ūüďö Weekend Read: SDGs | Middle East Debt and Financing Risks | Latin America | Uneven Recoveries | Gender and Taxes | Globalization

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IMF Weekend Read

Dear Colleague,

In today's edition we focus on Sustainable Development Goals, debt and financing risks in the Middle East and North Africa, looking beyond commodities in Latin America, rethinking capitalism, and more. On that note, let's dive right in.

ūüď£ But first, be sure to tune in today at 9:30 a.m. ET for a one-on-one conversation between IMF Managing Director Kristalina Georgieva and Canadian Deputy Prime Minister Chrystia Freeland.¬†The two will discuss the impact of the COVID-19 pandemic on women and¬†policies that not only help bring women back to work, but also advance gender equality. Watch the event here.

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SUSTAINABLE DEVELOPMENT GOALS: STILL WITHIN REACH?

The COVID-19 pandemic has slowed progress toward achieving the Sustainable Development Goals (SDGs) but has not necessarily derailed them. Countries will have to find the right balance between financing development and safeguarding debt sustainability, between long-term development objectives and pressing immediate needs, and between investing in people and upgrading infrastructure.

Support needed:¬†Decisive and extraordinary support from the international community‚ÄĒincluding private and official donors and international financial institutions‚ÄĒwill be needed. Without increasing financing, COVID-19 may have delayed progress toward the Sustainable Development Goals by up to five years in Cambodia, Rwanda, Pakistan and Nigeria, according to a blog based on a new study by the IMF's¬†Abdelhak Senhadji, Dora Benedek, Edward Gemayel, and Alexander Tieman

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Domestic policy advice: The authors outline four priority areas where some countries have had success and where continued focus is needed: fostering growth, strengthening the capacity to collect taxes, more efficient spending, and catalyzing private investment.

Read the full blog to find out how countries like Cambodia, Rwanda, Pakistan and Nigeria face challenges ahead but have been successful in some of these areas. Read more about SDG financing.

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ūüďļ Watch IMF Managing Director Kristalina Georgieva discuss the roadmap to achieving Sustainable Development Goals with Oxford University's Ian Goldin.


4 QUESTIONS ON MIDDLE EAST DEBT AND FINANCING RISKS 

Measures to fight the COVID-19 pandemic in the Middle East, North Africa, Afghanistan, and Pakistan (MENAP) saved lives and helped cushion the economic blow. It also exacerbated existing debt vulnerabilities and led to a surge in financing needs. The IMF's Jeta Menkulasi, Cesar Serra, and Suchanan Tambunlertchai provide answers to four big questions for the region:  

1. What was the situation before the pandemic? Many countries in the region were already facing high debt, with half carrying government debt ratios above 70 percent of GDP. 

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2. How did the pandemic make things worse? Compared to pre-pandemic expectations, primary deficits in MENAP expanded by an average of 7.5 percent of GDP in 2020, resulting in a 7 percentage-point average increase in debt-to-GDP ratios.

3. What challenges will emerging markets in the region face? Public gross financing needs are projected to rise and financing needs during 2021-22 are expected to remain above 15 percent of GDP.

4. What policies can help reduce debt vulnerabilities? Some countries will need to initiate growth-friendly consolidation plans as the crisis subsides. Others should work to proactively mitigate rollover and refinancing risks. Countries with limited market access could consider reprofiling their commercial and bilateral debt.

Read the full article.

ūüďļ Watch¬†Jihad Azour, director of the IMF's Middle East and Central Asia Department,¬†discuss debt and financing challenges with¬†Jose Franco Medeiros de Morais, Under Secretary of Public Debt, National Treasury of Brazil; Amer Bisat, Head of Sovereign and Emerging Markets at BlackRock; Elena Duggar, Chair of the Macroeconomic Board at Moody's Investors Service; and Rafael Molina, Managing Partner at Newstate Partners.


LOOKING BEYOND COMMODITIES IN LATIN AMERICA 

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A resurgence in commodity prices is providing a bright spot for some Latin American economies. This won't be enough to reduce poverty and inequality in commodity exporting countries, although there's ample evidence that a commodity boom from 2000-14 had a positive effect for the region.

The IMF's Antoinette Sayeh, Alejandro Werner, Ravi Balakrishnan and Frederik Toscani write in a new blog that the region should harness the next commodity super cycle to support three key reforms: more progressive public finance, preparing for the jobs of tomorrow, and more diversified economies.

