Policy Paper: Macro-Fiscal Implications of Health Care Reforms in Advanced and
Emerging Economies Health care reform will be a key fiscal policy challenge in
coming years in both advanced and emerging economies. This soon-to-be-published paper provides updated projections of public
health spending and options to address the rising public cost of health care, drawing from country experiences in the past
Fiscal Monitor Update: Strengthening Fiscal
Credibility (January 2011)
The first quarterly update of the Fiscal
Monitor—published on January 27—assesses recent fiscal developments, which show a greater divergence across
countries. Sovereign risks are elevated and have increased in some cases since the publication of the Fiscal Monitor in
November. Market pressures remain intense in Europe. Moreover, the U.S. and Japan have adopted new fiscal stimulus measures,
slowing the pace of fiscal consolidation in 2011. The underlying fiscal outlook has also weakened in some emerging markets.
Heightened market scrutiny and delayed fiscal adjustment make it even more essential for governments to signal clear
commitment to long-term sustainability through more robust and specific medium-term consolidation plans.
Update complements the fall 2010 full issue of the Fiscal
Monitor, which was presented in November to
policymakers, market participants, academics, and the media in Beijing, Brussels, Kampala, London, and Tokyo. The fall 2010 Fiscal Monitor reviewed fiscal
and debt market developments in advanced, emerging, and low-income countries with a special focus on the analysis of
countries’ medium-term strategies. Special topics included the growth impact of various pension reforms; the fiscal
implications of addressing the environmental impact of carbon-based fuels; and how revenues from value-added taxes can be
FAD In The
The initial media coverage of the Fiscal Monitor Update publication yesterday has been extensive so far
in the United States and Europe, including by Reuters, Bloomberg, AFP, Dow Jones, The Wall Street Journal Online, Xinhua, Agence France
Presse, Europa Press, and EFE. Due to the time difference, evidence of media
coverage further East was not yet available at the time this newsletter edition was closed.
Publication of the
November 2010 Fiscal Monitor was widely covered by the
media, including articles and newswires by Wall Street Journal Europe, Dow
Jones, and Reuters, and interviews of Carlo Cottarelli on CNBC Europe and other networks.
The media generally highlighted the projected sharp increase in debt ratios among advanced economies, but also the view that
markets might be overreacting due to excessively pessimist sentiment.
The blog by O. Blanchard and C. Cottarelli “How to Bake a (Cr)edible
Medium-Term Fiscal Pie” also proved popular in the blogosphere, particularly among financial websites and blogs.
IMF-Japan High-Level Tax
Seminar for Asia and Pacific Countries (Tokyo on January 11–14, 2011)
Conference on Fragile
economies face major fiscal consolidation needs, a one-day conference organized by FAD analyzed past fiscal adjustment plans and their
outcomes. Caroline Atkinson (Director, EXR) chaired a panel discussion comprising Alan Auerbach (UC Berkeley), Carlo Cottarelli (Director, FAD), Carmen
Reinhart (Peterson Institute of International Economics), and Vito Tanzi (former Director, FAD). Participants presented case
studies based on fiscal adjustment in G-7 countries and a broader cross-country analysis, identifying key factors underlying
both failures and successes. The studies will be published as a book, “Chipping Away at Public Debt”(Wiley), in early
Recent Staff Position Notes
"Lifting Euro Area Growth:
Priorities for Structural Reforms and Governance” by C. Allard and L. Everaert with A. Annett, A. Chopra, J. Escolano, D.
Hardy, M. Mühleisen, and B. Yontcheva. The note argues that the euro area needs to make better use of its labor resources and
lift productivity in Southern Europe. It proposes a series of product and labor market reforms as well as fiscal initiatives
and strengthened governance structures.
E. Baldacci, S. Gupta, and C. Mulas-Granados discuss the appropriate fiscal policy
mix in the aftermath of the “Great Recession” in their Finance & Development article Getting Debt Under Control—a topic they also
analyze in their recent Working Paper “Restoring Debt
Sustainability after Crises: Implications for the Fiscal Mix.”
In “A Status Update on Fiscal Exit Strategies” F. Bornhorst,
N. Budina, G. Callegari, A.A. El-Ganainy, R. Gomez Sirera, A. Lemgruber, A. Schaechter, and J.B. Shin, review the medium-term
fiscal consolidation plans of 25 countries.
Historical Public Debt Database” A.M.A. Abbas, N. Belhocine, A.A. El-Ganainy, and M. Horton compile the first
comprehensive historical public debt database (HPDD) covering gross government debt-to-GDP ratios for 174 countries, nearly
the entire IMF country membership, and spanning a long time period. The database is publicly available on the Fiscal Monitor webpage.
The Fiscal Affairs Department (FAD) seeks talented and dedicated
professionals with a background in different areas of public finance, to work on macro-fiscal policy issues and to provide
technical assistance advice to IMF member countries on public financial management, tax policy reform, revenue
administration, and different expenditure policy issues. Vacancies in FAD for staff and long-term expert positions are posted
on http://www.imf.org/jobs. FAD also seeks experts who are interested in occasional
short-term (2-3 week) assignments; interested candidates may send their CVs to FADexperts@imf.org.