INTERNATIONAL MONETARY FUND

FISCAL
MONITOR
On the Path to
Policy Normalization

2023
APR
INTERNATIONAL MONETARY FUND

FISCAL
MONITOR
On the Path to
Policy Normalization

2023
APR
 ©2023 International Monetary Fund

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Title: Fiscal monitor.
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Subjects: LCSH: Finance, Public—Periodicals. | Finance, Public—Forecasting—Periodicals. |
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Disclaimer: The Fiscal Monitor is a survey by the IMF staff published twice a year, in
the spring and fall. The report analyzes the latest public finance developments, updates
medium-term fiscal projections, and assesses policies to put public finances on a sustain-
able footing. The report was prepared by IMF staff and has benefited from comments
and suggestions from Executive Directors following their discussion of the report on
March 30, 2023. The views expressed in this publication are those of the IMF staff and
do not necessarily represent the views of the IMF’s Executive Directors or their national
authorities.

Recommended citation: International Monetary Fund (IMF). 2023. Fiscal Monitor:

On the Path to Policy Normalization. Washington, DC: IMF, April.

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 <CT>

CONTENTS

Assumptions and Conventions vi

Further Information vii
Preface viii
Foreword ix
Executive Summary xi
Chapter 1. On the Path to Policy Normalization 1
Introduction 1
Recent Fiscal Developments and Outlook 2
What Explains the Unusually Large Movements in Deficits and Debt? 7
Ongoing Food and Energy Crises 13
Policy Conclusions 17
Box 1.1. Improving Tax Capacity in Emerging Market and Developing Economies 19
Box 1.2. Revamping Fiscal Rules and Fiscal Frameworks 21
References 22
Chapter 2. Inflation and Disinflation: What Role for Fiscal Policy? 25
Introduction 25
Impact of Inflation on Public Finances 26
Distributive Effects of Inflation and Fiscal Policy Support 31
Disinflating and Distributing 36
Conclusions 40
Box 2.1. Does Public Wage Policy Make Inflation More Persistent? 41
Box 2.2. Inflation Effect via the Wealth Channel during Historical Episodes 42
Box 2.3. Price Hikes and the Middle Class in the United States 42
Box 2.4. Surges in Government Spending: A Historical Perspective 43
References 45
Economy Abbreviations 49
Glossary 51
Methodological and Statistical Appendix 55
Data and Conventions 55
Fiscal Policy Assumptions 58
Definition and Coverage of Fiscal Data 63
Table A. Economy Groupings 63
Table B. Advanced Economies: Definition and Coverage of Fiscal Monitor Data 67
Table C. Emerging Market and Middle-Income Economies: Definition and
Coverage of Fiscal Monitor Data 68
Table D. Low-Income Developing Countries: Definition and Coverage of Fiscal Monitor Data 69

International Monetary Fund | April 2023 iii

FISCAL MONITOR: ON THE PATH TO POLICY NORMALIZATION

List of Tables
Advanced Economies (A1–A8) 70
Emerging Market and Middle-Income Economies (A9–A16) 78
Low-Income Developing Countries (A17–A22) 86
Structural Fiscal Indicators (A23–A25) 92
Selected Topics 95
IMF Executive Board Discussion of the Outlook, March 2023 107
Figures
Figure 1.1. Monetary and Fiscal Policy Mix 2
Figure 1.2. Low Growth, Rising Rates, and High Debt 2
Figure 1.3. Sovereign Spreads by Income Group 3
Figure 1.4. General Government Primary Balance and Debt, 2019–27 3
Figure 1.5. Projected and Actual Primary Balance for 2022 4
Figure 1.6. Fiscal Impulse: Advanced Economies 4
Figure 1.7. Drivers of Changes in the Fiscal Balance, 2022–23 5
Figure 1.8. Impact of Exchange Rate Depreciation on Debt Change, and Potential Debt
Service Suspension Initiative Savings, 2021–22 6
Figure 1.9. Total Tax Collection 6
Figure 1.10. Drivers of Change in General Government Debt 9
Figure 1.11. Drivers of Annual Change in General Government Debt, 2021–22 10
Figure 1.12. What Share of Revenue Surprises Was Saved? 11
Figure 1.13. Inflation Effects on Different Types of Expenditures: Expenditure Forecast Errors 11
Figure 1.14. Difference in Projected and Actual Real Public Wage Growth 12
Figure 1.15. Effects of Fiscal Consolidation: High Inflation versus Low Inflation 12
Figure 1.16. Number of Countries with Expenditure Rules as of 2022 13
Figure 1.17. Food Prices and Food Insecurity 14
Figure 1.18. Fiscal Costs of Energy Price Increases 15
Figure 1.19. Impact of Energy Cost Increases for Firms and Fiscal Costs 16
Figure 1.1.1. Low Growth in Tax Revenues and Its Drivers 19
Figure 1.1.2. Tax Reform Waves in Emerging Market and Developing Economies 20
Figure 2.1. Indexation Policies Vary across the World and across Budget Items 28
Figure 2.2. Reaction to a 1 Percentage Point Growth Spike in the GDP Deflator 29
Figure 2.3. Debt Reaction to Surprise versus Expected Growth Spikes in the GDP Deflator 30
Figure 2.4. Estimated Initial Gains to Fiscal Balances from CPI Inflation Spikes 30
Figure 2.5. Household-Specific Levels of Inflation per Quintile, 2021−22 33
Figure 2.6. Income, Consumption, and Wealth Channels, 2021−22 34
Figure 2.7. Wealth Effect by Age and Income Brackets, 2021−22 35
Figure 2.8. Changes in Poverty from Different Types of Price Increase Shocks
(Excluding New Policy Measures Responding to Inflation) 36
Figure 2.9. Panel Evidence of the Fiscal Policy Impact on Inflation, 1950–2019 38
Figure 2.10. Fiscal Policy Impact on Inflation in the United States, 1939−2015 38
Figure 2.11. Disinflating via Different Policy Tightening Options in the HANK Model 39
Figure 2.1.1. Effects of Public Wage Spikes on Private Wages and Core CPI Inflation 41
Figure 2.3.1. Inflation Differentials between Middle- and High-Income Families 42
Figure 2.4.1. Surges in Public Expenditure, Revenue, and Debt over a Historical Span 43

iv International Monetary Fund | April 2023

 Contents

Figure 2.4.2. Price Level Rises with the World Wars 43

Figure 2.4.3. Correlation between 2022 Changes in Fiscal Policy and in Core Inflation since 2019 44
Tables
Table 1.1. General Government Fiscal Balance, 2018–28: Overall Balance 7
Table 1.2. General Government Debt, 2018–28 8
Table 2.1. Total Effect of Inflation on Saving Capacity by Age-Income Groups 35
Online-Only Annexes
Online Annex 1.1. The Long-Run Payoff of Tax Administration Reforms
Online Annex 1.2. Fiscal Consolidations during Times of High versus Low Inflation
Online Annex 1.3. Assessing Sectoral Exposures to Energy Cost Shock
Online Annex 1.4. The Budget Effects of 2022 Inflation Surprises
Online Annex 2.1. International Practices with Inflation Indexation
Online Annex 2.2. Estimating Dynamic Net Effects of Inflation Shocks on Fiscal Variables
Online Annex 2.3. The Redistributive Impact of Inflation
Online Annex 2.4. Disinflating and Distributing

International Monetary Fund | April 2023 v

FISCAL MONITOR: TK

ASSUMPTIONS AND CONVENTIONS

The following symbols have been used throughout this publication:

. . . to indicate that data are not available
— to indicate that the figure is zero or less than half the final digit shown, or that the item does not exist
– between years or months (for example, 2008–09 or January–June) to indicate the years or months covered,
including the beginning and ending years or months
/ between years (for example, 2008/09) to indicate a fiscal or financial year
“Billion” means a thousand million; “trillion” means a thousand billion.
“Basis points” refers to hundredths of 1 percentage point (for example, 25 basis points are equivalent to ¼ of 1
percentage point).
“n.a.” means “not applicable.”
Minor discrepancies between sums of constituent figures and totals are due to rounding.
As used in this publication, the term “country” does not in all cases refer to a territorial entity that is a state as
understood by international law and practice. As used here, the term also covers some territorial entities that are not
states but for which statistical data are maintained on a separate and independent basis.

vi International Monetary Fund | April 2023

 <CT>

FURTHER INFORMATION

Corrections and Revisions

The data and analysis appearing in the Fiscal Monitor are compiled by IMF staff at the time of publication.
Every effort is made to ensure their timeliness, accuracy, and completeness. When errors are discovered, corrections
and revisions are incorporated into the digital editions available from the IMF website and on the IMF eLibrary.
All substantive changes are listed in the Table of Contents of the online PDF of the report.

Print and Digital Editions

Print
Print copies of this Fiscal Monitor can be ordered from the IMF Bookstore at [Link]/529120.

Digital
Multiple digital editions of the Fiscal Monitor, including ePub, enhanced PDF, and HTML, are available on the
IMF eLibrary at [Link]/APR23FM.

Download a free PDF of the report and data sets for each of the figures therein from the IMF website at
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Copyright and Reuse

Information on the terms and conditions for reusing the contents of this publication are at [Link]/
external/[Link].

International Monetary Fund | April 2023 vii

FISCAL MONITOR: TK

PREFACE

The projections included in this issue of the Fiscal Monitor are drawn from the same database used for the April
2023 World Economic Outlook and Global Financial Stability Report (and are referred to as “IMF staff projections”).
Fiscal projections refer to the general government, unless otherwise indicated. Short-term projections are based on
officially announced budgets, adjusted for differences between the national authorities and the IMF staff regarding
macroeconomic assumptions. The fiscal projections incorporate policy measures that are judged by the IMF staff
as likely to be implemented. For countries supported by an IMF arrangement, the projections are those under the
arrangement. In cases in which the IMF staff has insufficient information to assess the authorities budget intentions
and prospects for policy implementation, an unchanged cyclically adjusted primary balance is assumed, unless
indicated otherwise. Details on the composition of the groups, as well as country-specific assumptions, can be found
in the Methodological and Statistical Appendix of the April 2023 Fiscal Monitor.
The Fiscal Monitor is prepared by the IMF Fiscal Affairs Department under the general guidance of Vitor Gaspar,
Department Director. The project was directed by Paolo Mauro, Deputy Director; and Paulo Medas, Division Chief.
The main authors of Chapter 1 in this issue are Francesca Caselli (team lead) and Gee Hee Hong (team co-lead),
Enrico Di Gregorio, Gabriel Hegab, Salma Khalid, Andresa Helena Lagerborg, and Jiae Yoo, with contributions from
David Amaglobeli, Mengfei Gu, Emine Hanedar, Samir Jahan, Delphine Prady and Céline Thévenot, and research
support from Chenlu Zhang and Victoria Haver. The main authors of Chapter 2 are Marcos Poplawski-Ribeiro (team
lead), Carlos Eduardo Gonçalves (team co-lead), Chadi Abdallah, Vybhavi Balasundharam, Yongquan Cao, Daniel
Garcia-Macia, Andres Ghini, Ting Lan, Anh Dinh Minh Nguyen, Julieth Pico Mejía, and Alberto Tumino, with
research support from Kardelen Cicek, Arika Kayastha, Zhonghao Wei, and Andrew Womer. The Methodological and
Statistical Appendix was prepared by Chenlu Zhang under the guidance of Jiae Yoo. Meron Haile and Andre Vasquez
provided excellent coordination and editorial support. Wala’a El Barasse from the Communications Department led
the editorial team for the report, with production and editorial support from Rumit Pancholi, Nancy Morrison, Lucy
Scott Morales, Michael Harrup, Linda Long, David Einhorn, Harold Medina (and team), and The Grauel Group.
Inputs, comments, and suggestions were received from other departments in the IMF, including area
departments—namely, the African Department, Asia and Pacific Department, European Department, Middle East
and Central Asia Department, and Western Hemisphere Department—as well as the Communications Department,
Institute for Capacity Development, Legal Department, Monetary and Capital Markets Department, Research
Department, Secretary’s Department, Statistics Department, and Strategy, Policy, and Review Department. Chapter
2 of the Fiscal Monitor also benefited from comments by Olivier Blanchard, Devrim Demirel, Karen Dynan, Joe
Gagnon, Patrick Honohan, Jim McHugh, Adam Posen, and participants of the Peterson Institute for International
Economics (PIIE)-IMF Workshop on “Fiscal Policy and Inflation.” Both projections and policy considerations are
those of the IMF staff and should not be attributed to Executive Directors or to their national authorities.

viii International Monetary Fund | April 2023

 <CT>

FOREWORD

C
OVID-19 became a major pandemic and China, is even more substantial than for the United
overwhelmed health systems around the States (4.5 against 2.8 percentage points). Excluding
world. Amid tremendous uncertainty, the United States and China, public debt ratios
governments enacted lockdowns. These worldwide would be declining—albeit slowly—from
developments triggered the sharpest contraction in 2023 to 2028.
economic activity recorded in quarterly national Another legacy of the pandemic was the rapidly
accounts, and financial markets initially crashed down in rising prices, especially of food and energy, which
a fear spiral. The pandemic and its repercussions shaped increased early in the pandemic, and later accelerated
public finances in the last three years and will continue with the Russian invasion of Ukraine. The surge
to have a bearing even as the pandemic recedes. in inflation in 2021 and 2022 helped reduce debt
After providing extraordinary support in 2020– ratios. The inflation surprise contributed about
21, fiscal policy is returning to normal. In many 9.4 percentage points of GDP (about 1¼ times the
countries, the reduction in public deficits started observed decline). The Fiscal Monitor looks at the
already in 2021, and additional countries joined effects of inflation on public finances and household
the trend in 2022 with monetary and fiscal policy budgets. It documents that inflation surprises erode
tightening in almost three-quarters of countries. the value of government debt for bondholders. More
During the pandemic, many countries suspended generally, inflation surprises benefit net debtors and
fiscal rules, activated escape clauses, or modified fiscal penalize net creditors. Across households, the wealth
targets to allow for the extraordinary policy response. effects of inflation are strongly influenced by age,
Now, most plan to revisit their fiscal rules and with young households (net borrowers) benefiting
frameworks before re-enacting them. and old households (net lenders) suffering from an
For the world, public debt-to-GDP ratios erosion of wealth. In addition, the distributive effects
fell sharply in 2021 and 2022, bringing them of inflation depend on consumption patterns and the
about halfway back from the increase of about composition of incomes.
15 percentage points of GDP in 2020. However, Fiscal policy can and should support monetary
going forward, debt ratios are projected to start going policy in bringing inflation back to target in a
up again in 2023 and continue to increase by about timely manner. Stronger fiscal balances contribute to
1¼ percentage points per year over the medium term cooling off aggregate demand and, hence, moderate
through 2028. Taken together, the level of public the required increase in policy rates. In addition,
debt is now more elevated and projected to grow rebalancing public finances helps limit public finance
faster than foreseen before the pandemic, at the same risks, and a more balanced policy mix contributes
time that real interest rates are also rising. to financial stability, reducing the risk of observing
Developments in the United States and China fiscal-financial feedback loops.
shape these global public debt trends. In the United The Fiscal Monitor looks at the possibility of fiscal
States, public debt to GDP is projected to increase policy contributing to disinflation while protecting the
by almost 3 percentage points of GDP per year vulnerable. The results of our Chapter 2 indicate that
from 2024, about twice the pace projected before when monetary policy acts alone or fiscal policies are
the pandemic. By 2028 the United States’ public not adequately targeted, the poorest households bear
debt ratio is projected to exceed 135 percent of the brunt of the costs of disinflation. Higher interest
GDP, surpassing the pandemic peak. For China, the rates are less costly for wealthier families as they have
public debt to GDP ratio is projected to increase financial buffers and benefit from asset income. Fiscal
continuously to reach 105 percent in 2028. The tightening with targeted transfers moderates interest
annual increase in the debt ratio, projected for rate increases and allows for smaller declines in total

International Monetary Fund | April 2023 ix

FISCAL MONITOR: ON THE PATH TO POLICY NORMALIZATION

private consumption (and no fall at all in the con- are urgently needed. One crucial argument comes
sumption of the poorest households). from the fact that the countries that contribute
Among the existential threats today’s world faces, least to global warming are the most vulnerable.
climate change stands out as one of the top threats. Climate change is the topic of the forthcoming
Under unchanged policies, emissions in this decade October 2023 Fiscal Monitor.
will likely increase and the path to limit temperature
increases to 2° C above pre-industrial levels will Vitor Gaspar
be missed. In the end, collective global actions Director of the Fiscal Affairs Department

x International Monetary Fund | April 2023

 <CT>

EXECUTIVE SUMMARY

Chapter 1: On the Path to Policy Normalization closer to prepandemic levels in many countries, but
Three years since the outbreak of the COVID-19 overall deficits have fallen somewhat less owing to
pandemic, fiscal policy is returning to normal. After rising interest payments. These sizable reductions in
providing extraordinary support simultaneously in debts and deficits stem in large part from atypical
2020, both monetary and fiscal policy tightened in growth and inflation dynamics. In 2022, most
nearly three-quarters of countries in 2022 amid high countries experienced revenue surprises amounting
inflation and the expiration of pandemic-related to 3.1 percent of GDP on average for advanced
spending measures. This shift occurred in a highly economies and 2.5 percent for emerging market and
volatile environment. Just as economies rebounded developing economies, with particularly large revenue
swiftly from a deep COVID-19-related recession with windfalls in oil exporters. Many countries saved part of
continued strains in fiscal space, governments were the extra revenues, but many others increased spending
confronted with a cost-of-living crisis, Russia’s invasion to counter the cost-of-living crisis. In some cases,
of Ukraine, and instability in the financial sector. particularly countries with large initial debt stocks in
Households and economies, supported by domestic currency, debt ratios fell by more than 10
governments, have demonstrated resilience in the percentage points in a year as nominal GDP surged.
face of these challenges. The global economy has However, debt dynamics deteriorated in emerging
recovered swiftly. The economic and social fabric has market economies and low-income developing
thus far withstood disruptions to energy supply. But countries with sizable shares of debt in foreign
the multiple shocks have reversed gains in poverty currency, as currency depreciation and rising interest
reduction, likely pushing the global goal of eradicating rates came together with inflation.
extreme poverty by 2030 farther into the future. Lack The near-term fiscal outlook remains complex,
of fiscal space amid high borrowing costs in developing and it is crucial that fiscal and monetary policies
countries has further stymied progress toward other are closely aligned to deliver price and financial
Sustainable Development Goals—progress that was stability while responding to an uncertain economic
already slow prior to the pandemic. Food prices in environment and rapidly changing financial
domestic currencies remain high in several countries, conditions. In 2023, overall fiscal deficits are expected
owing in part to exchange rate depreciations. to increase slightly to 5 percent of GDP on average,
Beyond the near-term imperative to safeguard poorer as governments face higher interest bills and pressures
households, long-standing challenges—including the to increase public spending, including spending on
climate agenda and population aging—have likewise wages and pensions, to catch up with past inflation.
become more pressing. Risks are firmly to the downside (see the April
Public finances have undergone major swings, 2023 World Economic Outlook and Global Financial
reflecting the unprecedented shocks and government Stability Report). Instability in the financial sector, if
actions. Following a historic surge in public debt it intensifies, could also put pressure on public sector
to nearly 100 percent of GDP in 2020 as a result balance sheets as governments may be called to help.
of economic contraction and massive government A tighter fiscal policy—while providing targeted
support, fiscal deficits have since declined, as support to the most vulnerable—should complement
exceptional measures have come to an end. With efforts by the monetary authorities to bring inflation
strong nominal GDP growth in 2021–22, global debt back to target, making it possible for central banks
posted the steepest decline in 70 years and stood at to increase interest rates by less than otherwise
about 92 percent of GDP at the end of 2022, still (see Chapter 2). Policies will need to be ready to
about 8 percentage points above the level at the end of adjust if risks materialize. If inflation proves to
2019. Primary deficits are falling rapidly and moving be stickier than expected, it will require tighter

International Monetary Fund | April 2023 xi

FISCAL MONITOR: ON THE PATH TO POLICY NORMALIZATION

policies for longer. In a scenario of systemic financial The international community needs to work
stress, fiscal policy may need to intervene swiftly together to find joint solutions to the multiple
to facilitate the resolution process and minimize its challenges that lie ahead. For the most vulnerable
costs, while mitigating moral hazard (October 2016 economies, it is urgent to strengthen the international
Fiscal Monitor). Governance principles, supported financial architecture, especially in debt resolution
by strong insolvency and bankruptcy procedures, and enhancement of the Global Financial Safety Net.
should be applied in the decision-making process The latter is a set of institutions and mechanisms
to safeguard public funds. The appropriate policy that provide insurance against crises and financing to
package will crucially depend on the available mitigate their impact. Many low-income countries
room for fiscal policy action. Given downside risks, need further international efforts to address sovereign
fiscal and monetary policies should stand ready to debt vulnerabilities, including debt relief, so that
respond if economic growth turns out significantly they can make progress toward the Sustainable
weaker than expected and unemployment rises. Development Goals.
Governments should allow automatic stabilizers to Finally, the recent energy crisis has demonstrated
work, especially where inflation is under control and the urgency of pressing ahead with the transition
fiscal space is available. to renewable energy, which would safeguard energy
Over the medium term, fiscal deficits are projected security and mitigate climate change. International
to remain above prepandemic levels in the next few cooperation on energy strategy, including carbon taxes
years. The fiscal outlook is subject to significant and subsidies, would help achieve climate goals and
uncertainty as the global economy rebounds from avoid trade tensions.
a series of shocks. Much will depend on the pace
of long-term (potential) economic growth and the
future course of global interest rates (see Chapter 2 Chapter 2: Inflation and Disinflation:
of the April 2023 World Economic Outlook). Under What Role for Fiscal Policy?
current projections, the envisaged gradual and The upsurge in inflation since 2021—the sharpest in
moderate fiscal tightening will not be sufficient to more than three decades—has called on policymakers
prevent public debt ratios from resuming an upward to respond. Government policies need to be informed
trend, as nominal GDP slows, driven by some large by an understanding of how inflation affects vari-
advanced and emerging market economies. Interest ous groups in society through uneven impacts on the
payments as a share of revenues in emerging market budgets of different households. This chapter examines
economies and low-income developing countries are the multifaceted impact of inflation on fiscal variables
expected to remain higher over the medium term (see infographic) and the distribution of well-being,
than before the pandemic. In low-income developing and it explores how fiscal policy can do its part to curb
countries, concerns persist regarding heightened inflation while supporting the vulnerable.
debt vulnerabilities because of high debt levels, Governments influence how the costs of inflation are
with 39 countries already in or near debt distress. distributed not only through discretionary intervention
Despite multiple waves of tax reforms in these but also through automatic indexation of pensions,
countries, revenues remain stubbornly insufficient at transfers to poorer households via social safety nets,
13.5 percentage points of GDP lower than revenues wages of civil servants, and tax thresholds. A survey of
in advanced economies. This calls for renewed efforts current international practices shows that indexation
to raise tax capacity. varies considerably across countries. Pensions are the
Recent crises have taught us that fiscal policy is most commonly indexed—in nearly all advanced
a powerful tool to foster resilience. To that end, economies and about 40 percent of emerging market
however, governments will need to give greater and developing economies—followed by cash transfers
priority to rebuilding fiscal buffers. Countries should to vulnerable groups and public wages.
develop credible risk-based fiscal frameworks that The impact of inflation on the fiscal accounts also
promote consistent macroeconomic policies, reduce depends on redistribution—in this case, between
debt vulnerabilities over time, and build up the the public sector and the private sector. Unexpected
necessary room to handle future shocks. inflation erodes the real (inflation-adjusted) value

xii International Monetary Fund | April 2023

 EXECUTIVE SUMMARY

Infographic Immediate Impacts of Inflation on Public Finances

Inflation

L
F D
S
Inflated Nominal Sovereign Debt Market
Indexation
Values Structure Expectations

GDP Primary Interest Bill

Revenue
Denominator Expenditure and Debt Service
• Nominal GDP increases with • The nominal tax base also grows • Primary expenditure does not • Interest payments on inflation-
inflation lead to lower fiscal deficits with inflation (for example, usually move immediately with indexed bonds go up with inflation.
and public debt as a ratio to GDP. value-added tax and profit tax). inflation. However, public • Governments with more short-term
expenditure can go up with
• If income tax brackets are not debt (S) than long-term debt (L)
inflation with a short delay via
indexed to inflation, taxpayers may face higher refinancing costs as
indexation of public goods and
be pushed into higher tax brackets investors ask for higher returns to
services (for example, public
(bracket creep). compensate for expected inflation.
wage, social benefits, subsidies, They pay higher interest on
pension, and medical expenses) to foreign-currency-denominated
inflation. debt (F) than on domestic-currency
debt (D) when the currency
depreciates due to inflation.

Source: IMF staff analysis.

Note: The infographic depicts channels of inflation’s immediate impact on fiscal variables, occurring before a policy response.

of government debt, with bondholders taking the than usually thought. Based on surveys of thousands of
brunt of the hit. For countries with debt exceeding households in Colombia, Finland, France, Kenya, Mexico,
50 percent of GDP, each 1 percentage point surprise and Senegal, estimates are provided for the price accel-
increase in inflation is estimated to reduce public debt eration from the second quarter of 2021 to the second
by 0.6 percentage point of GDP, with the effect last- quarter of 2022 for three channels (see Chapter 1 for
ing over the medium term. These effects are smaller more recent developments on the relationship between
or negligible for countries with a large share of debt inflation and public finances): (1) real incomes (wages
denominated in foreign currency. When inflation and pensions), (2) losses in net nominal assets, and
is expected, it is not associated with a decline in (3) faster-than-average price rises for the main goods
debt ratios, highlighting that inflating debt away is and services consumed by a given group (such as food
neither a desirable nor a sustainable strategy. Likewise, prices, which hurt the poor during the period studied).
­deficit-to-GDP ratios initially decline as the nominal Results show that changes in real income were the
(current monetary) values of the economy’s output most important and differed the most across countries
increase and, consequently, the tax base rises, generat- but less so across income groups. Losses on net nomi-
ing more tax revenue, while spending fails to keep up. nal assets were larger for older groups than for young
But such effects dissipate over time. adults (who often have outstanding mortgage debt) in
In addition, the chapter shows that redistributive countries with sizable household credit markets. During
effects of inflation on households are more complex the period considered, the estimated impact of inflation

International Monetary Fund | April 2023 xiii

FISCAL MONITOR: ON THE PATH TO POLICY NORMALIZATION

on the poverty rate (prior to new policy measures in The chapter offers several lessons for policymakers
response) is about 1 percentage point in three countries at the current juncture:
in the sample (France, Mexico, Senegal). •• Although surprise inflation may occasionally offer
Fiscal policy also influences aggregate demand and some breathing room for debt ratios, attempts
inflation, with its ultimate impact depending on the to keep surprising bondholders have historically
monetary authorities’ response. Estimates indicate proved futile or harmful.
that an increase in public spending of 1 percentage •• When reviewing automatic or discretionary index-
point of GDP led to an increase in inflation of ation, policymakers need to decide which programs
0.8 percentage point in the 1950–85 period and of and groups to protect from income erosion while
0.5 percentage point thereafter. The difference argu- avoiding excessive indexation or other policies
ably stems from a more forceful response by central that make inflation more persistent. The impact
banks to rising inflationary pressure in the post-1985 of decisions about public wages (including choices
era. Analysis using a model that embeds inequality ­regarding indexation) on private wage setting
in incomes, consumption, and asset holdings shows should also be carefully assessed.
that a reduction in the fiscal deficit leads to a similar •• When considering new measures or reforms against
level of disinflation but requires a smaller increase in the backdrop of significant inflation, policymakers
interest rates than when central banks act alone. The should consider that different groups of households
analysis also shows that deficit reduction combined may already be experiencing sizable distributive
with transfers to the poorest yields a smaller drop in effects.
total private consumption and a consumption path •• Fiscal policy—involving tough policy choices on
associated with less inequality across households. what budget items to cut and which to protect or
These effects are even more important when public expand—can support monetary policy in the effort
debt is high because fiscal restraint limits the rise in to bring down inflation while protecting those most
the cost of borrowing and reduces debt vulnerabilities. affected by the cost-of-living crisis.

xiv International Monetary Fund | April 2023

 1
CHAPTER

ON THE PATH TO POLICY NORMALIZATION

Introduction Global Financial Stability Report). The pace of fiscal

As the global economy recovered from tightening is projected to slow in 2023 as economies
COVID-19-related disruptions and as exceptional face spending pressures. Ongoing geopolitical tensions
measures by governments largely came to an end, may lead to further increases in defense spending
fiscal policy moved to a tightening stance in 2021–22 and fiscal support to address negative effects from
amid high inflation and the need to reduce debt disruptions to international trade. Industrial policies,
vulnerabilities. Nearly three-quarters of economies including government subsidies, may also emerge to
tightened both fiscal and monetary policy in 2022, foster import substitution. Progress on reducing global
up from a quarter in 2021 (Figure 1.1). With signs poverty stalled in 2022, with about 7 percent of the
of easing inflationary pressures, the global economy is world’s population now projected to be in extreme
now entering a new phase (April 2023 World Economic poverty in 2030, which will fall far short of the goal of
Outlook). The effects of policy tightening will weigh on eradicating extreme poverty. Low-income developing
economic activity. Governments will need to manage countries, many of which are in or near debt distress
high debt against a backdrop of modest growth and or have limited fiscal space, face a particularly difficult
less favorable financing conditions in the medium term balancing act. Many developing countries are grappling
(Figure 1.2). with tighter budgetary constraints. Low and stagnant
Over 2021–22, global public debt declined to about levels of revenue have also hampered progress in
92 percent of GDP—reversing half of the record achieving the Sustainable Development Goals, and
increase in 2020—because of the economic rebound food insecurity has even reversed the progress made in
following the COVID-19 crisis, inflation surprises, and combatting hunger prior to the pandemic.
the end of exceptional fiscal support measures enacted Governments will need to continue to balance their
during the pandemic.1 The pace of fiscal retrenchment efforts between rebuilding fiscal buffers, supporting
and decline in debt varied from country to country disinflation, and protecting the most vulnerable amid
depending on how fast they exited the pandemic and considerable uncertainty about future economic
how subsequent shocks affected them. In emerging growth as the global economy adjusts after massive
markets and low-income developing countries, which shocks. In the event that inflation turns out to be
have lower levels of domestic currency debt, inflation stickier than expected, further monetary tightening
surprises provided less relief for public debt ratios. will be needed and will weigh on economic activity.
The near-term fiscal outlook remains complex, Downside growth risks could also be magnified if
and risks are firmly to the downside with significant financial sector instabilities intensify (see Chapter 1 of
uncertainty surrounding the growth outlook and the April 2023 World Economic Outlook) and increase
rapidly changing financial conditions (April 2023 stress on public finances, as governments may be called
to support the private sector. Global growth could also
The authors of this chapter are Francesca Caselli (team lead) and be adversely impacted by a faltering in China’s recovery
Gee Hee Hong (team co-lead), Enrico Di Gregorio, Gabriel Hegab,
Salma Khalid, Andresa Helena Lagerborg, and Jiae Yoo, with
and an escalation of Russia’s war in Ukraine, which
contributions from David Amaglobeli, Mengfei Gu, Emine Hanedar, could renew tensions in energy markets and exacerbate
Samir Jahan, Delphine Prady, and Céline Thévenot; research support food insecurity in low-income countries.
from Chenlu Zhang and Victoria Haver, and under the guidance of
Over the medium term, under current policies,
Paolo Mauro and Paulo Medas.
public debt is expected to rise to close to the record
1Inflation surprises refer to the component of actual inflation that
levels seen at the height of the pandemic. Its path
was not expected. For public finances, it is critical to distinguish will depend crucially on the pace of economic
the unexpected component of high inflation for the reasons
discussed later in this chapter and in Chapter 2 of the April 2023 growth and whether borrowing costs, which remain
Fiscal Monitor. elevated in emerging market economies (Figure 1.3),

International Monetary Fund | April 2023 1

 FISCAL MONITOR: On the Path to Policy Normalization

Figure 1.1. Monetary and Fiscal Policy Mix pressing. The energy crisis should provide momentum
(Percentage of economies)
to press ahead with the transition to renewable sources
Monetary and fiscal loosening
Monetary tightening and fiscal loosening of energies. Climate change calls for international
Monetary loosening and fiscal tightening coordination in areas such as carbon pricing and
Monetary and fiscal tightening
investment in renewable energy. The global community
should give priority to agreements on climate change
2020 77 17 41 mitigation and adaptation, while ensuring financing
for the climate transition, especially in low-income
countries. The breadth of risks and challenges argues
2021 7 4 62 26 for enhancing medium-term fiscal frameworks to
address debt vulnerabilities in a credible manner.

2022 3 19 4 74
Recent Fiscal Developments and Outlook
Fiscal deficits fell to 4.7 percent of GDP on average
Sources: IMF, World Economic Outlook database; and IMF staff calculations. in 2022, about half of the levels observed in 2020 at
Note: The sample includes 34 advanced economies, 48 emerging market the height of the COVID-19 pandemic (Table 1.1).
economies, and 16 low-income developing countries. Fiscal policy is tightening
(loosening) if the annual change in the primary balance is positive (negative or zero). The large shifts in deficits and debt reflect several
Monetary policy is tightening (loosening) if the annual change in the policy rate is shocks that have hit economies around the globe in
positive (negative or zero). The policy rate is proxied by nominal short-term interest
rates in the World Economic Outlook database and from central bank websites. recent years—the pandemic, the war in Ukraine, and
energy and food price shocks—and the exceptional
policy response. But there is substantial heterogeneity
will gradually return to low prepandemic levels both across and within income groups (Figure 1.4).
(see Chapter 2 of the April 2023 World Economic In advanced economies, primary fiscal deficits fell for
Outlook). Debt sustainability risks are exacerbated by the second year in a row in 2022, from levels well
large contingent liabilities contracted as governments above those in other income groups at the peak of the
provided exceptional support during the pandemic pandemic. In emerging markets (excluding China),
and by the sovereign-bank nexus. Related fiscal risks primary balances nearly returned to their prepandemic
typically manifest themselves in weak growth and tight averages. In low-income developing countries, primary
financial conditions (Bova and others 2016; Battersby balance improved compared to the height of the
and others 2022; Chapter 2 of the April 2022 Global pandemic, albeit by a smaller margin compared to
Financial Stability Report). other income groups.
Long-standing challenges—including the climate In some countries, primary deficits improved by
agenda and population aging—have become more more than expected in the beginning of 2022, partly

Figure 1.2. Low Growth, Rising Rates, and High Debt

1. Growth 2. Median Interest Payments as a 3. Global Debt Levels
(Percent) Percentage of Taxes (Trillions of dollars, left scale;
percent of GDP, right scale)
10 20 Advanced Economies, excluding 120 110
Advanced economies Low-income developing countries China
18 United States Emerging market economies,
Emerging market economies
16 Low-income developing countries 100 excluding China 100
Global
14 Emerging market and middle-income Advanced economies
5 economies 80 Debt-to-GDP ratio 90
12 (right scale)
10 60 80
8
0 6 40 70
4 20 60
2
–5 0 0 50
2019 20 21 22 23 24
2007
08
09
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27

2007
08
09
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25

Sources: IMF, World Economic Outlook database; and IMF staff calculations.
Note: In panel 2, the United States (US) is excluded due to missing values from the World Economic Outlook database.

2 International Monetary Fund | April 2023

 CHAPTER 1 On the Path to Policy Normalization

Figure 1.3. Sovereign Spreads by Income Group an increase in global public debt. After declining
(Basis points)
for two years, public debt is expected to resume
800 Emerging and developing economies 3 an upward trend, driven by some large advanced
700 Advanced economies and emerging market economies. This worse debt
(right scale) 2
600 dynamics reflects both higher primary deficits
500 (e.g., advanced economies) and higher interest bills
1
400 (especially in emerging markets). Whether this
300 0 projected upward trend will materialize is subject to
uncertainty, however, as economies and policies are
200
–1 still normalizing after the substantial shocks of the last
100
few years. In addition, global prices for energy have
0 –2
1991 93 95 97 99 2001 03 05 07 09 11 13 15 17 19 21 23 recently come down from their peaks in March 2022
by more than 30 percent, and even 70 percent in the
Source: DataStream, Global Financial Data.
Note: Emerging Markets Bond Index (EMBI) spreads, if available, or the case of the European gas price. Nonetheless, although
government 10-year bond spread over US or German bonds. Averages are international food prices have also fallen from their
weighted by GDP in US dollars. Latest observation is March 1, 2023.
peaks, domestic food prices remain near record levels
in many countries.

reflecting higher-than-expected inflation (Figure 1.5;

see the next subsection for a more in-depth discussion). Advanced Economies: Falling Deficits, at a Diverse Pace
Commodity-rich countries (Australia and Canada) The average primary balance in advanced economies
benefited from positive terms-of-trade shocks. Deficits improved by 3.4 percentage points in 2022—for a
declined by less in countries where governments cumulative improvement of 6.2 percentage points
adopted measures to address a cost-of-living crisis. since 2020 (Figure 1.4, panel 1). The cyclically
The decline in public debt in 2022 was notable for adjusted primary balance in these economies improved
advanced and emerging market economies (excluding by 2.1 percentage points, on average, in 2022
China), although their debt ratios remain about 8 (Figure 1.6). Even so, the average primary deficit as a
and 4 percentage points above prepandemic levels, share of GDP remained about 1.3 percentage points
respectively (Table 1.2). The public-debt-to-GDP above prepandemic levels.
ratio in low-income developing countries remained These averages conceal important differences across
elevated at about 48 percent, a level not seen since the countries, however. Fiscal tightening was significant
early 2000s. in the United States, with a 4.6 percentage point
Over the medium term, the projected gradual and decline in its cyclically adjusted primary balance in
moderate fiscal tightening will likely not prevent 2022 alone, reflecting the economic recovery from

Figure 1.4. General Government Primary Balance and Debt, 2019–27

(Percent of GDP)
1. Advanced Economies 2. Emerging Markets 3. Low-Income Developing Countries
8 130 8 Gross debt (right scale, all EMs) 100 8 60
6 120 6 Gross debt (right scale, 90 6
4 4 excluding China) 80 4 50
110 70
2 2 2
100 60 40
0 0 0
50
–2 90 –2 –2
40 30
–4 –4 30 –4
80 Primary balance (all EMs)
–6 Primary balance –6 –6 Primary balance
Primary balance 20 20
–8 Gross debt (right scale) 70 –8 –8 Gross debt (right scale)
(excluding China) 10
–10 60 –10 0 –10 10
2019 20 21 22 23 24 25 26 27 2019 20 21 22 23 24 25 26 27 2019 20 21 22 23 24 25 26 27

Sources: IMF, World Economic Outlook database; and IMF staff calculations.
Note: Averages are weighted by purchasing-power-parity-adjusted nominal GDP in US dollars. EMs = emerging markets.

