Strategies for Fiscal Consolidation in the Post-Crisis World

By Mauricio Villafuerte, Cemile Sancak, Jan Gottschalk, S. M. Ali Abbas, Olivier Basdevant, Ricardo Velloso, Fuad Hasanov, Greetje Everaert, Stephanie Eble, Junhyung Park

September 17, 2010

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Mauricio Villafuerte, Cemile Sancak, Jan Gottschalk, S. M. Ali Abbas, Olivier Basdevant, Ricardo Velloso, Fuad Hasanov, Greetje Everaert, Stephanie Eble, and Junhyung Park. Strategies for Fiscal Consolidation in the Post-Crisis World, (USA: International Monetary Fund, 2010) accessed November 23, 2024

Disclaimer: The views expressed herein are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

In response to the global financial crisis, governments provided substantial support to the financial and other key sectors. Although this cushioned the adverse effects of the crisis, it is necessary now to articulate a strategy to ensure the sustainability of public finances. This paper discusses the scale and composition of fiscal adjustment that will need to occur once the recovery is securely under way. Although specific country-level circumstances will influence the composition of the adjustment and its political feasibility, in many cases restoring fiscal sustainability will require reforms to reduce spending and increase tax revenue.

Subject: Domestic debt, Expenditure, Fiscal consolidation, Fiscal policy, Fiscal stance, Pension spending, Public debt

Keywords: Advanced economy, Africa, Debt, Debt ratio, Debt ratio objective, Debt ratio target, Domestic debt, DP, DPPP, Economic growth, Economy, Fiscal consolidation, Fiscal stance, Foreign currency, Global, Government debt, Interest rate, Pension spending

Publication Details

Pages:

64
Volume:

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DOI:

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Issue:

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Series:

Departmental Paper No. 2010/008
Stock No:

SFCPEA
ISBN:

9781589069374
ISSN:

2616-5333

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