Country Reports
2020
February 24, 2020
Republic of Congo: Technical Assistance Report-National Accounts Mission
Description: This Technical Assistance report on the Republic of Congo presents mission outcomes and priority recommendations conducted to support the National Statistics Institute in its work on the national accounts estimates. The mission reviewed the calculation of consumption of fixed capital for the general government sector, an important element in calculating production by cost of production. The 2016 accounts are finalized and closed through the summary tables and the 2017 accounts are being finalized. The mission focused on an analysis of the 2016 and 2017 national accounts finalized in accordance with the 1993 System of National Accounts (SNA). The analysis consisted of a review of the information sources used, the methods of calculation and extrapolation, and compliance with the 1993 SNA. The mission made corrections and provided the team with an explanation of the consequences of the corrections and how to integrate them in the accounts, particularly the corrections affecting the branches’ value added and, accordingly, gross domestic product. In order to facilitate progress in various areas of effort, the mission provided several priority recommendations focused on the urgency of preparing and validating a continuous, updated national accounts series. The mission proposes several corrections to the 2015 intermediate consumption matrix and recommends that the national accounting officers make the same corrections, proportionally, for 2016 and 2017.
February 21, 2020
Uruguay: 2019 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Uruguay
Description: This 2019 Article IV Consultation with Uruguay highlights that the country enjoys political stability, strong governance and institutions, and a high degree of social cohesion. Following a decade and a half of robust growth, the country boasts high per capita income, low levels of poverty and inequality, and a resilient financial sector. More recently, in a context of a volatile region and global uncertainties, challenges have emerged. The political and economic landscapes—with the post-election mandate and a growth boost due to large private and infrastructure investments—present an opportunity to address these challenges and preserve the social compact for future generations. The authorities are expected to use the opportunity to reduce debt and bring inflation toward the mid-point of the target range, to rebuild buffers and manage sizable risks. In addition, the authorities should leverage Uruguay’s institutional advantages to further improve the fiscal and inflation targeting frameworks and implement structural reforms, in order to raise potential growth and safeguard the achievements of the past decade.
February 21, 2020
Uruguay: Selected Issues
Description: This Selected Issues paper studies economic growth in Uruguay. Following the 2002 crisis, Uruguay had a remarkable economic recovery. The major growth acceleration in 2004–14 was explained by a combination of positive external factors, recovery from crisis, and emergence of new export sectors. With external factors no longer a support for growth, Uruguay needs to leverage its strengths to raise growth sustainably. Uruguay’s high level of institutional quality and social cohesion provides a stable container for growth. A comparison relative to its trading partners and high growth peers helps identify areas that Uruguay can further enhance to unleash its growth potential. These include, a strong, flexible, and equitable labor market, better education outcomes, higher private sector dynamism, and continued macro stability. Structural policy reforms on key constraints to the private sector will help realize the potential of the new export industries and set the stage for inclusive growth. A strong and credible macro policy framework is also essential for growth sustainability. Efforts to reduce debt, inflation, and dollarization and keep them at low levels will lay the foundations for structural reforms to flourish.
February 19, 2020
Republic of Croatia: 2019 Article IV Consultation-Press Release and Staff Report
Description: This 2019 Article IV Consultation with the Republic of Croatia discusses that it experienced its fifth consecutive year of solid economic growth, once again driven largely by private consumption and tourism. Employment gains have been robust, wages have continued to rise, while import prices have helped to keep inflation muted. Increased absorption of European Union funds is likely to raise public investment in the coming years. In conjunction with continued strong consumption, the current account surplus is expected to decline, and turn into a moderate deficit, while economic growth moderates. Both public and external indebtedness are expected to continue their declining trajectories. The pace of fiscal consolidation in 2019 continued to slow, with the budget estimated to be close to balance. Contingent liabilities could also pressure budget balances in the coming years.
February 18, 2020
Myanmar: Technical Assistance Report-External Sector Statistics Mission
Description: This Technical Assistance Report paper highlights that the work on verifying reasonable size of coverage adjustments for Myanmar’s imports was addressed during the mission, using bilateral trade data from Thailand and China. The mission illustrated how granular data can be used to help determine proper adjustments to improve the coverage of the International merchandise trade statistics, using Thailand’s data on exports to Myanmar cross-classified by border checkpoint and 2-digit HS code. The data indicated potential under-coverage of Myanmar imports for a few checkpoints sharing land border with Thailand. Although the actual travel expenditure per person per day for certain years is likely to be lower than the time series published by the Ministry of Hotels and Tourism given continuous depreciation of Kyat over the past five years, this factor should unlikely outweigh the effect of growing numbers of inbound tourists. Balance-of-payments compilation file used by the Central Bank of Myanmar Balance of Payments Section has now been modified to accommodate suggested coverage adjustments for imports, and the new estimation model for freight and insurance on imports proposed during March 2019 mission.