International Monetary Fund | April 2023 3

 FISCAL MONITOR: On the Path to Policy Normalization

Figure 1.5. Projected and Actual Primary Balance for 2022 Figure 1.6. Fiscal Impulse: Advanced Economies
(Percent of GDP) (Percentage points)
4 12
Projected as of January 2022 April 2023 US UK EA Japan AE average
2 10
0
8
–2
6
–4
4
–6
–8 2

–10 0
MEX KOR BRA ITA CAN GBR USA FRA AUS IND JPN
–2
Sources: IMF, World Economic Outlook database; and IMF staff calculations.
Note: The figure compares the projected primary balance from the January 2022 –4
World Economic Outlook Update with the actual primary balance from the April
2023 World Economic Outlook. Data labels in the figure use International –6
Organization for Standardization (ISO) country codes. 2019 20 21 22 23 24 25

Sources: IMF, World Economic Outlook database; and IMF staff calculations.
Note: The fiscal impulse is calculated as the annual change in the cyclically
adjusted primary balance, multiplied by –1. A positive (negative) fiscal impulse
the pandemic. With rebounding private activity implies an expansionary (contractionary) fiscal stance. Advanced economy (AE)
and households drawing on excess savings built up averages are weighted by purchasing-power-parity-adjusted nominal GDP in
US dollars. EA = euro area; UK = United Kingdom; US = United States.
during the pandemic, overall demand weathered
the withdrawal of governments’ support. The
improvements in the cyclically adjusted primary
balance in the euro area and the United Kingdom tax incentives, grants, and other fiscal measures to
were smaller at 0.5 and 1.8 percentage point each, promote a transition to clean energy (United States)
because further support measures were taken in have steeper upward trajectories.
response to a deterioration of the terms of trade
stemming from Russia’s invasion of Ukraine. Japan
announced a series of fiscal packages throughout the Emerging Markets: Growth Fears and Varied Headwinds
year, including measures to mitigate the deterioration Following fiscal adjustment in 2021, primary deficits
in the cost of living. Other economies in Asia declined further by 1.1 percentage points in 2022, on
(Hong Kong SAR, Korea) also loosened their fiscal average, in emerging markets excluding China. The
stances in 2022. decline was largely driven by positive revenue surprises
The average debt-to-GDP ratio in advanced compared to the October 2022 Fiscal Monitor, but with
economies shed 10 percentage points between the large cross-country differences (Figure 1.7). Primary
end of 2020 and the end of 2022, thanks to favorable surpluses increased by more than 2 and 5 percentage
contributions from growth and inflation surprises. points, respectively, in non-oil commodity exporters
Nevertheless, the average current public-debt-to-GDP and oil-producing economies (excluding Russia), which
ratio of about 113 percent of GDP stands above benefited from an upswing in commodity prices and
its prepandemic levels. Over the medium term, from keeping expenditures in check. However, some
fiscal tightening is projected to moderate or abate large countries among the emerging market economies
among advanced economies as a group. Under group experienced different fiscal trends. In China,
current projections for higher interest payments the government introduced fiscal measures to alleviate
and lackluster growth, public debt would rise to growth headwinds from COVID-19-related policies
about 118 percent of GDP over the medium term. and concerns about its ailing real estate market. Support
Countries facing mounting pressures to engage in included a series of tax and other relief measures for
age-related spending (Japan), those contemplating small and medium-sized enterprises.
further increases in public wages and other social The overall deficit in emerging market economies
spending (United Kingdom), and those expanding (excluding China) is set to widen in 2023 by

4 International Monetary Fund | April 2023

 CHAPTER 1 On the Path to Policy Normalization

Figure 1.7. Drivers of Changes in the Fiscal Balance, 2022–23 concerns about debt vulnerabilities. The debt-to-GDP
(Percent of GDP)
ratio in oil producers and exporters has already
Revenue Interest expense Primary expenditure Fiscal balance declined, reaching levels in 2022 close to those seen
3 before the pandemic. In China, debt and associated
2 gross financing needs are expected to be on an upward
trajectory over the medium term under current
1
policies. In Brazil, the decline in debt from revenue
0 overperformance and inflation surprises in 2021–22 is
–1 projected to reverse over the medium term.
–2

–3 Low-Income Developing Countries: Rising Debt

–4 Vulnerabilities amid Low Revenues
–5 Low-income developing countries have been hit by
2022 2023 2022 2023 2022 2023 2022 2023 several concomitant shocks, including the COVID-19
Commodity Others China Brazil
exporters pandemic and the cost-of-living and food security
crises, which have taken their toll on public finances.
Sources: IMF, World Economic Outlook database; and IMF staff calculations.
Note: The figure shows annual changes in the fiscal balance (diamond) and Fiscal deficits in low-income developing countries,
contributions from revenues (blue), interest expenses (red), and primary at an average 4.2 percent of GDP in 2022, showed
expenditures (yellow). Positive (negative) values show improvement (deterioration)
compared with the previous year. Positive values from primary expenditures, for
moderate improvements relative to the worst of the
instance, imply a reduction in primary expenditures as a share of GDP compared pandemic. Primary spending remained stable at
with the previous year. 16.9 percent of GDP, just below its 2021 level, on
average, as countries increased fuel subsidies and social
spending to respond to rising energy and food import
1.6 percentage points, on average. Many emerging prices. The increase in spending was larger among
market economies are projected to cut primary commodity exporters (Burundi, Democratic Republic
spending further in 2023 from their 2022 levels. of Congo) and oil exporters (Nigeria, Yemen), with the
However, countries will continue to see higher latter group benefitting from more fiscal space thanks
interest bills following the large increase in financing to high energy prices. In non-oil commodity exporters,
costs (Figure 1.3), and revenues are expected to the average fiscal deficit rose by 0.6 percentage points
decline. The fiscal position among commodity in 2022, reversing the improvement in 2021, as both
exporters and oil producers is likely to deteriorate as primary spending and debt service payments increased.
their revenues decline by about 2 percentage points For commodity importers, fiscal deficits narrowed by
with a decline in commodity prices expected in 2023. 1.1 percentage point, on average, with the decreases
In Brazil, the primary balance is projected to worsen driven by spending cuts including a reduction in fuel
with the extension of social support and 2022 tax subsidies (Kenya) and slower execution of infrastructure
reductions, although some compensating measures spending (Vietnam), or new tax measures (Kenya).
are being considered to lower the deficits. In Chile, Fiscal deficits in low-income developing countries
the primary balance is projected to deteriorate by are expected to remain stable on average in 2023
2.4 percentage points in 2023 with weaker revenue at 4.2 percent of GDP, despite a deterioration of
collection. In China, on the other hand, the primary 0.3 percent of GDP in non-commodity exporting
balance is expected to increase in 2023, as not countries. In contrast, commodity exporters will reduce
all temporary measures introduced in 2022 may their deficit by 0.4 percentage point in 2023, driven by
be extended. spending cuts, including reductions in fuel subsidies
With moderate fiscal adjustments in the medium (Democratic Republic of Congo, Mauritania), even as
term, the average government-debt-to-GDP ratio in progress in revenue mobilization weakens, reflecting
emerging markets excluding China is projected to rise lower commodity prices and slowing growth.
to about 59 percent of GDP through 2028, above its In addition to the multiple shocks that have
prepandemic level, with some countries facing growing occurred since the pandemic, some international debt

International Monetary Fund | April 2023 5

 FISCAL MONITOR: On the Path to Policy Normalization

Figure 1.8. Impact of Exchange Rate Depreciation on Debt Figure 1.9. Total Tax Collection
Change, and Potential Debt Service Suspension Initiative (Percent of GDP)
Savings, 2021–22 35 Advanced economies
(Percent of GDP)
Emerging market economies
30
5 Low-income developing countries
Contribution of exchange rate depreciation to debt increase
Potential DSSI savings 25
4
20
3
15
2
10
1
5
0
0

1980
82
84
86
88
90
92
94
96
98
2000
02
04
06
08
10
12
14
16
18
20
22
24
–1

–2
Sources: IMF, World Economic Outlook database; and IMF staff calculations.
–3
Senegal

Guinea-Bissau

Côte d’Ivoire

Mali

Chad

Kenya

Nepal

Uganda

a debt treatment agreement with creditors under

the framework.
Sources: IMF, World Economic Outlook database; World Bank; and IMF staff Low-income developing countries have also made
calculations. limited progress in ramping up their tax capacity, as
Note: The figure shows the impact of exchange rate depreciation in 2022 on
changes in the debt ratio between the end of 2021 and the end of 2022. It also is needed to achieve the Sustainable Development
shows estimated debt service payments owed between January and December Goals and manage their debt burdens. In 2022,
2021. Estimated debt service payments owed to all official bilateral creditors as
per the World Bank Debtor Reporting System and International Debt Statistics (IDS) tax-to-GDP ratios in low-income developing countries
definitions and classifications. Estimates are derived from annual IDS projections remained, on average, 4.7 and 13.5 percentage points
based on end-2020 external public and publicly guaranteed debt outstanding and
disbursed. DSSI = Debt Service Suspension Initiative.
lower than those in emerging markets, and advanced
economies, respectively (Figure 1.9). In some cases,
total revenues remain exceptionally low (Nigeria at
8.8 percent and Bangladesh at 8.7 percent of GDP).
relief measures have expired, such as the Debt Service
Tax revenues-to-GDP ratios, on average, surpassed
Suspension Initiative (DSSI) that ended in 2021. At
prepandemic levels in 2022, but in 28 of 57 countries
the beginning of 2023, 11 countries were in debt
for which tax revenue data exist, tax collection remains
distress and another 28 countries were at high risk
below its prepandemic levels (Cameroon, Ethiopia,
of debt distress. Average public debt in low-income
Honduras, Tanzania, and Vietnam, among others).
developing countries in 2022 remained stable at
Stronger efforts will be needed to increase revenue
48.2 percent of GDP, just below the level in 2020.
capacity, which has been stagnant for the past 20
However, the debt burden soared for countries with
to 30 years (revenues can fluctuate significantly,
a high share of foreign currency borrowing, as their
especially in commodity-rich countries). Progress has
exchange rates depreciated (Figure 1.8).
been sluggish, especially in the decade following the
Over the medium term, average debt is
global financial crisis, in mobilizing revenues from
projected to decline from 48.3 percent of GDP
personal income, corporate, and indirect taxes, despite
in 2023 to 43.2 percent of GDP in 2028, still
waves of tax reforms that have included the adoption
above prepandemic levels but featuring significant
of large taxpayer units to monitor and maintain
projected declines in large countries (Ethiopia, Kenya,
relationships with large businesses and, in some cases,
Uzbekistan, Vietnam). Nevertheless, debt-servicing
high-net-worth individuals (Box 1.1 and Online
burdens are expected to climb above prepandemic
Annex 1.1).2
levels. In some low-income developing countries,
debt is projected to continue rising (Nigeria), and
some have asked for debt relief under the Group 2However, the benefits of better monitoring and servicing of
of Twenty (G20) Common Framework (Chad, corporate taxpayers seem to materialize over longer stretches of time,
Ethiopia, Ghana, Zambia). Chad recently reached and with considerable variability in magnitude (Online Annex 1.1).

6 International Monetary Fund | April 2023

 CHAPTER 1 On the Path to Policy Normalization

Table 1.1. General Government Fiscal Balance, 2018–28: Overall Balance

(Percent of GDP)
Projections
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
World –2.9 –3.6 –9.6 –6.6 –4.7 –5.0 –4.6 –4.5 –4.3 –4.2 –4.2
Advanced Economies –2.4 –3.0 –10.2 –7.5 –4.3 –4.4 –4.2 –4.1 –3.9 –3.8 –3.9
Canada 0.4 0.0 –10.9 –4.4 –0.7 –0.4 –0.4 –0.3 –0.2 –0.1 0.0
Euro Area –0.4 –0.6 –7.1 –5.4 –3.8 –3.7 –2.8 –2.3 –2.1 –2.0 –1.9
France –2.3 –3.1 –9.0 –6.5 –4.9 –5.3 –4.8 –4.5 –4.1 –3.9 –4.0
Germany 1.9 1.5 –4.3 –3.7 –2.6 –3.7 –1.9 –0.9 –0.7 –0.5 –0.5
Italy –2.2 –1.5 –9.7 –9.0 –8.0 –3.7 –3.3 –2.3 –1.8 –1.3 –0.7
Spain1 –2.6 –3.1 –10.1 –6.9 –4.5 –4.5 –3.5 –3.8 –4.0 –4.0 –4.0
Japan –2.5 –3.0 –9.1 –6.2 –7.8 –6.4 –4.0 –2.9 –3.1 –3.4 –3.7
United Kingdom –2.2 –2.2 –13.0 –8.3 –6.3 –5.8 –4.4 –4.2 –3.9 –3.9 –3.7
United States2 –5.3 –5.7 –14.0 –11.6 –5.5 –6.3 –6.8 –7.1 –6.9 –6.6 –6.8
Other Advanced Economies 1.2 –0.1 –4.8 –1.3 0.2 0.7 0.7 0.7 0.7 0.6 0.6
Emerging Market and Developing –3.5 –4.5 –8.6 –5.2 –5.2 –5.8 –5.3 –5.0 –4.8 –4.7 –4.7
Economies
Emerging Markets excl. China –3.0 –3.4 –8.2 –4.5 –3.4 –5.0 –4.4 –4.1 –3.8 –3.7 –3.6
Excluding MENA Oil Producers –3.7 –4.8 –8.9 –5.5 –6.0 –6.3 –5.7 –5.5 –5.2 –5.1 –5.0
Asia –4.2 –5.8 –9.7 –6.5 –7.4 –6.8 –6.3 –6.2 –6.0 –5.9 –5.9
China3 –4.3 –6.1 –9.7 –6.0 –7.5 –6.9 –6.4 –6.3 –6.2 –6.1 –6.0
India –6.4 –7.7 –12.9 –9.6 –9.6 –8.9 –8.3 –7.9 –7.7 –7.7 –7.6
Europe 0.3 –0.6 –5.5 –1.9 –2.8 –5.8 –4.0 –3.5 –2.9 –2.7 –2.4
Russian Federation 2.9 1.9 –4.0 0.8 –2.2 –6.2 –2.8 –1.8 –0.8 –0.3 0.2
Latin America –5.0 –4.1 –8.8 –4.5 –3.9 –5.2 –4.4 –3.7 –3.2 –3.0 –2.7
Brazil –7.0 –5.8 –13.3 –4.3 –4.6 –8.8 –8.2 –6.6 –5.5 –4.9 –4.4
Mexico –2.2 –2.3 –4.4 –3.9 –4.4 –4.1 –2.7 –2.7 –2.7 –2.7 –2.7
MENA –1.7 –2.5 –8.5 –2.1 2.6 –1.0 –1.7 –2.0 –1.9 –1.9 –2.1
Saudi Arabia –5.5 –4.2 –10.7 –2.3 2.5 –1.1 –1.2 –0.8 –0.3 –0.1 –0.3
South Africa –3.7 –4.7 –9.6 –5.6 –4.5 –5.9 –6.1 –6.7 –6.3 –6.3 –6.5
Low-Income Developing Countries –3.3 –3.5 –5.0 –4.7 –4.2 –4.2 –4.0 –3.8 –3.7 –3.7 –3.6
Kenya –6.9 –7.4 –8.1 –7.1 –6.0 –5.2 –4.4 –3.9 –3.9 –4.0 –3.9
Nigeria –4.3 –4.7 –5.6 –6.0 –5.5 –5.3 –5.4 –5.6 –5.8 –6.0 –6.1
Vietnam –1.0 –0.4 –2.9 –3.4 –2.5 –3.3 –3.1 –2.9 –2.5 –2.3 –2.0
Oil Producers 0.4 –0.1 –7.5 –1.1 2.0 –0.3 0.1 0.0 0.0 –0.1 –0.2
Memorandum
World Output (percent) 3.6 2.8 –2.8 6.3 3.4 2.8 3.0 3.2 3.2 3.1 3.0
Source: IMF staff estimates and projections.
Note: All country averages are weighted by nominal GDP converted to US dollars (adjusted by purchasing power parity only for world output) at average market
exchange rates in the years indicated and based on data availability. Projections are based on IMF staff assessments of current policies. In many countries,
2022 data are still preliminary. For country-specific details, see “Data and Conventions” and Tables A, B, C, and D in the Methodological and Statistical
Appendix. MENA = Middle East and North Africa.
1 Including financial sector support.
2 For cross-economy comparability, expenditure and fiscal balances of the United States are adjusted to exclude the imputed interest on unfunded pension

liabilities and the imputed compensation of employees, which are counted as expenditures under the 2008 System of National Accounts (2008 SNA) adopted by
the United States but not in countries that have not yet adopted the 2008 SNA. Data for the United States in this table may thus differ from data published by the
US Bureau of Economic Analysis.
3 China’s deficit and public debt numbers presented in this table cover a narrower perimeter of the general government than IMF staff’s estimates in China

Article IV reports (see IMF 2023 for a reconciliation of the two estimates).

What Explains the Unusually Large Movements Inflation Surprises and Declining Debt Ratios
in Deficits and Debt? Since the onset of the COVID-19 pandemic, debt
Since early 2020, public finances worldwide have dynamics have been characterized by unprecedented
been hit by large shocks and subject to exceptional fluctuations (IMF 2022).3 The largest one-year debt
policies that make it more complex to understand surge since World War II took place in 2020, with
developments in fiscal variables and policy stances.
This section takes a deeper look at these developments 3The exceptional debt dynamics have been both for public and

to inform policies. private debt (Gaspar, Medas, and Perrelli, 2022).

International Monetary Fund | April 2023 7

FISCAL MONITOR: On the Path to Policy Normalization

Table 1.2. General Government Debt, 2018–28

(Percent of GDP)
Projections
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Gross Debt
World1 82.8 84.3 99.7 95.5 92.1 93.3 94.6 96.1 97.3 98.4 99.6
Advanced Economies 102.9 104.0 122.9 117.4 112.5 112.4 113.6 115.0 115.9 116.7 117.8
Canada2 90.8 90.2 118.9 115.1 106.6 105.1 102.2 99.2 96.2 93.6 91.1
Euro Area 85.6 83.5 96.6 94.9 90.9 89.8 89.0 87.9 86.9 86.2 85.4
France 97.8 97.4 114.7 112.6 111.1 111.4 112.4 112.8 113.3 114.2 115.0
Germany 61.3 58.9 68.0 68.6 66.5 67.2 66.5 64.4 62.3 60.9 59.6
Italy 134.4 134.1 154.9 149.8 144.7 140.3 140.0 138.5 136.9 134.8 131.9
Spain 100.4 98.2 120.4 118.4 112.0 110.5 108.3 107.9 108.3 108.7 109.3
Japan 232.4 236.4 258.7 255.4 261.3 258.2 256.3 257.6 259.2 261.5 264.0
United Kingdom 85.2 84.5 105.6 108.1 102.6 106.3 109.7 112.8 112.7 113.0 113.1
United States2 107.4 108.7 133.5 126.4 121.7 122.2 125.8 129.1 131.8 134.0 136.2
Emerging Market and Developing 52.7 55.1 64.8 64.3 64.6 67.5 69.8 72.2 74.3 76.3 78.1
Economies
Emerging Markets excl. China 51.0 52.6 62.3 59.4 56.2 57.3 57.7 58.2 58.4 58.6 58.7
Excluding MENA Oil Producers 55.3 57.6 67.5 67.1 68.4 71.4 74.1 76.8 79.3 81.7 83.8
Asia 56.5 59.8 70.2 71.5 75.1 79.1 82.6 86.2 89.4 92.5 95.4
China3 56.7 60.4 70.1 71.8 77.1 82.4 87.2 92.0 96.5 100.8 104.9
India 70.4 75.0 88.5 84.7 83.1 83.2 83.7 83.8 83.8 83.7 83.6
Europe 29.0 28.5 37.0 34.7 32.7 36.9 37.9 38.6 39.0 39.2 39.2
Russian Federation 13.6 13.7 19.2 16.5 19.6 24.9 25.3 25.3 24.3 23.2 21.5
Latin America 67.4 68.3 77.3 71.9 69.7 68.6 69.3 70.1 70.3 70.3 70.1
Brazil4 85.6 87.9 96.8 90.7 85.9 88.4 91.5 93.7 95.2 96.0 96.2
Mexico 53.6 53.3 60.1 58.7 56.0 55.6 55.8 56.3 56.9 57.5 57.9
MENA Region 40.3 43.9 55.4 52.1 43.0 42.5 41.2 41.6 42.0 42.3 42.5
Saudi Arabia 17.6 21.6 31.0 28.8 22.6 23.6 23.1 22.3 21.5 20.7 19.9
South Africa 51.7 56.2 69.0 69.0 71.0 72.3 74.0 77.1 80.0 82.4 84.9
Low-Income Developing Countries 41.7 42.8 48.4 48.4 48.2 48.3 46.8 45.8 44.9 44.2 43.2
Kenya 56.4 59.1 67.8 67.0 67.9 66.6 65.4 64.1 62.7 61.1 59.5
Nigeria 27.7 29.2 34.5 36.5 38.0 38.8 39.0 40.3 41.5 42.3 43.1
Vietnam 43.5 40.8 41.3 39.3 37.1 36.3 35.4 34.6 33.8 32.9 31.3
Oil Producers 44.4 45.7 60.4 56.0 49.1 50.5 49.9 49.4 48.8 48.3 47.7
Net Debt
World1 67.2 68.2 80.0 77.9 74.6 75.3 76.8 77.9 78.7 79.4 80.2
Advanced Economies 73.9 74.7 86.8 84.6 81.6 82.5 84.3 85.7 86.7 87.6 88.7
Canada2 11.6 8.5 15.7 15.4 13.9 14.1 13.9 13.7 13.1 12.5 12.0
Euro Area 70.6 69.0 79.0 77.8 74.8 74.5 74.3 73.7 73.2 72.8 72.4
France 89.2 88.9 101.7 100.6 99.0 99.4 100.4 100.8 101.3 102.2 103.0
Germany 42.2 40.1 45.4 45.6 45.1 46.7 46.8 45.6 44.3 43.5 42.7
Italy 121.8 121.7 141.4 137.3 133.0 129.3 129.4 128.2 126.9 125.1 122.6
Spain 84.9 83.7 103.0 102.3 97.4 96.6 95.2 95.3 96.1 96.9 97.9
Japan 151.1 151.7 162.3 156.9 162.7 161.0 159.3 159.2 159.4 160.2 161.3
United Kingdom 75.4 74.6 94.5 96.7 91.9 95.1 98.2 101.0 100.9 101.2 101.2
United States2 81.1 83.1 98.3 98.3 94.2 95.5 99.8 103.1 105.7 108.0 110.5
Source: IMF staff estimates and projections.
Notes: All country averages are weighted by nominal GDP converted to US dollars (adjusted by purchasing power parity only for world output) at average
market exchange rates in the years indicated and based on data availability. Projections are based on IMF staff assessments of current policies. In many
countries, 2022 data are still preliminary. For country-specific details, see “Data and Conventions” and Tables A, B, C, and D in the Methodological and
Statistical Appendix. MENA = Middle East and North Africa.
1 Gross and net debt averages do not include the debt incurred by the European Union and used to finance the grants portion of the NextGenerationEU (NGEU)

package. This totaled €58 billion (0.4 percent of EU GDP) as of December 31, 2021, and €158 billion (1 percent of EU GDP) as of February 16, 2023. Debt
incurred by the European Union and used to on-lend to member states is included within member state debt data and regional aggregates.
2 For cross-economy comparability, gross and net debt levels reported by national statistical agencies for economies that have adopted the 2008 System of

National Accounts (Australia, Canada, Hong Kong SAR, United States) are adjusted to exclude unfunded pension liabilities of government employees’ defined-
benefit pension plans.
3 China’s deficit and public debt numbers presented in this table cover a narrower perimeter of the general government than IMF staff’s estimates in China

Article IV reports (see IMF 2023 for a reconciliation of the two estimates).
4 Gross debt refers to the nonfinancial public sector, excluding Eletrobras and Petrobras, and includes sovereign debt held on the balance sheet of the central bank.

8 International Monetary Fund | April 2023

 CHAPTER 1 On the Path to Policy Normalization

global public debt reaching almost 100 percent Figure 1.10. Drivers of Change in General Government Debt
(Change in end-of-year debt stocks as percentage of GDP)
of GDP, reflecting a pandemic-induced economic
contraction and associated fall in tax revenues, as 1. 2019–20
25
well as unprecedented policy responses deployed by Real GDP Inflation
Nominal interest rate Stock-flow adjustment
governments (Figure 1.10, panel 1). In the subsequent 20 Primary deficit Change in debt to GDP
19.4
two years, debt declined at an unusually fast pace
(Figure 1.10, panels 2 and 3). The global trends mask 15

large differences across country groups, however. In 10.1

10
advanced and emerging market economies, public
debt fell, despite positive (yet declining) primary 5 5.2
deficits, thanks to the growth rebound and inflation
surprises. In low-income developing countries, 0

however, a combination of exchange rate depreciation, –5

primary deficits, and nominal interest rates more than Advanced Emerging market Low-income
economies economies excl. China developing countries
offset the impact of inflation surprises, leading to a
small increase in their overall debt-to-GDP ratios 2. 2020–21
25 Real GDP
(Figure 1.10, panel 3).4 Inflation
20 Nominal interest rate Stock-flow adjustment
The role of inflation surprises in debt reduction Primary deficit Change in debt to GDP
during 2022 was shaped by individual countries’ 15
debt size and composition (Figure 1.11). Countries 10
with high initial levels of debt, combined with large
5
inflation surprises and strong growth, experienced 2.3
0
significant debt declines (Greece). In some emerging
–3.8 –3.1
market economies, on the other hand, rising interest –5
rates almost fully offset the impact of inflation –10
surprises (India). In some low-income developing –15
countries, overall debt increased as nominal exchange Advanced Emerging market Low-income
economies economies excl. China developing countries
rate depreciation and primary deficits more than offset
3. 2021–22
the effects of inflation (Senegal ).
25
Looking ahead, as fiscal and monetary policies Real GDP Inflation
20 Nominal interest rate Stock-flow adjustment
normalize, inflation subdues, and real interest rates Primary deficit Change in debt to GDP
rise, debt dynamics are also expected to change. Under 15
current projections, advanced and emerging market 10
economies will require larger primary balances to 5
prevent a further rise in debt ratios. However, there 1.7
0
is great uncertainty surrounding the projections, –2.1
–5 –3.5
namely for long-run growth and interest rates,
and debt developments may prove different than –10
initially expected, as the experience after the global –15
financial crisis showed. Compared with forecasts Advanced Emerging market Low-income
economies economies excl. China developing countries
prepared in 2010, fiscal consolidation did not
materialize, and debt ratios remained stable thanks to Sources: IMF, World Economic Outlook database; and IMF staff calculations.
Note: The figure shows contributions to changes in the debt-to-GDP ratio, following
lower-than-expected interest rates (Han, Mauro, and Escolano (2010). Stock-flow adjustment includes effects of exchange rate
Ralyea, forthcoming). depreciations. GDP deflators are used for inflation. The country averages are
constructed by weighting the debt change by nominal fiscal year GDP in dollars in
the most recent year of the change. Selected groups of countries. Excl. = excluding.

4The difference with respect to Table 1.2 is driven by

country coverage.

International Monetary Fund | April 2023 9

FISCAL MONITOR: On the Path to Policy Normalization

Inflation Spikes and the Budget Balance Figure 1.11. Drivers of Annual Change in General Government
Debt, 2021–22
In addition to the debt-to-GDP ratio, inflation (Percent of GDP)
surprises can also affect budgetary aggregates, such as
30 Primary deficit Stock-flow adjustment
the overall fiscal balance (see Chapter 2 for an analysis
Nominal interest rate Inflation
of various channels and their implications). High Real GDP Nominal exchange rate
20
inflation may also make conventional fiscal indicators Change in debt to GDP
an inaccurate gauge of policy efforts (Tanzi, Blejer,
10
and Teijeiro 1987). For instance, an improvement
in a country’s overall balance may partly reflect tax 0
buoyancy from an inflation surprise (combined with
budget spending targets set in nominal terms) rather –10
than consolidation measures.5
In 2022, most governments enjoyed positive –20
revenue surprises, stemming in part from tax buoyancy
related to inflation surprises (Figure 1.12; see also –30
Online Annex 1.4 for the effect of inflation surprises CHN ZAF SEN CHL FRA IND MEX BRA TUR GRC

on primary balances and debt).6 On average, these Sources: IMF, World Economic Outlook database; and IMF staff calculations.
revenue surprises amounted to 3.1 percent of GDP Note: The figure shows contributions to changes in the debt-to-GDP ratio, following
Escolano (2010). The sample includes a selected set of countries for which the
in advanced economies and 2.5 percent in emerging share of general government debt in foreign currency is available. GDP deflators
market economies. Commodity exporters (for example, are used for inflation. Data labels in the figure use International Organization for
Standardization (ISO) country codes.
Australia, Brazil, Saudi Arabia) experienced even larger
revenue surprises, reflecting positive terms of trade
shocks, while the benefits were smaller for commodity
importers, especially for those that experienced a (difference between dark and light blue bars in
large fall in the terms of trade. Some countries saved, Figure 1.12). Even when countries did not save the
to different degrees, part of the resulting windfalls surprise revenue, some observed significant drops in debt
ratios due to rising nominal GDP. However, neither the
5A country’s fiscal balance may also not accurately measure the
size of a country’s revenue surprise nor its overall fiscal
fiscal impulse, as interest payments may include an inflationary deficit displays a close association with its inflation rate,
component that has no relevance to aggregate demand. Some argue suggesting that additional factors were at play.
that if the inflationary component of interest rates is not removed An important source of variation of spending across
from interest payments, the deficit will be overstated by the size of
the amortization element included, which has no relevance to the
countries in 2022 was the surge in energy and food
aggregate demand. To alleviate this issue, alternative measures of a prices, which prompted several governments to introduce
country’s fiscal deficit have been proposed, such as the “operational measures to support people and firms. An analysis
balance,” which excludes the inflation-induced portion of interest
of subcomponents of expenditures reveals that some
payments from deficit calculations (Blejer and Cheasty 1991).
6The amount of the revenue surprise saved by government is countries (France, Germany, Italy, Mexico) allocated a
calculated as the difference between realized and projected revenues substantial portion of this additional spending to “other
(“revenue surprise”) and an “expenditure surprise” calculated the spending,” which includes subsidies (Figure 1.13).
same way. Projected revenues and expenditures used are from the
January 2022 World Economic Outlook vintage, which pre-dates the
economic implications of Russia’s invasion in Ukraine. Both actual
and projected revenue and expenditures are divided by 2022 GDP Challenges for Governments amid Spending Pressures
from the April 2023 World Economic Outlook database. Hence,
inflation surprises in 2022 should mostly drive revenue surprises.
Inflation surprises may lead to a persistent increase
Nevertheless, the surprises may include factors other than inflation in some spending items, for instance, through
surprises, namely, terms-of-trade shocks and measures taken by backward-looking indexation practices (see Chapter 2
government to address the cost-of-living crisis, both on the revenue
for indexation practices by countries). More generally,
and expenditure side. For example, the United Kingdom introduced
reductions in fuel duties and rebates in council taxes, affecting governments are likely to confront social and economic
80 percent of households in the country, to dampen price pressures. pressures to compensate various groups for past
Online Annex 1.4 also presents an alternative exercise that assesses and future increases in the cost of living. In 2022,
how the indexation of tax brackets and expenditure items (public
wages, pensions, and social transfers) has affected primary balances several governments introduced ad-hoc adjustments
across a select group of countries at different income levels. to compensation to civil servants and pension

10 International Monetary Fund | April 2023

 CHAPTER 1 On the Path to Policy Normalization

Figure 1.12. What Share of Revenue Surprises Was Saved?

(Percent of 2022 GDP)
1. Selected Advanced Economies 2. Selected Emerging Market Economies
6 Revenue surprise 13 11 Revenue surprise 13
Expenditure surprise Expenditure surprise
5 2022 inflation (right scale) 11 9 2022 inflation (right scale) 11

9 9
4 7
7 7
3 5
5 5
2 3
3 3
1 1 1 1

–1 –1 –1 –1
FRA AUS ITA KOR GBR CAN USA DEU JPN BRA SAU IDN MEX ZAF CHN IND

Sources: IMF, World Economic Outlook database; and IMF staff calculations.
Note: The revenue (expenditure) surprise is the difference between actual and projected revenues (expenditures), divided by actual 2022 GDP. All variables are in nominal
terms. Projections are from the January 2022 World Economic Outlook Update vintage, which predates Russia’s invasion of Ukraine. Figures for 2022 are from the April
2023 World Economic Outlook database. Data labels in the figure use International Organization for Standardization (ISO) country codes.

benefits to mitigate surges in energy and food prices Governments will need to find the right balance
(Amaglobeli and others 2023).7 Because inflation between avoiding excessive real cuts in some spending
surprises eroded public wages in real terms in 2021 items and achieving an appropriate overall fiscal
and 2022 (Figure 1.14), countries will likely experience stance consistent with reducing inflation, deficits,
significant spending pressures as indexation operates and debt. Clear communication by governments
with a lag or if workers request compensation. Past can help to steer the public’s expectations and avoid
evidence shows that fiscal consolidations undertaken in de-anchoring inflation expectations—especially
higher-inflation environments are shorter, but have a in countries where public wages influence private
larger effect on reducing debt, than those undertaken
in a low-inflation environment.8 An empirical analysis Figure 1.13. Inflation Effects on Different Types of
of fiscal consolidations in 25 advanced and emerging Expenditures: Expenditure Forecast Errors
market economies reveals that consolidations improved (Percentage points)
the cyclically adjusted primary balance more when 4 Social benefits
inflation was high (defined as above the 75th percentile Compensation of employees
of the distribution of Consumer Price Index inflation, 3 Goods and services
Not elsewhere specified
or 4.6 percent) than when it was low (below the 25th Overall non-interest expenses
2
percentile of the distribution of Consumer Price Index
inflation, or 1.7 percent) (Figure 1.15, panel 1). When 1
inflation was high, fiscal consolidations also resulted in
larger debt reductions (Figure 1.15, panel 2).9 0

7One-off
–1
adjustments to pensions or transfers to pensioners were
introduced (Czech Republic, Germany, Hungary, Portugal, Sri Lanka),
–2
as well as increases in minimum wages (Andorra, Argentina, Türkiye)
and wages for civil servants (Bosnia and Herzegovina, Democratic
Republic of Congo, France, Sri Lanka). -3
8Fiscal adjustment under very low (close to zero) inflation requires Australia South Saudi Germany France Mexico Italy Korea
Africa Arabia
cutting nominal spending and can prove more challenging (Bandeira
and other 2018). Moreover, downward wage rigidities also make Sources: IMF, World Economic Outlook database; and IMF staff calculations.
cutting spending more difficult when inflation is particularly low. Note: Figure includes only Group of Twenty countries that report data for all
9Point estimates suggest that fiscal consolidations during high spending categories [Link] report the difference between government
inflation reduced debt, but the effect was not statistically significant. expenditure, and its components for 2022, as a share of GDP, in the January 2022
See Online Annex 1.2 for more details on the methodology and World Economic Outlook Update, and those from the April 2023 World Economic
the dataset. Outlook database.

International Monetary Fund | April 2023 11

 FISCAL MONITOR: On the Path to Policy Normalization

Figure 1.14. Difference in Projected and Actual Real Public In general, governments can prepare budgets
Wage Growth consistent with inflation targets but incorporate
(Percentage points)
some flexibility to respond to inflation surprises. The
2 degree of real adjustments should be decided in the
context of a budget set consistently with broader
0 fiscal goals, while prioritizing different programs,
including social benefits for vulnerable households.
–2
Automatic indexation of wages to inflation or
other variables outside government control may
–4
lead to spending increases that are inconsistent
–6
with a government’s fiscal objectives (IMF 2016).
Governments should preferably adopt systematic,
Advanced economies
–8 Emerging market economies rules-based, and regular benefit adjustment regimes
Low-income developing countries that allow for some flexibility. Social benefits
–10 should typically be adjusted once a year, but in
2020 2021 2022
the current high-inflation environment, applying
Sources: IMF, World Economic Outlook database; and IMF staff calculations. interim adjustments may be necessary to shield
Note: Bars plot the difference between the real public wage growth projected in vulnerable households from significant losses in their
the October 2019 World Economic Outlook and actual real public wage growth
based on the April 2023 World Economic Outlook. purchasing power.
Large inflation surprises also complicate choices
when governments must comply with expenditure
rules. An expenditure rule expressed in nominal terms
sector wages. Indexing public wages, pensions, can imply large cuts in real government expenditures
and welfare payments may reduce uncertainty and if inflation surprises on the upside. It may in some
compensate for losses in real incomes (see Chapter 2). cases be appropriate to set up a rule this way,
However, pervasive indexation can harm public especially if reducing inflation requires curbing excess
finances and make inflation more persistent— demand pressures, but it may also involve difficult
eventually requiring a more disruptive monetary and policy choices. Some countries (for example, Sweden)
fiscal tightening. already include safety margins in their budgets to

Figure 1.15. Effects of Fiscal Consolidation: High Inflation versus Low Inflation
(Percent of GDP)
1. Effect on Cyclically Adjusted Primary Balance 2. Effect on Public Debt
1.2 Low inflation (WDI) (25%) High inflation (WDI) (75%) 3
1.0 2
1
0.8
0
0.6 –1
0.4 –2
–3
0.2
–4 Low inflation (25%)
0.0 –5 High inflation (75%)
–0.2 –6
0 1 2 3 4 5 0 1 2 3 4 5
Years after fiscal consolidation onset Years after fiscal consolidation onset

Source: IMF staff calculations.

Note: Based on fiscal consolidations in 25 countries (15 advanced economies and 10 emerging market economies) from 1985 to 2016. Fiscal consolidation episodes and
sizes are constructed using a news-based narrative approach from DeVries and others (2011), Alesina and others (2013), and David, Guajardo, and Yépez (2022).
Coefficients measure the impact of fiscal consolidations on the cyclically adjusted primary balance and debt-to-GDP ratio in low- and high-inflation periods (defined as the
25th and 75th percentiles of Consumer Price Index inflation, respectively) using panel local projection estimations, controlling for two-way fixed effects and lags of real GDP
growth and real GDP per capita. Shaded areas denote 90 percent confidence intervals for the respective scenarios. Standard errors are clustered at the country level.

