Country Reports
2017
December 26, 2017
People’s Republic of China: Financial Sector Assessment Program- Detailed Assessment of Observance of the Iosco Objectives and Principles of Securities Regulation
Description: This paper presents an assessment of the level of observance of the IOSCO Objectives and Principles of Securities Regulation in China. The regulatory framework and supervisory program for the securities markets is largely compliant with the IOSCO Principles. Since 2010, the authorities have implemented several initiatives aimed at protecting China’s very large retail investor population. On the China Securities Regulatory Commission (CSRC) side, this includes strengthening the suitability requirements for intermediaries, investors’ ability to exercise their rights, and its investor education program. The CSRC has also expanded authorized activities for some categories of securities intermediaries with the objective of developing an investment banking culture to help capital markets serve the real economy better.
December 26, 2017
People’s Republic of China: Financial Sector Assessment Program- Detailed Assessment of Observance of the Insurance Core Principles
Description: This paper presents an assessment of the level of observance of the Insurance Core Principles (ICPs) in China. Overall, the Chinese regulatory system is assessed to have a good level of compliance with the ICPs. The regulatory framework includes, in addition to the solvency standards, extensive requirements on corporate governance, risk management and internal controls as well as on reinsurance, disclosure and conduct of business. All these requirements are applied appropriately to the significant number of large insurance groups, which together account for the bulk of premium income. However, there is scope for further development of crisis preparedness and market conduct work.
December 22, 2017
Bolivia: 2017 Article IV Consultation-Press Release; Staff Report; and Statement by the Authorities of Bolivia
Description: This 2017 Article IV Consultation highlights that Bolivia’s real GDP is expected to grow by 4 percent in 2017, relatively strong by regional standards. Accommodative fiscal policy, strong credit growth, and robust private consumption are expected to continue supporting activity while the fiscal and external current account deficits are likely to persist in the medium term. With weak private investment and the end of the commodity boom, growth is forecast to moderate gradually to 3.7 percent in the medium term. Key risks to this outlook include failure to discover new natural gas fields, further dollar strength, or lower-than-expected gas and minerals prices.
December 22, 2017
Seychelles: Request for a Three-Year Policy Coordination Instrument and Ex-Post Assessment of Longer-Term Program Engagement-Press Release; Staff Report
Description: This paper discusses Seychelles’ Request for a Three-Year Policy Coordination Instrument (PCI) and Ex Post Assessment of Longer-Term Program Engagement. The PCI for Seychelles will build on the lessons from the previous programs supported by the IMF. It aims to support the authorities’ efforts to consolidate macroeconomic stabilization and foster sustained and inclusive growth. While the PCI involves no use of IMF resources, successful completion of program reviews would help signal Seychelles’ commitment to continued strong economic policies and structural reforms. Risks to the program are considered moderate given Seychelles’ impressive track record under the successive IMF arrangements. The IMF staff support the authorities’ request for a PCI.
December 21, 2017
Mongolia: First and Second Reviews Under the Extended Fund Facility-Press Release; Staff Report; and Statement by the Executive Director for Mongolia
Description: This paper discusses Mongolia’s First and Second Reviews Under the Extended Fund Facility. Performance under the program thus far has been strong. Growth in 2017 is projected to reach 3.3 percent, considerably better than forecasted at the time of program approval. The combination of strong policy implementation and a supportive external environment has helped the authorities over-perform on all of the quantitative targets under the program. Performance on structural reforms has also been strong, notwithstanding the delays owing to the change in government in September 2017.
December 21, 2017
India: Financial System Stability Assessment-Press Release and Statement by the Executive Director for India
Description: This paper discusses the findings of the Financial System Stability Assessment for India. Since the 2011 Financial Sector Assessment Program, India has recorded strong growth in both economic activity and financial assets, supported by important structural reforms and terms of trade gains. Increased diversification, commercial orientation, and technology-driven inclusion have supported growth in the financial industry, backed by improved legal, regulatory, and supervisory frameworks. Yet, the financial sector is facing considerable challenges, and economic growth has recently slowed down. High nonperforming assets (NPAs) and slow deleveraging and repair of corporate balance sheets are testing the resilience of the banking system, and holding back investment and growth. The authorities have been pursuing policies to accelerate the process of NPA resolution.
December 21, 2017
Republic of Moldova: Article IV Consultation and Second Reviews under the Extended Fund Facility and Extended Credit Facility Arrangements-Press Release; Staff Report; and Statement by the Executive Director for the Republic of Moldova
Description: This 2017 Article IV Consultation highlights that growth in Moldova is expected to be about 3 percent in 2018. Inflation is forecast to return to target in 2018, following a pickup in 2017. The banking sector has been stable, the fiscal performance has improved and Moldova’s external position has strengthened. The outlook, however, is still subject to substantial risks. The program is broadly on track, but continued reform efforts are needed to accelerate growth and improve living standards. Important progress has been made toward cleansing the financial sector, though with delay, including by strengthening supervisory and regulatory frameworks and increasing management and ownership transparency.
December 21, 2017
Republic of Moldova: Selected Issues
Description: This paper highlights the case of Moldova including public investment, efficiency, and growth. The scale up of public investment in Moldova should account for absorption capacity constraints and high reliance on external financing, to ensure a positive impact on growth. It should also be accompanied by efforts to build capacity and strengthen institutions. Public investment in Moldova relies significantly on external loans and grants to finance capital spending. The share of foreign financing varies across sectors, with agriculture and health relying significantly on donor support and education financed mostly domestically. Critical infrastructure needs in Moldova broadly correspond to the priority sectors identified in the National Development Strategy Moldova 2020: energy, transport, agriculture, health, and education. In general, infrastructure in Moldova ranks better regarding coverage than quality. Moldova has a relatively high index of public investment efficiency; nonetheless there are a number of dimensions to improve investment process.
December 21, 2017
St. Vincent and the Grenadines: Article IV Consultation-Press Release and Staff Report
Description: This 2017 Article IV Consultation highlights that growth in St. Vincent and the Grenadines in 2017 is expected to remain relatively flat. The current account deficit is expected to narrow reflecting additional profit repatriation by telecommunication companies. The domestic banking system remains stable, but credit to the private sector has been flat. The fiscal situation is projected to worsen substantially in 2017 owing to a projected decline in tax revenue after exceptional receipts in 2016 and higher outlays for transfers, subsidies and public investment. Growth is expected to pick up to 2.1 percent in 2018 and reach its potential over the medium-term.
December 21, 2017
Republic of Serbia: Eighth Review Under the Stand-By Arrangement-Press Release; Staff Report; and Statement by the Executive Director for the Republic of Serbia
Description: This paper discusses Serbia’s Eighth Review Under the Stand-By Arrangement. Notwithstanding some temporary supply shocks, economic activity remains robust, supported by recovery of private consumption and strong foreign direct investment. Significant fiscal over-performance has continued and efforts to address structural weaknesses have been accelerated. This, along with a healthy credit recovery on the back of substantial monetary policy easing, has helped support growth, while low inflation has reinforced recovery in real incomes. Continuing broader structural reforms are needed to improve the business climate and support Serbia’s medium-term growth.