong implementation of macroeconomic policies and economic reforms under the Stand-By Arrangement (SBA). Executive Directors commended the disinflation, debt reduction, and sustained economic growth, and stressed the need to safeguard macroeconomic stability and accelerate structural reforms. They welcomed the European Union-related legislation, and commended The Central Bank of Turkey for its monetary policy and the Banking Regulation and Supervision Agency in its supervision of banks. They agreed that Turkey has successfully completed the fifth review under the SBA, and granted waiver.