12 International Monetary Fund | April 2023

 CHAPTER 1 On the Path to Policy Normalization

allow for growth and inflation surprises based on Figure 1.16. Number of Countries with Expenditure Rules as
historical averages. of 2022
If expenditure limits are set in real terms, 25
Real
compliance is not as affected by the level of inflation. Nominal
However, spending rules set in real terms may also Other
20
be more complicated and less transparent in terms of
how they account for inflation surprises. For example,
15
in some countries, the degree of indexation allowed
varies by type of spending, may be done with a lag,
and may create space to increase other spending. 10

Moreover, spending rules set in real terms may result

in countries fully accommodating inflation surprises, 5
making higher inflation more entrenched. Ceilings on
real spending growth are relatively more frequent in 0
Advanced Emerging market Low-income and
emerging market economies than in other groups of economies economies developing countries
economies (Figure 1.16). The 2016 expenditures rule
in Brazil was set in real terms and is currently being Sources: IMF, Fiscal Rules Database (2022); and IMF staff calculations.

revised. This 2016 rule had set a ceiling on federal

government real primary expenditure, with some
exclusions, and indicates that nominal expenditure Ongoing Food and Energy Crises
can grow in line with inflation. In Finland, the Even as price pressures have subsided, countries
rule sets annual limits to government expenditure have continued to cope with the aftermath of global
for the four-year term of office of the government, food and energy price shocks and the high level of
with limits set in real terms for primary noncyclical uncertainty surrounding the economic outlook and
expenditure. its fiscal implications. Governments have introduced
Ultimately, fiscal rules may need to be designed for a wide array of measures to mitigate the shocks
periods with broadly stable inflation and safety margins (Amaglobeli and others 2023), and many of these
used to deal with upside surprises. In the context of measures have been extended in 2023.
the pandemic, countries also took advantage of fiscal
rules being suspended or escape clauses being activated
to adjust policies flexibly amid the different large Tackling Food Insecurity in Low-Income
shocks they faced. Developing Countries
More generally, as countries return to fiscal rules, it The war in Ukraine has intensified price pressures
is timely to reflect on how to improve rule-based fiscal in global food product markets in a context of
frameworks. Such frameworks should be designed with already-soaring commodity prices and surging inflation
the right balance between having enough flexibility from demand recovery and supply chain disruptions.
to adjust to shocks and being credible. Key elements Although global commodity food prices have fallen
of a revamped fiscal framework include feasible and from their peak levels in mid-2022, domestic prices
stable medium-term fiscal plans with transparent fiscal continue to be elevated, and the risks to food
anchors, flexibility to respond to shocks, risk-based production will continue to threaten food price
rules that ensure a path to debt sustainability and stability in 2023. The persistent conflict in Ukraine
buildup of fiscal buffers, and the strengthening of may further disrupt cereal production and prolong
institutions to increase credibility and accountability overly high costs of fertilizers.
(more transparency and upgraded independent Low-income developing countries continued to
fiscal councils). Shocks or surprises can then be suffer the most from persistently high food price
accommodated within a well-defined framework inflation throughout the pandemic (Figure 1.17,
depending on an assessment of risks and consistent panel 1). Food accounts for a larger share of household
with medium-term debt sustainability (Caselli and consumption baskets in low-income countries. In
others 2022). addition, high reliance on imported food makes

International Monetary Fund | April 2023 13

 FISCAL MONITOR: On the Path to Policy Normalization

Figure 1.17. Food Prices and Food Insecurity

1. Consumer Food Price 2. Acute Food Insecurity Projections, 2022
(Percent change, year-on-year) (Percent of population)
16 LIDCs
14 EMs MLI
12 AEs MRT AFG
TCD
10 HTI SEN BEN CAF YEM
CPV NER PAK
8 HND GMB SDN DJI
6 GTM GNB SSD SOM
4 SLE KEN
CIV COD UGA
2 BFA NGA
TGO CMR BDI
0 GHA
Jan. 2017
Apr. 17
July 17
Oct. 17
Jan. 18
Apr. 18
July 18
Oct. 18
Jan. 19
Apr. 19
July 19
Oct. 19
Jan. 20
Apr. 20
July 20
Oct. 20
Jan. 21
Apr. 21
July 21
Oct. 21
Jan. 22
Apr. 22
July 22
Oct. 22
ZMB SWZ MDG
Percent of population TZA
0 100 LSO MOZ MWI

Sources: Haver Analytics; Rother and others 2022; and IMF staff calculations.
Note: The map is from Rother and others (2022). Panel 2 includes data for 39 countries. The projection period varies by country between January 2022 and February 2023.
See IPC Technical Manual Figure 27 for a detailed description of the classification system. The boundaries, colors, denominations, and any other information shown on the
maps do not imply, on the part of the International Monetary Fund, any judgment on the legal status of any territory or any endorsement or acceptance of such boundaries.
AEs = advanced economies; EMs = emerging markets; LIDCs = low-income developing countries.

households in low-income countries vulnerable to Strong and timely action across countries is
movements in exchange rates.10 In many of these necessary to mitigate the food crisis (April 2022
countries, high oil prices have exacerbated domestic Fiscal Monitor). International humanitarian assistance,
food price inflation through their impact on transport backed by the full funding of the World Food
and food distribution costs. Programme, is crucial to adequately and swiftly
About 860 million people worldwide were help vulnerable households facing food insecurity.
estimated to be malnourished in August 2022, a Effective fiscal policy measures at the domestic level
steep increase from less than 800 million in 2021. should focus on improving social assistance while
Of these, 345 million people were suffering from building resilient public infrastructure to improve
acute food insecurity. Many live in sub-Saharan poorer households’ access to affordable food, facilitate
Africa, often in fragile and conflict-affected states expansion of climate-resilient agricultural production,
(FAOSTAT 2023) (Figure 1.17, panel 2). Extreme and support quicker recovery from adverse climate
weather events and conflicts (for example, those events. The IMF’s new food shock window under
in Chad, Somalia, Sudan, and Yemen and in the its Rapid Credit Facility and Rapid Financing
north of Mozambique) also contribute to food Instrument is designed to help member countries
insecurity by impeding domestic food production. fill the balance of payments gap associated with
Meanwhile, the coverage and adequacy of social global food price shocks and to support the most
safety nets is weak, and many of the countries vulnerable through feeding programs and cash and
most affected also face tight budget constraints. in-kind transfers.
As a result, food insecurity is expected to peak at
unprecedented levels in 2023 (World Bank 2023).
Recent projections suggest that almost 8 percent of From Energy Crisis to Clean Energy Transition
the world’s population could still be facing hunger The softening of global energy prices is providing
in 2030 (FAO and others 2022). breathing room for governments, but risks remain.
Ensuring energy security, while accelerating the green
transition, remains a policy priority.
10The global food import bill increased by 10 percent
The large volatility in energy prices in the last
year-over-year in 2022 alone, surpassing historical records (FAO and two years led governments around the world to take
others 2022). The average import share of total wheat consumption
in low-income countries is 80 percent, compared with 50 percent for measures to protect households. The International
other importing countries. Energy Agency estimates global fossil fuel

14 International Monetary Fund | April 2023

 CHAPTER 1 On the Path to Policy Normalization

Figure 1.18. Fiscal Costs of Energy Price Increases

1. Fiscal Costs of Food and Energy Support Policies, by Income Group 2. France: Sharing of Burdens from Energy Crisis
(Percent of GDP, median) (Billions of euros)
3.50 Median 90 Government
number of Households
measures 80
3.00 Businesses
announced:
70
1 36
2.50
2 60 50
2.00 7 50
5
1.50 40

30
1.00
20 44
32
0.50
10

0.00 0 3
Before government After government
Both

Energy

Food

Both

Energy

Food

Both

Energy

Food
support support
AEs EMEs LIDCs

Sources: Updated results of the DEFPA IMF Country Desk Survey from Amaglobeli and others (2023); Direction Générale du Trésor; and Ministry of the Green Transition.
Note: In panel 1, whiskers reflect the 20th and 80th percentiles. Dots reflect the median and the number of policies announced. In panel 2, “Before government support”
shows counterfactual sharing of the energy cost burden among economic agents. The projected increase in the energy price for 2022 uses futures price as of August 2022,
with France’s imported energy mix incorporated. “After government support” shows projected sharing after measures introduced are incorporated. Energy consumption
data are from a 2019 survey by Ministry of the Green Transition, and the share is assumed to remain the same. AEs = advanced economies; EMEs = emerging market
economies; LIDCs = low-income developing countries.

consumption subsidies doubled from the previous Europe provides a stark example of the effects of the
year to an all-time high of $1 trillion.11 In addition, energy crisis, as well as lessons on the effectiveness of
countries spent an additional 0.5 trillion on other policies, as the shock has been particularly severe owing
spending measures to help households (more than to European countries’ reliance on Russian natural
two-thirds of them in Europe). Countries with gas. Contrary to fears of a large drag on businesses,
existing energy subsidies have faced substantial fiscal however, economies in European countries have
costs, which exceeded 2 percent of GDP in 2022 thus far shown resilience. Energy consumption has
alone for some countries (Bolivia, Cameroon, Ecuador, fallen—for example, electricity consumption decreased
Iraq, Malaysia, Nigeria, Uzbekistan). Newly announced an average of 7 percent across European countries in
policy measures have encompassed targeted measures the fourth quarter of 2022 compared with the same
(Argentina, Georgia, Thailand ) and untargeted period in 2021,12 reflecting various factors, including
measures (Chile, Ecuador, Jordan, Oman) to dampen increases in energy prices (which provide incentives for
the impact of international prices on domestic prices energy efficiency) and unusually warm weather. Major
(Figure 1.18, panel 1). Suppressing price signals energy supply disruptions, such as power outages
through energy subsidies can hamper global energy and rationing, have largely been avoided. Increases
security by continuing to encourage higher energy in energy prices have disproportionately affected
demand, pushing energy prices higher for other energy-intensive sectors and firms with low energy
countries. The focus should be on strengthening social efficiency. Manufacturing activity has also slowed in
safety nets, including targeted cash transfers, and on energy-intensive sectors compared with other sectors.
measures to promote energy efficiency. Countries But overall, economic activity and labor markets have
also need to accelerate their efforts to transition to remained resilient.
renewable energy over time. The more-benign-than-expected effects of the
energy crisis have also reflected significant measures
11The subsidies are mainly concentrated in emerging market

and developing economies, and more than half were in fossil-fuel 12According to the European Network of Transmission System

exporting countries (IEA 2023). Operators for Electricity.

International Monetary Fund | April 2023 15

 FISCAL MONITOR: On the Path to Policy Normalization

Figure 1.19. Impact of Energy Cost Increases for Firms and Fiscal Costs
1. Annual Change in Electricity Prices for Residential and 2. Fiscal Costs of Support to Firms and Sectoral Exposures to the
Nonresidential Consumers, 2022:H1 Energy Price Shock
(Percent) (Left scale, percent; right scale, percent of GDP)
140 Nonresidential Residential
60 Proportion of employment at risk 6
120 50 Proportion of enterprises at risk 5
100 Fiscal costs (right scale)
80 40 4
60 30 3
40 20 2
20
0 10 1
–20 0 0
Cyprus
Estonia
Poland
Ireland
Norway
France
Lithuania
Serbia
Croatia
Bosnia and Herzegovina
Luxembourg
The Netherlands
Austria
Portugal
Germany
Belgium
Slovenia
Czechia
Bulgaria
Slovak Republic
Hungary
Italy
Spain
Romania
Greece

Sweden
Greece
Bulgaria
Croatia
Slovenia
Italy
Slovakia
Germany
Malta
Austria
Luxembourg
Spain
Latvia
Lithuania
Portugal
Romania
North Macedonia
France
Netherlands
Czechia
Poland
Belgium
Estonia
Cyprus
Hungary
Norway
Denmark
Sources: Panel 1. Eurostat; Panel 2. Eurostat (bars), Arregui and others 2022 (yellow dots); and IMF staff calculations.
Note: In panel 1, changes are calculated based on annual electricity prices for residential and nonresidential consumers in euros. Panel 2 uses the country-level two-digit
NACE2 industry classification for manufacturing and construction sectors. See Online Annex 1.3 for details.

taken by governments, such as procuring alternative support conditional on efforts to increase energy
sources of energy, as well as shielding—to some efficiency (Bulgaria, Luxembourg).
degree—households and firms from the steep rise One question is whether countries have
in energy prices. In some cases, governments have appropriately designed their support to firms in a
shouldered a large share of the fiscal burden, as in way that reflects the size of the shock and potential
the case of France (Figure 1.18, panel 2). Fiscal costs economic risks (for example, loss of jobs). A
related to the energy crises were sizable for all income cross-country comparison reveals that the fiscal cost
groups. For European countries, these costs are of countries’ support measures to firms has not been
expected to remain elevated in 2022–23 at an average proportionate to countries’ exposures to energy
of 2–3 percent of GDP. The size of the energy bill price increases (Figure 1.19, panel 2; see also Online
reflects not only the unusually large shock but also Annex 1.3 for details). In addition, the capacity of
the implementation of broad-based and untargeted firms to cope with energy price increases differs from
measures (for example, intervention in wholesale or that of households and across sectors. Unlike during
retail energy markets and end-user price cuts through the pandemic, when public health measures disrupted
value-added taxes and other fees and taxes; see normal business operations, firms have margins of
Arregui and others 2022). adjustment to dampen increases in energy costs. Firms
Although countries initially directed support mainly can pass cost increases on to consumers by adjusting
to households, over time they have expanded their prices, reallocating inputs for production, or switching
support for firms, which experienced a larger price shock to alternative energy sources (Bialek, Schaffranka,
than households (Figure 1.19, panel 1). Some countries and Schnitzer 2023). Early evidence shows that
have provided support to ailing energy companies to firms have been adapting to energy price shocks by
avoid supply disruptions (Finland, Sweden). Whereas swiftly increasing investments in energy efficiency and
some countries have supported small and medium renewable technologies (European Investment Bank
enterprises or firms in specific nonenergy sectors (France, and Ipsos Public Affairs 2022; Ifo Institute 2022).
Luxembourg, Norway), others have subsidized energy The recent crisis offers some general lessons on the
or reduced ad valorem taxes for all firms (Germany, decision of when and how to support firms. In general,
Greece, United Kingdom). A few countries have provided allowing energy prices to fluctuate creates incentives

16 International Monetary Fund | April 2023

 CHAPTER 1 On the Path to Policy Normalization

for firms to adjust their energy demand. Moreover, higher interest rates to compensate for higher and
governments can take actions to ensure energy security, more volatile inflation. Moreover, deficits and debts
including finding additional sources of energy and generally remain above prepandemic levels, which
accelerating transition to renewable energy, and they means that additional fiscal efforts will be needed in
did so in the recent crisis. But other reasons have also the years ahead.
been given to justify government support: In the present environment of high inflation, rising
•• Preventing large-scale bankruptcies to reduce the interest rates, and elevated debt, it is critical that fiscal
risk of economic disruption. If firms pass prices and monetary policies are aligned to ensure price and
through to final products, government measures financial stability. In many countries, fiscal policy
that temporarily shield firms from price shocks just should tighten to help ease inflation pressures, thereby
delay the inevitable transition to renewable sources allowing central banks to raise interest rates by less
of energy at a cost to the budget. If governments than otherwise (see Chapter 2). Such fiscal restraint
decide in the face of large shocks to support sectors should protect priority areas and manage heightened
that are more vulnerable, such support should be social demands from the cost-of-living crisis amid a
temporary and linked with incentives to promote slowdown in economic growth. Even so, spending
energy efficiency and transition to renewable pressures will need to be contained, as different groups
energy sources. may seek to be compensated for past inflation. Full
•• Dampening price pressures in a high-inflation compensation could make inflation more persistent
environment, as passing high energy costs through and require additional monetary and fiscal tightening
to final products may have second-round effects in the future. An overall fiscal tightening that
and add price pressures. Such an approach assumes protects the vulnerable through targeted measures
the energy shock is short-lived, because it would can help countries achieve an appropriate policy mix
otherwise risk prolonging the inflation episode. In (see Chapter 2).
addition, measures that shield firms from higher Given heightened uncertainty, fiscal policy should
energy prices can carry large immediate budgetary stand ready to respond in case risks materialize. If
costs or contingent liabilities (for example, forcing elevated inflation proves more persistent, the policy
electricity companies to take the losses). mix will need to remain tighter for longer. Should
•• Maintaining the competitiveness of domestic firms, systemic financial stress arise, fiscal policy may need to
given the wedge between domestic energy prices intervene swiftly to facilitate the resolution process and
and those of international competitors when energy minimize its economic costs, while mitigating moral
price shocks have uneven global effects. To boost hazard (October 2016 Fiscal Monitor). Governance
competitiveness in the face of a more persistent principles, supported by strong insolvency and
shock, government support should focus on bankruptcy procedures, should be applied in the
productivity-enhancing measures and encourage decision-making process to safeguard public funds. In
firms to be energy efficient, rather than providing the event that economic growth turns out significantly
temporary relief through price-distorting measures. weaker than expected and labor market conditions
deteriorate, governments should allow automatic
stabilizers to work, especially where inflation is under
Policy Conclusions control and fiscal space is available.
Fiscal policy has entered a period of normalization, Over the medium term, the challenge will be to
with the priority turning to ensuring a consistent reduce debt vulnerabilities and rebuild fiscal buffers.
policy mix to deliver price and financial stability and Projections suggest that modest fiscal adjustments
reduce debt vulnerabilities. will not be enough to prevent a rise in debt in many
Fiscal deficits and public debt ratios have fallen countries, especially in some large advanced and
since 2020, and inflation surprises have helped the emerging market economies. Pressure on public sector
adjustment of public balance sheets in some countries. balance sheets could be exacerbated from support to
But relying on inflation to keep reducing debt is not a the private sector in a scenario of heightened financial
sustainable approach, as bondholders would demand turbulence. Building a credible medium-term fiscal

International Monetary Fund | April 2023 17

FISCAL MONITOR: On the Path to Policy Normalization

framework can guide the process and could include The recent energy crisis has highlighted the need to
revamped fiscal rules, which many countries are press ahead with an energy transition consistent with
considering (see Box 1.2).13 In particular, climate goals and energy security. The energy crisis
•• Countries can enhance medium-term fiscal should provide momentum for countries to accelerate a
frameworks to combine more flexible rules or targets clean energy transition with a faster shift to low-carbon
with strengthened institutions. A credible and energy (for example, the EU Innovation Fund for
well-communicated fiscal framework that promotes demonstrating innovative low-carbon technologies)
consistent macroeconomic policies and addresses and more resilient and efficient energy systems.
concerns with debt sustainability will be critical. The COVID-19 pandemic and increased
Interactions between fiscal and monetary policy geopolitical tensions have tested international relations
should be considered, implying a need for fiscal and raised questions about the benefits of global
policy to support monetary tightening in view of integration (Aiyar and others 2023). Now more than
large inflation surprises. ever, however, international cooperation is crucial to
•• Fiscal plans should put a greater emphasis on risk tackle these urgent global challenges. Countries should
assessment. Medium-term fiscal policy should be avoid unilateral actions, such as the introduction of
anchored by debt sustainability objectives and build export restrictions. Moreover, international cooperation
up sufficient fiscal buffers over time, consistent with is needed to help highly indebted low-income
the expanded role of fiscal policy in times of crises. developing economies. It is urgent to strengthen the
Risk-based frameworks should (1) provide incentives international financial architecture, especially in the
to build up buffers over time, even when there is no areas of debt resolution and enhancing the Global
immediate high risk of debt distress; (2) prescribe Financial Safety Net. The latter is a set of institutions
more ambitious fiscal consolidation paths for and mechanisms that provide insurance against crises
countries with high debt sustainability risks; and and financing to mitigate their impact. In some
(3) incorporate well-defined escape clauses to allow cases, a comprehensive approach that encompasses a
greater flexibility when countries are hit by shocks. country’s fiscal consolidation efforts as well as debt
restructuring—renegotiation of terms of servicing of
Low-income countries currently face severe existing debt—may be necessary.14
challenges. Increasing revenue collection is necessary Regarding the climate agenda, global coordination
to restore fiscal sustainability and help achieve of carbon pricing, investment in renewable energy,
the Sustainable Development Goals. In many subsidies to promote a green transition, and data
countries, tax systems and administration have transparency and sharing are needed for a number
improved significantly since the early 1990s, with of reasons, among them to avoid trade tensions.
the introduction of value-added taxes, large taxpayer International agreements on climate change mitigation
units, and, more recently, electronic filing. However, and on ensuring financing for the climate transition
revenue growth has disappointed in general (Box 1.1), and adaptation, especially in low-income countries,
which calls for rethinking tax systems and boosting tax should be priorities for the global community.
revenues by adopting and implementing medium-term Furthermore, international cooperation on taxation,
revenue strategies. These should include reducing including in the areas of corporate taxation,
levels of informality, establishing effective reporting transparency, and carbon pricing, can encourage
and auditing systems in synergy with digitalization necessary investments by mobilizing resources to
efforts, and improving incentives for tax compliance address common concerns that countries face around
in a cost-effective manner. Tax policy settings need to the world (April 2022 Fiscal Monitor; see also de
be redesigned, revenue agencies reformed, and legal Mooij, Klemm, and Waerzeggers 2023).
frameworks strengthened to build efficient, equitable,
and effective tax policy frameworks.
14See Chapter 3 of the April 2023 World Economic Outlook for a
13Tworecent IMF staff papers discuss these revamped rules. discussion of debt restructuring and the effectiveness of reductions in
Davoodi and others (2022) provide an account of recent trends the face value of debt, particularly, under coordinated and large-scale
relating to fiscal rules and fiscal councils, and Caselli and others initiatives for debt reductions such as the G20 Common Framework
(2022) discuss the return to fiscal rules. for highly indebted low-income countries.

18 International Monetary Fund | April 2023

 CHAPTER 1 On the Path to Policy Normalization

Box 1.1. Improving Tax Capacity in Emerging Market and Developing Economies
In the decade before the COVID-19 pandemic, introducing value-added taxes, for instance—and their
countries made mixed progress in mobilizing tax administration practices—by segmenting taxpayers
domestic revenue, including revenue to fund the according to risk, including by establishing large
Sustainable Development Goals agenda. On average, taxpayer units (see Online Annex 1.1) and initiating
tax collection in emerging market and developing the expansion of electronic services. Emerging
economies stagnated after the global financial crisis, market and developing economies that established
mostly owing to slow progress in personal income large taxpayer units are found to have increased their
tax collection (against the backdrop of stubbornly total-tax-to-GDP ratios from 0.5 percent of GDP
large informal sectors), as well as weak corporate to as much as 3.6 percent of GDP after about two
income and indirect tax performance (Figures 1.1.1 decades of the units’ operations. As reform waves
and 1.1.2). have abated, however, translating new tax systems
Difficulties in implementing the significant into higher tax collection has often been undermined
transformations in emerging market and developing by unstable political leadership and frequent staff
economies over the past 30 years can partly account turnover, inadequate human and financial resources,
for the slower progress in mobilizing revenues. Since and the lack of a comprehensive vision of tax capacity
the 1990s, a number of countries have reshaped their as part of state capacity (Gaspar, Jaramillo, and
tax systems, changing both their tax policies—by Wingender 2016).

Figure 1.1.1. Low Growth in Tax Revenues and Its Drivers

1. Slowdown in Mean Tax-to-GDP Growth 2. Tax Base Components of Slowdown
0.30
1.4 Mean growth, Mean 1997–2007
1997–2007 0.25 Mean 2008–18
1.2 Mean growth,
2008–18 0.20
Probability density

1.0
0.15
0.8 0.10
0.6 0.05
0.4 0.00
0.2 –0.05
0 –0.10
–2.3 –1.3 –0.3 0.7 1.7 2.7 Total CIT Indirect Property PIT Social
Percent of GDP taxes taxes and wealth contri-
taxes butions
Sources: Bachas and others 2022; and IMF staff calculations.
Note: In panel 1, x-axis is percent of GDP, y-axis is the density. In panel 2, bars reflect decade average of year fixed effects in a panel
regression of the yearly change in the tax-to-GDP ratio on year and country fixed effects, with each country weighted by its share of
GDP in the same year. CIT = corporate income tax; PIT = personal income tax.

International Monetary Fund | April 2023 19

FISCAL MONITOR: On the Path to Policy Normalization

Box 1.1 (continued)

Figure 1.1.2. Tax Reform Waves in Emerging Climate change, aging, digitalization, and the
Market and Developing Economies increasing international activity of taxpayers highlight
140 the importance of building skilled and responsive
Countries with value-added tax
Countries with large taxpayer units
administrations that can meet complex challenges.
120 Countries with e-filing One such comprehensive approach to reform is to
adopt a medium-term revenue strategy. Currently,
100 26 countries are engaging with such strategies. The
Number of countries

experiences of Papua New Guinea and Uganda, among

80
the earliest adopters, show the importance of seeking
60 broad consensus with civil society and ensuring
cooperation across all parts of government.
40

20

0
1960
65
70
75
80
85
90
95
2000
05
10
15
20

Sources: Bachas, Fattal Jaef, and Jensen 2019; International

Survey on Revenue Administration; Organisation for
Economic Co-operation and Development; World Bank; and
IMF staff calculations.

20 International Monetary Fund | April 2023

 CHAPTER 1 On the Path to Policy Normalization

Box 1.2. Revamping Fiscal Rules and Fiscal Frameworks

Many countries are considering reforming their (by postponing the debt reduction requirement)
fiscal frameworks as they emerge from the COVID-19 and recognizes the need to improve compliance by
pandemic. The global health and economic crisis strengthening national ownership through a greater
stemming from the pandemic led to a fiscal response role for national fiscal councils, in addition to
of unprecedented magnitude worldwide, with many enhancing “smart” ex post enforcement.
countries activating escape clauses or suspending their A number of other countries have initiated reforms
fiscal rules to create flexibility. Now countries need to of their fiscal frameworks as their situations have
decide whether to return to fiscal rules and, if so, how continued to normalize. After a two-year suspension
fast and which ones. of its fiscal rule in 2020–21, Colombia enhanced its
The European Union’s extension of its escape fiscal framework in 2021 by outlining a transition
clause until 2023 provides a window of opportunity path toward a structural primary balance rule with a
to reform the union’s fiscal governance framework. new debt anchor and by introducing an autonomous
The European Commission’s reform guidance, fiscal rule oversight committee (the Comité Autónomo
published in November 2022, aims to simplify de la Regla Fiscal). Uruguay introduced an expenditure
the current framework by reducing the number of rule in 2020 as a new pillar of its fiscal framework
indicators and rules.1 It proposes a move toward a and established a committee of experts and advisory
risk-based framework centered on comprehensive debt council. Also in 2020, Ecuador revised its expenditure
sustainability analysis, binding multi-annual fiscal rule and introduced new rules regarding budget
plans, and the introduction of a single operational balance and debt that reflect its updated medium-term
tool focused on (net primary) expenditures. fiscal strategy. In 2022, Chile introduced a new debt
Countries would be required to ensure that debt sustainability objective and escape clause applicable
is on a plausible debt reduction path at the end of only after 2026 to signal commitment to a gradual
a four-year and seven-year adjustment period for fiscal consolidation path. Several other countries
countries with “substantial” and “moderate” debt have transitioned to a rules-based fiscal responsibility
challenges, respectively. The proposal also creates framework in the aftermath of COVID-19. Antigua
incentives for investment and reforms that enhance and Barbuda adopted expenditure, revenue, and debt
sustainable growth and address common EU priorities rules in 2021. Also in 2021, Dominica established a
debt ceiling of 60 percent of GDP, to be achieved by
2035, and set a primary balance rule of maintaining a
1For instance, the revised framework would eliminate the
primary surplus of 2 percent of GDP in all years when
procedure for significant deviation from the medium-term
objective for the structural balance, as well as the one-twentieth
debt exceeds 60 percent. Discussions surrounding
debt reduction rule, which currently implies an unrealistic pace fiscal framework reform are ongoing in many
of debt reduction for many countries. more countries.

International Monetary Fund | April 2023 21

FISCAL MONITOR: On the Path to Policy Normalization

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International Monetary Fund | April 2023 23

 2
CHAPTER

INFLATION AND DISINFLATION: WHAT ROLE FOR FISCAL POLICY?

Introduction disproportionately more because they consume more

The upsurge in inflation that began in 2021—the as share of their income and they lack buffers in the
sharpest in more than three decades—has affected form of accumulated savings. But the distributive
fiscal accounts, worsened poverty, and altered the effects of inflation stemming from its uneven impacts
distribution of households’ well-being, calling on on the budgets of different households are far more
policymakers to respond. This chapter analyzes these complex. In turn, these depend on various factors,
developments and explores how fiscal policy can do its including the source of price increases (for example,
part to curb inflation while supporting the vulnerable.1 food or energy prices) and their form (demand,
Most people strongly dislike high and variable or wage push); households’ consumption baskets,
inflation,2 which causes many distortions in the sources of income, and the size and composition
economy (Agarwal and Kimball 2022), including greater of their balance sheets (for example, their position
uncertainty. Relative prices of goods and services may as net borrowers or lenders); and policy design and
become blurred—no longer reflecting relative demand responses (such as indexation of wages, pensions,
and supply conditions and making everyday decisions and social safety nets). Government policies need to
about consumption, investment, and production be informed by an understanding of how inflation
decisions harder for households, financiers, and firms. affects various groups in society. Greater availability
Inflation is more likely to become persistent if, akin to of household data makes it possible to analyze how
a tug-of-war, each group in the economy—employers big those effects are, which channels affect them, and
and workers, producers and consumers, and retailers how they vary across households.3
and their suppliers—tries to hold on to its share of The impact of inflation on the fiscal accounts also
prosperity at the expense of others. If such social depends on redistribution—in this case, between the
tensions lead to inconsistent macroeconomic policies public sector and the private sector. An unexpected
(for example, monetary policy that is too loose), high bout of inflation erodes the real (inflation-adjusted)
inflation will persist longer, ultimately prolonging a value of public debt, at least in the near term, with
costly phenomenon for everyone. bondholders bearing the loss. Likewise, deficit-to-GDP
Inflation often leads to a rise in poverty from ratios decline because the nominal (current monetary)
loss of purchasing power (Cardoso 1992), and, values of the economy’s output and of tax bases
as with any adversity, poor families tend to suffer will generally rise, generating more revenues, while
spending—often set in nominal terms in the budget—
initially fails to keep up. Without indexation, real
This chapter was prepared by staff from the Fiscal Affairs
Department. The authors of this chapter are Marcos Poplawski- incomes decline for civil servants, pensioners, and
Ribeiro (team lead), Carlos Eduardo Gonçalves (team co-lead), recipients of welfare transfers. The quality of public
Chadi Abdallah, Vybhavi Balasundharam, Yongquan Cao, Daniel services may also suffer as nominal spending ceilings
Garcia-Macia, Andres Ghini, Ting Lan, Anh Dinh Minh Nguyen,
Julieth Pico Mejía, and Alberto Tumino, with research support
clash with higher costs of goods and services. The early
from Kardelen Cicek, Arika Kayastha, Zhonghao Wei, and Andrew decline in deficits as a share of GDP may not last over
Womer, and under the guidance of Paolo Mauro and Paulo Medas. the medium term; yet, as inflation becomes expected,
1Although the spike in prices during 2021–22 was initially
spending catches up, and the cost of borrowing
concentrated in food and energy, this chapter discusses inflation rises as investors require an inflation risk premium
more generally as a sustained rise in the prices of many goods
and services, which may originate from different sources. The 3Empirical analyses of historical episodes have been constrained by

analysis measures inflation using the Consumer Price Index (CPI), limited availability of comparable data. A study based on surveys of
complementing it with the GDP deflator in specific exercises. For overall incomes of households in Israel with at least one employee,
recent developments on the relationship between inflation and for the period 1950−91 (including the hyperinflation of the
public finances, see also Chapter 1. mid-1980s), reports evidence of a statistically significant correlation
2See survey results in Shiller (1997), Scheve (2001), and Prati (2022). between inflation and inequality in incomes (Dahan 1996).

International Monetary Fund | April 2023 25

FISCAL MONITOR: On the Path to Policy Normalization

and central bank policy rates are hiked. Initial fiscal •• How large are the distributive effects of inflation across
gains may even be reversed in some cases, notably if households in countries at different levels of economic
growth falters. and financial development, and what is the role of
High and volatile inflation thus makes fiscal fiscal policy? The section “Distributive Effects of
management more challenging, potentially Inflation and Fiscal Policy Support” analyzes the
undermining the credibility of economic institutions impact of inflation on poverty and the distribution
and of the fiscal framework. Fiscal planning and of consumption, income, and net wealth, using
budget preparation become more complex not only household surveys for six countries at different levels
because of uncertainty regarding prices, wages, of economic and financial development.
and interest rates but also because the overall fiscal •• What is the role of fiscal policy in the efforts to
stance affects inflation through aggregate demand promote price stability? The section “Disinflating
and through inflation expectations (Coibion, and Distributing” estimates the impact of fiscal
Gorodnichenko, and Weber 2021). policy on inflation through aggregate demand.
Governments can influence how the costs of Using model simulations that allow for distributive
inflation are allocated, via indexation or discretionary effects, it explores how fiscal policy can support
policy decisions. They could choose, for example, to monetary policy to curb inflation while protecting
let inflation quietly increase taxation while eroding vulnerable households.
public pensions, wages, and transfers or instead seek
to keep the real values of these variables unchanged. The conclusion summarizes the chapter’s policy
They could also make the tax or transfer more or less implications.
progressive by adjusting some items but not others.
Further complicating policymakers’ task, widespread
indexation of public wages and other expenditure Impact of Inflation on Public Finances
items would entrench inflation expectations and make Inflation can affect fiscal aggregates through multiple
inflation more persistent. Such anticipation of inflation channels, with varying effects over time (Dynan 2022;
makes price stability harder to achieve. Similarly, if US CBO 2022a).
untargeted support outlasts spikes in energy prices or
other prices that originally motivated it, fiscal costs
and contributions to aggregate demand would be Direct Channels of Impact
unnecessarily prolonged (October 2022 Fiscal Monitor, The main direct channels through which inflation
Chapter 1). High inflation can lead to policy mistakes affects public finances, abstracting from subsequent
that may ultimately hamper investment and economic fiscal and monetary policy reactions, are listed below
growth, whereas price stability helps all individuals in and sketched out in the Executive Summary.
the economy. •• Inflated nominal values for GDP and the tax base.
Against this backdrop, it is timely to review what Higher nominal output lowers debt and deficits as
we know about these variegated interactions between a share of GDP. The nominal tax base also grows
inflation and fiscal variables and draw lessons for with inflation. For example, more revenues from
the conduct of fiscal policy. The chapter analyzes the value-added taxes are collected as the prices of
following questions: underlying goods and services go up. For some
•• How does inflation affect fiscal accounts? And how do taxes, such as income taxes, revenues may increase
the effects depend on institutional features of the tax even more than one-for-one with inflation,
and benefit system, such as indexation? The section including because some taxpayers may jump over
“Impact of Inflation on Public Finances” reviews nominal thresholds to higher tax brackets (bracket
the mechanisms through which inflation affects creep).4 These effects also depend on the degree of
public finance; surveys indexation practices across
4Beer, Griffiths, and Klemm (2023) analyze further channels
the world; and estimates the impact of inflation on
through which inflation affects the real value of collected tax
public debts, deficits, expenditures, and revenues in revenues, including the erosion of such revenues if inflation is high
the near and medium term. and they are collected with a lag (Tanzi 1977).

26 International Monetary Fund | April 2023

 CHAPTER 2 Inflation and Disinflation: What Role for Fiscal Policy?

indexation (in this case, of thresholds), discussed inflation, for example, taxpayers may be pushed into
later in the chapter. higher tax brackets (bracket creep), or the value of
•• Inertia in nominal spending. The net response their tax allowances and deductions may be eroded.
of the fiscal balances to inflation depends on The degree of indexation involves trade-offs. On
whether expenditure keeps pace with revenues. one hand, indexing public wages, pensions, or welfare
During the budget year, this is seldom the case transfers reduces uncertainty and preserves purchasing
because spending caps are usually set in nominal power for civil servants, retirees, and low-income
terms, although indexation of some important households. It may also prevent distortionary gaps
items such as public wages and transfers may between public and private wages or a possible brain
lead in some cases to automatic adjustments to drain from the public sector. On the other hand,
inflation in the same year. Ad hoc adjustments indexation sustains real expenditures, contributing to
or new measures such as introduction or aggregate demand and potentially making inflation
enhancement of subsidies (for example, in more persistent. If public wages are a benchmark for
response to higher food or energy prices) can also private wages (as in many countries), indexation of
speed up the rise in nominal spending. public wages could prolong wage and inflationary
•• Sovereign debt size and structure, and investors’ pressures (Box 2.1). Widespread indexation can limit
response. The larger the debt, the greater the the scope for discretionary cuts.
potential erosion from inflation. This effect is Countries have taken different approaches to
attenuated, however, if a portion of the debt is indexation policies (Figure 2.1). A minority of
inflation-linked (as inflation automatically leads countries index or regularly adjust their income tax
to higher borrowing costs), is denominated in rate brackets to minimize bracket creep.
foreign currency (as inflation leads to depreciation, Indexation is more common for some important
potentially resulting in higher repayments when expenditure items, especially pensions. Nearly all
expressed in domestic currency), has a floating advanced economies, about 50 percent of emerging
rate (as inflation prompts higher policy, and market economies, and 30 percent of low-income
hence higher short-term benchmark rates), or developing countries have some form of indexation.
has a greater share of short-term bonds that are Pension indexation has become more prevalent
maturing and need to be rolled over (as investors recently, but many countries have made it less generous
will ask for higher rates on newly issued bonds). to reduce the burden on the budget and safeguard
When governments issue new debt, investors may the sustainability of pension systems (OECD 2022a).
require higher returns to compensate not only for Countries have moved from wage indexation toward
expected inflation but also for higher inflation price indexation as nominal wage increases have
volatility (an inflation risk premium)—and, for tended to exceed price inflation in the past, reflecting
countries where economic prospects are uncertain productivity gains.5 Many countries further index
and the debt ratio remains high or keeps rising, a their social assistance programs, with around half of
default premium. advanced economies linking several of their benefits to
inflation (OECD 2022c). By contrast, most countries
do not index public wages to inflation—a practice that
International Practices with Inflation Indexation has become less prevalent in recent decades, perhaps
Countries’ practices vary regarding how much tax because inflation had been low. But the pressure
or budget items are indexed to inflation or adjusted to index wages may return if high inflation persists
to inflation by policy measures. This has consequences (Suthaharan and Bleakley 2022).6
for how their public finances evolve in the face of
inflation surprises. Indexation of politically salient
expenditure items such as pensions or wages is often 5In 2022, such a strategy may have been costlier than predicted
a prominent topic in public discourse. The effects given that inflation rose faster than nominal wages (OECD 2022d).
6For public wages, their increases in most countries tend to be
on the revenue side, while less discussed, are no less related to the political cycle rather than to indexation (Gaspar,
relevant. If income tax thresholds are not adjusted to Gupta, and Mulas-Granados 2017).

International Monetary Fund | April 2023 27

 FISCAL MONITOR: On the Path to Policy Normalization

Figure 2.1. Indexation Policies Vary across the World and across Budget Items
(Percentage of countries in each income group)
1. Personal Income Tax 2. Pension Indexation2 3. Social Assistance Program 4. Public Wages Indexation4
Brackets’ Indexation1 Indexation3
No regular adjustments Price Wage No No
Regular de facto adjustments Mixed No Yes, to other variables Yes, to other variables
Automatic price adjustments Yes, to inflation Yes, to inflation
100 100 100 100

90 90 90 90

80 80 80 80

70 70 70 70

60 60 60 60

50 50 50 50

40 40 40 40

30 30 30 30

20 20 20 20

10 10 10 10

0 0 0 0
AEs EMs LIDCs AEs EMs LIDCs AEs EMs LIDCs AEs EMs LIDCs

Sources: IMF staff analysis based on an IMF survey and using additional data from Beer, Griffiths, and Klemm (2023); IMF Pay Systems database (2016); International Social
Security Association database; OECD (2022c); and US Social Security Administration databases.
Note: Panels include data for 2016–23. Observations vary from 116 to 176 countries in each panel (see Online Annex 2.1 for details). Price indexation includes different
measures of inflation, for example, “core,” or measures that include only urban workers or exclude fuel, tobacco, alcohol, and others. Even with automatic indexation,
discretionary approval stages may be part of the framework that result in ad hoc adjustments. AEs = advanced economies; EMs = emerging market economies;
LIDCs = low-income developing countries.
1
“Regular de facto adjustments” means that personal income tax thresholds are regularly revised but not automatically.
2
“Mixed” indexation refers to an adjustment that includes a mix of price, wages, and other variables.
3
Social assistance programs include major fixed cash transfer programs. “Yes” means that majority of benefits are indexed in the country.
4
“No” means that inflation does not play an automatic or mandatory role in the setting of public wages. Indexation includes both partial and full indexation.

Effects of Inflation on Public Finances over public spending could catch up with revenues through
the Medium Term indexation. Second, public policies and decisions,
Inflation surprises often improve debt and budget including for wages or pensions, could lead to higher
balances in the near term, but are these gains spending over time, reducing any initial gains for public
maintained over the medium term? To answer this finance indicators. Third, most central banks have the
question, the chapter employs both quarterly and statutory objective of maintaining price stability, using
annual data.7 The effects of inflation on public finance adjustments in their policy rates to do so, which may
could ebb over time for three main reasons. First, lead to a tightening of financial conditions for agents in
the economy, including the government. Even so, the
7Recent attempts to answer this question have used different adjustment of interest expense may be gradual if the
methods, including event studies (Blanco, Ottonello, and Ranosova structure of public debt is mostly in its own currency
2022), model-based simulations (Bénassy-Quéré 2022), and surprises
in World Economic Outlook forecasts (October 2022 Fiscal Monitor,
and in long maturities and if the country’s monetary
Chapter 1). The US Congressional Budget Office’s 2002 workbook authority has a reputation for maintaining price stability.
allows users to simulate alternative economic scenarios by specifying In such cases, exchange rate risks may be muted and
different values for inflation (and three other economic variables) for
market expectations well anchored. A debt structure
the United States, comparing them to its baseline projections (US
CBO 2022b). The estimates in this section use the local projection with longer maturities will facilitate less pass-through of
method (Jordà 2005). The annual historical data include many more interest rates to increases in public interest payments in
(emerging market) economies, allowing the research of samples where the medium term.
inflation is higher, more volatile, and less surprising (more persistent).
Quarterly data provide more accurate estimates of the immediate Analysis using historical annual data (1962−2019)
effects of CPI inflation on fiscal variables. See Online Annex 2.2. for 85 economies shows that, on average, spikes in

28 International Monetary Fund | April 2023

 CHAPTER 2 Inflation and Disinflation: What Role for Fiscal Policy?

Figure 2.2. Reaction to a 1 Percentage Point Growth Spike in the GDP Deflator
(Percent of GDP)
1. Debt 2. Overall Balance
0.4 0.4
Debt/GDP > 50 percent Debt/GDP ≤ 50 percent

0.0 0.0

–0.4 –0.4

–0.8 –0.8
All countries in the sample

–1.2 –1.2
–1 0 1 2 3 4 5 –1 0 1 2 3 4 5
Year after shock Year after shock

Source: IMF staff estimates using data from the IMF Public Finances in Modern History and World Economic Outlook databases.
Note: The data cover the period 1962–2019. Fixed effects ordinary least squares regressions use the GDP deflator as the inflation indicator and include 85 countries.
Countries with populations of less than 1 million in 2019 are excluded as well as observations with annual GDP deflator inflation higher than 30 percent in absolute terms or
for which the original data source changes. The panels plot the average impulse response and the 90 percent confidence bands, with standard errors clustered at the
country level. Average debt to GDP in the sample is approximately 50 percent. See Online Annex 2.2.

the growth of the GDP deflator tend to reduce the Whereas unexpected spikes in inflation reduce the
debt-to-GDP ratio persistently (Figure 2.2).8 The drop debt ratio, increases in inflation expectations do not. The
in the debt-to-GDP ratio is larger in economies with latter are associated with a faster rise in both primary
higher initial debt, as expected, with an initial spike of spending and interest expense, and a smaller increase in
1 percentage point in the growth of the GDP deflator9 the nominal GDP denominator. The difference in the
associated with a persistent cumulative decline in the effects of surprise versus expected inflation is larger for
debt ratio of 0.6 percentage point of GDP (see also countries with high initial debt levels (Figure 2.3). Both
Chapter 1 for recent developments on the relationship results underscore that attempting to inflate public debt
between inflation and debt). The reduction in the debt away is neither a desirable nor a sustainable strategy.
ratio is caused by a hike in the GDP denominator and If inflation surprises frequently, agents will adjust
an initial rise in fiscal balances. The debt and fiscal their inflation expectations accordingly and demand
balance reactions to a spike in the growth of the GDP protection against it, leading to higher spreads owing to
deflator are similar between advanced and emerging the inflation risk.
market economies. Yet the drop in debt is significantly Estimates using quarterly data from the first quarter
smaller in countries with flexible exchange rates, as of 1999 to the fourth quarter of 2019 for 28 advanced
in those countries, inflation tends to be associated economies confirm that CPI inflation spikes tended
with exchange rate depreciation, increasing the value to improve the overall and primary fiscal balances in
of foreign-currency-denominated debt relative to the short term (Figure 2.4).10 High-frequency data
domestic GDP (see Online Annex 2.2). capture the immediate effects of inflation on public

10Regressionswith quarterly data are estimated using

8The result is qualitatively robust to the use of CPI inflation. instrumental variables. CPI inflation spikes are instrumented by
To capture inflation from all sources, the estimates employ ordinary the change in the price growth of the commodity import basket,
least squares regressions (panels with fixed effects). The analysis also interacted with an exchange rate peg dummy (lagged).
excludes countries with 2019 population of less than 1 million. Commodity price spikes tend to be more surprising and tend to
9Throughout the chapter, a “spike” in inflation refers to a sudden pass through to prices of various goods and services (see Choi
rise in inflation followed by a gradual decline. Specifically, when and others 2018). The correlation is clear for countries with more
using annual data, a spike is a 1 percentage point increase in the flexible exchange rate regimes. For these countries, commodity
GDP deflator growth rate, followed by gradual decline in subsequent import price rises tend to lead to exchange rate depreciations and
years (see Online Annex Figure 2.2.1). When using quarterly data, so to more inflation. This approach implies that results capture
the spike in CPI inflation stems from a 1 percentage point increase mainly the impact of imported inflation shocks, which may differ
in commodity import inflation (weighted by GDP), with CPI from domestically driven shocks affecting the GDP deflator more
inflation petering out after three quarters (see Figure 2.4, panel 1). directly. See Online Annex 2.2 for details.

