Sailendra Pattanayak, Racheeda Boukezia, Yasemin Hurcan, and Ramon Hurtado
Fiscal institutional capacity in most fragile states (FS) and several low-income developing countries (LIDCs) is much lower than in other countries. Governments in these countries face several cash management challenges because they often lack credible budgets, have smaller and less diversified revenue bases, have limited access to financial markets, and rely largely on donors to fund a large portion of their budgets. Available public funds in these countries often remain dispersed outside the control of the ministry of finance. In the absence of a good cash forecasting function, these countries typically resort to cash rationing to meet their priority spending needs, often in an ad hoc manner, which can adversely affect budget execution and achievement of fiscal policy targets. This note sets out the key objectives and building blocks of a cash management function in FS and LIDCs. It suggests several measures to progressively build cash management capacity in three interrelated areas: consolidating cash resources, forecasting cash flows, and managing cash balances with sound institutional setups.
International Monetary Fund. Strategy, Policy, & Review Department
Over the course of the pandemic, the Fund has made several modifications to the access limits on the use of Fund’s resources to increase the borrowing space under the hard caps on emergency financing and under the annual limits that trigger exceptional access (EA) safeguards under GRA and PRGT. The current temporarily-increased access limits expire at end-December 2021, and absent policy changes, the limits would return to the lower pre-pandemic levels or to the new PRGT annual access limit. Staff proposes to let all access limits return to pre-pandemic levels (or the new PRGT annual access limit), with the exception of the cumulative access limits for emergency financing instruments, which would be extended at the current level for another 18 months.
A 9-month Staff Monitored Program (SMP) combined with a disbursement under the Rapid Credit Facility (RCF) of 50 percent of quota (about US$174 million) was approved on March 30, 2021 to address BOP challenges and build a track record towards an upper credit tranche financial arrangement. This followed a disbursement under the RCF in November 2020 of 15 percent of quota (about US$52 million), which was the first-ever financial disbursement from the Fund to South Sudan. Progress has continued in implementing the revitalized peace agreement of 2018: following the formation of a unity government in February 2020 and the appointment of state governors in June 2020, the national parliament was sworn into office in August 2021. The humanitarian situation remains dire, with about 60 percent of the population facing high levels of acute food insecurity.
The COVID-19 crisis has a severe impact on education and employment and exposed the many social inequities that make some populations more vulnerable to shocks. Despite a vast literature on social mobility in advanced economies, little is known about it in African countries, mainly due to data limitations. Using a large harmonized dataset of more than 72 million individuals, we fill this gap and examine socioeconomic status mobility across generations, measured by educational and occupational attainment. We uncover the substantial geographical variations in the degree of upward/downward educational and occupational mobility across and within African countries, and the gender and rural/urban divide. Additionally, we explore the determinants of social mobility in the African region. We find that social mobility on the continent could be partly explained by observable individual characteristics (gender, marital status, age, etc.), and that educational mobility is a driver of occupational mobility. Lastly, we show that the quality of institutions, the level of public spending on education, social protection coverage, natural resource endowments, and countries' fragility are strong predictors of social mobility in Africa.
International Monetary Fund. Middle East and Central Asia Dept.
Sudan, with the support of the international community, is implementing an ambitious reform program to address major macroeconomic imbalances and support sustainable, inclusive growth. A new transitional government was established in the wake of the 2019 revolution with the mandate to carry out sweeping reforms to reverse decades of economic and social decline. The government is pursuing a transformational reform agenda focused on: (i) achieving internal peace based on inclusion, regional equity, and justice; (ii) stabilizing the economy and correcting large macroeconomic imbalances; (iii) providing a foundation for future rapid growth, development, and poverty reduction; and (iv) improving governance and transparency.