Read the full blog.

ūüďļ Watch¬†IMF Deputy Managing Director Antoinette Sayeh¬†and IMF Western Hemisphere Department Director¬†Alejandro Werner discuss policies to tackle poverty and inequality in Latin America with¬†Silvana Vargas, Minister of Development and Social Inclusion of Peru;¬†Nora Lustig, Samuel Z. Stone Professor of Latin American Economics and Director of the Commitment to Equity Institute (CEQ) at Tulane University; and¬†Luis Fernando Meija, Executive Director of Fedesarrollo Colombia.


UNEVEN RECOVERIES

Next week, IMF Chief Economist Gita Gopinath and Bruegel Director Guntram Wolff will discuss the uneven recovery from the pandemic. In the latest World Economic Outlook, the IMF warns that even though the global economy is on firmer ground, recoveries are diverging dangerously across and within countries, as economies with slower vaccine rollout, more limited policy support, and more reliance on tourism do less well. 

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This May 5 event starts 12 p.m. ET and is audio-only. You can listen here or connect via Bruegel’s Clubhouse channel, where you can ask questions.

ICYMI:¬†Gopinath spoke this week about the divergent recovery from the crisis at the London Business School's Wheeler Institute for Business and Development.¬†ūüďļ Watch the full event.


KOREA'S ONGOING RECOVERY

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The Korean government's actions were successful in containing the pandemic and lessening its economic impact, according to the country's latest annual assessment. Still, the country faces challenges ahead and should maintain supportive economic policies, while advancing reforms that will promote inclusive medium-term growth, the IMF's Sohrab Rafiq and Andrew Swiston write in a new Country Focus article.

The key takeaways: Korea's sound economic fundamentals and decisive policy actions helped it navigate the crisis, recovery is quick but uneven, troubled economic sectors have gotten help, the financial system has weather the crisis well, and reforms are needed to boost growth potential and enhance inclusiveness.

Read the full article to find out more about five key factors that show the country's economic story of the past year.


GENDER AND TAXES

The IMF‚Äôs Fiscal Affairs Department and the Tax Administration Diagnostic Assessment Tool (TADAT) just released the second podcast and videocast of the TADAT Gender and Revenue Administration series‚Äďlaunched on International Women‚Äôs Day last March. In this videocast, IMF economists and their counterparts from Maldives and Romania focus on the role of gender in tax administration, and in particular on how to design and introduce policies that promote women‚Äôs participation in the workforce in tax administrations and the broader economy. Watch here or look for the TADAT podcast on your favorite podcast app.


F&D: THE GURU OF GLOBALIZATION

In our latest issue of F&D, read a profile of Tel Aviv University’s Assaf Razin, an early scholar of the promise and perils of globalization. From working in a Marxist commune to studying at the University of Chicago, a bastion of free market economics, the award-winning economist has been a leading voice for how countries can make the most of globalization.

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Interested in reading more? Read the full article here, download the PDF.


IMF AROUND THE WORLD

The IMF Executive Board concluded Article IV economic assessment consultations with Uzbekistan and Chile.

IMF Staff issued concluding statements for 2021 Article IV missions with Serbia, Norway and Tuvalu. 

The IMF this week also reached a staff-level agreement with the Republic of Suriname for a $690 million, three-year program under the Extended Fund Facility.

RESPONDING TO THE CRISIS: To date, 86 countries have received more than $110 billion in financial assistance in response to the economic impact of the COVID-19 crisis. Find out more in our  lending tracker, which visualizes the latest emergency financial assistance and debt relief to member countries approved by the IMF’s Executive Board. 

Overall, the IMF is currently making about $250 billion, a quarter of its $1 trillion lending capacity, available to member countries.

Looking for our Q&A about the IMF's response to COVID-19?¬†Click here.¬†We are also continually producing a¬†special series of notes‚ÄĒabout 100 to date‚ÄĒby IMF experts to help members address the economic effects of COVID-19 on a range of topics including fiscal, legal, statistical, tax and more.


HAVE YOUR SAY

Thank you again very much for your interest in the Weekend Read. We really appreciate your time. Please feel free to provide any feedback on our efforts to update the layout and readability of the newsletter.

And if you're on LinkedIn, subscribe to this newsletter in a more ūüďą visual format.

Sincerely,

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Adam Behsudi
Deputy Editor, IMF Weekend Read
abehsudi@IMF.org

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