International Monetary Fund | April 2023 29

 FISCAL MONITOR: On the Path to Policy Normalization

Figure 2.3. Debt Reaction to Surprise versus Expected Growth Spikes in the GDP Deflator
(Percent of GDP)
Debt/GDP > 50 percent Debt/GDP ≤ 50 percent
1. Surprise 2. Expected
1.2 1.2

0.6 0.6

0.0 0.0

–0.6 –0.6

–1.2 –1.2
–1 0 1 2 3 4 5 –1 0 1 2 3 4 5
Year after shock Year after shock

Source: IMF staff estimates using data from the IMF Public Finances in Modern History and World Economic Outlook databases.
Note: Fixed effects ordinary least squares regressions include 85 countries during the period with available data 1992–2019. Countries with population of less than 1 million
in 2019 are excluded as well as observations with annual surprise or expected inflation higher than 30 percent in absolute terms or for which the original data source
changes. Expected inflation is defined as the one-year-ahead forecast; surprise inflation is realized minus expected inflation. The panels plot the average impulse response
and the 90 percent confidence bands (blue shaded areas and red short-dashed lines), with standard errors clustered at the country level. See Online Annex 2.2 for details.

Figure 2.4. Estimated Initial Gains to Fiscal Balances from CPI Inflation Spikes
(Percent of GDP, unless stated otherwise)
1. CPI Inflation 2. Overall Balance 3. Total Tax Revenue
(Percent)
1.2 1.2 1.2
0.8 0.8 0.8
0.4 0.4 0.4
0.0 0.0 0.0
–0.4 –0.4 –0.4
–0.8 –0.8 –0.8
–1.2 –1.2 –1.2
–1 0 1 2 3 4 5 6 7 –1 0 1 2 3 4 5 6 7 –1 0 1 2 3 4 5 6 7
Quarter after shock Quarter after shock Quarter after shock
4. Primary Expenditure 5. Interest Expense 6. Nominal Long-Term Bond Rate
(Percent)
1.2 0.6 0.6
0.8 0.4 0.4
0.4 0.2 0.2
0.0 0.0 0.0
–0.4 –0.2 –0.2
–0.8 –0.4 –0.4
–1.2 –0.6 –0.6
–1 0 1 2 3 4 5 6 7 –1 0 1 2 3 4 5 6 7 –1 0 1 2 3 4 5 6 7
Quarter after shock Quarter after shock Quarter after shock

Sources: IMF staff estimates using data from Gruss and Kebhaj (2019); Ilzetzki, Reinhart, and Rogoff (2019); and IMF International Financial Statistics and World Economic
Outlook databases.
Note: Regressions are estimated between the first quarter of 1999 and the fourth quarter of 2019 using instrumental variables and control for quarter indicator variables and
country and year fixed effects (fixed effects two-stage least squares). The panels plot the average impulse response and the 90 percent confidence bands (blue shaded
area) with standard errors clustered at the country level. See Online Annex 2.2 for details. CPI = Consumer Price Index.

30 International Monetary Fund | April 2023

 CHAPTER 2 Inflation and Disinflation: What Role for Fiscal Policy?

finance before policies have time to react. The findings Channels for Distributive Effects of Inflation
suggest that for each 1 percentage point initial increase across Households
in inflation, budget balances go up by 0.5 percent Inflation affects the distribution of households’
of GDP. Revenue broadly rises in line with nominal well-being through three main channels:11
GDP, whereas primary expenditures tend to be stable •• Differences in price increases across goods combined
in nominal terms in initial quarters. Interest expense with differing consumption patterns (consumption
climbs gradually over time given that debt in the basket channel). If the prices of some goods rise
sample features mainly fixed rates and long maturities, more than those of others, households with a higher
slowing the pickup in effective nominal rates of share of higher-priced goods in their consumption
public bonds. baskets will suffer more. For example, spikes in food
The quarterly data further enable empirical prices may hurt the consumption of the poor more
exercises for budget subcomponents, revealing than other households because food constitutes a
different patterns among them (see Online larger share of consumption (and income) for the
Annex 2.2). While total tax revenue in nominal poor (Baez Ramirez, Inan, and Nebiler 2021). If
terms grows by about the same magnitude as inflation becomes equally widespread across goods
inflation, some items (profit and income taxes) and services, this differential effect abates.
rise proportionally more. On the expenditure side, •• Impact on households’ real incomes (income channel).
some expenditure categories are sticky, especially Real incomes may be significantly eroded if wages,
compensation of employees and social benefits. Over pensions, or other transfers do not keep pace with
time, automatic or de facto indexation brings those inflation. The extent and distribution of such erosion
expenditures back to their initial levels in real terms. depends not only on features of the labor market and
pension or transfer systems but also on the source of
Distributive Effects of Inflation and price changes. During the price surge of 2021, which
Fiscal Policy Support was driven by commodity prices, for example, real
wages fell in most commodity-importing countries
Beyond the overall impact of inflation on the but rose in some commodity-exporting countries.
fiscal accounts, analyzing the effects of inflation on In some historical episodes during which inflation
the distribution of households’ well-being is key originated from a worker-led push for compensation,
to understanding how policies, including social real wages may have risen.12 Moreover, if price and
protection, can be designed to take such effects into wage changes stem from the sudden emergence
consideration. Such an analysis can also be useful of imbalances in demand and supply for certain
for exploring the political feasibility of other policies sectors or skills, some workers may benefit (or be
or reforms by identifying potential pressure points harmed) disproportionately. Likewise, wage and
(relative winners and losers among those who stand pension indexation may serve some workers or
to gain or lose from inflation). As the discussion that retirees to the detriment of others (Süssmuth and
follows shows, for example, the impact of inflation Wieschemeyer 2022).
in countries with sizable mortgage markets is more •• Impact on the real value of households’ initial stock
adverse—as a share of household income—for those of assets and liabilities (wealth channel). Inflation
older than age 65 (usually net holders of nominal is expected to lead to a change in relative asset
assets) than for people in their 30s to 40s (who often prices and a reduction in real terms of households’
have mortgage debt outstanding). When considering
the design, timing, and preparatory work for reforms
11See also Online Annex 2.3 and Cardoso and others (2022). The
to pensions or health care, it would be helpful to term “well-being” is a shorthand for the sum of these three effects.
consider that inflation is already placing a burden The analysis does not estimate welfare using utility functions, nor
on the households and groups that would be more does it consider households’ behavioral responses.
12According to Hirschman (1985, 60), the experience in Argentina
affected. This section uses household-level data for
in 1946–55 could be interpreted as an attempt at redistribution
distinct countries and economic groups to examine toward lower-income groups through higher wages, social security,
such distributive effects. and transfers, which were also associated with higher inflation.

International Monetary Fund | April 2023 31

FISCAL MONITOR: On the Path to Policy Normalization

initial liabilities. A surprise hike in inflation in electricity, gas, and other fuels; transportation; other)
principle helps net borrowers and hurts net lenders for the second quarter of 2021 to the second quarter
(Doepke and Schneider 2006). In countries featuring of 2022 (Figure 2.5). A household’s specific inflation
developed financial and credit markets, wealth effects is the weighted average of the percentage price
are potentially relevant. The change in relative asset hikes (in each country) for each given consumption
prices means that portfolio composition also matters. category, with the weights derived from the individual
Families holding cash as their main asset tend to be hit household’s consumption basket as reported in
the most (Albanesi 2007). Likewise, holders of bank the survey.
deposits and fixed-rate government bonds usually Household-specific inflation levels are higher for
incur real losses from inflation. Instead, historically, households in lower income quintiles in Colombia,
home or land ownership has served as good protection Kenya, Mexico, and Senegal, reflecting a larger
against inflation, and mortgage borrowers have often contribution from food price increases for the lower
benefited from it (Box 2.2). quintiles (Figure 2.5). In turn, this stemmed from a
combination of (1) more rapid increases in food prices
than in other goods and (2) the well-known universal
Estimation pattern whereby the share of food in total consumption
The effects through these three channels are declines with income per person.14 For Finland and
estimated for six economies, using a new rich set France, household-specific inflation rates are nearly the
of statistics and household survey data. The sample same across income quintiles. In these two countries,
encompasses low-income and developing countries the contribution from food prices was limited because
(Kenya and Senegal ), emerging market economies the rise in food prices was less pronounced, and food
(Colombia and Mexico), and advanced economies accounts for a share of consumption that is lower and
(Finland and France). These countries also vary with roughly the same across quintiles. Energy prices rose
respect to past inflation histories, status as commodity faster and account for a sizable portion of the overall
exporters or importers, and availability and use of increase, although the effect was felt through utilities
mortgage and other household credit markets. The at the lower quintiles and transportation (which
wealth channel is estimated only for Colombia, includes fuel) at the higher quintiles.15 More recently,
Finland, and France, given data constraints. energy prices have adjusted down to levels seen before
To illustrate, the analysis focuses on observed Russia’s invasion of Ukraine (see Chapter 1), and these
price developments during the initial upsurge in consumption basket channels may abate or even reverse.
global prices in the aftermath of the COVID-19 However, as found in new evidence reported in Box 2.3,
pandemic; that is, the second quarter of 2021 to the changes in relative prices can on occasion persist or
second quarter of 2022. This rise was concentrated widen for several years, with meaningful implications for
in food and energy prices and was associated with a the budgets of different groups.
cost-of-living crisis for millions of people across the Although the effects occurring through the
world. All countries in the sample faced significant consumption basket channel were sizable during the
headline inflation, ranging from 6.1 percent in period analyzed, they may become negligible (or
France to 9.2 percent in Colombia during the period reverse) when other sample periods are considered that
considered. Prices of food spiked the least in Finland
and France, whereas energy prices in those countries
rose the most (Online Annex 2.3).13 14In developing or emerging market economies such as

Colombia, Kenya, Mexico, and Senegal, the poorest households

The consumption basket channel is illustrated by
spend 40–50 percent of their budget on food, compared with
reporting averages, by quintile, of household-specific 15–30 percent for their richest quintiles. In advanced economies
inflation and the contributions of various such as Finland and France, the budget share spent on food is
components of household consumption baskets roughly constant across quintiles at 10–15 percent. In the United
States too, transportation represents a large expenditure share for the
(food and nonalcoholic beverages; housing, water, middle/upper class (The Economist 2023).
15Whereas energy used for utilities in these countries is a larger
13See Online Annex 2.3 for the details, including the assumptions share of consumption for lower-income households, the share of
for the income and wealth estimates. Online Annex 2.3 further transportation in total consumption rises with household income
analyzes total net wealth, including real assets, such as dwellings. (see Hellebrandt and Mauro 2015 for international evidence).

32 International Monetary Fund | April 2023

 CHAPTER 2 Inflation and Disinflation: What Role for Fiscal Policy?

Figure 2.5. Household-Specific Levels of Inflation per Quintile, 2021−22

(Percent)
Other consumption categories Transport Housing, water, electricity, gas, and other fuels Food and nonalcoholic beverages Annual inflation
1. Kenya 2. Mexico 3. Senegal
12 12 12
10 10 10
8 8 8
6 6 6
4 4 4
2 2 2
0 0 0
Poorest 2 3 4 Richest Poorest 2 3 4 Richest Poorest 2 3 4 Richest
4. Colombia 5. Finland 6. France
12 12 12
10 10 10
8 8 8
6 6 6
4 4 4
2 2 2
0 0 0
Poorest 2 3 4 Richest Poorest 2 3 4 Richest Poorest 2 3 4 Richest

Source: IMF staff calculations.

Note: The figure covers the period from the second quarter of 2021 to the second quarter of 2022. In Colombia and Mexico, and in Finland and France, quintiles are built
using per capita income. For Kenya and Senegal, the quintiles use per capita consumption (as a proxy for their income). See Online Annex 2.3 for details.

encompass, for example, food price increases similar to and other income failed to keep pace with price
(or lower than) the general price index.16 hikes. In Colombia and Mexico, real incomes rose. The
Whereas the consumption basket channel fact that these two countries are oil exporters may
appropriately received much attention in several explain why nominal income increased there more
recent analyses,17 the other two channels often have recently. Institutional factors may be at play too—for
had even greater impacts. The income channel was example, wage and pension indexation is widespread
generally the most prominent, but its sign differed in Colombia and Mexico. In most countries, the
across countries (Figure 2.6, blue bars).18 In Finland, impact of inflation via this channel did not vary
France, Kenya, and Senegal, nominal changes in much across quintiles and, to the extent it did, there
remuneration of families through wages, pensions, was no clear pattern, with several characteristics
playing important roles (including the gender of the
16In all countries except Finland, the consumption channel is
head of household; Mao 2022).
negative at the bottom of the income distribution and positive at the
Effects occurring through the wealth channel are
top. The finding confirms the evidence shown above on the cost of
living in Colombia, Kenya, Mexico, and Senegal increasing more for also significant in the countries for which data are
poor households than for rich households. available (Figure 2.6, green bars) and present the most
17See, for example, OECD (2022b) for Organisation
complex interactions with household income, age
for Economic Co-operation and Development economies;
Charalampakis and others (2022), Claeys and Guetta-Jeanrenaud of the head of the household, and country-specific
(2022), and Mohrle and Wollmershauser (2021) for European mortgage and household credit markets.19 In Finland
countries; and Autor, Dube, and McGrew (forthcoming), Jaravel and France, real losses from the erosion of net nominal
(2022), and US CBO (2022c) for the United States.
18Figure 2.6 assumes changes in nominal values of incomes, assets, assets (or gains from erosion of net nominal liabilities)
and liabilities in line with the data discussed in Online Annex 2.3.
The annex includes another simulation in which those financial 19Emerging market and advanced economies generally have

resources are assumed to remain constant in nominal terms, allowing more developed financial markets and higher household debt levels
for a study of the immediate effects of an unexpected inflationary (Bahadir and Gumus 2016; Jordà, Schularick, and Taylor 2016).
shock. In that scenario, the total immediate effects of inflation on Credit for large real assets, such as dwellings, is less widespread in
households’ incomes are negative in all countries, with the fall in real low-income countries. For an analysis of the penetration of mortgage
income being equal to the level of inflation. loans in those economies, see Badev and others (2014).

International Monetary Fund | April 2023 33

 FISCAL MONITOR: On the Path to Policy Normalization

Figure 2.6. Income, Consumption, and Wealth Channels, 2021−22

(Percent of household income)

1. Kenya 2. Mexico 3. Senegal

8 8 8
6 Income Consumption Total 6 Income Consumption Total 6 Income Consumption Total
4 4 4
2 2 2
0 0 0
–2 –2 –2
–4 –4 –4
–6 –6 –6
–8 –8 –8
Poorest 2 3 4 Richest Poorest 2 3 4 Richest Poorest 2 3 4 Richest
4. Colombia 5. Finland 6. France
8 8 8
6 6 Income Consumption 6 Income Consumption
4 4 Wealth Total 4 Wealth Total

2 2 2
0 0 0
–2 –2 –2
–4 Income Consumption –4 –4
–6 Wealth Total –6 –6
–8 –8 –8
Poorest 2 3 4 Richest Poorest 2 3 4 Richest Poorest 2 3 4 Richest

Source: IMF staff calculations, as described in Online Annex 2.3.

Note: The figure covers the period from the second quarter of 2021 to the second quarter of 2022. For Colombia, results are based on the financial inclusion module of the
Great Integrated Household Survey (GEIH) to include the wealth effect. Results for income and consumption basket channels using a representative survey are similar.

differ significantly across household income groups. Considering the overall impact of inflation and the
Families in the fourth quintile in Finland and the relative importance of the three channels (consumption
third and fourth quintiles in France are, on average, basket, income, and wealth) in different countries and
net borrowers (at least in terms of liquid assets and for different income groups, it becomes apparent that
liabilities) and thus experience net wealth gains from the impact of inflation on well-being is variegated and
inflation.20 Conversely, families in the two lowest depends on several factors. In Kenya, during the period
quintiles in Finland and, to a lesser extent, those in the considered, the impact of inflation was worse the lower
lowest and highest quintiles in France are net lenders the income group, largely owing to the stronger impact
(or holders of net nominal assets) and experience of food prices on the poor. The pattern is similar,
losses. In Colombia, households for all income groups though less pronounced, in Mexico, whereas in Senegal,
report, on average, that they have net liquid liability the income channel drove most of the action, with
positions.21 The positive size of the wealth effect is little variation across quintiles. In Colombia, the overall
significant, in comparison with the other effects, and impact of inflation was similar across income quintiles,
does not present a straightforward association with as the income and wealth channels masked the pattern
income—the largest gains are for the lowest and stemming from the consumption basket channel. In
highest income quintiles. Finland and France, the middle quintiles were less
affected than the highest and lowest. While the income
20The conclusions may depend on whether real assets, including channel was the most sizable, variation across quintiles
dwellings, are considered (see Online Annex 2.3). reflected the wealth channel.22
21Although this would merit further analysis, the asset counterpart

to these positions could be with financial institutions (including

informal ones). The survey does not include information about 22For inequality trends by income percentile in the United States

ownership of these assets. caused by inflation see Autor, Dube, and McGrew (forthcoming).

34 International Monetary Fund | April 2023

 CHAPTER 2 Inflation and Disinflation: What Role for Fiscal Policy?

Figure 2.7. Wealth Effect by Age and Income Brackets, 2021−22

(Percent of household income)
Poorest p20–p40 p40–p60 p60–p80 Richest
1. Colombia 2. Finland 3. France
12 12 12
9 9 9
6 6 6
3 3 3
0 0 0
–3 –3 –3
–6 –6 –6
–9 –9 –9
–12 –12 –12
–15 –15 –15
–18 –18 –18
–21 –21 –21
<36 36–45 46–55 56–65 >65 <36 36–45 46–55 56–65 >65 <36 36–45 46–55 56–65 >65
Age of the head of household Age of the head of household Age of the head of household

Source: IMF staff calculations, as described in Online Annex 2.3.

Note: The figure covers the period from the second quarter of 2021 to the second quarter of 2022. Each line in the panels corresponds to the income brackets. The wealth
effect differs, on average, across generations: Young people are net borrowers, whereas elderly people tend to be net lenders. Therefore, the wealth effect is usually
positive for young people and negative for older households. p = percentile.

Table 2.1. Total Effect of Inflation on Saving Capacity by Age-Income Groups

(Percent of household income)
Spain Colombia Finland France
Income Quartile Income Quintile Income Quintile Income Quintile
Age Poorest Second Third Richest Poorest Second Third Fourth Richest Poorest Second Third Fourth Richest Poorest Second Third Fourth Richest
<36 –2.6 –2.9 –2.4 –2.9 9.0 –8.4 –8.1 –7.4 –7.7 –6.2 –6.1 –2.8 0.1 1.6 –5.1 –3.1 0.2 0.9 6.0
36–45 –0.9 –0.3 –1.0 –2.0 –3.4 –8.0 –7.2 –7.1 –5.0 –5.8 –5.5 –3.7 –1.7 –0.7 –4.3 –3.0 –1.2 0.1 5.0
46–55 –3.5 –3.5 –3.9 –4.4 –0.7 –8.5 –8.2 –7.5 –5.7 –3.3 –6.0 –6.6 –5.3 –4.9 –5.2 –4.1 –3.7 –3.8 –2.9
56–65 –8.3 –6.2 –6.9 –6.8 –10.1 –7.6 –8.1 –7.6 –6.2 –10.4 –9.3 –8.7 –9.3 –12.9 –7.8 –6.9 –7.3 –7.1 –8.9
>65 –12.7 –9.6 –9.8 –9.7 –11.3 –13.0 –9.1 –8.4 –7.8 –17.3 –16.9 –18.2 –18.2 –27.0 –11.2 –10.4 –10.4 –11.2 –18.5
Sources: Cardoso and others (2022) for Spain and IMF staff calculations for Colombia, Finland, and France.
Note: Age brackets are based on the age of the head of household. See Online Annex 2.3 for details.

Redistributive wealth effects of inflation are pattern is identified in Colombia, however. To sum
also strongly influenced by the age of the head of up, in advanced economies, a group highly exposed
household, especially in countries with sizable markets to losses from inflation would consist of retirees who
for mortgages. Figure 2.7 shows that for Finland and live in a rental apartment and hold their savings in
France, young families, which tend to be net borrowers nominal assets and whose pension is not indexed.
(for example, via mortgages), experience gains through The importance of age is further corroborated
the wealth channel. For most families, a mortgage is by results for Spain by Cardoso and others (2022).
the largest loan they ever undertake to gain ownership Table 2.1 compares their results with those in
of their largest asset—their home. In contrast, older this chapter.
age groups, which typically do not have mortgages
and are net holders of nominal assets, experience
wealth erosion. This pattern holds within each income Poverty
quintile and in these countries is most pronounced The analysis further suggests a likely increase in
within the highest income quintile, which has the poverty in all economies analyzed. Figure 2.8 displays
easiest access to credit and asset markets. No clear the change in absolute poverty headcount following four

International Monetary Fund | April 2023 35

 FISCAL MONITOR: On the Path to Policy Normalization

Figure 2.8. Changes in Poverty from Different Types of Price considered. The effect of a rise in food prices is larger
Increase Shocks (Excluding New Policy Measures
in Kenya, Senegal, and Mexico, whereas energy price
Responding to Inflation)
(Percentage points) hikes are more important for Colombia, Finland, and
France. If the pace of increases in food and energy
2.0
Baseline inflation prices declines below average consumer price inflation, a
1.8 Average inflation
5% higher food prices significant source of increases in poverty may subside.
1.6 5% higher fuel prices
1.4
Disinflating and Distributing
1.2
1.0
The previous sections show how inflation affects
public finances and households. Now the analysis
0.8
turns to whether and how fiscal policy affects
0.6 inflation. Understanding the specific channels through
0.4 which public policies affect inflation and how those
0.2 policies can contribute to the mix of instruments
0.0 meant to restore price stability are two complex and
interconnected issues. Monetary and fiscal policies
–0.2
Colombia Finland France Kenya Mexico Senegal have their own distributional effects. In addition, their
Source: IMF staff calculations. overall impacts on the macroeconomy vary according to
Note: Baseline inflation refers to household inflation calculated based on observed the structure of wealth and income inequality. Recent
inflation from the first quarter of 2021 to the second quarter of 2022. Results can
be considered as a ceiling because the estimation does not take into account new
studies (often using a so-called Heterogeneous Agent
measures taken by the government or households to respond to the effects of New Keynesian [HANK] approach) have indicated that
inflation. the role played by fiscal policy in aggregate demand
and inflation management may be larger than typically
scenarios of price hikes:23 (1) baseline or actual inflation assumed. These studies have also considered monetary
(and distribution across goods and services) in each policy’s possible effect on distribution.
country from the second quarter of 2021 to the second This section discusses how fiscal policy may lead to,
quarter of 2022, (2) an average or widespread price hike or may help deal with, moderately high inflation. It
in all goods and services, whose increase remains equal does not speak to cases of instability, such as episodes
to the country’s inflation level, (3) a 5 percent hike in of debt distress, which currently apply to a small set of
the price of food and nonalcoholic beverages on top of emerging markets. Situations in which the government
observed price rises, and (4) a 5 percent spike in energy does not adjust the primary balance to stabilize public
prices on top of observed price rises. debt and central banks are less independent—both
The estimated impact of inflation (observed baseline) usually associated with the economic concept of fiscal
on the poverty rate, prior to new compensatory dominance—are outside the scope of this chapter.24
measures, is as high as about 1 percentage point in Instead, the standard assumption that central banks
France, Mexico, and Senegal. Such increases in poverty pursue their objective of price stability, unhindered
already consider the growth of nominal income, which by concerns about public debt, holds. Public finances
helped contain the adverse effects of inflation on matter for inflation via their impact on aggregate
poverty. In the countries studied, the mitigating effect demand.25 They also contribute to the price stability
of the growth in nominal income on poverty varies, goal if they are aligned with monetary policy, bringing
with some countries experiencing little to no effect, credibility to the overall macroeconomic framework.
while others, like Colombia, experienced a significant Hence, by taming spending, governments can help
reduction in the poverty headcount (0.4 percentage monetary policy curb inflation at lower costs for the
point). Rises in food prices had a disproportionate
impact on vulnerable populations during the period
24See Leeper (1991), Sims (1994), and Cochrane (1998), who
initially developed the Fiscal Theory of the Price Level.
23Poverty headcount is the share of the population whose income 25Over time, such effects of fiscal policy can be offset by monetary

falls below international poverty lines set by the World Bank. policy through the rise in interest rates.

36 International Monetary Fund | April 2023

 CHAPTER 2 Inflation and Disinflation: What Role for Fiscal Policy?

overall economy (see, for example, Adrian and Gaspar Historical Evidence of the Impact of Fiscal Policy
2022; and Erceg and Lindé 2012). on Inflation
Fiscal policy support for monetary policy in To assess the effect of public spending on inflation,
disinflating is important for two additional reasons. as motivated by the recent spending surge, for a broad
First, monetary tightening26 can have unwelcome sample of economies, an empirical analysis is pursued
distributive effects—for example, via more expensive using historical data from 1950 for 17 advanced
credit for small firms (Alfaro, Faia, and Minoiu 2022; economies, for two periods: 1950–85 and 1986–2019.
Haltom 2012) and because the poor do not hold The split in 1985 is aimed at dividing the sample into
interest-bearing assets.27 Second, a disinflation strategy an earlier period of relatively passive monetary policy in
that relies solely on monetary policy is accompanied advanced economies and a later period of more active
by real interest rates that are too high, and this can monetary policy that anchors inflation expectations
pose a challenge for debt dynamics. Government (see Banerjee and others 2022). The analysis focuses on
policies, in turn, can be more agile and contemplate public spending given that the recent debate relates to
other objectives if the right fiscal tool is employed.28 the large spending surge during COVID-19 (Gopinath
Different fiscal policies can be calibrated and used to 2022), as during the two world wars (Box 2.4).
support the disinflation effort while mitigating the The analysis shows that the effect of public
increase in poverty and income inequality at the same spending on inflation varied over time (Figure 2.9). A
time. Monetary policy does not have the mandate to 1 percent-of-GDP rise in government spending in the
address income inequality, nor can it be targeted in the pre-1985 period leads to an average hike in inflation
way that fiscal policy can. of almost 1 percentage point in the same year, phasing
In effect, the discussion in this chapter is out slowly. For the post-1985 period, the same shock
geared toward policies that can help reduce overall leads to an average increase in inflation of roughly half
inflationary pressures while providing temporary that size and, differently from the first case, it flattens
support (preferably targeted cash transfers) to the most out after three to four years. Monetary policy responses
vulnerable. It does not advocate the use of specific to forces pushing inflation up in both periods varied
fiscal instruments to cap specific prices. As during the markedly. In the earlier part of the sample, central banks
recent episode, some countries have adopted price were more likely to accommodate fiscal expansions,
controls or subsidies, put the squeeze on profits of thus allowing for a higher pass-through from those
state-owned enterprises, or cut taxes to try limit price expansions to inflation. After 1985, central banks more
increases and inflation (see Chapter 1 and the October often tightened monetary policy in response to fiscal
2022 Fiscal Monitor). However, such actions can be expansions to slake their inflationary effects.
costly to the budget, lead to shortages and rationing, Ascertaining a causal impact of public spending
and prove ultimately ineffective and potentially make on inflation (rather than vice versa, or the impact of
inflation more persistent. a third factor on both variables) involves the same
thorny methodological challenges faced by studies that
have sought to estimate the fiscal multiplier for output
26In the analysis, monetary tightening is captured by central
(Ramey 2019; April 2012 Fiscal Monitor, Chapter 1).
banks’ hikes in interest rates. However, in the current inflationary
episode, many central banks—which have used quantitative
Following Ramey and Zubairy (2018), this chapter
easing to support firms and households during the recent years analyzes increases in government purchases that follow
of very low interest rates and the pandemic—may also restrict news about extra military spending in the United States.
their policies through quantitative tightening. For example, some
The methodological advantage is that such news is not
monetary authorities may stop purchasing corporate bonds, which
was guaranteeing a supply of liquidity for some firms. Other caused by the economic cycle, and the only impact on
central banks may even consider selling a portion of the corporate the US economy occurs through additional spending.29
bonds they hold on their balance sheets. While those policies As shown in Figure 2.10, there is a clear positive effect
may have implications for (dis)inflation, they are not considered
explicitly in this chapter’s exercises.
27Yet low interest rates are also shown to inflate stock prices, 29Specifically, a structural vector autoregression model is

benefiting the rich (Auclert 2019), so a monetary tightening may estimated, with public spending identified by quarterly news of
have the opposite effect, depending on country characteristics. additional military spending in the United States from the first
28Public investment projects, for instance, have long lags of quarter of 1939 to the fourth quarter of 2015 (Ramey and Zubairy
execution that are usually higher than those of monetary policy. 2018). See Online Annex 2.4.

International Monetary Fund | April 2023 37

 FISCAL MONITOR: On the Path to Policy Normalization

Figure 2.9. Panel Evidence of the Fiscal Policy Impact on Inflation, 1950–2019
1950–85 1986–2019
1. Output 2. Inflation
1.5 1.5

1.0 1.0

Percentage points
Percent

0.5 0.5

0.0 0.0

–0.5 –0.5
1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12
Years Years
Sources: IMF staff analysis using the IMF Public Finances in Modern History database; and Jordà, Schularick, and Taylor (2017).
Note: The panels plot average impulse responses and the 90 percent confidence bands (shaded blue area and short-dashed lines). See Online Annex 2.4 for further details.

Figure 2.10. Fiscal Policy Impact on Inflation in the United States, 1939−2015
1. Impulse Response for Output 2. Impulse Response for Inflation
1.0 1.0

0.8 0.8
Percentage points

0.6 0.6
Percent

0.4 0.4

0.2 0.2

0.0 0.0

–0.2 –0.2
1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12
Quarter after shock Quarter after shock
Sources: IMF staff estimates using the Ramey and Zubairy (2018) database; and IMF World Economic Outlook database.
Note: The figure covers the period from the first quarter of 1939 to the fourth quarter of 2015. The panels plot the average impulse responses (solid blue line) and the
90 percent confidence bands (blue shaded areas). See Online Annex 2.4.

on inflation. As the blue line in panel 1 indicates, the households’ income and wealth distribution—the
following the news of additional military spending, HANK model (McKay and Reis 2016; Kaplan, Moll,
output increases in subsequent quarters, confirming and Violante 2018; Bayer, Born, and Luetticke 2023).
the presence of a positive fiscal multiplier (see Online Such a model allows for the impact of different types
Annex 2.4). The novel result is the response of annual of public policies—fiscal and monetary—on the
inflation: It rises and reaches the highest level in less households’ income distribution. Specifically, the analysis
than one year after the spending news, with inflation here focuses on how different forms of fiscal restraint
going up by an additional 0.5 percentage point by the government can help monetary policy achieve
than otherwise. price stabilization. At the same time, their distributive
effects across households are analyzed and considered for
policy design.
Fiscal Policy and Disinflation: Lessons from an The model has five crucial ingredients: (1) The
Economic Model with Income Distribution government issues short-term debt that is held mostly
To illustrate and understand some of the main by the higher-income groups; (2) when debt rises above
consequences of varied monetary-fiscal mixes, the 90 percent of GDP, taxes are gradually increased to
analysis turns to a (simple) version of a state-of-art guarantee that debt returns to that value; (3) transfers
class of models that include a richer description of for lower-income people boost overall private

38 International Monetary Fund | April 2023

 CHAPTER 2 Inflation and Disinflation: What Role for Fiscal Policy?

Figure 2.11. Disinflating via Different Policy Tightening Options in the HANK Model
(Deviation from long-term value)
Variation in Interest Rates Impact on Inflation, Consumption by Income Bracket Percentile
(Percentage points) Consumption, and Output (Percent)
1. Monetary Tightening (Percent, unless stated otherwise) 99 (richest) 90–100
3.0 0.0 0.9 65–90 35–65
2.5 0.6 10–35 1–10
2.0 –0.2 0.3 1 (poorest)
1.5 0.0
Inflation –0.3
1.0 –0.4 (percentage points) –0.6
0.5 Consumption –0.9
0.0 –0.6 GDP –1.2
–0.5 –1.5
–1.0 –0.8 –1.8
0 1 2 3 4 5 6 7 8 9 10 11 12 0 1 2 3 4 5 6 7 8 9 10 11 12 0 1 2 3 4 5 6 7 8 9 10 11 12
2. Fiscal Restraint Only
3.0 0.0 0.0 0.9
2.5 0.6
2.0 –0.2 –0.5 0.3
1.5 0.0
Inflation –0.3
1.0 –0.4 (percentage points) –1.0
–0.6
0.5 Consumption –0.9
0.0 –0.6 GDP (right scale) –1.5 –1.2
–0.5 –1.5
–1.0 –0.8 –2.0 –1.8
0 1 2 3 4 5 6 7 8 9 10 11 12 0 1 2 3 4 5 6 7 8 9 10 11 12 0 1 2 3 4 5 6 7 8 9 10 11 12
3. Fiscal Restraint with Targeted Transfers
3.0 0.0 0.0 0.9
2.5 0.6
2.0 –0.2 –0.5 0.3
1.5 0.0
Inflation –0.3
1.0 –0.4 (percentage points) –1.0
–0.6
0.5 Consumption –0.9
0.0 –0.6 GDP (right scale) –1.5 –1.2
–0.5 –1.5
–1.0 –0.8 –2.0 –1.8
0 1 2 3 4 5 6 7 8 9 10 11 12 0 1 2 3 4 5 6 7 8 9 10 11 12 0 1 2 3 4 5 6 7 8 9 10 11 12
Quarter after shock Quarter after shock Quarter after shock

Source: IMF staff calculations based on the model calibration in Auclert and others (2021).
Note: See Online Annex 2.4 for details. HANK = Heterogeneous Agent New Keynesian.

consumption because these groups consume a high to its debt target (90 percent); (2) untargeted fiscal
share of any extra dollar of income they receive; (4) the tightening—that is, a reduction in overall spending
central bank increases real interest rates when inflation across all budget items; and (3) targeted fiscal
goes above target (specifically, the central bank follows tightening composed of an overall cut in spending
a so-called Taylor rule); and (5) taxes on labor income items while increasing transfers to families in the
are progressive, meaning that higher-income families pay lowest 10 percent of the income distribution.
a higher share of their income in taxes, compared with In the first scenario, nominal interest rates are
lower-income families.30 raised by 250 basis points to bring inflation down by
Calibrating the model for the United States about 2 percent in roughly two years (Figure 2.11).
(Auclert and others 2021), the analysis examines three Output and consumption fall throughout this period.
combinations of policies to reduce inflation: (1) an The poorest families cut their consumption the most
increase in the nominal interest rate above what the because they have no assets to draw from.
Taylor rule would suggest, with fiscal policy taking The second scenario simulates a cut in overall public
no further action than required for a gradual return spending amounting to 1 percent of GDP while
monetary policy is also actively following a Taylor
30In this version of model, the production function includes labor rule. This leads again to a contraction in aggregate
and a productivity term but not capital. demand and output, with inflation falling by a total of

International Monetary Fund | April 2023 39

FISCAL MONITOR: On the Path to Policy Normalization

2 percentage points in eight quarters (as a response the Current practices on indexation vary considerably
central bank cuts interest rates, which in the real world across countries. Among budget items, pensions are
should be interpreted as being able to raise them by the most commonly indexed, followed by transfers to
less). The drop in aggregate demand affects everyone, lower-income groups and public sector wages. When
but the impact is proportionately more cushioned for reviewing automatic or discretionary indexation going
higher-income families by the decline in taxation. forward, policymakers need to decide which groups
In the third scenario, a fiscal tightening of the same and programs to protect from income erosion while
overall size (1 percent of GDP) but with a different avoiding policies that make inflation more persistent.
composition is simulated. While the fiscal effort in other Policymakers should carefully assess the impact of
spending items is greater than before (by 1.5 percent of public wage setting during periods of high inflation,
GDP), targeted transfers to the poorest 10 percent of including through indexation, on the setting of
families are in turn increased by 0.5 percent of GDP. private wages. Policymakers also need to consider
The results show that in such a scenario, both GDP and potential effects of inflation on the structure of
inflation go down. But because the poor households the tax system.
receiving transfers consume a high share of their extra The redistributive effects of inflation on households
income, aggregate consumption decreases by less than are more complex than usually thought. Analysis of
in the other simulations. The consumption of those the recent surge in inflation highlights the importance
targeted households goes up with the transfers. To of changes in families’ incomes and net assets for the
summarize, a generalized fiscal contraction helps contain distributive effect, especially in countries with more
inflation, with a smaller drop in private consumption developed financial and credit markets. Policy reforms
than in the monetary policy scenario, but its impact should consider the redistribution that inflation
favors higher-income groups at the expense of the drives from net lenders to net borrowers, usually
lower-income groups. These adverse distributional effects associated with old and young families, respectively.
can be remedied if the fiscal contraction is accompanied During the period considered, the poverty rate rose by
by a targeted transfer program. 1 percentage point or more in three countries of the
sample (France, Mexico, Senegal ).
While monetary policy is in the driver’s seat
Conclusions in the battle against inflation, fiscal policy can
The evidence presented in this chapter highlights help. Well-targeted fiscal restraint can be designed
the pattern that inflationary surprises are historically to support monetary policy in attaining price
associated with an initial rise in fiscal balances in the stability while protecting the vulnerable from
short term and a fall in public debt that often persists the cost-of-living crisis. The chapter documents
into the medium term. However, expected inflation is the empirical association between fiscal policies
not associated with a fall in debt ratios, stressing that and developments in inflation. Estimates suggest
inflating debt away is neither a desirable nor a sustainable that 1 percentage point of GDP in additional
strategy. Unexpected inflation may offer some breathing public spending resulted in higher inflation by
room for debt ratios, but attempts to keep surprising 0.8 percentage point in a sample covering the
bondholders have historically proved futile or harmful. 1950–85 period and by 0.5 percentage point
The impact on debt is more significant for countries with thereafter. Moreover, through an economic model
large amounts of debt, especially when it is denominated capturing income distribution, the chapter shows
in local currency, long term, and unindexed. For that targeted fiscal restraint—involving tough policy
countries with debt exceeding 50 percent of GDP, choices on what budget items to cut and which to
each 1 percentage point surprise increase in inflation is protect or expand—can bring inflation down at lower
estimated to reduce public debt by 0.6 percentage point cost to aggregate consumption and income inequality
of GDP, with the effect lasting for several years. while protecting lower-income families.

40 International Monetary Fund | April 2023

 CHAPTER 2 Inflation and Disinflation: What Role for Fiscal Policy?

Box 2.1. Does Public Wage Policy Make Inflation More Persistent?
This box explores the interplay between public wages, The results suggest that, considering labor market
private wages, and inflation. Public wage setting needs to institutions and conditions, public wages may have
be mindful of developments in prices and private wages to a significant and lasting effect on private wages and
attract and retain qualified civil servants while avoiding core Consumer Price Index (CPI) inflation in the
a wage-price spiral. sample (Figure 2.1.1). For countries with higher union
density and centralization of wage bargaining, the peak
Public wage setting is important to attract and responses of private wages and core CPI inflation to
retain qualified civil servants. At the same time, public spikes in public wages are 0.32 percentage point and
wage hikes can increase aggregate demand or influ- 0.12 percentage point, respectively. They also last for
ence wage setting in the broader economy, depending many quarters after the spike.
on labor market institutions (such as the density of Prevailing macroeconomic conditions can also mat-
unions or the degree of centralization of bargaining) ter for the transmission of government wage shocks.
and the size of the public sector. For instance, workers’ bargaining power is typically
Applying the approach of Abdallah, Coady, and greater when labor markets are tight. Similarly, firms
Jirasavetakul (2023) to an expanded country sample, may have more pricing power when aggregate demand
this box estimates the effects of public wage spikes on is strong. Figure 2.1.1 suggests that the impacts of
private wages over the medium term using data from government wage hikes on private wages and core CPI
30 member countries of the Organisation for Economic are significantly larger and longer-lasting when labor
Co-operation and Development from the first quarter markets are tighter.
of 1990 to the second quarter of 2022. Changes in gov- The findings imply that during periods of high
ernment wages are assumed to be predetermined with inflation and tight labor markets, public wage
respect to the behavior of macroeconomic variables, as policy should balance the need to attract and retain
usually identified in the literature (see Blanchard and high-quality civil servants against the risk of fomenting
Perotti 2002; and Jørgensen and Ravn 2022). inflationary pressures.

