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The government could end gas price subsidies

in AFRICA/ENERGY by

Finance Minister Abderrahmane Raouia said on Saturday that the government could end gas price subsidies from 2019 and other subsidies from 2020.Mr. Raouia’s announcement was made in Dubai on the sidelines of the meeting between the Arab Finance Ministers and the International Monetary Fund (IMF). The minister did not specify which subsidies could be cut in 2020, simply recalling that the state subsidizes a wide variety of goods and services such as electricity, bread and oil. Abderrahmane Raouia justified the announcement by the fact that the state aims to eliminate its budget deficit in three to four years.

IMF expects Mexico’s inflation to slow ‘drastically’ in 2018

in AMERICAS/ECONOMY by

The International Monetary Fund (IMF) said on Thursday that the improvement of the Mexican economy expected for 2018 will include a deceleration of inflation and highlighted the exit of the recession in Brazil, but warned about the electoral uncertainty and projected a new collapse in Venezuela this year. The IMF gave more details of an advance of its updated prospects for Latin America that it published this week, in which it raised its economic estimates for Mexico and Brazil based on the expansion in the United States and the rise in the prices of raw materials. In Mexico, the Washington-based agency said that “inflation is projected to drop drastically in 2018 as the effect of the increase in domestic prices for fuel last year fades.” The Fund did not provide projections of price developments.

IMF’s last report

in ECONOMY/MIDLE EAST by

The economic reforms held by the heir prince Bin Salman, are in line with the economic provisions set this Monday by the International Monetary Fund. It is making growth provision throughout the middle east. However, the dependence to the oil market, which in this particular moment is favouring the exporting countries, is in the end perceived as a weakness that the prince is trying directly to face. The International Monetary Fund has raised its growth projection for the deficit-hit Saudi economy on the back of higher oil prices but retained its estimates for the region. In its World Economic Outlook update, the IMF said the Saudi economy — which shrank 0.7 percent last year — is expected to grow by 1.6 percent in 2018, up 0.5 percent on its October estimates. The Saudi economy is also projected to grow by 2.2 percent next year, up 0.6 percent on the previous estimate, it said. However, the IMF maintained its October projections for growth in the Middle East, North Africa, Afghanistan and Pakistan (MENAP) region at 3.6 percent and 3.5 percent for this year and 2019, respectively. IMF’s representatives stated that: “While stronger oil prices are helping a recovery in domestic demand in oil exporters, including Saudi Arabia, the fiscal adjustment that is still needed is projected to weigh on growth prospects”. It said oil prices rose 20 percent between August and October of last year. The Saudi economy, the largest in the region, contracted last year for the first time since 2009 when it dove into negative territory due to the global financial crisis. The kingdom has posted budget deficits in the past four fiscal years since oil prices began to plunge. It is projected to remain in the red until 2023. Thus, Riyadh has introduced a series of austerity measures to boost non-oil income, raising the prices of fuel and power, imposing fees and charges on expatriate labor and introducing a value-added tax (VAT) of five percent.

Good news for Russian economy

in ASIA/ECONOMY by

The statement made by the International Monetary Fund that Russia will be among sources of global GDP acceleration reflects objective realities and the Russian economy will be one of the most attractive for investments in coming years, chief executive of the Russian Direct Investment Fund (RDIF) Kirill Dmitriev told reporters on Monday. The International Monetary Fund (IMF) improved the estimate of Russia’s GDP growth in 2018 to 1.7% in the report released earlier today. Russia is among primary sources of global GDP acceleration, IMF Economic Counsellor Maurice Obstfeld said when presenting the report.

 Macedonia needs stronger fiscal consolidation

in EUROPE/PRESS RELEASE/REGIONS by

The International Monetary Fund (IMF) said on Wednesday that the formation of the new government is a turning point for the Macedonian economy, and underscored this as an opportunity to rebuild policy space and revive reforms.Macedonia needs stronger fiscal consolidation due to rapid rise in public debt and high gross financing needs. On the fiscal front, the overall deficit narrowed to 2.6% in 2016, with the improvement largely due to under-execution of capital investment, spending constraints imposed during the pre-election period, and accumulation of payment arrears, the IMF said in its concluding statement on Article IV consultation with Macedonia on the country’s economic performance and policies.The IMF expects Macedonia to close 2017 with fiscal deficit equivalent to around 3% of GDP, while public debt is projected to rise to 47% of GDP, according to the statement. “[IMF] Directors welcomed the authorities’ intention to reduce the overall deficit gradually to 2% of GDP in the medium term, but stressed that this should rely on durable measures”.

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