February 18, 2020
Myanmar: Technical Assistance Report-External Sector Statistics Mission
Description: This Technical Assistance (TA) report on Myanmar presents outcomes and priority recommendations of mission on external sector statistics (ESS) for the Directorate of Investment and Company Administration (DICA). Intensive hands-on training provided to the DICA through peripatetic TA missions have effectively contributed to building up capacity for DICA compilers, which have gradually materialized and translated into successful foreign direct investment surveys (FDIS) conducted last year. Data coverage has significantly improved through inclusion of FDI in oil and gas sector, which is one of the largest FDI recipients for Myanmar. In order to further enhance the coverage of Myanmar’s FDI statistics, the mission advised the DICA to extend the coverage of FDIS to incorporate new companies and FDI in power generation sector. The mission also assisted DICA officials in updating the annual FDIS survey forms, making alterations to the previous year’s survey forms to capture additional information as requested by DICA management.
February 18, 2020
Cameroon: Fifth Review Under the Extended Credit Facility Arrangement and Request for a Waiver of Nonobservance of a Performance Criterion and Modification Performance Criteria-Press Release; Staff Report; and Statement by the Executive Director for Cameroon
Description: This paper discusses Cameroon’s Fifth Review Under the Extended Credit Facility Arrangement and Request for a Waiver of NonObservance of a Performance Criterion and Modification of Performance Criteria (PC). Growth reached 3.9 percent in the first half of 2019, supported by a rebound in the oil and gas sector. The overall fiscal deficit was 1.4 percent of GDP for the first three quarters of 2019, slightly better than the program’s projection. External buffers are being rebuilt, despite external and domestic headwinds. The economy is coping with the impact of the suspension of production at the national oil refinery (SONARA). Program implementation over the first nine months of 2019 was mixed and faces challenges. The continuous PC on external arrears accumulation and three September ITs were also missed. Structural reforms are advancing but with delays. The IMF staff supports the authorities’ requests for completion of the fifth review, a waiver of nonobservance of one continuous performance criterion and modification of one December 2019 and one 2020 performance criterion.
February 18, 2020
Solomon Islands: 2019 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for the Solomon Islands
Description: This 2019 Article IV Consultation with the Solomon Islands highlights that the country has made substantial progress since the Tensions in the early 2000s but faces considerable economic and governance challenges and is highly vulnerable to natural disasters. Finding new sources of growth is becoming urgent with the decline in logging. The consultation focused on similar issues to last year—restoring fiscal buffers to build resilience, strengthening public financial management and public investment management, setting a medium-term fiscal strategy, improving governance, improving exchange rate management and building conditions for sustainable growth. The report recommends developing a holistic approach to medium-term fiscal policy by setting a realistic spending envelope and establishing a medium-term revenue strategy. Together with strengthened budget planning and expenditure control, this would provide greater budget predictability and support natural disaster contingency planning. It is also imperative to strengthen enforcement of governance standards, apply the mining fiscal regime rigorously, improve transparency and advance the anti-corruption agenda.
February 14, 2020
Republic of Armenia: Technical Assistance Report-Strategic Choices for Tax Administration to Enhance Tax Compliance
Description: This technical assistance report on Republic of Armenia advices on advises on strategic choices for tax administration and compliance risk management. It complements the March 2018 tax administration mission, which provided the State Revenue Committee (SRC) with general guidance to develop and implement a compliance improvement framework. Armenia’s tax policy setting creates challenges for the SRC to effectively manage tax compliance. The Government’s tax policy framework is likely to create new noncompliance opportunities and result in revenue leakages. Strengthened fundamental functions and processes are needed for the delivery of effective tax administration. Two issues raised in the 2018 tax administration mission report need to be highlighted again. The mission provided an analysis of SRC case selection and advised on the adoption of analytical tools to achieve better results. The SRC’s current additive risk rule scoring approaches need to be supplemented by predictive modeling giving better predictions and prioritization of the likelihood and potential consequences of noncompliance—the use of such model is envisaged in the SRC’s draft strategic plan.
February 13, 2020
Somalia: Enhanced Heavily-Indebted Poor Countries (HIPC) Initiative-Preliminary Document
Description: This Enhanced Heavily Indebted Poor Countries (HIPC) Initiative Program’s preliminary document discusses that as per the agreement by the IMF, Somalia can be eligible for debt relief under the Enhanced HIPC Initiative. It provides a clear recognition of Somalia’s sustained commitment to key economic and financial reforms under consecutive staff-monitored programs with the IMF. Helping Somalia achieve debt relief and unlock access to the needed resources to increase growth and reduce poverty is a key priority for the IMF. Once Somalia has reached the Completion Point, it would qualify for unconditional debt relief under the HIPC Initiative, and for debt relief under the Multilateral Debt Relief Initiative (MDRI) from the World Bank's International Development Association and the African Development Fund, together with beyond-HIPC assistance from the IMF. Paris Club creditors are also expected to provide further beyond-HIPC assistance at the Completion Point. With HIPC, MDRI and beyond HIPC assistance, Somalia’s NPV of debt-to-exports ratio is projected to decline from 491.7 percent in 2018 to 57.0 percent in 2027 and 41.5 percent in 2038.