Figure 2.1.1. Effects of Public Wage Spikes on Private Wages and Core CPI Inflation
(Percent for the response of private wages; percentage points for core CPI)
Higher unionization and centralization Tighter labor markets
Lower unionization and centralization Less tight labor markets
1. Private Wages 2. Private Wages 3. Consumer Prices 4. Consumer Prices
0.6 0.6 0.3 0.3
0.4 0.4
0.2 0.2 0.2 0.2

0.0 0.0
0.1 0.1
–0.2 –0.2
–0.4 –0.4 0.0 0.0
–0.6 –0.6
–0.8 –0.8 –0.1 –0.1
0 3 6 9 12 15 18 21 0 3 6 9 12 15 18 21 0 3 6 9 12 15 18 21 0 3 6 9 12 15 18 21
Quarter Quarter Quarter Quarter

Source: IMF staff calculations based on Abdallah, Coady, and Jirasavetakul (2023).
Note: Shaded areas and dashed lines represent the 90 percent confidence bands of the impulse responses. CPI = Consumer Price Index.

International Monetary Fund | April 2023 41

FISCAL MONITOR: On the Path to Policy Normalization

Box 2.2. Inflation Effect via the Wealth Channel during Historical Episodes
This box takes a historical perspective on the redistribu- Homeowners gained relative to renters, middle-aged
tive effect of inflation on households’ assets and liabilities. households gained relative to younger and older ones,
married couples gained relative to singles, and Whites
Some patterns of redistribution from inflation gained relative to non-Whites. Inequality of wealth
through the net wealth channel hold true in many declined because lower-wealth groups had higher
historical episodes. Net holders of cash, bank deposits, debt-to-asset ratios.
and local currency (unindexed) bonds suffer real losses, But the inflation protection of homeownership can
while net borrowers (notably for fixed-rate mortgages) be undone, at least in part, by government policies,
gain. Moreover, stockholders lose if inflation is joined as seen in France and Germany, for example, in the
by economic disruption. Homeowners and landowners aftermath of World War I. Inflation once again hit net
have usually been shielded, but public policies, such holders of nominal assets hardest, but homeowners were
as rent control or taxation, sometimes have partially not unscathed. In France, rent control was severe during
undone such protection. both world wars. Combined with inflation, this resulted
Comparing the portfolios of different demographic in rents falling to one-tenth of their value in real terms
groups for a sample of more than 60,000 house- between 1913 and 1950 (Piketty 2003). Likewise, in
holds in the United States, Wolff (1979) analyzed the Germany, real estate lost one-fifth of its value during
impact of the 1969–75 period of inflation through 1913–27 owing to a mix of rent regulation and taxation
the net wealth channel. The biggest gainers were (Albers, Bartels, and Schularick 2022). The only asset
homeowners who had large mortgages. Low-income that gained was land, with a strong rural-urban divide
households also gained if they had a mortgage. in the effect of inflation.

Box 2.3. Price Hikes and the Middle Class in the United States
The box shows that middle-income families in the United Figure 2.3.1. Inflation Differentials between
States experienced sharper rises in the cost of their con- Middle- and High-Income Families
sumption baskets, compared with higher-income families, (Percentage points)
not only during times of rapid inflation but also during Recession
14
the past two decades more generally. Price gap
12
Using US Bureau of Labor Statistics Consumer 10
Expenditure Surveys, estimates show that prices rose 8
faster for goods and services that make up a large share
6
of the consumption baskets of US middle-income house-
holds as of 2021, confirming the findings by Cravino, 4
Lan, and Levchenko (2020) (Online Annex 2.3). 2
New analysis reveals that such a price gap for
0
goods and services consumed by the middle class
constitutes a longer time trend. The relative price –2
1998
99
2000
01
02
03
04
05
06
07
08
09
10
11
12
13
14
15
16
17
18
19
20
21

of the consumption basket for a middle-class family

(40th–60th income percentiles) rose by 11.7 percent
Sources: IMF staff analysis based on Cravino, Lan, and
relative to the consumption basket of a higher-income Levchenko (2020); and US Bureau of Labor Statistics.
family (top fifth percentile) between 1998 and 2021 Note: Price gap is the accumulated inflation gap since 1998
(Figure 2.3.1). Potential factors underlying this differ- between top 5th and 40th–60th income percentiles.
ence include product innovations and price changes in
imported goods (Cravino and Levchenko 2017; Jaravel
2019). These divergent price paths, along with static
US middle incomes (Mishel and Bivens 2021), suggest
a widening in the purchasing power of the two groups.

42 International Monetary Fund | April 2023

 CHAPTER 2 Inflation and Disinflation: What Role for Fiscal Policy?

Box 2.4. Surges in Government Spending: A Historical Perspective

This box shows that large-scale fiscal support during the Figure 2.4.1. Surges in Public Expenditure,
pandemic bears some similarities to war-related surges Revenue, and Debt over a Historical Span
in public spending, which were followed by sustained (Percent of GDP)
inflation. Will history rhyme? Debt (left scale) Revenue (right scale)
Primary expenditure (right scale)
The economic impact and ensuing policy response 1. United States
150 WWI WWII COVID-19 45
of the COVID-19 pandemic have been compared
40
with those of war periods (Dell’Ariccia and others 125
35
2020; Hall and Sargent 2022). Figure 2.4.1 shows 100 30
that the hikes in debt and public primary expenditure 75
25
in 2020 constitute one of the largest annual increases 20
50 15
since the 1800s.
10
During World War I and World War II, several 25
5
tactics were used for marketing government bonds 0 0

1800
10
20
30
40
50
60
70
80
90
1900
10
20
30
40
50
60
70
80
90
2000
10
20
(Eichengreen and others 2021), including forcing
banks to buy bonds and imposing ceilings on
2. United Kingdom
Treasury rates. In more recent episodes, central 300 70
banks purchased sovereign bonds in the secondary WWI WWII COVID-19
250 60
markets to reduce deflationary pressures. Even so,
50
they enlarged balance sheets and raised their ratio 200
40
of sovereign bonds to total assets (Ferguson, Schaab, 150
30
and Schularick 2015; October 2020 Global Financial 100
Stability Report, Chapter 1). Historically, wars have 20
50 10
often been followed by a persistent rise in inflation
(Bonam and Smădu 2021). After World War I, prices 0 0
1830
40
50
60
70
80
90
1900
10
20
30
40
50
60
70
80
90
2000
10
20
kept going up, reaching levels more than 70 percent
higher in the United States and more than 90 percent
Sources: IMF Public Finances in Modern History database;
higher in France, Italy, and the United Kingdom
and IMF staff calculations.
(Figure 2.4.2). Note: WWI = World War I; WWII = World War II.

Figure 2.4.2. Price Level Rises with the World Wars

(Percent)
1. WWI 2. WWII
150 250 75 500
France Italy Germany UK
UK US US France (right scale)
120 200 60 400
Germany (right scale) Italy (right scale)
90 150 45 300
WWI WWII
60 100 30 200

30 50 15 100

0 0 0 0
1914 16 18 20 1939 41 43 45 47
Year Year

Source: IMF staff analysis using the Jordà-Schularick-Taylor Macro-history Database.

Note: The lines are calculated by 100 × (ln Pt – In Pstart-of-war), in which Pt is the Consumer Price Index. WWI = World War I;
WWII = World War II.

International Monetary Fund | April 2023 43

FISCAL MONITOR: On the Path to Policy Normalization

Box 2.4 (continued)

In Austria, Germany, Hungary, and Poland, inflation Figure 2.4.3. Correlation between 2022
surged and turned into hyperinflation in the early Changes in Fiscal Policy and in Core Inflation
1920s and was brought down only by putting an end since 2019
to financing government spending while adjusting the (Percent)
budgets into balance (Sargent 1982). During World 12 HUN
War II, similar price surges were also observed. After
the war, prices remained elevated in most countries, 10 CZE
compared with before the war. Price levels were about

Core inflation differential

8 LTU
50 percent higher in the United Kingdom and in the
United States and more than 200 percent higher in
6
France and Italy. IRL
Some authors have suggested that differences in
4
fiscal policy during the COVID-19 pandemic relate CRI
to differences in inflation (de Soyres, Santacreu,
2
and Young 2022). As shown in Figure 2.4.3, a
NOR ZAF
small cross-section of countries, those where real 0
spending grew more in the past three years, also 0.9 1.0 1.1 1.2 1.3
experienced a larger increase in core inflation Real primary spending differential
(that is, inflation excluding changes in energy and Source: IMF staff calculations using the World Economic
food prices). Outlook database.
As noted in the chapter, surprise inflation and the Note: Blue dots represent advanced economies. Red
diamonds represent emerging market economies. Core
rebound in growth contributed to debt reduction in inflation differential = core inflation in 2022 minus core
2021 and 2022. Moderate inflation has reduced debt inflation in 2019. Real primary spending differential = real
in the past when combined with financial repression— primary spending in 2022 divided by real primary spending
in 2019. Data labels in the figure use International
which, however, brings its own costs (Esteves and Organization for Standardization (ISO) country codes.
Eichengreen 2022; Mauro and Zhou 2021).

44 International Monetary Fund | April 2023

 CHAPTER 2 Inflation and Disinflation: What Role for Fiscal Policy?

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ECONOMY ABBREVIATIONS

Code Name Code Name

AFG Afghanistan DNK Denmark
AGO Angola DOM Dominican Republic
ALB Albania DZA Algeria
AND Andorra ECU Ecuador
ARE United Arab Emirates EGY Egypt
ARG Argentina ERI Eritrea
ARM Armenia ESP Spain
ATG Antigua and Barbuda EST Estonia
AUS Australia ETH Ethiopia
AUT Austria FIN Finland
AZE Azerbaijan FJI Fiji
BDI Burundi FRA France
BEL Belgium FSM Micronesia, Federated States of
BEN Benin GAB Gabon
BFA Burkina Faso GBR United Kingdom
BGD Bangladesh GEO Georgia
BGR Bulgaria GHA Ghana
BHR Bahrain GIN Guinea
BHS Bahamas, The GMB Gambia, The
BIH Bosnia and Herzegovina GNB Guinea-Bissau
BLR Belarus GNQ Equatorial Guinea
BLZ Belize GRC Greece
BOL Bolivia GRD Grenada
BRA Brazil GTM Guatemala
BRB Barbados GUY Guyana
BRN Brunei Darussalam HKG Hong Kong Special Administrative Region
BTN Bhutan HND Honduras
BWA Botswana HRV Croatia
CAF Central African Republic HTI Haiti
CAN Canada HUN Hungary
CHE Switzerland IDN Indonesia
CHL Chile IND India
CHN China IRL Ireland
CIV Côte d’Ivoire IRN Iran
CMR Cameroon IRQ Iraq
COD Congo, Democratic Republic of the ISL Iceland
COG Congo, Republic of ISR Israel
COL Colombia ITA Italy
COM Comoros JAM Jamaica
CPV Cabo Verde JOR Jordan
CRI Costa Rica JPN Japan
CYP Cyprus KAZ Kazakhstan
CZE Czech Republic KEN Kenya
DEU Germany KGZ Kyrgyz Republic
DJI Djibouti KHM Cambodia
DMA Dominica KIR Kiribati

International Monetary Fund | April 2023 49

FISCAL MONITOR: ON THE PATH TO POLICY NORMALIZATION

Code Name Code Name

KNA St. Kitts and Nevis ROU Romania
KOR Korea RUS Russian Federation
KWT Kuwait RWA Rwanda
LAO Lao P.D.R. SAU Saudi Arabia
LBN Lebanon SDN Sudan
LBR Liberia SEN Senegal
LBY Libya SGP Singapore
LCA St. Lucia SLB Solomon Islands
LKA Sri Lanka SLE Sierra Leone
LSO Lesotho SLV El Salvador
LTU Lithuania SMR San Marino
LUX Luxembourg SOM Somalia
LVA Latvia SRB Serbia
MAR Morocco SSD South Sudan
MDA Moldova STP São Tomé and Príncipe
MDG Madagascar SUR Suriname
MDV Maldives SVK Slovak Republic
MEX Mexico SVN Slovenia
MHL Marshall Islands SWE Sweden
MKD North Macedonia SWZ Eswatini
MLI Mali SYC Seychelles
MLT Malta SYR Syria
MMR Myanmar TCD Chad
MNE Montenegro TGO Togo
MNG Mongolia THA Thailand
MOZ Mozambique TJK Tajikistan
MRT Mauritania TKM Turkmenistan
MUS Mauritius TLS Timor-Leste
MWI Malawi TON Tonga
MYS Malaysia TTO Trinidad and Tobago
NAM Namibia TUN Tunisia
NER Niger TUR Türkiye
NGA Nigeria TUV Tuvalu
NIC Nicaragua TWN Taiwan Province of China
NLD Netherlands, The TZA Tanzania
NOR Norway UGA Uganda
NPL Nepal UKR Ukraine
NRU Nauru URY Uruguay
NZL New Zealand USA United States
OMN Oman UZB Uzbekistan
PAK Pakistan VCT St. Vincent and the Grenadines
PAN Panama VEN Venezuela
PER Peru VNM Vietnam
PHL Philippines VUT Vanuatu
PLW Palau WSM Samoa
PNG Papua New Guinea YEM Yemen
POL Poland ZAF South Africa
PRT Portugal ZMB Zambia
PRY Paraguay ZWE Zimbabwe
QAT Qatar

50 International Monetary Fund | April 2023

GLOSSARY

Automatic stabilizers Revenue and some Disinflating Bringing inflation down or restoring
expenditure items built in the budget that adjust price stability.
automatically to cyclical changes in the economy—
Excess savings The amount by which actual
for example, as output falls, revenue collections
savings exceed the projected savings for a given period.
decline and unemployment benefits increase, which
“automatically” provides demand support. Expenditure ceiling An instrument for enforcing
aggregate expenditure discipline.
Balance sheet Statement of the values of the stock
positions of assets owned and liabilities owed by a unit, Fiscal buffer Fiscal space created by saving budgetary
or group of units, drawn up in respect of a particular resources and reducing public debt in good times.
point in time. Fiscal consolidation Fiscal policy that reduces
Burden or incidence Refers to whose economic government deficits and government debt.
welfare is reduced by a policy and by how much. It is
Fiscal council A permanent agency with a statutory
quite different from the formal or legal incidence— or executive mandate to assess publicly and independently
fuel suppliers, for example, may be responsible for fiscal policy, fiscal plans, and fiscal performance against
remitting tax payments to the national tax authority, official objectives, such as long-term sustainability of
but they may bear little economic incidence if they can public finances and macroeconomic stability.
charge higher prices.
Fiscal dominance Situation in which governments
Carbon tax or carbon pricing A tax imposed on do not adjust the primary balance to stabilize public
CO2 releases emitted largely through the combustion debts, and monetary policy becomes ineffective.
of carbon-based fossil fuels. Administratively, the
easiest way to implement the tax is through taxing the Fiscal framework The set of rules, procedures,
supply of fossil fuels—coal, oil, and natural gas—in and institutions that guide fiscal policy.
proportion to their carbon content. Fiscal impulse The term is synonymous to fiscal
Contingent liabilities Obligations that are not stimulus and is measured as the change in the cyclically
explicitly recorded on government balance sheets and adjusted primary balance.
that arise only in the event of a particular discrete Fiscal multiplier Measures the short-term impact
situation, such as a crisis. of discretionary fiscal policy on output. Usually
Cost of living The level of prices relating to the defined as the ratio of a change in output to an
consumption of everyday goods and services. exogenous change in the fiscal deficit with respect to
their respective baselines.
Coverage of public benefits Share of individuals
or households of a particular socioeconomic group Fiscal rules Lasting constraints on fiscal policy
who receive a public benefit. through predetermined numerical limits on aggregate
fiscal indicators (such as the budget balance,
Cyclically adjusted primary balance (CAPB) government expenditure, debt).
Cyclically adjusted balance excluding net interest
payments (interest expenditure minus interest revenue). Fiscal space The room for undertaking
discretionary fiscal policy (increasing spending or
Debt Service Suspension Initiative (DSSI) An reducing taxes) relative to existing plans without
initiative in which bilateral official creditors provide endangering market access and debt sustainability.
during a limited period a suspension of debt service
payments for the poorest countries (73 low-income Fiscal stance An assessment of the fiscal stance
and lower-middle-income countries) that request the refers to a sense of the impact of fiscal policy on
suspension. domestic demand and financial resources.

International Monetary Fund | April 2023 51

FISCAL MONITOR: On the Path to Policy Normalization

Fixed cash transfer programs Cash transfer Hyperinflation It is an excessive, and out-of-control
programs that include fixed payments to recipients in a general price increase process, typically used when
regular frequency. inflation surpasses 50 percent of inflation in the year.
General government All government units and all In-kind benefits/transfers Government social
nonmarket, nonprofit institutions that are controlled assistance provided in terms of specific goods (for
and mainly financed by government units comprising example, food) or services (for example, health care)
the central, state, and local governments; includes instead of cash.
social security funds and does not include public
Inflation A general increase in the price level of
corporations or quasi corporations.
goods and services in the economy leading to a fall in
Government financing needs (also gross financing the purchasing value of money.
needs) Overall new borrowing requirement plus debt
Net debt Gross debt minus financial assets
maturing during the year.
corresponding to debt instruments. These financial
Government guarantees Governments can assets are monetary gold and special drawing rights;
undertake payment of a debt or liabilities in the currency and deposits; debt securities; loans, insurance,
event of a default by the primary creditor. The most pensions, and standardized guarantee programs; and
common type is a government-guaranteed loan, which other accounts receivable. In some countries, the
requires government to repay any amount outstanding reported net debt can deviate from this definition
on a loan in the event of default. In some contracts, based on available information and national fiscal
governments provide a revenue or demand guarantee. accounting practices.
The budget costs related to guarantees are usually not
Net (financial) worth Net worth is a measure of
recognized in the budget without any upfront cost, but
fiscal solvency. It is calculated as assets minus liabilities.
they create a contingent liability, with the government
Net financial worth is calculated as financial assets
exposed to future calls on guarantees and fiscal risks.
minus liabilities.
Green transition A general concept of moving from
Nonfinancial public sector General government
a carbon-based economy to a more sustainable economy.
plus nonfinancial public corporations.
Gross debt All liabilities that require future
Overall fiscal balance (also headline fiscal
payment of interest and/or principal by the debtor to
balance) Net lending and borrowing, defined as the
the creditor. This includes debt liabilities in the form
difference between revenue and total expenditure, using
of special drawing rights, currency, and deposits; debt
the IMF’s 2001 Government Finance Statistics Manual
securities; loans; insurance, pension, and standardized
(GFSM 2001). Does not include policy lending. For
guarantee programs; and other accounts payable.
some countries, the overall balance is still based on
(See the IMF’s 2001 Government Finance Statistics
the GFSM 1986, which defines it as total revenue and
Manual and Public Sector Debt Statistics Manual.)
grants minus total expenditure and net lending.
The term “public debt” is used in the Fiscal Monitor,
for simplicity, as synonymous with gross debt of Potential output Estimate of the level of GDP
the general government, unless specified otherwise. that can be reached if the economy’s resources are fully
(Strictly speaking, public debt refers to the debt of the employed.
public sector as a whole, which includes financial and Price stickiness Prices tend to stay the same or
nonfinancial public enterprises and the central bank.) change gradually and less frequently when demand or
Gross financing needs See Government costs change.
financing needs Price subsidies Price subsidies are measure that
Headline fiscal balance See Overall fiscal balance keep prices for end users below market levels, or
for suppliers above market levels. Subsidies can take
Heterogeneous Agents New Keynesian approach
various forms including direct transfers, but also
Economic models with incomplete markets and
indirect support such as tax exemptions, price controls,
income inequality coupled with wages or prices (New
or rebates.
Keynesian) rigidities.

52 International Monetary Fund | April 2023

 Glossary

Primary balance Overall balance excluding net Structural primary balance Extension of the
interest payments (interest expenditure minus interest cyclically adjusted primary balance that also corrects
revenue). for other nonrecurrent effects that go beyond the cycle,
such as one-off operations and other factors whose
Public debt See Gross debt
cyclical fluctuations do not coincide with the output
Public works programs A subset of social cycle (for instance, asset and commodity prices and
protection programs that provide income transfers to output composition effects).
the poor through employment, generally in public
Sustainable Development Goals A collection of
labor-intensive infrastructure development initiatives
17 goals set by the United Nations General Assembly
such as rural roads, irrigation, and tree plantation
in 2015 covering global warming, poverty, health,
and are often designed to smooth income particularly
education, gender equality, water, sanitation, energy,
during “slack” or “hungry” periods of the year.
urbanization, environment, and social justice. Each
Quantitative easing Form of monetary policy in goal has a set of targets to achieve, and in total, there
which a central bank purchases securities—public or are 169 targets.
private—to reduce long-term interest rates.
Tanzi effect It is an economic situation involving
Quantitative tightening Also known as balance a period of high inflation in a country which results
sheet normalization, these are monetary policies aimed in a decline in the volume of tax collection and a
at reducing a central bank’s balance sheet. deterioration of real tax proceeds being collected by the
government of that country owing to the time elapsed
Ricardian equivalence It is an economic theory
between the moment the taxable event occurs, and the
that says that if government spending is financed by
collection of the tax becomes effective.
current deficits, future taxes will have to increase to
compensate the current debt-increasing operation. Taylor rule It is a guideline for central banks
on how to manipulate interest rates so as to stabilize
Social safety nets Noncontributory transfer
inflation and the economy.
programs financed by general government revenue.
Terms of trade The relative price of exports in
Stock-flow adjustments Change in the gross
terms of imports, defined as the ratio of export to
debt explained by factors other than the overall fiscal
import prices.
balance (for example, valuation changes).

International Monetary Fund | April 2023 53

METHODOLOGICAL AND STATISTICAL APPENDIX

This appendix comprises four sections. “Data and GDP in current US dollars. Data for the full list of
Conventions” describes the data and conventions economies can be found at [Link]
used to calculate economy group composites. “Fiscal external/datamapper/datasets/FM. The seven largest
Policy Assumptions” summarizes the country-specific advanced economies as measured by GDP (Canada,
assumptions underlying the estimates and projections France, Germany, Italy, Japan, the United Kingdom,
for 2023–28. “Definition and Coverage of Fiscal Data” and the United States) constitute the subgroup of
summarizes the classification of countries in the various major advanced economies, often referred to as the
groups presented in the Fiscal Monitor and details the Group of Seven (G7). The members of the euro area
coverage and accounting practices underlying each are also distinguished as a subgroup. Composite data
country’s Fiscal Monitor data. Statistical tables on key shown in the tables for the euro area cover the current
fiscal variables complete the appendix. Data in these members for all years, even though membership has
tables have been compiled on the basis of information increased over time. Data for most European Union
available through April 3, 2023. (EU) member countries have been revised following
their adoption of the updated European System
of National and Regional Accounts (ESA 2010).
Data and Conventions Low-income developing countries are countries that
Country-specific data and projections for key fiscal have per capita income levels below a certain threshold
variables are based on the April 2023 World Economic (set at $2,700, as of 2016, as measured by the World
Outlook database, unless indicated otherwise, and Bank Atlas method), structural features consistent with
compiled by IMF staff. Historical data and projections limited development and structural transformation,
are based on the information IMF country desk and external financial relationships insufficiently open
officers gather in the context of their missions and for the countries to be considered emerging market
through their ongoing analysis of the evolving situation economies. Emerging market and middle-income
in each country; data are updated continually as more economies include those not classified as advanced
information becomes available. Structural breaks in economies or low-income developing countries.
data may be adjusted to produce smooth series through See Table A, Economy Groupings, for more details.
splicing and other techniques. IMF staff estimates serve Most fiscal data for advanced economies refer to
as proxies when complete information is unavailable. the general government, whereas data for emerging
As a result, Fiscal Monitor data may differ from official market and developing economies often refer to only
data in other sources, including the IMF’s International the central government or the budgetary central
Financial Statistics and the Government Finance government (for specific details, see Tables B–D). All
Statistics Manual (GFSM 2014). fiscal data refer to calendar years, except in the cases of
Sources for fiscal data and projections not covered The Bahamas, Bangladesh, Barbados, Bhutan, Botswana,
by the World Economic Outlook database are listed in Dominica, Egypt, Eswatini, Ethiopia, Fiji, Haiti,
the respective tables and figures. Hong Kong Special Administrative Region, India, the
Country classification in the Fiscal Monitor divides Islamic Republic of Iran, Jamaica, Lesotho, Malawi,
the world into three major groups: 41 advanced the Marshall Islands, Mauritius, Micronesia, Myanmar,
economies, 95 emerging market and middle-income Namibia, Nauru, Nepal, Pakistan, Palau, Puerto Rico,
economies, and 59 low-income developing countries. Rwanda, Samoa, Singapore, St. Lucia, Thailand, Tonga,
Fiscal Monitor tables display 37 advanced economies, and Trinidad and Tobago, for which they refer to the
39 emerging market and middle-income economies, fiscal year. For economies whose fiscal years end before
and 40 low-income developing countries. The June 30, data are recorded in the previous calendar
countries in the tables generally represent the largest year. For economies whose fiscal years end on or after
countries within each group based on the size of their June 30, data are recorded in the current calendar year.

International Monetary Fund | April 2023 55

FISCAL MONITOR­: On the Path to Policy Normalization

Composite data for country groups are weighted Brazil: General government data refer to the
averages of individual-country data, unless specified nonfinancial public sector—which includes the
otherwise. Data are weighted by annual nominal GDP federal, state, and local governments, as well
converted to US dollars at average market exchange as public enterprises (excluding Petrobras and
rates as a share of the group GDP. Eletrobras)—and are consolidated with data for the
For the purpose of data reporting in the Fiscal sovereign wealth fund. Revenue and expenditures
Monitor, the Group of Twenty (G20) member of federal public enterprises are added in full to
aggregate refers to the 19 country members and does the respective aggregates. Transfers and withdrawals
not include the EU. from the sovereign wealth fund do not affect the
In most advanced economies, and in some large primary balance. Disaggregated data on gross
emerging market and middle-income economies, fiscal interest payments and interest receipts are available
data follow the GFSM 2014 or are produced using a only from 2003 onward. Before 2003, total revenue
national accounts methodology that follows the 2008 of the general government excludes interest receipts;
System of National Accounts (SNA) or ESA 2010, total expenditure of the general government
both broadly aligned with the GFSM 2014. Most other includes net interest payments. Gross public debt
countries follow the GFSM 2001, but some countries, includes the Treasury bills on the central bank’s
including a significant proportion of low-income balance sheet, including those not used under
developing countries, have fiscal data based on the 1986 repurchase agreements. Net public debt consolidates
GFSM. The overall fiscal balance refers to net lending nonfinancial public sector and central bank debt.
and borrowing by the general government. In some The authorities’ definition of general government
cases, however, the overall balance refers to total revenue gross debt excludes government securities held
and grants minus total expenditure and net lending. by the central bank; except the stock of Treasury
The fiscal gross and net debt data reported in the securities the central bank uses for monetary
Fiscal Monitor are drawn from official data sources and policy (those pledged as security reverse repurchase
IMF staff estimates. Whereas attempts are made to agreement operations). According to the authorities’
align gross and net debt data with the definitions in the definition, gross debt amounted to 73.4 percent of
GFSM, data limitations or specific country circumstances GDP at the end of 2022.
can cause these data to deviate from the formal Canada: For cross-economy comparability, gross
definitions. Although every effort is made to ensure the and net debt levels reported by national statistical
debt data are relevant and internationally comparable, agencies for economies that have adopted the
differences in both sectoral and instrument coverage 2008 SNA (Australia, Canada, Hong Kong Special
mean that the data are not universally comparable. As Administrative Region, and the United States) are
more information becomes available, changes in either adjusted to exclude unfunded pension liabilities of
data sources or instrument coverage can give rise to data government employees, defined-benefit pension
revisions that are sometimes substantial. plans. Canada’s net debt corresponds to net financial
As used in the Fiscal Monitor, the term “country” liabilities as reported by Statistics Canada and
does not always refer to a territorial entity that is a includes equity and investment fund shares, which
state as understood by international law and practice. Canada has built up substantially. Statistics Canada
As used here, “country” also covers some territorial has made a recent methodological change to value
entities that are not states but whose statistical data are assets at market value instead of book value, which
maintained separately and independently. has decreased net debt.
Chile: Cyclically adjusted balances refer to the
Australia: For cross-economy comparability, gross structural balance, which includes adjustments for
and net debt levels reported by national statistical output and commodity price developments.
agencies for economies that have adopted the China: Deficit and public debt numbers cover a
2008 SNA (Australia, Canada, Hong Kong Special narrower perimeter of the general government than
Administrative Region, and the United States) are IMF staff’s estimates in China Article IV reports (see
adjusted to exclude the unfunded pension liabilities of IMF 2023 for a reconciliation of the two estimates).
government employees defined-benefit pension plans. Public debt data include central government debt as
Bangladesh: Data are on a fiscal year basis. reported by the Ministry of Finance, explicit local

56 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

government debt, and shares of contingent liabilities Iran, Islamic Republic of: Data are on a fiscal year basis.
the government may incur, based on estimates Ireland: For 2015, if the conversion of the
from the National Audit Office estimate. IMF staff government’s remaining preference shares to
estimates exclude central government debt issued for ordinary shares in one bank is excluded, then the
China Railway. Relative to the authorities’ definition, fiscal balance is −1.1 percent of GDP. Cyclically
consolidated general government net borrowing adjusted balances reported in Appendix Tables
excludes transfers to and from stabilization funds A3 and A4 exclude financial sector support
but includes state-administered funds, state-owned measures. Ireland’s 2015 national accounts were
enterprise funds, and social security contributions and revised as a result of restructuring and relocation
expenses, as well as some off-budget spending by local of multinational companies, which resulted
governments. Deficit numbers do not include some in a level shift of nominal and real GDP. For
expenditure items, mostly infrastructure investment more information, see “National Income and
financed off budget through land sales and local Expenditure Annual Results: 2015,” http://
government financing vehicles. Fiscal balances are not [Link]/en/releasesandpublications/er/nie/
consistent with reported debt, because no time series nationalincomeandexpenditureannualresults2015/.
of data in line with the National Audit Office debt Japan: Gross debt is on an unconsolidated basis.
definition is published officially. Mexico: General government refers to the central
Colombia: Gross public debt refers to the combined government, social security funds, public enterprises,
public sector, including Ecopetrol and excluding development banks, the national insurance
Banco de la República’s outstanding external debt. corporation, and the National Infrastructure Fund,
Dominican Republic: The fiscal series have the but excludes subnational governments.
following coverage: the public debt, debt service, Myanmar: Data are on a fiscal year basis.
and cyclically adjusted or structural balances are Nepal: Data are on a fiscal year basis.
for the consolidated public sector (which includes Norway: Cyclically adjusted balances correspond to
the central government, the rest of the nonfinancial the cyclically adjusted non-oil overall or primary
public sector, and the central bank). The remaining balance. These variables are a percentage of non-oil
fiscal series are for the central government. potential GDP.
Egypt: Data are on a fiscal year basis. Pakistan: Data are on a fiscal year basis.
Ethiopia: Data are on a fiscal year basis. Gross debt Peru: Cyclically adjusted balances include adjustments
refers to the nonfinancial public sector, excluding for commodity price developments.
Ethiopian Airlines. Singapore: Data are on a fiscal year basis.
Fiji: Data are on a fiscal year basis. Spain: Overall and primary balances include financial
Greece: General government gross debt follows the sector support measures estimated to be 0.3 percent
GFSM 2014 definition and includes the stock of of GDP for 2013, 0.1 percent of GDP for 2014,
deferred interest. 0.1 percent of GDP for 2015, and 0.2 percent of
Haiti: Data are on a fiscal year basis. GDP for 2016.
Hong Kong Special Administrative Region: Data are Sweden: Cyclically adjusted balances account for
on a fiscal year basis. Cyclically adjusted balances output and employment gaps.
include adjustments for land revenue and investment Switzerland: Data submissions at the cantonal and
income. For cross-economy comparability, gross commune levels may be subject to sizable revisions.
and net debt levels reported by national statistical Cyclically adjusted balances include adjustments for
agencies for economies that have adopted the extraordinary operations related to the banking sector.
2008 SNA (Australia, Canada, Hong Kong Special Thailand: Data are on a fiscal year basis.
Administrative Region, and the United States) are Türkiye: Projections in the Fiscal Monitor are based
adjusted to exclude the unfunded pension liabilities of on the IMF-defined fiscal balance, which excludes
government employees defined-benefit pension plans. some revenue and expenditure items included in the
Iceland: Gross debt excludes insurance technical authorities’ headline balance.
reserves (including pension liabilities) and other Turkmenistan: IMF staff estimates, and projections of
accounts payable. the fiscal balance exclude receipts from domestic
India: Data are on a fiscal year basis. bond issuances as well as privatization operations,

International Monetary Fund | April 2023 57

FISCAL MONITOR­: On the Path to Policy Normalization

in line with GFSM 2014. The authorities’ official Venezuela: Fiscal accounts include the budgetary
estimates, which are compiled using domestic central government, social security funds, FOGADE
statistical methodologies, include bond issuance and (insurance deposit institution), and a sample of
privatization proceeds as part of government revenues. public enterprises, including Petróleos de Venezuela,
United States: For cross-economy comparability, S.A. (PDVSA). Data for 2018–21 are IMF staff
expenditures and fiscal balances are adjusted to estimates.
exclude the imputed interest on unfunded pension
liabilities and the imputed compensation of
employees, which are counted as expenditures under Fiscal Policy Assumptions
the 2008 SNA adopted by the United States. Data for Historical data and projections of key fiscal
the United States may thus differ from data published aggregates are in line with those of the April 2023
by the US Bureau of Economic Analysis. In addition, World Economic Outlook, unless noted otherwise. For
gross and net debt levels reported by the Bureau of underlying assumptions other than on fiscal policy, see
Economic Analysis and national statistical agencies the April 2023 World Economic Outlook.
for other economies that have adopted the 2008 Short-term fiscal policy assumptions are based
SNA (Australia, Canada, and Hong Kong Special on officially announced budgets, adjusted for
Administrative Region) are adjusted to exclude the differences between the national authorities and
unfunded pension liabilities of government employees IMF staff regarding macroeconomic assumptions
defined-benefit pension plans. and projected fiscal outturns. Medium-term fiscal
Uruguay: Starting in October 2018, Uruguay’s public projections incorporate policy measures judged likely
pension system has been receiving transfers in the to be implemented. When IMF staff has insufficient
context of a new law that compensates persons information to assess the authorities’ budget
affected by the creation of the mixed pension system. intentions and prospects for policy implementation,
These funds are recorded as revenues, consistent an unchanged structural primary balance is assumed,
with the IMF’s methodology. Therefore, data and unless indicated otherwise.
projections for 2018–22 are affected by these
transfers, which amounted to 1.2 percent of GDP in Afghanistan: All data and projections for 2021–28
2018, 1.1 percent of GDP in 2019, 0.6 percent of are omitted because of an unusually high degree
GDP in 2020, and 0.3 percent of GDP in 2021 and of uncertainty and given that the IMF has paused
are projected to be 0.1 percent of GDP in 2022 and its engagement with the country due to a lack
0 percent thereafter. See IMF Country Report 19/64 of clarity within the international community
for further details. The disclaimer about the public regarding the recognition of a government in
pension system applies only to the revenues and net Afghanistan.
lending/borrowing series. The coverage of the fiscal Algeria: Starting with the October 2022 Regional
data for Uruguay was changed from consolidated Economic Outlook, total government expenditure and
public sector to nonfinancial public sector with the net lending/borrowing include policy lending by the
October 2019 World Economic Outlook. In Uruguay, government which mostly reflects support to the
nonfinancial public sector coverage includes central pension system and other public sector entities.
government, local government, social security funds, Argentina: Fiscal projections are based on the available
nonfinancial public corporations, and Banco de information regarding budget outturn, budget
Seguros del Estado. Historical data were also revised plans, and IMF-supported program targets for the
accordingly. Under this narrower fiscal perimeter— federal government; on fiscal measures announced
which excludes the central bank—assets and liabilities by the authorities; and on IMF staff macroeconomic
held by the nonfinancial public sector where the projections.
counterpart is the central bank are not netted out Australia: Fiscal projections are based on data from
in debt figures. In this context, capitalization bonds the Australian Bureau of Statistics, the fiscal year
issued in the past by the government to the central (FY)2022/23 budget published by the Commonwealth
bank are now part of the nonfinancial public sector government in October 2022, the FY2022/23 budget
debt. Gross and net debt estimates for 2008–11 is published by the respective state/territory governments,
preliminary. and the IMF staff’s estimates and projections.

