1 / 12

Article IV: Economic Policies for Sustainable Growth Seminar

Fiscal Policy: between Fiscal Ease and Increasing Expenditures -some considerations- Catalin Pauna World Bank Bucharest, June 14, 2016. Article IV: Economic Policies for Sustainable Growth Seminar Hosted by the National Institute for Statistics. Content. Cyclicality of fiscal policy

cbarreto
Download Presentation

Article IV: Economic Policies for Sustainable Growth Seminar

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Fiscal Policy: between Fiscal Ease and Increasing Expenditures-some considerations-Catalin PaunaWorld BankBucharest, June 14, 2016 Article IV: Economic Policies for Sustainable Growth Seminar Hosted by the National Institute for Statistics

  2. Content • Cyclicality of fiscal policy • Short term fiscal pressures • Long term fiscal pressures • Institutional and process reforms for efficiency gains

  3. Industrial countries pursue counter-cyclical fiscal policies • Pro-cyclical in emerging countries (“when it rains, it pours”) • Acyclical/counter-cyclical in industrial countries • Yet, about a third of emerging countries have graduated Source: Prof. Carlos Vegh (Johns Hopkins University)

  4. Andrei More than half of the EU members were pro-cyclical in the last ten years Cyclical behavior of the fiscal policy in the EU (2005-2015) Country correlation between the cyclical components of real government expenditure and real GDP Is fiscal policy an effective counter-cyclical tool? It depends on a country’s characteristics: exchange rate regime, debt level, openness, cyclical position, and type of spending (public consumption versus public investment) Source: World Bank

  5. Andrei Romania’s monetary policy has become counter-cyclical Source: Vegh (2015)

  6. In the short run the challenge is to contain the fiscal deficit Fiscal deficit (% of GDP) Source: AMECO • Others: • Improved tax compliance • Investment budget (incl. PNDL)

  7. Long term fiscal pressures are significant • To alleviate them: • Private provision of public goods/services • Efficiency gains (ex. centralized procurement) • Higher taxes (?)

  8. Reform initiatives to improve public fiscal management • Revenue side • Modernization of ANAF • Expenditure side • Spending Reviews Unit • Work on the concept of program-based budgeting • Centralized procurement in health • Strengthen linkages between planning, policy and budgeting • Unit for Evaluation and Monitoring of Significant Public Investments (UEIP) • Delivery Unit (not permanent) • Strategy Unit in Chancellery of the Prime Minister • Institutional Strategic Plans of ministries • Reform of SOEs • Corporate governance framework • Accelerate recruiting of boards and managers (!) • IPOs/privatizations?

  9. Conclusion It is time to connect the dots: performance-based budgeting

  10. Thank you

  11. Is fiscal policy an effective counter-cyclical tool?

More Related