58 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

Austria: Fiscal projections are based on the 2023 budget the medium-term fiscal plan as embodied in the
and the Austria Medium Term Strategy Programme. authorities’ latest budget. Structural balances are
The NextGenerationEU (NGEU) fund and the latest net of temporary fluctuations in some revenues
announcement on fiscal measures have also been (for example, North Sea revenue, pension yield tax
incorporated. revenue) and one-offs (COVID-19–related one-offs
Belgium: Projections are based on the Belgian Stability are, however, included).
Program 2022–25, the 2023 Budgetary Plan, and other Ecuador: The authorities are undertaking revisions of
available information on the authorities’ fiscal plans, the historical fiscal data with technical support from
with adjustments for the IMF staff’s assumptions. the IMF.
Brazil: Fiscal projections for 2023 reflect the current Egypt: Fiscal projections are mainly based on
policy in place. budget sector operations. Projections are based
Cambodia: Historical fiscal and monetary data are from on the budget for FY2022/23 and the Fund’s
the Cambodia authorities. Projections are based on macroeconomic outlook.
IMF staff’s assumptions given discussions with the Estonia: The forecast incorporates the authorities’ Draft
authorities. Budgetary Plans for 2023 (as of October 2022),
Canada: Projections use the baseline forecasts from adjusted for publicly available information (for
the Government of Canada’s Fall Economic example, measures to mitigate the impacts of high
Statement 2022 and the latest provincial budgets. The inflation and the cost-of-living crisis) for IMF staff’s
IMF staff makes some adjustments to these forecasts, macroeconomic scenario.
including those for differences in macroeconomic Finland: Fiscal projections are based on the authorities’
projections. The IMF staff’s forecast also incorporates projections which reflect their latest medium-term
the most recent data releases from Statistics Canada’s fiscal plan, adjusting where appropriate for the IMF
National Economic Accounts, including quarterly staff’s macroeconomic and other assumptions.
federal, provincial, and territorial budgetary outturns. France: Projections for 2022 and projections for 2023
Chile: Projections are based on the authorities’ budget onward are based on the 2018–23 budget laws,
projections, adjusted to reflect the IMF staff’s the 2023 amended social security finance bill,
projections for GDP, copper prices, depreciation, Stability Program 2022–27, draft medium-term
and inflation. programming bill, and other available information
China: Staff fiscal projections incorporate the 2023 on the authorities’ fiscal plans, adjusted for
budget as well as estimates of off-budget financing. differences in revenue projections and assumptions
Colombia: Projections are based on the authorities’ on macroeconomic and financial variables.
policies and projections reflected in the 2022 Germany: The IMF staff’s projections for 2023 and
Financing Plan and the 2022 Medium-Term beyond are based on the 2023 budgets and data
Fiscal Framework, adjusted to reflect IMF staff updates from the national statistical agency (Destatis)
macroeconomic assumptions. and the ministry of finance, adjusted for differences
Cyprus: Projections are based on IMF staff’s assessment in the IMF staff’s macroeconomic framework and
of authorities’ budget plans and IMF staff’s assumptions concerning revenue elasticities.
macroeconomic assumptions. Greece: Data since 2010 reflect adjustments in line
Czech Republic: The fiscal projections are based on the with the primary balance definition under the
authorities’ latest-available convergence program, enhanced surveillance framework for Greece.
budget and medium-term fiscal framework, as well Hong Kong Special Administrative Region: Projections
as IMF staff’s macroeconomic framework. Structural are based on the authorities’ medium-term fiscal
balances are net of temporary fluctuations in some projections for expenditures.
revenues and one-offs. COVID-19–related one-offs Hungary: Fiscal projections include the IMF staff’s
are however included. projections of the macroeconomic framework and
Denmark: Estimates for the current year are fiscal policy plans announced in the 2023 budget.
aligned with the latest official budget numbers, India: Projections are based on available information
adjusted where appropriate for the IMF staff’s on the authorities’ fiscal plans, with adjustments for
macroeconomic assumptions. Beyond the current the IMF staff’s assumptions. Subnational data are
year, the projections incorporate key features of incorporated with a lag of up to one year; general

International Monetary Fund | April 2023 59

FISCAL MONITOR­: On the Path to Policy Normalization

government data are thus finalized well after central some statistical discrepancies between above-the-line
government data. IMF and Indian presentations and below-the-line numbers. Fiscal projections for
differ, particularly regarding disinvestment and 2022 and 2023 are informed by the estimates in
license-auction proceeds, net versus gross recording Criterios 2023; projections for 2024 onward assume
of revenues in certain minor categories, and some continued compliance with rules established in the
public sector lending. Starting with FY2020/21 Federal Budget and Fiscal Responsibility Law.
data, expenditure also includes the off-budget Moldova: Fiscal projections are based on various bases
component of food subsidies, consistent with the and growth rates for GDP, consumption, imports,
revised treatment of food subsidies in the budget. wages, and energy prices and on demographic
The IMF staff adjusts expenditure to take out changes.
payments for previous years’ food subsidies, which Myanmar: Fiscal projections are made based on budget
are included as expenditure in budget estimates for numbers and changed macro environment.
FY2020/21. The Netherlands: Fiscal projections for 2023–28 are
Indonesia: The IMF staff’s projections are based based on the IMF staff’s forecast framework and
on maintaining a neutral fiscal stance going are also informed by the authorities’ draft budget
forward, accompanied by moderate tax policy plan and Bureau for Economic Policy Analysis
and administration reforms, some expenditure projections.
realization, and a gradual increase in capital New Zealand: Fiscal projections are based on the
spending over the medium term in line with FY2022/23 budget (May 2022) and the IMF staff’s
fiscal space. estimates.
Ireland: Fiscal projections are based on the country’s Nigeria: Fiscal projections assume unchanged policies
Budget 2023. and differ from the authorities’ active policy
Italy: The IMF staff’s estimates and projections scenario.
are informed by the fiscal plans included in the Norway: The fiscal projections are based on the 2023
government’s 2023 budget and amendments. The budget and subsequent ad-hoc updates.
stock of maturing postal bonds is included in the Philippines: Revenue projections reflect the IMF staff’s
debt projections. macroeconomic assumptions and incorporate the
Japan: The projections reflect fiscal measures updated data. Expenditure projections are based on
the government has already announced, with budgeted figures, institutional arrangements, and
adjustments for the IMF staff’s assumptions. current data in each year.
Kazakhstan: Fiscal projections are based on the budget Poland: Data is on ESA-95 2004 and prior. Data
law and IMF staff projections. is on ESA-2010 beginning 2005 (accrual) basis.
Korea: The forecast incorporates the overall fiscal Projections begin in 2022, based on the 2022 and
balance in the 2022 annual budget and two 2023 budgets and subsequently announced fiscal
supplementary budgets, the proposed 2023 budget measures.
and medium-term fiscal plan, and IMF staff’s Portugal: The projections for the current year are
adjustments. based on the authorities’ approved budget, adjusted
Lebanon: For Lebanon, data and projections for to reflect the IMF staff’s macroeconomic forecast.
2021–28 is omitted owing to an unusually high Projections thereafter are based on the assumption
degree of uncertainty. of unchanged policies. Projections for 2023 reflect
Libya: IMF staff judgement based on 2021 fiscal information available in the 2023 budget proposal.
accounts. Romania: Fiscal projections reflect legislated
Malaysia: Fiscal projections are based on budget changes up to the end of 2022. Medium-term
numbers, discussion with the authorities, and IMF projections include a gradual implementation of
staff estimates. recovery measures from the temporary recovery
Malta: Projections are based on the authorities’ instrument NGEU.
latest budget document, adjusted for IMF staff’s Russian Federation: The fiscal rule was suspended last
macroeconomic and other assumptions. year by the government in response to the sanctions
Mexico: The 2020 public sector borrowing imposed after the invasion of Ukraine, allowing for
requirements estimated by the IMF staff adjusts for windfall oil and gas revenues above benchmark to

60 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

be used to finance a larger deficit in 2022. Savings The impact of cyclical developments on the fiscal
accumulated in the National Welfare Fund can also accounts is calculated using the 2014 Organisation
now be used in this way. A new fiscal rule will become for Economic Co-operation and Development
fully effective in 2025. The new rule allows for higher elasticity to take into account output and
oil and gas revenues to be spent, but it simultaneously employment gaps.
targets a smaller primary structural deficit. Switzerland: The projections assume that fiscal policy is
Saudi Arabia: The IMF staff’s baseline fiscal projections adjusted as necessary to keep fiscal balances in line
are primarily based on its understanding of with the requirements of Switzerland’s fiscal rules.
government policies as outlined in the 2022 and Türkiye: The basis for the projections is the IMF-
2023 budget statement. Export oil revenues are defined fiscal balance, which excludes some revenue
based on World Economic Outlook baseline oil price and expenditure items that are included in the
assumptions and the IMF staff’s understanding of authorities’ headline balance.
current oil policy under the OPEC+ (Organization of Ukraine: Projections for 2024–28 are omitted due to
the Petroleum Exporting Countries, including Russia an unusually high degree of uncertainty.
and other non-OPEC oil exporters) agreement. United Kingdom: Fiscal projections are based on the
Singapore: FY2020 figures are based on budget latest GDP data published by the Office for National
execution. FY2021 projections are based on revised Statistics on January 21, 2023, and forecasts by
figures based on budget execution through the end the Office for Budget Responsibility from March
of 2021. FY2022 projections are based on the initial 15, 2023. Revenue projections are adjusted for
budget of February 18, 2022. The IMF staff assumes differences between the IMF staff’s forecasts for
gradual withdrawal of remaining pandemic-related macroeconomic variables (such as GDP growth
measures and the implementation of various revenue and inflation) and the forecasts for these variables
measures announced in the FY2022 budget for the assumed in the authorities’ fiscal projections.
remainder of the projection period. These include IMF baseline projections take Office for Budget
(1) an increase in the Goods and Services Tax from Responsibility forecasts only as a reference and do
7 percent to 8 percent on January 1, 2023, and to not necessarily assume that the new fiscal rules
9 percent on January 1, 2024; (2) an increase in announced on November 17, 2022, will be met
property taxes in 2023 for non-owner-occupied at the end of the forecast period. The IMF staff’s
properties (from 10–20 percent to 12–36 percent) data exclude public sector banks and the effect of
and for owner-occupied properties with an annual transferring assets from the Royal Mail Pension Plan
value in excess of $30,000 (from 4–16 percent to to the public sector in April 2012. Real government
6–32 percent); and (3) an increase of the carbon tax consumption and investment are part of the real
from S$5 per tonne to S$25 per tonne in 2024 and GDP path, which, according to the IMF staff, may
2025 and S$45 per tonne in 2026 and 2027. or may not be the same as projected by the Office
Slovak Republic: The fiscal projection is based on the for Budget Responsibility. Data are presented on a
2022 Stability Program and takes into consideration calendar year basis.
of available data for 2022. United States: Fiscal projections are based on the
Spain: Fiscal projections for 2022 include COVID- February 2023 Congressional Budget Office
19- and energy-related support measures, a legislated baseline, adjusted for the IMF staff’s policy
increase in pensions, and legislated revenue and macroeconomic assumptions. Projections
measures. Fiscal projections from 2023 onward incorporate the effects of the Bipartisan
assume energy support measures amounting to 1 Infrastructure Law and Inflation Reduction Act.
percent of GDP in 2023. Projections for 2021–25 Fiscal projections are adjusted to reflect the IMF
reflect disbursements under the EU Recovery and staff’s forecasts for key macroeconomic and financial
Resilience Facility. variables and different accounting treatment of
Sri Lanka: Fiscal projections are based on IMF staff financial sector support and of defined-benefit
judgment. pension plans and are converted to a general
Sweden: Fiscal estimates for 2022 and 2023 are based government basis.
on the authorities’ budget bill and have been Uruguay: Historical fiscal and monetary data are from
updated with the authorities’ latest interim forecast. the Uruguayan authorities. Projections are based on

International Monetary Fund | April 2023 61

FISCAL MONITOR­: On the Path to Policy Normalization

the authorities’ policies and projections, adjusted to hydrocarbon prices and authorities’ projections
reflect IMF staff macroeconomic assumptions and for oil and gas production. Non-hydrocarbon
assessment of policy plans. revenues largely reflect authorities projection and the
Venezuela: Projections for 2023–28 are omitted due to evolution of other key indicators. Over the medium
an unusual high degree of uncertainty. term, we assume conflict resolution, a recovery
Vietnam: Projections starting 2022 use authorities’ in economic activity, and additional expenditures
2022 budget numbers and IMF staff own associated with reconstruction costs.
projections. Zambia: General government net and gross debt
Yemen: Hydrocarbon revenue projection are based projections for 2023–28 is omitted due to ongoing
on World Economic Outlook assumptions for debt restructuring.

62 International Monetary Fund | April 2023

 

Definition and Coverage of Fiscal Data

Table A. Economy Groupings
The following groupings of economies are used in the Fiscal Monitor. Data for all the economies can be found
here: [Link]
Low-Income Advanced Emerging
Advanced Emerging Market G7 G201
Developing G201 G20
Economies Economies Countries Countries
Countries Countries Countries
Andorra Albania Afghanistan Canada Argentina Australia Argentina
Australia Algeria Bangladesh France Australia Canada Brazil
Austria Angola Benin Germany Brazil France China
Belgium Antigua and Bhutan Italy Canada Germany India
Canada Barbuda Burkina Faso Japan China Italy Indonesia
Croatia Argentina Burundi United France Japan Mexico
Cyprus Armenia Cambodia Kingdom Germany Korea Russia
Czech Republic Aruba Cameroon United States India United Saudi Arabia
Denmark Azerbaijan Central African Indonesia Kingdom South Africa
Estonia Bahrain Republic Italy United States Türkiye
Finland Barbados Chad Japan
France Belarus Comoros Korea
Germany Belize Congo, Democratic Mexico
Greece Bolivia Republic of the Russia
Hong Kong SAR Bosnia and Congo, Republic of Saudi Arabia
Iceland Herzegovina Côte d’Ivoire South Africa
Ireland Botswana Djibouti Türkiye
Israel Brazil Eritrea United
Italy Brunei Darussalam Ethiopia Kingdom
Japan Bulgaria Gambia, The United States
Korea Cabo Verde Ghana
Latvia Chile Guinea
Lithuania China Guinea-Bissau
Luxembourg Colombia Haiti
Macao SAR Costa Rica Honduras
Malta Dominica Kenya
Netherlands, The Dominican Kiribati
New Zealand Republic Kyrgyz Republic
Norway Ecuador Lao P.D.R.
Portugal Egypt Lesotho
Puerto Rico El Salvador Liberia
San Marino Equatorial Guinea Madagascar
Singapore Eswatini Malawi
Slovak Republic Fiji Mali
Slovenia Gabon Mauritania
Spain Georgia Moldova
Sweden Grenada Mozambique
Switzerland Guatemala Myanmar
Taiwan Province Guyana Nepal
of China Hungary Nicaragua
United Kingdom India Niger
United States Indonesia Nigeria
Iran Papua New Guinea
Iraq Rwanda
Jamaica São Tomé and
Jordan Príncipe
Kazakhstan Senegal
Kosovo Sierra Leone
Kuwait Solomon Islands
Lebanon South Sudan
Libya Somalia
Malaysia Sudan
Maldives Tajikistan
Tanzania

International Monetary Fund | April 2023 63

FISCAL MONITOR­: On the Path to Policy Normalization

Table A. Economy Groupings (continued)

Low-Income Advanced Emerging
Advanced Emerging Market G7 G201
Developing G201 G20
Economies Economies Countries Countries
Countries Countries Countries
Marshall Islands Timor-Leste
Mauritius Togo
Mexico Uganda
Micronesia Uzbekistan
Mongolia Vietnam
Montenegro Yemen
Morocco Zambia
Namibia Zimbabwe
Nauru
North Macedonia
Oman
Pakistan
Palau
Panama
Paraguay
Peru
Philippines
Poland
Qatar
Romania
Russia
Samoa
Saudi Arabia
Serbia
Seychelles
South Africa
Sri Lanka
St. Kitts and Nevis
St. Lucia
St. Vincent and the
Grenadines
Suriname
Thailand
Bahamas, The
Tonga
Trinidad and
Tobago
Tunisia
Türkiye
Turkmenistan
Tuvalu
Ukraine
United Arab
Emirates
Uruguay
Vanuatu
Venezuela
West Bank and
Gaza
Note: G7 = Group of Seven; G20 = Group of Twenty.
1 Does not include European Union aggregate.

64 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

Table A. Economy Groupings (continued)

Emerging Market
Emerging Market Emerging Market Emerging Market Emerging Market
and Middle-Income
Euro Area and Middle-Income and Middle-Income and Middle-Income and Middle-Income
Middle East, North
Asia Europe Latin America Africa
Africa, and Pakistan
Austria Brunei Darussalam Albania Antigua and Algeria Angola
Belgium China Azerbaijan Barbuda Bahrain South Africa
Croatia Fiji Belarus Argentina Egypt
Cyprus India Bosnia and Aruba Iran
Estonia Indonesia Herzegovina Bahamas, The Iraq
Finland Malaysia Bulgaria Barbados Jordan
France Maldives Hungary Belize Kuwait
Germany Marshall Islands Kazakhstan Bolivia Lebanon
Greece Micronesia Kosovo Brazil Libya
Ireland Mongolia Montenegro Chile Morocco
Italy Nauru North Macedonia Colombia Oman
Latvia Palau Poland Costa Rica Pakistan
Lithuania Philippines Romania Dominica Qatar
Luxembourg Samoa Russia Dominican Republic Saudi Arabia
Malta Sri Lanka Serbia Ecuador Tunisia
Netherlands Thailand Türkiye El Salvador United Arab
Portugal Tonga Ukraine Grenada Emirates
Slovak Republic Tuvalu Guatemala
Slovenia Vanuatu Guyana
Spain Jamaica
Mexico
Panama
Paraguay
Peru
St. Kitts and Nevis
St. Lucia
St. Vincent and the
Grenadines
Suriname
Trinidad and Tobago
Uruguay
Venezuela

International Monetary Fund | April 2023 65

FISCAL MONITOR­: On the Path to Policy Normalization

Table A. Economy Groupings (continued)

Low-Income Low-Income
Low-Income Low-Income Low-Income Oil Oil
Developing Latin Developing
Developing Asia Developing Others Producers Producers
America Sub-Saharan Africa
Bangladesh Haiti Benin Afghanistan Chad Algeria
Bhutan Honduras Burkina Faso Djibouti Congo, Rep of. Angola
Cambodia Nicaragua Burundi Kyrgyz Republic Nigeria Azerbaijan
Kiribati Cameroon Mauritania Timor-Leste Bahrain
Lao P.D.R. Central African Moldova Yemen Brunei Darussalam
Myanmar Republic Somalia Chad
Nepal Chad Sudan Canada
Papua New Comoros Tajikistan Congo, Republic of
Guinea Congo, Dem. Rep. Uzbekistan Ecuador
Solomon Islands of the Yemen Equatorial Guinea
Timor-Leste Congo, Rep. of Gabon
Vietnam Côte d’Ivoire Iran
Eritrea Iraq
Ethiopia Kazakhstan
Gambia, The Kuwait
Ghana Libya
Guinea Nigeria
Guinea-Bissau Norway
Kenya Oman
Lesotho Qatar
Liberia Russian Federation
Madagascar Saudi Arabia
Malawi Timor-Leste
Mali Trinidad and Tobago
Mozambique Turkmenistan
Niger United Arab Emirates
Nigeria Venezuela
Rwanda Yemen
São Tomé and
Príncipe
Senegal
Sierra Leone
South Sudan
Tanzania
Togo
Uganda
Zambia
Zimbabwe

66 International Monetary Fund | April 2023

 Table B. Advanced Economies: Definition and Coverage of Fiscal Monitor Data
Overall Fiscal Balance1 Cyclically Adjusted Balance Gross Debt
Coverage Accounting Coverage Accounting Coverage Valuation
Aggregate Subsectors Practice Aggregate Subsectors Practice Aggregate Subsectors of Debt2
Australia GG CG,SG,LG,TG A GG CG,SG,LG,TG A GG CG,SG,LG,TG Current market
Austria GG CG,SG,LG,SS A GG CG,SG,LG,SS A GG CG,SG,LG,SS Face
Belgium GG CG,SG,LG,SS A GG CG,SG,LG,SS A GG CG,SG,LG,SS Face
Canada GG CG,SG,LG,SS A GG CG,SG,LG,SS A GG CG,SG,LG,SS Face
Cyprus GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Face
Czech Republic GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Nominal
Denmark GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Face
Estonia GG CG,LG,SS C ... ... ... GG CG,LG,SS Nominal
Finland GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Face
France GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Face
Germany GG CG,SG,LG,SS A GG CG,SG,LG,SS A GG CG,SG,LG,SS Face
Greece GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Nominal
Hong Kong SAR GG CG C GG CG C GG CG Face
Iceland GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Face
Ireland GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Nominal
Israel GG CG,LG,SS Mixed GG CG,LG,SS Mixed GG CG,LG,SS Nominal
Italy GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Face
Japan GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Current market
Korea CG CG,SS C CG CG,SS C GG CG,SS Nominal
Latvia GG CG,LG,SS C GG CG,LG,SS C GG CG,LG,SS Nominal
Lithuania GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Nominal
Luxembourg GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Face
Malta GG CG,SS A GG CG,SS A GG CG,SS Nominal
The Netherlands GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Nominal
New Zealand GG CG,LG A GG CG,LG A GG CG,LG Current market
Norway GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Current market
Portugal GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Nominal
Singapore GG CG C GG CG C GG CG Nominal
Slovak Republic GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Face
Slovenia GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Face
Spain GG CG,SG,LG,SS A GG CG,SG,LG,SS A GG CG,SG,LG,SS Nominal
Sweden GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Nominal
Switzerland GG CG,SG,LG,SS A GG CG,SG,LG,SS A GG CG,SG,LG,SS Nominal
United Kingdom GG CG,LG A GG CG,LG A GG CG,LG Nominal
United States GG CG,SG,LG A GG CG,SG,LG A GG CG,SG,LG Nominal

International Monetary Fund | April 2023

Note: Coverage: CG = central government; GG = general government; LG = local governments; SG = state governments; SS = social security funds; TG = territorial governments. Accounting practice: A = accrual; C = cash; Mixed = combination of accrual and
cash accounting.
1 In many economies, fiscal data follow the IMF’s Government Finance Statistics Manual 2014. The concept of overall fiscal balance refers to net lending and borrowing of the general government. In some cases, however, the overall balance refers to total

revenue and grants minus total expenditure and net lending.

METHODOLOGICAL AND STATISTICAL APPENDIX

67
2 “Nominal” refers to debt securities that are valued at their nominal values, that is, the nominal value of a debt instrument at any moment in time is the amount that the debtor owes to the creditor. “Face” refers to the undiscounted amount of principal to be

repaid at (or before) maturity. The use of face value as a proxy for nominal value in measuring the gross debt position can result in an inconsistent approach across all instruments and is not recommended, unless nominal and market values are not available.
“Current market” refers to debt securities that are valued at market prices; insurance, pension, and standardized guarantee schemes are valued according to principles that are equivalent to market valuation; and all other debt instruments are valued at nominal
prices, which are considered to be the best generally available proxies for their market prices.
 Table C. Emerging Market and Middle-Income Economies: Definition and Coverage of Fiscal Monitor Data
Overall Fiscal Balance1 Cyclically Adjusted Balance Gross Debt
Coverage Accounting Coverage Accounting Coverage Valuation
Aggregate Subsectors Practice Aggregate Subsectors Practice Aggregate Subsectors of Debt2

68
Algeria CG CG C ... ... ... CG CG Face
Angola3 GG CG,LG Mixed ... ... ... GG CG,LG Nominal
Argentina GG CG,SG,SS C CG CG C CG CG Nominal
Belarus4 GG CG,LG,SS C ... ... ... GG CG,LG,SS Nominal
Brazil5 NFPS CG,SG,LG,SS,NFPC C NFPS CG,SG,LG,SS,NFPC C NFPS CG,SG,LG,SS,NFPC Nominal
Bulgaria GG CG,LG,SS C GG CG,LG,SS C GG CG,LG,SS Nominal
Chile GG CG,LG A CG CG A GG CG,LG Face
China GG CG,LG,SS C GG CG,LG,SS C GG CG,LG,SS Face
Colombia6 GG CG,SG,LG,SS Mixed GG CG,SG,LG,SS Mixed GG CG,SG,LG,SS Face
Croatia GG CG,LG A GG CG,LG A GG CG,LG Nominal
Dominican Republic CG CG,LG,SS,NMPC Mixed PS CG,LG,SS,NMPC Mixed PS CG,LG,SS,NMPC Face
Ecuador NFPS CG,SG,LG,SS,NFPC Mixed NFPS CG,SG,LG,SS,NFPC Mixed NFPS CG,SG,LG,SS,NFPC Nominal
Egypt GG CG,LG,SS C GG CG,LG,SS C GG CG,LG,SS Nominal
Hungary GG CG,LG,SS,NMPC A GG CG,LG,SS,NMPC A GG CG,LG,SS,NMPC Face
India GG CG,SG C GG CG,SG C GG CG,SG Nominal

International Monetary Fund | April 2023

Indonesia GG CG,LG C GG CG,LG C GG CG,LG Face
Iran CG CG C ... ... ... CG CG Nominal
Kazakhstan GG CG,LG C ... ... ... GG CG,LG Nominal
Kuwait GG CG,SS Mixed ... ... ... GG CG,SS Nominal
Lebanon CG CG Mixed CG CG Mixed CG CG Nominal
FISCAL MONITOR­: On the Path to Policy Normalization

Malaysia GG CG,SG,LG C GG CG,SG,LG C GG CG,SG,LG Nominal

Mexico PS CG,SS,NMPC,NFPC C PS CG,SS,NMPC,NFPC C PS CG,SS,NMPC,NFPC Face
Morocco CG CG A ... ... ... CG CG Face
Oman CG CG C ... ... ... CG CG Nominal
Pakistan GG CG,SG,LG C ... ... ... GG CG,SG,LG Nominal
Peru GG CG,SG,LG,SS C GG CG,SG,LG,SS C NFPS CG,SG,LG,SS,NFPC Face
Philippines GG CG,LG,SS C GG CG,LG,SS C GG CG,LG,SS Nominal
Poland GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Face
Qatar CG CG C ... ... ... CG CG Nominal
Romania GG CG,LG,SS C GG CG,LG,SS C GG CG,LG,SS Face
Russia GG CG,SG,SS Mixed GG CG,SG,SS Mixed GG CG,SG,SS Current market
Saudi Arabia CG CG C ... ... ... CG CG Nominal
South Africa7 GG CG,SG,SS C GG CG,SG,SS C GG CG,SG,SS Nominal
Sri Lanka CG CG C ... ... ... CG CG Nominal
Thailand8 PS CG,BCG,LG,SS A PS CG,BCG,LG,SS A PS CG,BCG,LG,SS Nominal
Türkiye GG CG,LG,SS A GG CG,LG,SS A GG CG,LG,SS Nominal
Ukraine GG CG,LG,SS C GG CG,LG,SS C GG CG,LG,SS Nominal
United Arab Emirates GG CG,BCG,SG,SS Mixed ... ... ... GG CG,BCG,SG,SS Nominal
Uruguay NFPS CG,LG,SS,NMPC,NFPC A ... ... ... NFPS CG,LG,SS,NMPC,NFPC Face
Venezuela9 GG BCG,NFPC C GG BCG,NFPC C GG BCG,NFPC Nominal
Note: Coverage: BCG = budgetary central government; CG = central government; GG = general government; LG = local governments; NFPC = nonfinancial public corporations; NFPS = nonfinancial public sector; NMPC = nonmonetary financial public corporations;
PS = public sector; SG = state governments; SS = social security funds. Accounting practice: A = accrual; C = cash; Mixed = combination of accrual and cash accounting.
1 In many economies, fiscal data follow the IMF’s Government Finance Statistics Manual 2014. The concept of overall fiscal balance refers to net lending and borrowing of the general government. In some cases, however, the overall balance refers to total revenue and

grants minus total expenditure and net lending.

2 “Nominal” refers to debt securities that are valued at their nominal values, that is, the nominal value of a debt instrument at any moment in time is the amount that the debtor owes to the creditor. “Face” refers to the undiscounted amount of principal to be repaid

at (or before) maturity. The use of face value as a proxy for nominal value in measuring the gross debt position can result in an inconsistent approach across all instruments and is not recommended, unless nominal and market values are not available. “Current
market” refers to debt securities that are valued at market prices; insurance, pension, and standardized guarantee schemes are valued according to principles that are equivalent to market valuation; and all other debt instruments are valued at nominal prices, which are
considered to be the best generally available proxies of their market prices.
3 Gross debt includes the domestic and external debt of the central government; the external debt of the state-owned oil company, Sonangol, and the state-owned airline, TAAG; public guarantees; and reported external liabilities of other state entities, including external arrears.
4 Gross debt refers to general government public debt, including publicly guaranteed debt.
5 Gross debt refers to the nonfinancial public sector, excluding Eletrobras and Petrobras, and includes sovereign debt held on the balance sheet of the central bank. The overall balance combines the cash primary balance of the nonfinancial public sector and the net

interest of the public sector on an accrual basis.

6 Revenue is recorded on a cash basis and expenditure on an accrual basis.
7 Coverage for South Africa is consolidated government, which serves as a good proxy for the general government. It includes the national and provincial governments and certain public entities, while local governments are only partly covered. The subnational

government debt is estimated to be limited given the available data from the South African Reserve Bank.
8 Data for Thailand do not include the debt of specialized financial institutions (SFIs/NMPC) without a government guarantee.
9 The fiscal accounts include the budgetary central government, social security, FOGADE (an insurance deposit institution), and a sample of public enterprises, including Petróleos de Venezuela, S.A. (PDVSA). Data for 2018–19 are IMF staff estimates.
 Table D. Low-Income Developing Countries: Definition and Coverage of Fiscal Monitor Data
Overall Fiscal Balance1 Cyclically Adjusted Balance Gross Debt
Coverage Accounting Coverage Accounting Coverage Valuation
Aggregate Subsectors Practice Aggregate Subsectors Practice Aggregate Subsectors of Debt2
Afghanistan CG CG C ... ... ... CG CG Nominal
Bangladesh CG CG C CG CG C CG CG Nominal
Benin CG CG C ... ... ... CG CG Nominal
Burkina Faso CG CG CB ... ... ... CG CG Face
Cambodia CG CG,LG A CG CG,LG A CG CG,LG Face
Cameroon CG CG C ... ... ... CG CG Nominal
Chad NFPS CG,NFPC C ... ... ... CG CG Face
Congo, Democratic CG CG,LG A ... ... ... GG CG,LG,NFPC Nominal
Republic of the
Congo, Republic of CG CG A ... ... ... CG CG Nominal
Côte d’Ivoire CG CG,SS Mixed ... ... ... CG CG,NFPC Nominal
Ethiopia GG CG,SG,LG C ... ... ... NFPS CG,SG,LG,NFPC Nominal
Ghana CG CG CB ... ... ... CG CG Face
Guinea CG CG Mixed ... ... ... CG CG Nominal
Haiti3 CG CG C … … … CG CG Nominal
Honduras GG CG,LG,SS Mixed GG CG,LG,SS Mixed GG CG,LG,SS Nominal
Kenya CG CG C ... ... ... CG CG Current market
Kyrgyz Republic GG CG,LG,SS C ... ... ... GG CG,LG,SS Face
Lao P.D.R.4 CG CG C CG CG C CG CG Nominal
Madagascar CG CG,LG CB ... ... ... NFPS CG,LG,NFPC Nominal
Malawi CG CG C ... ... ... CG CG …
Mali CG CG Mixed ... ... ... CG CG Nominal
Moldova GG CG,LG,SS C GG CG,LG,SS C GG CG,LG,SS Nominal
Mozambique CG CG,SG Mixed CG CG,SG Mixed CG CG,SG Nominal
Myanmar5 NFPS CG,NFPC C ... ... ... NFPS CG,NFPC Face
Nepal CG CG C CG CG C CG CG Face
Nicaragua GG CG,LG,SS C GG CG,LG,SS C GG CG,LG,SS Nominal
Niger CG CG A ... ... ... CG CG Nominal
Nigeria GG CG,SG,LG C ... ... ... GG CG,SG,LG Current market
Papua New Guinea CG CG C ... ... ... CG CG Face
Rwanda GG CG,LG Mixed ... ... ... CG CG Nominal
Senegal CG CG C … … … PS CG,LG,SS,NFPC Nominal
Sudan CG CG Mixed ... ... ... CG CG Nominal
Tajikistan GG CG,LG,SS C ... ... ... GG CG,LG,SS Nominal
Tanzania CG CG,LG C ... ... ... CG CG,LG Nominal
Uganda CG CG C ... ... ... CG CG Nominal
Uzbekistan6 GG CG,SG,LG,SS C ... ... ... GG CG,SG,LG,SS Nominal
Vietnam GG CG,SG,LG C GG CG,SG,LG C GG CG,SG,LG Nominal
Yemen GG CG,LG C ... ... ... GG CG,LG Nominal
Zambia CG CG C ... ... ... CG CG Nominal
Zimbabwe CG CG C ... ... ... CG CG Current market
Note: Coverage: CG = central government; GG = general government; LG = local governments; NFPC = nonfinancial public corporations; NFPS = nonfinancial public sector; SG = state governments; SS = social security funds. Accounting practice: A = accrual;
C = cash; CB = commitments based; Mixed = combination of accrual and cash accounting.
1 In many countries, fiscal data follow the IMF’s Government Finance Statistics Manual 2014. The concept of overall fiscal balance refers to net lending and borrowing of the general government. In some cases, however, the overall balance refers to total

revenue and grants minus total expenditure and net lending.

International Monetary Fund | April 2023

2 “Nominal” refers to debt securities that are valued at their nominal values, that is, the nominal value of a debt instrument at any moment in time is the amount that the debtor owes to the creditor. “Face” refers to the undiscounted amount of principal to be

repaid at (or before) maturity. The use of face value as a proxy for nominal value in measuring the gross debt position can result in an inconsistent approach across all instruments and is not recommended, unless nominal and market values are not available.
“Current market” refers to debt securities that are valued at market prices; insurance, pension, and standardized guarantee schemes are valued according to principles that are equivalent to market valuation; and all other debt instruments are valued at nominal
prices, which are considered to be the best generally available proxies of their market prices.
METHODOLOGICAL AND STATISTICAL APPENDIX

69
3 Haiti’s fiscal balance and debt data cover the central government, special funds and programs (Fonds d’Entretien Routier and Programme de Scolarisation Universelle, Gratuite, et Obligatoire), and the state-owned electricity company EDH.

4 Lao P.D.R.’s fiscal spending includes capital spending by local governments financed by loans provided by the central bank.

5 Overall and primary balances in 2012 are based on monetary statistics and are different from the balances calculated from expenditure and revenue data.

6 Uzbekistan’s listing includes the Fund for Reconstruction and Development.

 FISCAL MONITOR: On the Path to Policy Normalization

Table A1. Advanced Economies: General Government Overall Balance, 2014–28

(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average –3.1 –2.6 –2.7 –2.4 –2.4 –3.0 –10.2 –7.5 –4.3 –4.4 –4.2 –4.1 –3.9 –3.8 –3.9
Euro Area –2.5 –1.9 –1.5 –0.9 –0.4 –0.6 –7.1 –5.4 –3.8 –3.7 –2.8 –2.3 –2.1 –2.0 –1.9
G7 –3.6 –3.0 –3.3 –3.3 –3.3 –3.8 –11.6 –9.1 –5.4 –5.6 –5.3 –5.2 –5.0 –4.8 –5.0
G20 Advanced –3.4 –2.9 –3.1 –3.0 –3.0 –3.6 –11.2 –8.7 –5.1 –5.3 –5.1 –4.9 –4.7 –4.6 –4.7
Andorra 2.1 2.0 4.4 3.3 2.7 2.3 –3.0 –2.3 1.2 1.4 2.5 2.7 3.0 3.3 3.5
Australia –2.9 –2.8 –2.4 –1.7 –1.3 –4.4 –8.7 –6.3 –3.3 –3.1 –2.8 –2.5 –2.2 –2.1 –1.9
Austria –2.7 –1.0 –1.5 –0.8 0.2 0.6 –8.0 –5.9 –3.3 –2.7 –1.5 –1.1 –1.1 –1.2 –1.2
Belgium –3.1 –2.4 –2.4 –0.7 –0.9 –1.9 –9.0 –5.6 –4.3 –5.2 –5.5 –5.5 –5.6 –5.7 –5.7
Canada 0.2 –0.1 –0.5 –0.1 0.4 0.0 –10.9 –4.4 –0.7 –0.4 –0.4 –0.3 –0.2 –0.1 0.0
Croatia –5.2 –3.5 –1.0 0.6 –0.1 0.2 –7.3 –2.6 –0.9 –2.3 –1.7 –1.3 –1.1 –1.1 –1.1
Cyprus 1 –0.2 0.2 0.2 2.0 –3.6 1.3 –5.8 –1.7 2.3 1.9 1.7 1.5 1.3 1.0 1.0
Czech Republic –2.1 –0.6 0.7 1.5 0.9 0.3 –5.8 –5.1 –3.6 –4.2 –2.8 –2.5 –2.5 –2.5 –2.5
Denmark 1.1 –1.3 –0.1 1.8 0.8 4.1 0.2 3.6 2.5 1.4 0.5 0.0 –0.1 –0.1 –0.2
Estonia 0.7 0.1 –0.4 –0.7 –0.6 0.1 –5.5 –2.3 –1.2 –4.8 –3.5 –2.8 –2.1 –1.6 –1.4
Finland –3.0 –2.4 –1.7 –0.7 –0.9 –0.9 –5.5 –2.7 –1.9 –2.5 –2.4 –3.0 –2.9 –2.7 –2.7
France –3.9 –3.6 –3.6 –3.0 –2.3 –3.1 –9.0 –6.5 –4.9 –5.3 –4.8 –4.5 –4.1 –3.9 –4.0
Germany 0.6 1.0 1.2 1.3 1.9 1.5 –4.3 –3.7 –2.6 –3.7 –1.9 –0.9 –0.7 –0.5 –0.5
Greece –4.2 –3.0 0.3 0.9 0.8 0.2 –10.7 –8.0 –4.0 –2.4 –1.3 –1.1 –0.9 –0.8 –0.7
Hong Kong SAR 3.6 0.6 4.4 5.5 2.3 –0.6 –9.2 0.0 –7.1 –3.9 –1.0 0.2 0.6 0.6 0.6
Iceland 0.3 –0.4 12.5 1.0 0.9 –1.5 –9.0 –8.4 –4.3 –2.8 –1.8 –0.1 0.6 0.8 0.3
Ireland 1 –3.6 –2.0 –0.8 –0.3 0.1 0.5 –5.0 –1.7 1.2 1.3 1.2 1.0 1.1 1.1 1.1
Israel –2.3 –1.2 –1.7 –1.2 –3.6 –3.9 –10.8 –3.7 0.1 –1.2 –1.4 –2.5 –2.8 –2.8 –2.7
Italy –3.0 –2.6 –2.4 –2.4 –2.2 –1.5 –9.7 –9.0 –8.0 –3.7 –3.3 –2.3 –1.8 –1.3 –0.7
Japan –5.6 –3.7 –3.6 –3.1 –2.5 –3.0 –9.1 –6.2 –7.8 –6.4 –4.0 –2.9 –3.1 –3.4 –3.7
Korea 0.6 0.5 1.6 2.2 2.6 0.4 –2.2 0.0 –0.9 0.0 –0.2 –0.1 –0.1 –0.1 –0.1
Latvia –1.7 –1.5 –0.4 –0.8 –0.7 –0.4 –3.7 –5.4 –3.6 –4.7 –2.0 –3.1 –1.3 –0.5 –0.4
Lithuania –0.7 –0.2 0.3 0.5 0.6 0.3 –7.2 –1.0 –0.8 –4.5 –2.8 –2.0 –1.5 –1.1 –1.0
Luxembourg 1.3 1.3 1.9 1.4 3.0 2.2 –3.4 0.8 –0.2 –3.0 –1.8 –1.0 –0.5 –0.5 –0.5
Malta –1.7 –1.0 1.1 3.3 2.1 0.6 –9.3 –7.5 –5.3 –4.8 –3.7 –2.6 –2.1 –2.2 –2.1
The Netherlands –2.3 –1.9 0.1 1.4 1.5 1.8 –3.7 –2.6 –1.0 –1.9 –1.5 –1.5 –1.5 –1.7 –1.8
New Zealand –0.3 0.4 1.0 1.4 1.3 –2.5 –4.4 –3.4 –4.2 –3.8 –3.1 –1.5 0.0 0.3 0.0
Norway 8.6 6.0 4.0 5.0 7.8 6.5 –2.6 9.4 22.4 25.3 23.7 21.7 20.3 18.9 17.5
Portugal –7.3 –4.4 –1.9 –3.0 –0.3 0.1 –5.8 –2.8 –1.9 –1.2 –1.2 –1.1 –1.1 –1.0 –0.9
Singapore 4.6 2.9 3.3 5.2 3.7 3.8 –6.8 1.2 0.4 3.1 2.1 2.4 2.7 2.8 2.9
Slovak Republic –3.1 –2.7 –2.6 –1.0 –1.0 –1.2 –5.4 –5.5 –3.5 –5.1 –4.1 –4.4 –4.0 –3.9 –3.8
Slovenia –5.5 –2.8 –1.9 –0.1 0.7 0.6 –7.7 –4.7 –3.3 –4.0 –2.5 –2.1 –1.5 –1.4 –1.4
Spain 1 –6.1 –5.3 –4.3 –3.1 –2.6 –3.1 –10.1 –6.9 –4.5 –4.5 –3.5 –3.8 –4.0 –4.0 –4.0
Sweden –1.5 0.0 1.0 1.4 0.8 0.6 –2.8 –0.1 0.7 0.0 –0.3 0.0 0.3 0.3 0.3
Switzerland –0.2 0.5 0.2 1.1 1.3 1.3 –3.0 –0.5 0.2 0.4 0.2 0.1 0.1 0.1 0.1
United Kingdom –5.5 –4.5 –3.3 –2.4 –2.2 –2.2 –13.0 –8.3 –6.3 –5.8 –4.4 –4.2 –3.9 –3.9 –3.7
United States2 –4.0 –3.5 –4.4 –4.8 –5.3 –5.7 –14.0 –11.6 –5.5 –6.3 –6.8 –7.1 –6.9 –6.6 –6.8
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For country-specific details, see “Data and Conventions” in text and Table B.
1 Data include financial sector support. For Cyprus, 2014 and 2015 balances exclude financial sector support.

2 For cross-economy comparison, the expenditures and fiscal balances of the United States are adjusted to exclude the imputed interest on unfunded pension liabilities and the imputed

compensation of employees, which are counted as expenditures under the 2008 System of National Accounts (2008 SNA) adopted by the United States, but not in economies that have not
yet adopted the 2008 SNA. Data for the United States in this table may therefore differ from data published by the US Bureau of Economic Analysis.

70 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

Table A2. Advanced Economies: General Government Primary Balance, 2014–28

(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average –1.5 –1.1 –1.1 –1.0 –0.9 –1.5 –9.0 –6.2 –2.8 –2.8 –2.4 –2.3 –2.1 –1.9 –1.9
Euro Area –0.2 0.1 0.4 0.8 1.2 0.8 –5.7 –4.0 –2.3 –2.1 –1.2 –0.6 –0.3 –0.1 0.0
G7 –1.8 –1.3 –1.6 –1.6 –1.6 –2.1 –10.1 –7.4 –3.5 –3.6 –3.2 –3.0 –2.7 –2.5 –2.5
G20 Advanced –1.7 –1.3 –1.5 –1.4 –1.4 –2.0 –9.7 –7.0 –3.4 –3.4 –3.0 –2.8 –2.6 –2.3 –2.3
Andorra ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Australia –2.1 –1.9 –1.5 –0.8 –0.4 –3.6 –7.8 –5.3 –2.3 –1.8 –1.3 –1.0 –0.6 –0.4 –0.1
Austria –0.7 0.9 0.1 0.6 1.4 1.6 –7.1 –5.2 –2.7 –1.8 –0.5 0.1 0.1 0.0 0.0
Belgium –0.2 0.2 0.0 1.4 1.0 –0.2 –7.3 –4.1 –3.0 –3.7 –3.5 –3.3 –3.2 –3.1 –3.0
Canada 0.5 0.6 0.1 0.1 0.4 0.1 –10.5 –5.0 –1.3 –0.6 –0.5 –0.5 –0.4 –0.4 –0.4
Croatia –2.3 –0.4 1.8 3.0 2.0 2.2 –5.6 –1.2 0.5 –0.5 0.3 0.5 0.5 0.4 0.3
Cyprus 1 2.8 3.1 2.7 4.3 –1.3 3.4 –3.8 0.0 3.7 3.2 3.0 2.8 2.6 2.3 2.2
Czech Republic –1.0 0.3 1.5 2.1 1.5 0.8 –5.2 –4.5 –2.9 –3.3 –1.7 –1.4 –1.4 –1.3 –1.3
Denmark 1.6 –0.6 0.4 1.7 0.4 3.9 –0.1 3.2 2.1 1.1 0.3 –0.1 –0.1 –0.2 –0.3
Estonia 0.7 0.1 –0.5 –0.8 –0.6 0.1 –5.5 –2.3 –1.1 –4.5 –3.2 –2.4 –1.6 –1.2 –1.0
Finland –2.8 –2.3 –1.4 –0.4 –0.7 –0.8 –5.4 –2.8 –2.0 –2.1 –1.8 –2.4 –2.5 –2.5 –2.6
France –1.8 –1.8 –1.9 –1.3 –0.7 –1.7 –7.8 –5.2 –3.0 –3.7 –3.0 –2.5 –2.0 –1.5 –1.4
Germany 1.8 2.0 2.1 2.2 2.7 2.1 –3.9 –3.3 –2.1 –2.9 –1.0 0.1 0.3 0.5 0.5
Greece –0.2 0.6 3.5 4.1 4.2 3.2 –7.7 –5.5 –1.5 0.4 1.4 1.6 1.8 2.0 2.0
Hong Kong SAR 3.6 0.6 3.6 4.7 1.0 –2.2 –11.1 –2.7 –10.2 –5.8 –2.4 –1.3 –0.6 –0.5 –0.5
Iceland 3.8 3.2 15.5 3.9 3.1 0.5 –6.8 –6.3 –1.9 0.9 1.3 2.3 2.9 2.9 2.4
Ireland 1 –0.3 0.3 1.5 1.7 1.7 1.7 –4.0 –0.9 1.9 2.0 1.9 1.6 1.7 1.7 1.4
Israel –0.2 0.6 0.2 0.7 –1.4 –2.0 –9.0 –1.0 2.5 0.9 0.7 –0.6 –0.9 –0.9 –0.9
Italy 1.4 1.4 1.3 1.2 1.3 1.7 –6.4 –5.6 –3.8 0.4 0.8 1.8 2.2 2.7 3.2
Japan –4.5 –2.6 –2.5 –2.2 –1.7 –2.4 –8.4 –5.6 –7.5 –6.2 –3.8 –2.7 –2.9 –3.1 –3.2
Korea 0.2 0.2 1.4 1.8 2.1 –0.1 –2.7 –0.4 –1.2 –0.2 –0.3 –0.2 –0.1 –0.1 0.0
Latvia –0.2 0.3 0.8 0.3 0.2 0.5 –2.8 –4.7 –3.1 –4.2 –1.3 –2.1 –0.5 0.2 0.3
Lithuania 1.0 1.3 1.6 1.6 1.5 1.1 –6.6 –0.7 –0.9 –4.2 –2.4 –1.3 –0.8 –0.4 –0.3
Luxembourg 1.1 1.1 1.6 1.1 2.8 2.0 –3.7 0.5 –0.5 –3.2 –2.2 –1.5 –1.1 –1.2 –1.3
Malta 0.9 1.2 3.2 5.1 3.6 1.9 –8.0 –6.4 –4.2 –3.7 –2.4 –1.4 –0.9 –0.9 –0.9
The Netherlands –0.9 –0.7 1.2 2.3 2.4 2.5 –3.0 –2.1 –0.8 –2.1 –1.7 –1.5 –1.2 –1.3 –1.3
New Zealand 0.3 1.0 1.6 2.0 1.9 –1.9 –3.7 –2.7 –3.3 –2.6 –1.3 0.3 1.7 2.0 1.7
Norway 6.3 3.4 1.5 2.6 5.7 4.5 –4.6 8.2 20.7 23.6 22.0 20.0 18.6 17.2 15.9
Portugal –3.0 –0.1 1.9 0.7 2.9 2.9 –3.1 –0.5 0.0 1.1 0.9 0.9 1.0 1.2 1.3
Singapore ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Slovak Republic –1.4 –1.2 –1.2 0.2 0.1 –0.2 –4.4 –4.6 –2.8 –4.1 –2.9 –3.1 –2.7 –2.7 –2.6
Slovenia –2.7 0.0 0.7 2.1 2.5 2.1 –6.3 –3.5 –2.3 –3.2 –1.6 –1.3 –0.5 –0.4 –0.3
Spain 1 –3.1 –2.7 –1.9 –0.9 –0.4 –1.0 –8.1 –4.9 –2.5 –2.4 –1.3 –1.4 –1.5 –1.5 –1.5
Sweden –1.4 0.2 1.1 1.5 0.9 0.7 –2.7 0.0 1.1 0.4 0.0 0.4 0.6 0.6 0.6
Switzerland 0.0 0.8 0.4 1.3 1.4 1.4 –3.0 –0.4 0.3 0.5 0.3 0.2 0.1 0.1 0.1
United Kingdom –3.7 –3.1 –1.8 –0.6 –0.5 –0.9 –12.0 –6.0 –2.7 –3.3 –2.5 –2.2 –2.0 –2.0 –1.9
United States2 –2.1 –1.7 –2.4 –2.8 –3.1 –3.5 –11.9 –9.3 –3.4 –3.8 –4.1 –4.3 –3.9 –3.6 –3.6
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: “Primary balance” is defined as the overall balance, excluding net interest payments. For country-specific details, see “Data and Conventions” in text and Table B.
1 Data include financial sector support. For Cyprus, 2014 and 2015 balances exclude financial sector support.

2 For cross-economy comparison, the expenditures and fiscal balances of the United States are adjusted to exclude the imputed interest on unfunded pension liabilities and the imputed

compensation of employees, which are counted as expenditures under the 2008 System of National Accounts (2008 SNA) adopted by the United States, but not in economies that have not
yet adopted the 2008 SNA. Data for the United States in this table may therefore differ from data published by the US Bureau of Economic Analysis.

International Monetary Fund | April 2023 71

 FISCAL MONITOR: On the Path to Policy Normalization

Table A3. Advanced Economies: General Government Cyclically Adjusted Balance, 2014–28
(Percent of potential GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average –2.2 –1.9 –2.2 –2.3 –2.5 –3.2 –7.8 –6.9 –4.9 –4.8 –4.3 –4.2 –4.1 –4.0 –4.1
Euro Area –0.9 –0.6 –0.5 –0.6 –0.4 –0.8 –4.4 –4.2 –3.9 –3.5 –2.6 –2.2 –2.1 –2.0 –2.0
G7 –2.5 –2.2 –2.7 –3.0 –3.2 –3.9 –8.9 –8.2 –5.7 –5.6 –5.1 –5.0 –4.9 –4.8 –4.9
G20 Advanced –2.4 –2.1 –2.5 –2.7 –2.9 –3.7 –8.6 –7.8 –5.4 –5.4 –4.9 –4.8 –4.6 –4.5 –4.7
Andorra ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Australia1 –2.7 –2.5 –2.2 –1.5 –1.1 –4.0 –7.9 –6.1 –3.5 –3.3 –2.9 –2.5 –2.2 –2.1 –1.8
Austria –2.2 –0.5 –1.2 –0.9 –0.8 –0.6 –4.9 –4.8 –3.7 –2.5 –1.0 –0.8 –0.9 –1.2 –1.2
Belgium –2.6 –2.3 –2.3 –0.8 –1.2 –2.8 –6.4 –5.4 –4.8 –5.3 –5.6 –5.5 –5.6 –5.7 –5.7
Canada –0.2 0.0 –0.1 –0.3 0.1 –0.2 –9.2 –3.7 –1.0 –0.5 –0.2 –0.3 –0.2 –0.1 0.0
Croatia –5.1 –3.1 –1.1 0.6 0.1 –0.1 –5.6 –3.5 –2.1 –2.8 –1.9 –1.3 –1.1 –1.0 –1.1
Cyprus 2.3 2.3 1.3 1.8 2.6 0.7 –3.7 –1.1 1.3 1.3 1.2 1.1 1.0 0.8 0.7
Czech Republic –0.6 –0.4 0.7 0.8 0.1 –0.8 –5.5 –5.4 –3.8 –3.7 –2.4 –2.3 –2.3 –2.4 –2.5
Denmark 2.5 –0.5 –0.4 0.8 –0.4 3.2 2.0 3.2 0.8 1.0 0.4 0.0 –0.2 –0.2 –0.2
Estonia 1.2 0.8 0.1 –1.1 –1.1 –0.3 –4.9 –3.0 –0.6 –3.5 –3.0 –2.5 –1.9 –1.5 –1.4
Finland –0.6 0.1 –0.3 –0.9 –1.0 –1.3 –3.3 –2.1 –1.9 –2.2 –2.2 –2.7 –2.7 –2.6 –2.6
France –2.5 –2.1 –2.0 –2.0 –1.8 –3.1 –5.9 –5.3 –4.4 –4.6 –4.1 –4.0 –3.9 –3.9 –4.1
Germany 0.8 1.2 1.1 0.8 1.5 1.3 –2.9 –3.1 –2.8 –3.2 –1.4 –0.5 –0.6 –0.5 –0.5
Greece 4.1 4.5 7.0 6.6 5.2 3.5 –2.4 –4.2 –3.3 –2.8 –1.6 –1.4 –1.1 –0.9 –0.7
Hong Kong SAR 3.6 0.7 4.7 5.5 2.3 0.3 –5.5 1.0 –5.2 –2.9 –0.2 0.7 0.9 0.7 0.6
Iceland 1.2 0.2 12.0 0.1 –1.0 –3.4 –5.9 –6.9 –4.8 –3.1 –1.9 –0.2 0.6 0.8 0.3
Ireland 2 –3.1 –1.4 –1.4 –0.8 –0.1 0.4 –4.4 –2.1 0.9 1.2 1.2 1.0 1.1 1.1 1.1
Israel –2.5 –0.8 –1.6 –1.3 –3.8 –4.2 –9.5 –3.5 –0.7 –1.8 –1.7 –2.7 –2.9 –2.8 –2.7
Italy –0.7 –0.5 –0.9 –1.5 –1.5 –1.0 –6.1 –6.8 –8.1 –3.8 –3.3 –2.8 –2.1 –1.6 –1.0
Japan –6.0 –4.5 –4.5 –3.7 –3.0 –3.3 –8.1 –6.2 –7.8 –6.4 –4.1 –2.9 –3.1 –3.4 –3.7
Korea 0.7 0.7 1.8 2.3 2.6 0.5 –1.5 0.1 –0.9 0.2 –0.1 0.0 –0.1 –0.1 –0.1
Latvia –1.1 –1.1 –0.3 –1.2 –1.5 –1.2 –2.9 –5.0 –3.2 –3.8 –1.6 –2.8 –1.2 –0.5 –0.4
Lithuania –0.4 0.1 0.6 0.5 0.5 0.1 –6.8 –1.8 –1.5 –4.5 –3.1 –2.1 –1.5 –1.1 –1.0
Luxembourg 1.4 1.5 1.1 1.0 3.0 2.1 –2.6 0.4 –0.4 –2.9 –1.6 –1.0 –0.5 –0.5 –0.5
Malta –1.3 –2.1 0.7 3.1 1.5 0.3 –5.7 –6.5 –5.6 –5.0 –3.8 –2.6 –2.1 –2.2 –2.2
The Netherlands –0.6 –0.7 0.9 1.4 0.9 1.1 –1.2 –2.0 –2.1 –2.9 –2.2 –2.1 –1.9 –1.8 –1.8
New Zealand 0.4 0.7 1.0 1.1 0.9 –2.2 –4.3 –4.4 –5.3 –4.5 –3.1 –1.5 0.0 0.3 0.0
Norway2 –5.6 –6.6 –7.6 –7.7 –7.0 –7.2 –8.7 –12.3 –12.9 –12.1 –10.2 –10.1 –10.0 –9.9 –9.9
Portugal –2.7 –1.1 0.2 –2.3 –0.5 –0.7 –2.7 –1.2 –2.9 –1.7 –1.3 –1.3 –1.1 –1.0 –0.9
Singapore 1.0 –0.7 0.7 1.8 0.7 1.7 –7.9 –1.1 –1.3 0.7 –0.4 –0.1 0.2 0.3 0.5
Slovak Republic –2.3 –3.3 –3.1 –1.5 –1.6 –1.7 –3.9 –4.9 –3.2 –4.7 –3.9 –4.4 –4.0 –3.9 –3.8
Slovenia –4.4 –1.9 –1.8 0.0 0.6 0.2 –6.3 –5.5 –4.6 –4.6 –2.6 –2.2 –1.5 –1.4 –1.4
Spain2 –1.2 –2.1 –2.5 –2.4 –2.2 –3.1 –4.8 –4.1 –4.2 –4.2 –3.4 –3.8 –4.0 –4.0 –4.0
Sweden2 –0.9 –0.7 0.7 0.9 0.3 –0.2 –1.7 –0.3 0.1 0.4 0.3 0.2 0.3 0.3 0.3
Switzerland2 –0.2 0.6 0.2 1.2 1.1 1.2 –2.3 –0.4 0.1 0.4 0.2 0.1 0.1 0.1 0.1
United Kingdom2 –2.9 –2.5 –1.6 –1.3 –1.4 –1.6 –10.7 –7.7 –7.2 –5.7 –3.8 –3.8 –3.8 –3.9 –3.8
United States2,3 –2.7 –2.5 –3.6 –4.3 –5.1 –6.0 –10.7 –10.7 –5.9 –6.6 –6.7 –6.9 –6.7 –6.5 –6.7
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For country-specific details, see “Data and Conventions” in text and Table B.
1 Data are based on the fiscal year-based potential GDP.

2 Data for these economies include adjustments beyond the output cycle.

3 For cross-economy comparison, the expenditures and fiscal balances of the United States are adjusted to exclude the imputed interest on unfunded pension liabilities and the imputed

compensation of employees, which are counted as expenditures under the 2008 System of National Accounts (2008 SNA) adopted by the United States, but not in economies that have not
yet adopted the 2008 SNA. Data for the United States in this table may therefore differ from data published by the US Bureau of Economic Analysis.

72 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

Table A4. Advanced Economies: General Government Cyclically Adjusted Primary Balance, 2014–28
(Percent of potential GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average –0.5 –0.4 –0.7 –0.8 –1.0 –1.8 –6.6 –5.5 –3.4 –3.2 –2.6 –2.4 –2.2 –2.1 –2.1
Euro Area 1.3 1.4 1.3 1.2 1.3 0.7 –3.1 –2.9 –2.4 –1.9 –0.9 –0.5 –0.3 –0.2 –0.1
G7 –0.7 –0.5 –1.0 –1.3 –1.5 –2.2 –7.4 –6.5 –3.8 –3.7 –3.0 –2.8 –2.6 –2.4 –2.5
G20 Advanced –0.7 –0.5 –0.9 –1.2 –1.3 –2.1 –7.2 –6.2 –3.7 –3.5 –2.8 –2.6 –2.5 –2.3 –2.3
Andorra ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Australia1 –1.8 –1.6 –1.3 –0.7 –0.2 –3.2 –7.1 –5.2 –2.4 –2.0 –1.4 –1.0 –0.6 –0.4 –0.1
Austria –0.2 1.4 0.4 0.5 0.4 0.4 –4.0 –4.0 –3.1 –1.6 –0.1 0.4 0.2 0.0 0.0
Belgium 0.2 0.2 0.1 1.3 0.6 –1.0 –4.8 –3.9 –3.5 –3.8 –3.6 –3.3 –3.3 –3.1 –3.0
Canada 0.1 0.6 0.5 –0.1 0.2 –0.1 –8.8 –4.4 –1.6 –0.7 –0.4 –0.5 –0.4 –0.4 –0.4
Croatia –2.1 0.0 1.8 3.1 2.2 1.9 –4.0 –2.1 –0.6 –1.0 0.1 0.4 0.5 0.4 0.3
Cyprus 4.3 4.3 3.1 3.5 4.3 2.3 –2.1 0.2 2.4 2.4 2.2 2.1 1.9 1.7 1.7
Czech Republic 0.4 0.5 1.5 1.5 0.7 –0.3 –4.9 –4.8 –3.1 –2.7 –1.3 –1.1 –1.2 –1.2 –1.3
Denmark 3.0 0.2 0.1 0.7 –0.7 2.9 1.7 2.8 0.3 0.7 0.2 –0.1 –0.2 –0.2 –0.3
Estonia 1.2 0.8 0.0 –1.1 –1.1 –0.4 –4.9 –3.0 –0.6 –3.3 –2.6 –2.1 –1.4 –1.1 –1.0
Finland –0.5 0.3 –0.1 –0.6 –0.8 –1.1 –3.2 –2.2 –2.0 –1.9 –1.6 –2.1 –2.3 –2.3 –2.5
France –0.5 –0.3 –0.3 –0.4 –0.2 –1.7 –4.7 –4.0 –2.6 –3.0 –2.3 –2.1 –1.8 –1.5 –1.4
Germany 2.0 2.2 2.0 1.7 2.3 1.9 –2.5 –2.6 –2.3 –2.5 –0.6 0.5 0.3 0.5 0.5
Greece 7.4 7.5 9.7 9.3 8.3 6.3 0.1 –1.9 –0.6 0.3 1.5 1.8 2.2 2.6 2.7
Hong Kong SAR 3.6 0.7 3.9 4.7 0.9 –1.3 –7.3 –1.7 –8.2 –4.8 –1.6 –0.8 –0.3 –0.4 –0.5
Iceland 4.6 3.7 14.9 3.2 1.3 –1.3 –3.8 –4.9 –2.4 0.6 1.2 2.3 2.9 2.9 2.4
Ireland2 0.2 1.0 0.8 1.2 1.4 1.6 –3.4 –1.3 1.7 1.9 1.9 1.6 1.7 1.7 1.4
Israel –0.4 0.9 0.3 0.7 –1.7 –2.4 –7.7 –0.9 1.7 0.4 0.3 –0.8 –1.0 –1.0 –0.9
Italy 3.5 3.2 2.8 2.0 1.9 2.2 –3.1 –3.5 –3.9 0.3 0.9 1.4 1.9 2.4 3.0
Japan –4.9 –3.4 –3.4 –2.7 –2.2 –2.6 –7.5 –5.6 –7.4 –6.2 –3.9 –2.8 –2.9 –3.1 –3.2
Korea 0.3 0.4 1.5 2.0 2.2 0.0 –2.0 –0.3 –1.1 0.0 –0.2 –0.1 –0.1 –0.1 0.0
Latvia 0.4 0.6 0.9 –0.1 –0.5 –0.3 –2.0 –4.3 –2.7 –3.3 –0.8 –1.9 –0.4 0.2 0.3
Lithuania 1.2 1.6 1.9 1.6 1.4 0.9 –6.2 –1.6 –1.6 –4.2 –2.6 –1.4 –0.9 –0.4 –0.3
Luxembourg 1.1 1.2 0.8 0.8 2.8 1.8 –2.8 0.1 –0.7 –3.1 –2.0 –1.4 –1.1 –1.2 –1.3
Malta 1.3 0.2 2.9 4.9 3.0 1.6 –4.5 –5.4 –4.5 –3.9 –2.5 –1.4 –0.9 –0.9 –0.9
The Netherlands 0.7 0.4 2.0 2.4 1.8 1.9 –0.5 –1.4 –1.9 –3.1 –2.3 –2.0 –1.6 –1.4 –1.3
New Zealand 1.0 1.3 1.6 1.8 1.5 –1.6 –3.6 –3.6 –4.4 –3.2 –1.4 0.3 1.7 2.1 1.8
Norway2 –8.2 –9.5 –10.4 –10.4 –9.4 –9.5 –14.0 –10.8 –8.6 –8.8 –8.7 –8.6 –8.7 –8.7 –8.6
Portugal 1.4 2.9 3.9 1.3 2.7 2.2 –0.1 1.0 –0.9 0.7 0.8 0.8 1.0 1.2 1.3
Singapore ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Slovak Republic –0.7 –1.8 –1.6 –0.3 –0.5 –0.6 –3.0 –4.0 –2.4 –3.7 –2.7 –3.0 –2.7 –2.7 –2.6
Slovenia –1.6 0.8 0.8 2.1 2.4 1.7 –5.0 –4.3 –3.7 –3.8 –1.8 –1.3 –0.5 –0.4 –0.3
Spain2 1.6 0.4 –0.2 –0.2 0.0 –1.0 –2.9 –2.2 –2.2 –2.1 –1.1 –1.4 –1.5 –1.5 –1.5
Sweden2 –0.8 –0.5 0.8 1.0 0.4 –0.1 –1.6 –0.3 0.5 0.8 0.6 0.6 0.7 0.6 0.6
Switzerland2 0.0 0.8 0.4 1.3 1.2 1.3 –2.3 –0.2 0.2 0.5 0.3 0.2 0.1 0.1 0.1
United Kingdom2 –1.2 –1.1 –0.1 0.5 0.2 –0.3 –9.7 –5.5 –3.7 –3.3 –2.0 –1.8 –1.8 –2.0 –1.9
United States2,3 –0.8 –0.7 –1.6 –2.3 –2.9 –3.7 –8.6 –8.3 –3.8 –4.1 –4.0 –4.1 –3.7 –3.4 –3.5
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: “Cyclically adjusted primary balance” is defined as the cyclically adjusted balance plus net interest payable/paid (interest expense minus interest revenue) following the
World Economic Outlook convention. For economy-specific details, see “Data and Conventions” in text and Table B.
1 Data are based on the fiscal year–based potential GDP.

2 The data for these economies include adjustments beyond the output cycle.

3 For cross-economy comparison, expenditures and fiscal balances of the United States are adjusted to exclude the imputed interest on unfunded pension liabilities and the imputed

compensation of employees, which are counted as expenditures under the 2008 System of National Accounts (2008 SNA) adopted by the United States, but not in economies that have not
yet adopted the 2008 SNA. Data for the United States in this table may therefore differ from data published by the US Bureau of Economic Analysis.

International Monetary Fund | April 2023 73

 FISCAL MONITOR: On the Path to Policy Normalization

Table A5. Advanced Economies: General Government Revenue, 2014–28

(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average 36.5 36.1 36.0 35.9 36.0 35.7 36.1 37.0 37.4 36.9 36.6 36.4 36.4 36.4 36.3
Euro Area 46.8 46.4 46.2 46.1 46.4 46.2 46.3 47.2 47.1 47.1 46.5 46.3 46.1 46.0 46.0
G7 36.5 36.3 36.0 35.8 35.8 35.6 36.1 36.9 37.4 36.8 36.4 36.2 36.3 36.3 36.2
G20 Advanced 35.7 35.6 35.4 35.2 35.3 35.1 35.6 36.4 37.0 36.3 36.0 35.9 35.9 36.0 35.8
Andorra 33.8 35.0 38.5 38.0 38.5 38.1 40.5 36.8 37.1 37.6 38.1 38.2 38.3 38.4 38.5
Australia 33.9 34.6 35.0 35.2 35.7 34.6 35.9 35.9 35.1 36.0 36.6 36.9 37.1 37.2 37.2
Austria 49.6 50.0 48.5 48.5 48.9 49.2 48.7 50.0 49.1 49.7 49.4 49.6 49.6 49.6 49.6
Belgium 52.5 51.3 50.8 51.3 51.4 49.9 49.9 49.9 49.3 50.8 51.2 51.4 51.3 51.3 51.5
Canada 38.5 40.0 40.3 40.3 41.0 40.6 41.8 41.5 40.8 40.7 40.6 40.6 40.7 40.8 40.9
Croatia 43.4 44.0 45.4 45.3 45.4 46.3 46.7 46.0 44.7 45.2 44.7 44.5 44.6 44.0 43.9
Cyprus 40.1 39.5 37.5 38.3 39.0 39.4 38.8 41.4 42.1 41.0 40.9 40.6 40.0 39.8 39.7
Czech Republic 40.5 41.3 40.5 40.5 41.5 41.3 41.5 41.4 41.2 42.0 40.8 40.2 40.2 40.2 40.3
Denmark 56.4 53.2 52.4 52.3 51.3 53.8 53.8 54.4 51.7 50.8 50.2 50.0 50.3 50.3 50.3
Estonia 38.5 39.7 39.0 38.5 38.7 39.5 39.4 39.0 39.0 38.4 38.9 39.0 39.3 39.3 39.5
Finland 54.3 54.1 53.9 53.0 52.5 52.4 51.6 53.0 52.2 52.1 51.7 51.5 51.3 51.3 51.4
France 53.3 53.2 53.0 53.5 53.4 52.3 52.5 52.5 53.6 52.7 51.9 51.6 51.5 51.5 51.5
Germany 44.9 45.1 45.5 45.5 46.3 46.5 46.1 47.5 47.1 47.0 46.9 47.0 47.1 47.1 47.1
Greece 46.5 48.2 50.2 49.4 49.3 48.0 49.0 49.5 51.5 47.9 45.7 45.2 44.7 43.6 43.0
Hong Kong SAR 20.8 18.6 22.6 22.9 20.7 20.4 20.7 23.7 20.9 21.1 22.8 23.6 23.7 23.7 23.7
Iceland 46.1 43.1 59.0 45.4 44.8 42.1 42.2 41.4 41.8 42.0 41.6 41.8 41.6 41.0 40.5
Ireland 34.0 27.0 27.3 25.9 25.5 24.7 22.3 23.2 23.3 22.3 22.0 22.0 22.0 22.0 21.8
Israel 36.0 36.3 36.0 37.1 35.5 34.6 34.0 36.6 37.0 35.2 35.1 34.2 34.2 34.2 34.3
Italy 47.9 47.8 46.7 46.3 46.2 47.0 47.3 48.3 48.8 50.0 48.6 48.4 48.2 48.0 47.8
Japan 32.8 33.6 33.6 33.6 34.3 34.2 35.5 36.6 36.2 35.7 35.4 35.4 35.4 35.4 35.4
Korea 20.4 20.3 21.1 21.8 22.9 22.9 22.9 25.8 27.0 25.3 24.9 25.0 25.0 25.0 25.0
Latvia 36.1 35.9 35.7 35.7 37.3 37.2 37.4 37.4 35.6 36.8 37.9 36.4 36.6 36.5 36.3
Lithuania 33.4 34.2 33.6 32.9 33.7 34.0 34.7 36.3 35.8 35.4 35.2 35.0 34.9 35.0 34.9
Luxembourg 41.9 41.7 41.9 42.6 45.3 45.4 43.3 43.7 43.1 43.3 44.3 44.5 44.8 45.2 45.5
Malta 38.2 37.2 37.5 37.7 37.9 36.3 36.4 36.1 35.6 35.6 34.8 34.8 34.8 34.8 34.8
The Netherlands 43.0 42.1 43.0 43.0 43.0 43.1 43.3 43.2 43.5 43.1 42.7 42.5 42.5 42.3 42.2
New Zealand 37.3 37.6 37.4 37.0 37.4 36.3 37.8 38.5 39.0 39.0 40.2 41.0 41.2 41.2 40.4
Norway 53.8 54.2 54.4 54.2 55.5 56.7 54.2 56.9 60.9 65.7 64.9 63.8 63.6 63.4 63.2
Portugal 44.4 43.8 42.9 42.4 42.9 42.6 43.4 44.6 43.7 43.6 43.6 43.6 43.6 43.5 43.7
Singapore 17.2 17.3 18.6 18.9 17.6 17.8 17.5 17.4 15.9 17.2 17.1 17.6 18.0 18.2 18.2
Slovak Republic 40.2 42.9 40.0 38.5 38.7 39.3 39.4 40.9 40.7 42.7 39.1 38.4 38.4 38.0 38.0
Slovenia 45.3 45.9 44.2 44.0 44.2 43.8 43.4 44.6 43.1 42.7 42.2 42.1 42.2 42.1 42.2
Spain 39.2 38.7 38.2 38.2 39.2 39.2 41.8 43.7 43.4 44.2 43.5 42.7 41.4 41.4 41.4
Sweden 48.1 48.4 49.8 49.6 49.6 48.7 48.3 48.3 47.5 46.9 47.8 48.0 48.0 48.1 48.1
Switzerland 31.9 33.0 32.7 33.6 33.0 33.3 34.1 34.7 33.8 33.3 33.0 32.8 32.8 32.8 32.8
United Kingdom 35.7 35.7 36.2 36.6 36.6 36.3 36.9 38.0 38.9 39.2 39.2 38.9 37.3 35.9 34.7
United States 31.4 31.7 31.2 30.6 30.2 30.2 30.8 31.4 33.0 31.9 31.6 31.3 31.7 31.9 32.0
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For economy-specific details, see “Data and Conventions” in text and Table B.

74 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

Table A6. Advanced Economies: General Government Expenditure, 2014–28

(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average 39.6 38.7 38.6 38.3 38.4 38.7 46.4 44.5 41.7 41.3 40.7 40.4 40.3 40.2 40.2
Euro Area 49.3 48.3 47.7 47.1 46.8 46.9 53.4 52.5 51.0 50.8 49.3 48.6 48.2 48.0 47.9
G7 40.1 39.3 39.3 39.1 39.2 39.4 47.8 46.0 42.8 42.3 41.7 41.4 41.3 41.1 41.2
G20 Advanced 39.2 38.5 38.5 38.3 38.3 38.7 46.8 45.1 42.1 41.6 41.1 40.8 40.7 40.5 40.5
Andorra 31.7 33.0 34.1 34.7 35.9 35.8 43.4 39.2 36.0 36.2 35.7 35.5 35.3 35.2 35.0
Australia 36.9 37.4 37.4 36.9 37.0 39.1 44.6 42.2 38.4 39.0 39.4 39.3 39.3 39.3 39.0
Austria 52.3 51.0 50.1 49.3 48.8 48.6 56.7 56.0 52.4 52.4 50.9 50.6 50.6 50.8 50.8
Belgium 55.6 53.7 53.1 52.0 52.3 51.9 58.9 55.5 53.7 56.0 56.7 56.9 56.9 57.0 57.2
Canada 38.4 40.0 40.8 40.5 40.7 40.6 52.7 45.9 41.5 41.1 41.0 40.9 40.9 40.9 40.9
Croatia 48.6 47.5 46.4 44.7 45.5 46.1 54.0 48.5 45.7 47.5 46.4 45.8 45.6 45.1 45.0
Cyprus 40.3 39.3 37.3 36.4 42.6 38.1 44.6 43.1 39.9 39.1 39.3 39.1 38.7 38.8 38.8
Czech Republic 42.6 41.9 39.8 39.0 40.6 41.1 47.2 46.5 44.8 46.2 43.6 42.7 42.7 42.7 42.8
Denmark 55.2 54.5 52.5 50.5 50.5 49.7 53.5 50.8 49.2 49.4 49.8 50.0 50.4 50.5 50.5
Estonia 37.8 39.5 39.4 39.2 39.3 39.4 44.8 41.3 40.2 43.2 42.4 41.8 41.4 40.9 40.9
Finland 57.3 56.5 55.6 53.6 53.4 53.3 57.1 55.7 54.0 54.6 54.2 54.5 54.2 54.1 54.1
France 57.2 56.8 56.7 56.5 55.6 55.4 61.5 59.1 58.5 58.1 56.7 56.0 55.6 55.4 55.5
Germany 44.3 44.1 44.4 44.2 44.3 45.0 50.4 51.3 49.7 50.7 48.8 47.9 47.8 47.6 47.6
Greece 50.7 51.2 49.9 48.5 48.5 47.7 59.7 57.4 55.5 50.3 47.0 46.2 45.5 44.4 43.7
Hong Kong SAR 17.3 18.0 18.3 17.4 18.4 21.0 29.9 23.7 28.1 25.0 23.8 23.4 23.1 23.1 23.1
Iceland 45.8 43.5 46.4 44.4 43.8 43.6 51.2 49.8 46.1 44.8 43.4 41.9 41.0 40.3 40.3
Ireland 37.6 29.1 28.1 26.2 25.3 24.3 27.3 24.8 22.1 21.0 20.8 20.9 20.9 20.9 20.7
Israel 38.3 37.5 37.7 38.3 39.1 38.5 44.7 40.2 36.9 36.4 36.5 36.8 37.0 37.0 37.0
Italy 50.9 50.3 49.1 48.8 48.4 48.5 57.0 57.3 56.8 53.7 51.9 50.8 50.0 49.2 48.5
Japan 38.4 37.3 37.2 36.7 36.7 37.3 44.6 42.8 44.0 42.1 39.4 38.3 38.5 38.8 39.1
Korea 19.8 19.7 19.5 19.6 20.4 22.6 25.1 25.8 27.9 25.4 25.1 25.1 25.1 25.1 25.1
Latvia 37.8 37.4 36.1 36.5 38.1 37.6 41.1 42.9 39.2 41.5 39.9 39.5 37.9 37.0 36.7
Lithuania 34.0 34.4 33.3 32.4 33.2 33.8 42.0 37.3 36.6 39.8 38.0 37.0 36.4 36.1 36.0
Luxembourg 40.6 40.4 40.0 41.3 42.3 43.1 46.7 42.9 43.3 46.3 46.1 45.5 45.4 45.6 46.0
Malta 39.9 38.2 36.4 34.5 35.8 35.7 45.7 43.6 40.9 40.4 38.6 37.4 36.9 37.0 36.9
The Netherlands 45.3 44.0 42.9 41.7 41.5 41.3 47.0 45.8 44.6 45.0 44.2 44.0 44.0 44.0 44.0
New Zealand 37.7 37.3 36.5 35.6 36.1 38.8 42.1 41.9 43.2 42.8 43.3 42.5 41.2 40.9 40.4
Norway 45.2 48.2 50.4 49.2 47.7 50.2 56.7 47.6 38.5 40.4 41.1 42.1 43.3 44.5 45.7
Portugal 51.7 48.2 44.8 45.4 43.2 42.5 49.2 47.4 45.7 44.9 44.9 44.7 44.7 44.5 44.6
Singapore 12.6 14.4 15.3 13.6 13.9 14.0 24.3 16.2 15.4 14.1 15.0 15.2 15.3 15.4 15.3
Slovak Republic 43.3 45.6 42.5 39.5 39.7 40.5 44.8 46.3 44.3 47.8 43.1 42.8 42.4 42.0 41.9
Slovenia 50.8 48.7 46.2 44.1 43.5 43.2 51.2 49.3 46.3 46.6 44.6 44.2 43.6 43.5 43.6
Spain 45.3 44.0 42.5 41.3 41.8 42.3 51.9 50.6 47.8 48.7 47.0 46.5 45.4 45.4 45.4
Sweden 49.7 48.4 48.8 48.2 48.8 48.1 51.0 48.4 46.8 46.8 48.0 48.0 47.8 47.8 47.8
Switzerland 32.2 32.5 32.4 32.5 31.7 32.0 37.1 35.2 33.6 33.0 32.8 32.7 32.8 32.8 32.8
United Kingdom 41.2 40.3 39.5 39.0 38.7 38.5 49.9 46.3 45.1 45.0 43.6 43.1 41.2 39.8 38.4
United States 1 35.4 35.2 35.6 35.4 35.6 36.0 44.8 43.0 38.5 38.2 38.4 38.4 38.5 38.6 38.8
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For economy-specific details, see “Data and Conventions” in text and Table B.
1 For cross-economy comparison, expenditures and fiscal balances of the United States are adjusted to exclude the imputed interest on unfunded pension liabilities and the imputed

compensation of employees, which are counted as expenditures under the 2008 System of National Accounts (2008 SNA) adopted by the United States, but not in economies that have
not yet adopted the 2008 SNA. Data for the United States in this table may therefore differ from data published by the US Bureau of Economic Analysis.

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 FISCAL MONITOR: On the Path to Policy Normalization

Table A7. Advanced Economies: General Government Gross Debt, 2014–28

(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average1 103.7 103.3 105.7 103.4 102.9 104.0 122.9 117.4 112.5 112.4 113.6 115.0 115.9 116.7 117.8
Euro Area 92.8 90.9 90.1 87.6 85.6 83.5 96.6 94.9 90.9 89.8 89.0 87.9 86.9 86.2 85.4
G7 117.4 116.4 119.5 117.5 117.2 118.3 140.4 134.1 128.4 128.4 130.3 132.2 133.5 134.7 136.2
G20 Advanced 111.3 110.9 113.8 111.7 111.6 113.0 134.1 128.1 123.1 123.5 125.4 127.2 128.4 129.5 130.9
Andorra 42.0 40.9 39.8 37.8 36.3 35.4 46.3 48.5 38.8 37.4 35.6 34.3 33.1 31.9 30.9
Australia2 34.0 37.8 40.6 41.2 41.8 46.7 57.1 57.6 55.7 59.4 62.4 62.9 62.8 62.6 62.2
Austria 83.8 84.4 82.5 78.6 74.1 70.6 82.9 82.3 77.8 74.9 72.6 71.4 70.1 68.7 67.9
Belgium 107.0 105.2 105.0 102.0 99.9 97.6 112.0 109.2 105.3 106.0 108.3 111.1 114.0 116.9 119.5
Canada2 85.5 92.0 92.4 90.9 90.8 90.2 118.9 115.1 106.6 105.1 102.2 99.2 96.2 93.6 91.1
Croatia 82.4 82.1 79.4 77.5 74.5 71.9 86.8 78.6 67.5 65.2 64.2 63.3 62.2 61.4 60.1
Cyprus 108.8 106.8 102.6 92.6 98.1 90.4 113.5 101.1 86.5 79.6 71.9 67.8 62.6 59.4 56.0
Czech Republic 41.9 39.7 36.6 34.2 32.1 30.0 37.7 42.0 42.3 43.8 43.3 43.2 43.9 44.9 45.7
Denmark 44.3 39.8 37.2 35.9 34.0 33.7 42.2 36.6 29.7 30.4 30.3 30.3 30.7 31.1 31.5
Estonia 10.6 10.1 10.0 9.1 8.2 8.5 18.5 17.6 17.2 21.0 23.1 24.1 24.6 24.7 24.4
Finland 64.5 68.3 68.0 66.0 64.9 64.9 74.8 72.6 74.8 74.5 75.9 77.8 79.5 80.9 82.1
France 94.8 95.4 96.1 98.1 97.8 97.4 114.7 112.6 111.1 111.4 112.4 112.8 113.3 114.2 115.0
Germany 75.3 71.9 69.0 64.6 61.3 58.9 68.0 68.6 66.5 67.2 66.5 64.4 62.3 60.9 59.6
Greece 181.8 179.1 183.7 183.2 190.7 185.5 212.4 200.7 177.4 166.0 160.5 155.8 151.6 147.5 143.6
Hong Kong SAR 2 0.1 0.1 0.1 0.1 0.1 0.3 1.0 1.9 4.3 6.1 7.1 7.8 8.8 9.8 10.6
Iceland 115.3 97.3 82.5 71.7 63.2 66.6 77.8 75.6 68.7 64.7 61.5 57.4 52.9 48.9 44.2
Ireland 104.3 76.7 74.3 67.6 63.0 57.0 58.4 55.4 45.2 39.9 36.1 33.2 30.7 27.7 25.2
Israel 64.9 63.1 61.4 59.7 59.9 58.8 70.7 68.0 60.9 57.6 55.3 54.5 54.1 53.7 53.5
Italy 135.4 135.3 134.8 134.2 134.4 134.1 154.9 149.8 144.7 140.3 140.0 138.5 136.9 134.8 131.9
Japan 233.3 228.3 232.4 231.3 232.4 236.4 258.7 255.4 261.3 258.2 256.3 257.6 259.2 261.5 264.0
Korea 39.7 40.8 41.2 40.1 40.0 42.1 48.7 51.3 54.3 55.3 55.9 56.6 57.2 57.8 58.2
Latvia 41.6 37.1 40.4 39.0 37.1 36.7 42.1 44.7 41.6 42.0 41.0 41.2 39.9 37.8 37.3
Lithuania 40.5 42.7 39.9 39.3 33.7 35.8 46.3 44.0 39.6 40.2 39.1 38.0 36.8 35.8 35.0
Luxembourg 21.9 21.1 19.6 21.8 20.9 22.4 24.5 24.5 24.3 27.4 29.2 29.7 29.7 29.5 29.3
Malta 62.1 56.2 54.7 47.8 43.7 40.3 52.9 55.1 55.8 56.9 57.1 56.6 56.1 55.9 55.5
The Netherlands 67.9 64.6 61.9 57.0 52.4 48.5 54.7 52.4 48.5 48.2 47.3 47.0 46.5 46.2 46.3
New Zealand 34.2 34.2 33.4 31.1 28.1 31.8 43.3 50.1 52.8 49.9 45.5 41.1 38.8 36.5 34.9
Norway 29.7 34.3 37.9 38.3 39.4 40.6 46.1 42.7 39.6 38.8 38.5 38.0 37.5 37.0 37.0
Portugal 132.9 131.2 131.5 126.1 121.5 116.6 134.9 125.4 116.0 112.4 108.6 105.2 102.2 99.3 96.5
Singapore 97.7 102.2 106.5 107.8 109.4 127.8 149.0 147.7 134.2 134.5 134.9 135.4 135.9 136.4 136.8
Slovak Republic 53.5 51.7 52.3 51.5 49.4 48.0 58.9 62.2 58.8 57.4 57.4 58.2 59.6 60.9 62.0
Slovenia 80.3 82.6 78.5 74.2 70.3 65.4 79.6 74.5 70.2 67.7 65.9 64.1 62.3 60.6 59.0
Spain 105.1 103.3 102.7 101.8 100.4 98.2 120.4 118.4 112.0 110.5 108.3 107.9 108.3 108.7 109.3
Sweden 44.9 43.7 42.3 40.7 39.2 35.2 39.5 36.3 31.7 32.3 32.9 32.5 31.9 31.0 30.0
Switzerland 42.1 42.2 40.9 41.8 39.8 39.6 43.3 41.5 39.1 37.5 36.1 35.0 33.8 32.8 31.7
United Kingdom 86.1 86.7 86.6 85.6 85.2 84.5 105.6 108.1 102.6 106.3 109.7 112.8 112.7 113.0 113.1
United States 2 104.5 105.1 107.2 106.2 107.4 108.7 133.5 126.4 121.7 122.2 125.8 129.1 131.8 134.0 136.2
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For economy-specific details, see “Data and Conventions” in text and Table B.
1 The average does not include the debt incurred by the European Union, and used to finance the grants portion of the NextGenerationEU (NGEU) package. This totaled €58 billion

(0.4 percent of European Union GDP) as of December 31, 2021, and €158 billion (1 percent of European Union GDP) as of February 16, 2023. Debt incurred by the EU and used to
on-lend to member states is included within member state debt data and regional aggregates.
2 For cross-economy comparison, gross debt levels reported by national statistical agencies for economies that have adopted the 2008 System of National Accounts (Australia, Canada,

Hong Kong SAR, United States) are adjusted to exclude unfunded pension liabilities of government employees’ defined-benefit pension plans.

76 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

Table A8. Advanced Economies: General Government Net Debt, 2014–28

(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average1 74.9 74.9 76.5 74.1 73.9 74.7 86.8 84.6 81.6 82.5 84.3 85.7 86.7 87.6 88.7
Euro Area 76.3 75.1 74.6 72.4 70.6 69.0 79.0 77.8 74.8 74.5 74.3 73.7 73.2 72.8 72.4
G7 86.4 85.8 87.7 85.4 85.5 86.2 99.9 98.0 94.2 95.3 97.9 99.8 101.1 102.4 104.0
G20 Advanced 80.9 80.7 82.6 80.1 80.3 81.4 94.6 92.7 89.5 90.8 93.3 95.1 96.4 97.7 99.1
Andorra ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Australia2 19.1 22.1 23.4 23.3 24.1 27.9 34.5 33.3 32.4 35.9 38.2 39.1 39.4 39.5 39.4
Austria 59.1 58.3 56.9 55.9 50.7 48.0 59.3 60.1 57.7 56.4 54.7 54.2 53.4 52.7 52.4
Belgium3 93.4 92.0 91.2 88.3 86.4 84.8 97.5 94.5 91.9 93.2 96.0 99.2 102.5 105.7 108.6
Canada2 21.7 18.5 18.0 12.5 11.6 8.5 15.7 15.4 13.9 14.1 13.9 13.7 13.1 12.5 12.0
Croatia 67.6 68.8 67.4 65.5 62.5 58.9 69.7 63.4 54.5 52.6 51.8 51.1 50.2 49.5 48.5
Cyprus 90.3 90.6 85.3 76.8 51.1 45.9 56.3 53.7 ... ... ... ... ... ... ...
Czech Republic 29.4 28.1 25.0 21.5 19.6 18.1 23.6 26.4 28.1 29.7 29.0 28.8 29.4 30.2 30.6
Denmark 18.1 16.2 17.5 15.8 13.4 12.3 14.7 10.0 6.5 5.0 4.4 4.3 4.2 4.2 4.3
Estonia –3.8 –2.0 –1.9 –1.8 –1.8 –2.2 3.0 4.5 5.9 10.5 13.4 15.2 16.4 16.9 17.3
Finland4 17.2 18.4 21.2 21.8 24.5 27.0 33.3 34.3 34.1 34.5 35.7 37.6 39.4 41.0 42.4
France 85.5 86.3 89.2 89.4 89.2 88.9 101.7 100.6 99.0 99.4 100.4 100.8 101.3 102.2 103.0
Germany 54.9 52.2 49.3 45.0 42.2 40.1 45.4 45.6 45.1 46.7 46.8 45.6 44.3 43.5 42.7
Greece ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Hong Kong SAR2 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Iceland5 88.2 78.1 67.7 60.3 50.7 54.4 61.1 60.4 57.1 53.8 51.2 47.7 43.6 39.3 35.9
Ireland6 85.8 65.7 65.4 58.8 54.2 48.8 49.8 45.1 36.5 32.0 28.8 26.4 24.2 21.6 19.4
Israel 62.3 60.6 59.0 57.1 57.6 57.5 67.6 65.1 58.4 55.2 53.1 52.4 52.1 51.9 51.7
Italy 121.4 122.2 121.6 121.3 121.8 121.7 141.4 137.3 133.0 129.3 129.4 128.2 126.9 125.1 122.6
Japan 144.9 144.5 149.5 148.1 151.1 151.7 162.3 156.9 162.7 161.0 159.3 159.2 159.4 160.2 161.3
Korea 7.5 9.5 9.7 9.6 9.6 11.7 18.3 20.9 23.9 24.8 25.4 26.1 26.8 27.3 27.8
Latvia 30.3 31.4 31.2 30.5 28.8 28.2 32.5 34.2 32.8 34.0 33.5 34.1 33.2 31.5 31.3
Lithuania 32.5 35.4 32.9 32.9 27.7 30.3 40.9 39.2 35.5 36.5 35.7 34.8 33.8 32.9 32.3
Luxembourg –10.9 –12.2 –11.6 –11.3 –11.8 –14.1 –10.5 –10.9 –8.5 –3.8 –0.7 1.3 2.6 3.6 4.5
Malta 52.7 47.8 41.8 35.4 32.9 29.2 42.4 44.8 49.3 50.8 51.4 51.2 51.0 51.1 50.9
The Netherlands 55.1 53.3 51.5 46.6 42.9 39.8 44.8 42.9 39.7 39.5 38.8 38.5 38.1 37.9 37.9
New Zealand 7.9 7.3 6.6 5.6 4.7 6.9 10.4 14.1 19.7 23.2 24.1 25.2 25.7 23.5 22.2
Norway –74.1 –85.1 –83.7 –78.6 –70.9 –74.2 –79.0 –85.3 –57.3 –68.4 –81.4 –93.9 –106.7 –118.8 –130.4
Portugal 120.6 121.0 119.4 116.0 113.4 109.9 123.0 118.1 109.6 106.2 102.7 99.6 96.8 94.1 91.4
Singapore ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Slovak Republic 49.5 47.3 46.9 45.8 43.4 43.1 48.9 50.5 49.0 49.9 51.0 52.8 54.4 56.0 57.3
Slovenia 63.8 63.6 62.7 60.2 53.4 49.9 57.2 56.4 53.2 52.3 51.9 51.4 50.9 50.4 50.0
Spain 86.2 86.0 87.1 86.2 84.9 83.7 103.0 102.3 97.4 96.6 95.2 95.3 96.1 96.9 97.9
Sweden 11.2 11.1 8.9 6.2 6.1 4.6 8.1 7.1 4.8 7.1 8.6 9.4 9.7 9.8 9.6
Switzerland 20.8 21.0 21.6 20.8 18.7 17.3 20.5 21.0 18.7 17.0 15.6 14.5 13.3 12.4 11.2
United Kingdom 77.9 78.2 77.6 76.2 75.4 74.6 94.5 96.7 91.9 95.1 98.2 101.0 100.9 101.2 101.2
United States 2 81.1 80.9 81.8 80.4 81.1 83.1 98.3 98.3 94.2 95.5 99.8 103.1 105.7 108.0 110.5
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For economy-specific details, see “Data and Conventions” in text, and Table B.
1 The average does not include the debt incurred by the European Union, and used to finance the grants portion of the NextGenerationEU (NGEU) package. This totaled €58 billion

(0.4 percent of European Union GDP) as of December 31, 2021, and €158 billion (1 percent of European Union GDP) as of February 16, 2023. Debt incurred by the EU and used to
on-lend to member states is included within member state debt data and regional aggregates.
2 For cross-economy comparison, net debt levels reported by national statistical agencies for economies that have adopted the 2008 System of National Accounts (Australia, Canada,

Hong Kong SAR, and the United States) are adjusted to exclude unfunded pension liabilities of government employees’ defined-benefit pension plans.
3 Belgium’s net debt series has been revised to ensure consistency between liabilities and assets. “Net debt” is defined as gross debt (Maastricht definition) minus assets in the form of

currency and deposits, loans, and debt securities.

4 Net debt figures were revised to include only categories of assets corresponding to the liabilities covered by the Maastricht definition of “gross debt.”

5 “Net debt” for Iceland is defined as gross debt minus currency and deposits.

6 “Net debt” for Ireland is defined as gross general debt minus debt instrument assets, namely, currency and deposits, debt securities, and loans. Net debt was previously defined as

general government debt less currency and deposits.

International Monetary Fund | April 2023 77

 FISCAL MONITOR: On the Path to Policy Normalization

Table A9. Emerging Market and Middle-Income Economies: General Government Overall Balance, 2014–28
(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average –2.4 –4.2 –4.5 –3.8 –3.5 –4.6 –8.9 –5.2 –5.3 –5.9 –5.4 –5.1 –4.9 –4.8 –4.7
Asia –1.7 –3.1 –3.7 –3.7 –4.2 –5.8 –9.7 –6.5 –7.4 –6.8 –6.3 –6.2 –6.0 –5.9 –5.9
Europe –1.5 –2.7 –2.8 –1.8 0.3 –0.6 –5.5 –1.9 –2.8 –5.8 –4.0 –3.5 –2.9 –2.7 –2.4
Latin America –4.8 –6.3 –5.8 –5.1 –5.0 –4.1 –8.8 –4.5 –3.9 –5.2 –4.4 –3.7 –3.2 –3.0 –2.7
MENA –1.7 –7.9 –8.9 –5.1 –1.7 –2.5 –8.5 –2.1 2.6 –1.0 –1.7 –2.0 –1.9 –1.9 –2.1
G20 Emerging –2.5 –4.3 –4.6 –4.0 –4.1 –5.2 –9.4 –5.5 –6.2 –6.6 –5.9 –5.7 –5.4 –5.3 –5.2
Algeria –8.0 –15.7 –13.4 –8.6 –6.8 –9.6 –11.9 –7.2 2.2 –7.9 –7.8 –8.0 –8.0 –8.1 –8.1
Angola –5.7 –2.9 –4.5 –6.6 2.3 0.8 –1.9 3.8 1.6 –0.2 –1.9 –2.5 –3.0 –3.3 –3.5
Argentina –4.3 –6.0 –6.7 –6.7 –5.4 –4.4 –8.6 –4.3 –3.9 –3.8 –3.6 –2.0 –1.7 –1.3 –1.3
Belarus 0.1 –3.0 –1.7 –0.3 1.8 0.9 –2.9 –1.7 –4.9 –1.8 –0.5 0.5 0.6 0.7 0.6
Brazil –6.0 –10.2 –9.0 –7.8 –7.0 –5.8 –13.3 –4.3 –4.6 –8.8 –8.2 –6.6 –5.5 –4.9 –4.4
Bulgaria –3.7 –2.8 1.5 0.8 0.1 –1.0 –2.9 –2.8 –0.8 –3.3 –3.0 –3.0 –2.3 –2.2 –2.2
Chile –1.5 –2.1 –2.7 –2.6 –1.5 –2.7 –7.1 –7.5 1.3 –1.8 –1.2 –0.7 –0.3 0.0 0.2
China1 –0.7 –2.5 –3.4 –3.4 –4.3 –6.1 –9.7 –6.0 –7.5 –6.9 –6.4 –6.3 –6.2 –6.1 –6.0
Colombia –1.7 –3.5 –2.3 –2.5 –4.7 –3.5 –7.0 –7.2 –6.7 –4.0 –2.1 –2.4 –2.5 –2.4 –2.1
Dominican Republic –2.8 0.0 –3.1 –3.1 –2.2 –2.2 –7.9 –2.9 –3.3 –3.0 –2.8 –2.6 –2.5 –2.5 –2.5
Ecuador2 –8.4 –7.2 –10.1 –5.8 –2.8 –3.5 –7.1 –1.6 0.1 ... ... ... ... ... ...
Egypt –10.7 –10.4 –11.8 –9.9 –9.0 –7.6 –7.5 –7.0 –5.8 –7.6 –9.2 –8.5 –6.9 –5.7 –5.0
Hungary –2.8 –2.0 –1.8 –2.5 –2.1 –2.0 –7.5 –7.1 –6.1 –3.9 –2.5 –2.9 –2.2 –2.1 –1.1
India –7.1 –7.2 –7.1 –6.2 –6.4 –7.7 –12.9 –9.6 –9.6 –8.9 –8.3 –7.9 –7.7 –7.7 –7.6
Indonesia –2.1 –2.6 –2.5 –2.5 –1.8 –2.2 –6.1 –4.5 –2.3 –2.6 –2.5 –2.4 –2.3 –2.2 –2.1
Iran –1.0 –1.5 –1.8 –1.6 –1.6 –4.5 –5.8 –4.2 –4.0 –5.8 –6.2 –6.4 –6.7 –7.0 –7.4
Kazakhstan 2.5 –6.3 –4.5 –4.3 2.6 –0.6 –7.0 –5.0 0.1 –1.8 –1.0 –0.8 –1.2 –1.2 –1.5
Kuwait 21.5 4.5 1.0 2.0 6.7 2.5 –11.4 2.3 11.6 7.0 4.2 2.8 0.4 –2.0 –3.2
Lebanon –6.2 –7.5 –8.9 –8.7 –11.3 –10.4 –3.5 ... ... ... ... ... ... ... ...
Malaysia3 –2.6 –2.5 –2.6 –2.4 –2.6 –2.0 –4.9 –5.8 –5.3 –4.8 –4.6 –4.5 –4.4 –4.5 –4.5
Mexico –4.5 –4.0 –2.8 –1.1 –2.2 –2.3 –4.4 –3.9 –4.4 –4.1 –2.7 –2.7 –2.7 –2.7 –2.7
Morocco –4.8 –4.5 –4.4 –3.2 –3.4 –3.6 –7.1 –5.9 –5.1 –4.9 –4.4 –3.8 –3.3 –3.1 –3.1
Oman –1.6 –13.5 –19.6 –10.5 –6.7 –4.8 –16.1 –3.2 6.3 0.3 0.9 0.5 0.3 0.3 0.4
Pakistan –4.3 –4.7 –3.9 –5.2 –5.7 –7.8 –7.0 –6.0 –7.8 –6.8 –8.3 –7.1 –6.2 –5.8 –5.4
Peru –0.2 –2.1 –2.2 –2.9 –2.0 –1.4 –9.0 –2.5 –1.3 –2.0 –1.9 –1.3 –0.5 –0.3 –0.3
Philippines 0.8 0.5 –0.8 –0.8 –1.5 –1.5 –5.5 –6.3 –5.2 –4.2 –3.7 –3.2 –2.9 –2.5 –2.2
Poland –3.7 –2.6 –2.4 –1.5 –0.2 –0.7 –6.9 –1.8 –3.1 –4.5 –3.8 –4.0 –4.2 –3.9 –3.5
Qatar 15.4 21.7 –4.9 –2.6 5.9 4.8 1.3 4.4 14.2 14.7 11.1 10.1 10.2 12.0 13.2
Romania –2.0 –1.3 –2.5 –2.9 –2.7 –4.6 –9.6 –6.7 –5.8 –5.7 –5.2 –4.9 –4.5 –4.4 –4.4
Russia –1.1 –3.4 –3.7 –1.5 2.9 1.9 –4.0 0.8 –2.2 –6.2 –2.8 –1.8 –0.8 –0.3 0.2
Saudi Arabia –3.5 –15.5 –13.7 –8.9 –5.5 –4.2 –10.7 –2.3 2.5 –1.1 –1.2 –0.8 –0.3 –0.1 –0.3
South Africa –3.9 –4.4 –3.7 –4.0 –3.7 –4.7 –9.6 –5.6 –4.5 –5.9 –6.1 –6.7 –6.3 –6.3 –6.5
Sri Lanka –6.0 –6.6 –5.0 –5.1 –5.0 –7.5 –12.1 –11.6 –10.4 ... ... ... ... ... ...
Thailand –0.8 0.1 0.6 –0.4 0.1 –0.8 –4.7 –7.0 –5.5 –3.1 –3.1 –3.2 –3.3 –3.4 –3.4
Türkiye –1.4 –1.3 –2.3 –2.2 –3.8 –4.8 –5.1 –4.0 –1.6 –6.5 –5.7 –5.6 –5.6 –5.6 –5.6
Ukraine –4.5 –1.2 –2.5 –2.4 –2.1 –2.1 –5.9 –3.9 –16.7 –20.3 ... ... ... ... ...
United Arab Emirates 1.9 –6.6 –3.1 –0.2 3.8 2.6 –2.5 4.0 9.0 4.3 3.7 2.9 2.4 2.2 2.0
Uruguay4 –2.6 –1.9 –2.7 –2.5 –1.9 –2.8 –4.7 –2.7 –2.5 –2.2 –2.5 –2.4 –2.2 –2.1 –1.9
Venezuela –9.8 –8.1 –8.5 –13.3 –30.3 –10.0 –5.0 –4.6 –6.0 ... ... ... ... ... ...
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For country-specific details, see “Data and Conventions” in text and Table C. MENA = Middle East and North Africa.
1 China’s deficit and public debt numbers presented in this table cover a narrower perimeter of the general government than IMF staff’s estimates in China Article IV reports (see IMF 2023

for a reconciliation of the two estimates).

2 The data for Ecuador reflect net lending/borrowing of the nonfinancial public sector. The authorities are undertaking revisions of the historical fiscal data with technical support from the IMF.

3 The general government overall balance in 2019 includes a one-off refund of tax arrears in 2019 of 2.4 percent of GDP.

4 Data are for the nonfinancial public sector, which includes central government, local government, social security funds, nonfinancial public corporations, and Banco de Seguros del

Estado. The coverage of fiscal data was changed from the consolidated public sector to the nonfinancial public sector with the October 2019 submission. With this narrower coverage, the
central bank balances are not included in the fiscal data. Historical data were also revised accordingly. Starting in October 2018, the public pension system has been receiving transfers
in the context of a new law that compensates persons affected by the creation of the mixed pension system. These funds are recorded as revenues, consistent with the IMF’s methodology.
Therefore, data and projections for 2018–22 are affected by these transfers, which amounted to 1.2 percent of GDP in 2018, 1.1 percent of GDP in 2019, 0.6 percent of GDP in 2020, and
0.3 percent of GDP in 2021 and are projected to be 0.1 percent of GDP in 2022 and 0 thereafter. See IMF Country Report No. 19/64 for further details. The disclaimer about the public
pension system applies only to the revenues and net lending/borrowing series.

78 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

Table A10. Emerging Market and Middle-Income Economies: General Government Primary Balance, 2014–28
(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average –0.8 –2.5 –2.8 –2.1 –1.8 –2.7 –7.1 –3.4 –3.4 –3.7 –3.0 –2.8 –2.5 –2.3 –2.2
Asia –0.5 –1.9 –2.4 –2.2 –2.8 –4.3 –8.0 –4.9 –5.8 –5.0 –4.4 –4.1 –3.8 –3.5 –3.4
Europe –0.4 –1.5 –1.7 –0.8 1.4 0.4 –4.5 –0.9 –1.9 –4.4 –2.4 –1.8 –1.2 –1.1 –0.8
Latin America –1.5 –2.1 –2.0 –1.3 –1.3 –0.5 –5.5 –1.0 0.0 –0.9 0.1 0.4 0.8 1.0 1.2
MENA –1.2 –7.5 –8.6 –4.8 –0.8 –1.3 –7.6 –0.9 3.5 0.5 0.0 –0.3 –0.3 –0.3 –0.4
G20 Emerging –0.8 –2.5 –2.9 –2.2 –2.3 –3.4 –7.6 –3.8 –4.3 –4.4 –3.6 –3.3 –2.9 –2.7 –2.6
Algeria –7.8 –15.4 –13.1 –7.7 –6.3 –9.0 –11.0 –6.5 3.1 –6.5 –6.2 –6.4 –6.1 –5.9 –5.7
Angola –4.7 –1.1 –1.7 –3.0 7.0 6.4 5.0 9.0 6.0 4.0 3.2 2.7 2.3 2.0 1.9
Argentina –3.5 –4.4 –4.8 –4.2 –2.2 –0.4 –6.2 –2.5 –1.8 –1.4 –0.4 0.6 1.4 2.0 2.0
Belarus 1.1 –1.3 0.3 1.6 3.8 2.6 –1.2 –0.2 –3.2 –0.2 1.1 2.1 2.1 2.0 1.9
Brazil –0.6 –1.9 –2.5 –1.7 –1.5 –0.8 –9.2 0.7 1.3 –2.0 –1.0 –0.5 0.2 0.8 1.4
Bulgaria –3.4 –2.4 1.8 1.2 0.3 –0.8 –2.8 –2.8 –0.8 –3.2 –2.5 –2.0 –1.4 –1.4 –1.3
Chile –1.4 –1.9 –2.4 –2.3 –1.1 –2.4 –6.6 –6.9 0.9 –1.5 –0.9 –0.3 0.1 0.4 0.6
China –0.1 –2.0 –2.7 –2.6 –3.5 –5.2 –8.8 –5.1 –6.6 –5.8 –5.2 –4.9 –4.6 –4.3 –4.1
Colombia –0.2 –1.7 –0.4 –0.5 –2.5 –1.0 –4.4 –4.4 –2.5 0.3 1.9 1.1 0.8 0.6 0.6
Dominican Republic –0.4 2.3 –0.6 –0.5 0.4 0.6 –4.7 0.2 –0.5 0.2 0.5 0.8 0.9 0.9 0.9
Ecuador 1 –7.5 –5.9 –8.6 –3.7 –0.3 –0.8 –4.3 –0.3 1.6 ... ... ... ... ... ...
Egypt –4.0 –3.9 –4.1 –2.4 –0.4 1.3 1.2 1.1 0.4 1.6 2.2 2.2 2.3 2.4 2.5
Hungary 1.0 1.3 1.2 0.1 0.2 0.1 –5.3 –5.0 –3.7 –0.8 0.6 0.3 0.7 0.6 1.0
India –2.6 –2.7 –2.5 –1.5 –1.7 –3.0 –7.3 –4.5 –4.4 –3.6 –2.9 –2.5 –2.2 –2.1 –2.0
Indonesia –0.9 –1.2 –1.0 –0.9 –0.1 –0.4 –4.1 –2.5 –0.4 –0.5 –0.3 –0.1 –0.1 0.0 0.0
Iran –1.0 –1.4 –1.3 –1.0 –0.6 –3.5 –4.6 –3.1 –3.1 –3.2 –3.1 –3.0 –2.9 –2.7 –2.6
Kazakhstan 2.0 –5.9 –4.3 –5.2 1.8 –0.8 –7.7 –4.4 0.8 –0.7 0.2 0.4 0.2 0.1 –0.2
Kuwait2 12.7 –7.5 –14.0 –9.6 –4.1 –8.4 –28.1 –11.6 0.6 –5.8 –8.7 –10.1 –12.4 –14.8 –16.1
Lebanon 2.5 1.4 0.4 0.8 –1.4 –0.3 –0.5 ... ... ... ... ... ... ... ...
Malaysia –0.9 –0.9 –0.8 –0.6 –0.8 0.0 –3.1 –3.7 –3.2 –2.5 –2.0 –1.9 –1.7 –1.6 –1.6
Mexico –1.7 –1.2 0.4 2.6 1.6 1.4 –0.5 0.0 –0.1 0.2 1.7 1.8 1.8 1.7 1.6
Morocco –2.2 –2.0 –2.0 –0.9 –1.2 –1.4 –4.6 –3.8 –3.0 –2.6 –2.1 –1.5 –1.0 –0.8 –0.9
Oman –1.9 –14.1 –20.0 –11.1 –5.2 –4.6 –13.3 –1.0 8.2 2.5 3.2 2.7 2.3 2.1 1.9
Pakistan –0.3 –0.4 –0.1 –1.4 –1.8 –3.0 –1.5 –1.1 –3.0 –0.5 –0.4 –0.4 –0.4 –0.4 –0.4
Peru 0.7 –1.2 –1.3 –1.9 –0.9 –0.2 –6.9 –1.2 0.0 –0.5 –0.5 0.0 0.5 0.6 0.6
Philippines 3.0 2.4 0.9 0.9 0.2 0.1 –3.7 –4.5 –3.4 –2.2 –1.7 –1.2 –1.0 –0.7 –0.5
Poland –1.7 –0.8 –0.7 0.1 1.2 0.6 –5.6 –0.7 –1.7 –2.7 –2.0 –2.0 –2.1 –1.7 –1.3
Qatar 16.6 23.1 –3.4 –1.2 7.3 6.6 3.6 6.1 15.6 16.2 12.4 11.3 11.4 13.1 14.2
Romania –0.5 –0.1 –1.3 –1.8 –1.4 –3.4 –8.3 –5.3 –3.8 –3.7 –3.3 –3.2 –2.8 –2.8 –2.8
Russia –0.7 –3.1 –3.2 –1.0 3.4 2.2 –3.7 1.1 –2.0 –5.9 –2.4 –1.4 –0.4 –0.1 0.5
Saudi Arabia –4.2 –17.5 –16.5 –11.3 –6.0 –4.2 –12.5 –2.0 2.8 –0.6 –0.7 –0.3 0.2 0.4 0.1
South Africa –1.2 –1.4 –0.6 –0.8 –0.4 –1.1 –5.5 –1.3 0.1 –0.8 –0.6 –0.7 0.3 0.7 0.9
Sri Lanka –1.9 –2.1 –0.2 0.0 0.6 –1.9 –5.9 –5.7 –3.8 ... ... ... ... ... ...
Thailand –0.1 0.7 1.0 0.1 0.6 –0.3 –4.2 –6.2 –4.4 –1.6 –1.5 –1.5 –1.5 –1.5 –1.6
Türkiye 0.5 0.6 –1.0 –0.9 –2.3 –2.9 –3.2 –2.3 –0.4 –4.4 –2.8 –2.2 –2.0 –2.0 –2.0
Ukraine –1.2 3.0 1.6 1.4 1.2 1.0 –3.0 –1.1 –13.4 –15.7 ... ... ... ... ...
United Arab Emirates 2.2 –6.3 –2.9 0.0 4.0 2.9 –2.2 4.3 9.4 5.0 4.2 3.4 3.0 2.7 2.5
Uruguay 3 –0.5 0.2 –0.3 –0.2 0.5 –0.5 –2.1 –0.7 –0.7 –0.9 –1.1 –0.8 –0.5 –0.3 –0.1
Venezuela –7.5 –6.8 –7.7 –13.1 –30.3 –10.0 –4.9 –4.6 –5.8 ... ... ... ... ... ...
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: “Primary balance” is defined as the overall balance, excluding net interest payments. For country-specific details, see “Data and Conventions” in text and Table C. MENA = Middle East
and North Africa.
1 The data for Ecuador reflect primary balance of the nonfinancial public sector. The authorities are undertaking revisions of the historical fiscal data with technical support from the IMF.

2 Interest revenue is proxied by IMF staff estimates of investment income. The country team does not have the breakdown of investment income between interest revenue and dividends.

3 Data are for the nonfinancial public sector, which includes central government, local government, social security funds, nonfinancial public corporations, and Banco de Seguros del Estado.

The coverage of fiscal data was changed from the consolidated public sector to the nonfinancial public sector with the October 2019 submission. With this narrower coverage, the central
bank balances are not included in the fiscal data. Historical data were also revised accordingly. Starting in October 2018, the public pension system has been receiving transfers in the context
of a new law that compensates persons affected by the creation of the mixed pension system. These funds are recorded as revenues, consistent with the IMF’s methodology. Therefore, data
and projections for 2018–22 are affected by these transfers, which amounted to 1.2 percent of GDP in 2018, 1.1 percent of GDP in 2019, 0.6 percent of GDP in 2020, and 0.3 percent of GDP
in 2021 and are projected to be 0.1 percent of GDP in 2022 and 0 thereafter. See IMF Country Report No. 19/64 for further details. The disclaimer about the public pension system applies
only to the revenues and net lending/borrowing series.

International Monetary Fund | April 2023 79

 FISCAL MONITOR: On the Path to Policy Normalization

Table A11. Emerging Market and Middle-Income Economies: General Government Cyclically Adjusted Balance,
2014–28
(Percent of potential GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average –2.7 –3.7 –3.9 –3.6 –3.7 –4.6 –7.4 –5.2 –5.8 –6.2 –5.6 –5.4 –5.2 –5.1 –5.0
Asia –1.7 –2.8 –3.6 –3.5 –4.2 –5.5 –8.1 –5.9 –6.7 –6.4 –6.1 –6.1 –6.0 –5.9 –5.9
Europe –1.2 –2.2 –2.3 –1.7 –0.2 –0.9 –4.7 –2.1 –3.2 –5.9 –4.0 –3.5 –2.9 –2.6 –2.3
Latin America –5.3 –6.4 –5.3 –4.8 –4.2 –3.5 –6.8 –4.4 –4.3 –5.3 –4.5 –3.7 –3.3 –3.0 –2.8
MENA –9.6 –10.7 –10.3 –8.2 –7.4 –7.8 –8.0 –7.2 –4.2 –6.8 –7.3 –6.6 –5.7 –4.9 –4.4
G20 Emerging –2.5 –3.8 –4.1 –3.8 –3.9 –4.9 –7.9 –5.2 –6.0 –6.5 –5.9 –5.7 –5.6 –5.5 –5.4
Algeria ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Angola –7.5 –0.5 –2.4 –4.5 3.1 1.5 0.4 3.4 0.8 –0.3 –1.7 –2.0 –2.2 –2.6 –3.0
Argentina –3.4 –6.2 –6.0 –7.2 –5.0 –3.4 –5.0 –3.2 –3.9 –3.5 –3.5 –2.0 –1.7 –1.3 –1.3
Belarus –0.8 –2.3 0.0 0.4 1.6 0.4 –3.3 –3.2 –4.8 –1.9 –0.7 0.3 0.5 0.8 0.7
Brazil –7.8 –10.3 –7.5 –6.6 –6.2 –5.2 –11.8 –4.2 –5.0 –9.0 –8.3 –6.6 –5.5 –4.9 –4.4
Bulgaria –3.1 –2.7 1.4 0.7 0.1 –1.3 –2.3 –3.2 –1.2 –3.2 –3.1 –2.9 –2.2 –2.2 –2.2
Chile 1 –0.5 0.5 –1.0 –2.0 –1.5 –1.7 –1.6 –12.1 –1.1 –1.6 –0.9 –0.4 –0.1 0.1 0.0
China –0.7 –2.2 –3.1 –3.2 –4.1 –5.8 –8.4 –5.6 –6.6 –6.4 –6.1 –6.2 –6.2 –6.0 –6.0
Colombia –2.4 –3.9 –2.6 –2.3 –4.2 –2.5 –4.9 –7.5 –8.3 –4.6 –2.1 –2.9 –3.2 –3.2 –2.9
Dominican Republic –4.3 –4.2 –3.8 –3.7 –3.3 –3.2 –7.6 –3.4 –3.7 –4.0 –3.9 –3.6 –3.5 –3.3 –3.2
Ecuador2 –9.2 –8.8 –10.5 –5.3 –3.3 –3.4 –5.0 –1.2 –0.6 ... ... ... ... ... ...
Egypt –11.0 –10.8 –11.4 –10.1 –9.0 –7.3 –6.6 –7.1 –6.0 –7.7 –9.2 –8.5 –6.8 –5.6 –4.9
Hungary –1.7 –1.5 –1.2 –2.6 –3.0 –3.4 –6.9 –7.1 –6.1 –3.6 –2.4 –2.8 –2.1 –2.1 –1.1
India –6.6 –7.0 –7.4 –6.2 –6.8 –7.6 –9.1 –8.8 –9.6 –8.9 –8.3 –8.0 –7.8 –7.7 –7.6
Indonesia –2.3 –2.7 –2.5 –2.4 –1.8 –2.1 –5.3 –3.9 –2.1 –2.5 –2.5 –2.4 –2.3 –2.2 –2.1
Iran ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Kazakhstan ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Kuwait ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Lebanon –13.5 –11.6 –11.5 –13.8 –12.7 –18.4 –12.1 ... ... ... ... ... ... ... ...
Malaysia –2.6 –2.6 –2.7 –2.6 –3.6 –1.6 –3.9 –4.9 –5.5 –5.1 –4.8 –4.8 –4.6 –4.6 –4.5
Mexico –4.5 –4.2 –4.1 –2.6 –2.4 –2.1 –3.3 –3.4 –4.3 –4.0 –2.6 –2.6 –2.6 –2.6 –2.7
Morocco –6.1 –4.8 –4.9 –4.3 –3.9 –3.8 –5.5 –5.9 –5.0 –4.9 –4.4 –3.8 –3.3 –3.1 –3.1
Oman ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Pakistan ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Peru –0.1 –1.5 –1.8 –2.1 –1.6 –0.6 –6.0 –3.7 –1.8 –2.2 –2.3 –1.8 –1.3 –1.2 –1.1
Philippines 0.6 0.5 –0.9 –0.8 –1.5 –1.5 –3.3 –5.4 –5.4 –4.3 –3.7 –3.2 –2.9 –2.5 –2.3
Poland –2.9 –2.2 –1.7 –1.7 –1.5 –2.3 –5.3 –2.1 –4.2 –4.0 –3.1 –3.6 –4.1 –3.8 –3.5
Qatar ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Romania –1.1 –0.4 –1.4 –3.1 –3.8 –5.7 –8.1 –6.8 –6.2 –5.6 –5.1 –4.8 –4.5 –4.4 –4.4
Russia –0.1 –3.1 –3.2 –1.0 2.9 2.0 –4.4 0.5 –2.0 –5.9 –2.6 –1.7 –0.7 –0.3 0.3
Saudi Arabia ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
South Africa –4.0 –4.2 –3.6 –3.8 –3.7 –4.4 –5.7 –5.0 –5.5 –6.4 –6.4 –6.2 –6.3 –6.3 –6.5
Sri Lanka ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Thailand –0.7 0.4 0.8 –0.4 –0.1 –1.0 –3.8 –5.8 –5.2 –2.9 –2.5 –3.1 –3.3 –3.4 –2.7
Türkiye –1.6 –1.6 –2.1 –2.9 –4.2 –4.0 –3.6 –4.4 –2.3 –7.2 –6.4 –6.1 –5.9 –5.7 –5.6
Ukraine –3.2 1.5 –0.9 –1.4 –2.2 –1.7 –4.4 –3.3 ... ... ... ... ... ... ...
United Arab Emirates ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Uruguay 3 –3.4 –1.9 –2.6 –2.6 –1.9 –2.5 –3.2 –1.8 –2.2 –2.0 –2.4 –2.3 –2.2 –2.1 –1.9
Venezuela ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For country-specific details, see “Data and Conventions” in text and Table C. MENA = Middle East and North Africa.
1 Data for these economies include adjustments beyond the output cycle.

2 The data for Ecuador reflect cyclically adjusted balance of the nonfinancial public sector. The authorities are undertaking revisions of the historical fiscal data with technical support from

the IMF.
3 Data are for the nonfinancial public sector, which includes central government, local government, social security funds, nonfinancial public corporations, and Banco de Seguros del

Estado. The coverage of fiscal data was changed from the consolidated public sector to the nonfinancial public sector with the October 2019 submission. With this narrower coverage, the
central bank balances are not included in the fiscal data. Historical data were also revised accordingly. Starting in October 2018, the public pension system has been receiving transfers
in the context of a new law that compensates persons affected by the creation of the mixed pension system. These funds are recorded as revenues, consistent with the IMF’s methodology.
Therefore, data and projections for 2018–22 are affected by these transfers, which amounted to 1.2 percent of GDP in 2018, 1.1 percent of GDP in 2019, 0.6 percent of GDP in 2020, and
0.3 percent of GDP in 2021 and are projected to be 0.1 percent of GDP in 2022 and 0 thereafter. See IMF Country Report No. 19/64 for further details. The disclaimer about the public
pension system applies only to the revenues and net lending/borrowing series.

80 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

Table A12. Emerging Market and Middle-Income Economies: General Government Cyclically Adjusted Primary
Balance, 2014–28
(Percent of potential GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average –0.8 –1.7 –2.0 –1.6 –1.8 –2.7 –5.5 –3.3 –3.8 –3.9 –3.2 –2.9 –2.7 –2.4 –2.3
Asia –0.5 –1.7 –2.2 –2.0 –2.8 –4.1 –6.5 –4.4 –5.1 –4.6 –4.2 –4.0 –3.8 –3.5 –3.4
Europe 0.1 –1.0 –1.1 –0.5 0.9 0.2 –3.7 –1.0 –2.3 –4.6 –2.5 –1.8 –1.2 –0.9 –0.6
Latin America –1.9 –2.1 –1.6 –0.9 –0.5 0.2 –3.6 –1.0 –0.2 –0.9 0.2 0.5 0.9 1.1 1.3
MENA –5.2 –6.2 –5.1 –3.5 –2.2 –2.3 –2.6 –2.1 0.1 –1.1 –0.8 –0.3 0.1 0.4 0.8
G20 Emerging –0.7 –1.9 –2.2 –1.8 –2.0 –3.1 –6.0 –3.4 –4.1 –4.3 –3.6 –3.3 –3.0 –2.8 –2.6
Algeria ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Angola –6.4 1.1 0.1 –1.3 7.5 6.8 6.4 8.7 5.4 3.9 3.3 3.0 2.8 2.5 2.3
Argentina –2.7 –4.6 –4.1 –4.7 –1.8 0.5 –2.7 –1.4 –1.8 –1.1 –0.3 0.6 1.4 2.0 2.0
Belarus 0.2 –0.7 1.9 2.3 3.6 2.1 –1.6 –1.6 –3.1 –0.3 0.9 1.9 2.0 2.1 2.0
Brazil –2.1 –1.9 –1.3 –0.7 –0.9 –0.3 –7.9 0.8 0.9 –2.1 –1.1 –0.5 0.2 0.8 1.4
Bulgaria –2.8 –2.3 1.7 1.0 0.3 –1.2 –2.2 –3.1 –1.2 –3.1 –2.5 –2.0 –1.4 –1.3 –1.3
Chile 1 –0.4 0.7 –0.7 –1.7 –1.2 –1.4 –1.1 –11.5 –1.5 –1.3 –0.6 0.0 0.3 0.5 0.4
China –0.2 –1.7 –2.5 –2.5 –3.3 –4.9 –7.5 –4.7 –5.7 –5.3 –4.9 –4.8 –4.6 –4.3 –4.1
Colombia –0.8 –2.1 –0.6 –0.3 –2.0 0.1 –2.4 –4.4 –3.5 0.4 2.5 1.4 1.0 0.8 0.8
Dominican Republic –2.0 –1.9 –1.3 –1.2 –0.7 –0.5 –4.6 –0.3 –0.8 –0.8 –0.6 –0.2 –0.1 0.1 0.2
Ecuador2 –8.2 –7.4 –9.0 –3.2 –0.9 –0.7 –2.4 0.1 1.0 ... ... ... ... ... ...
Egypt –4.3 –4.4 –3.7 –2.6 –0.5 1.5 2.0 0.9 0.2 1.5 2.2 2.3 2.3 2.5 2.6
Hungary 1.9 1.8 1.7 0.0 –0.7 –1.1 –4.7 –5.0 –3.8 –0.5 0.8 0.4 0.8 0.7 1.0
India –2.2 –2.5 –2.8 –1.4 –2.0 –2.9 –3.9 –3.7 –4.4 –3.6 –2.9 –2.5 –2.3 –2.1 –2.0
Indonesia –1.1 –1.3 –1.0 –0.8 0.0 –0.4 –3.3 –2.0 –0.2 –0.5 –0.3 –0.1 –0.1 0.0 0.0
Iran ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Kazakhstan ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Kuwait ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Lebanon –4.9 –2.8 –2.1 –4.0 –2.1 –7.4 –9.4 ... ... ... ... ... ... ... ...
Malaysia –0.8 –1.0 –0.9 –0.8 –1.7 0.4 –2.2 –2.9 –3.4 –2.7 –2.3 –2.1 –1.9 –1.7 –1.6
Mexico –1.7 –1.4 –0.9 1.1 1.4 1.6 0.4 0.4 0.0 0.3 1.8 1.9 1.8 1.7 1.6
Morocco –3.5 –2.3 –2.5 –1.9 –1.6 –1.7 –3.0 –3.8 –3.1 –2.6 –2.1 –1.5 –1.0 –0.8 –0.9
Oman ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Pakistan ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Peru 0.8 –0.6 –0.9 –1.1 –0.5 0.5 –4.0 –2.4 –0.5 –0.8 –1.0 –0.6 –0.2 –0.3 –0.2
Philippines 2.8 2.5 0.9 0.8 0.1 0.1 –1.7 –3.7 –3.5 –2.3 –1.8 –1.2 –1.0 –0.7 –0.5
Poland –0.9 –0.5 0.0 –0.1 0.0 –0.9 –4.1 –1.0 –2.7 –2.2 –1.4 –1.6 –2.0 –1.7 –1.3
Qatar ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Romania 0.4 0.8 –0.2 –2.0 –2.4 –4.5 –6.9 –5.3 –4.1 –3.7 –3.2 –3.1 –2.8 –2.8 –2.8
Russia 0.3 –2.8 –2.8 –0.5 3.4 2.3 –4.1 0.8 –1.7 –5.5 –2.2 –1.3 –0.3 0.0 0.5
Saudi Arabia ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
South Africa –1.2 –1.2 –0.5 –0.6 –0.3 –0.9 –2.0 –0.9 –1.0 –1.3 –0.9 –0.2 0.3 0.7 0.9
Sri Lanka ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Thailand 0.0 0.9 1.2 0.1 0.4 –0.4 –3.3 –5.1 –4.0 –1.4 –0.9 –1.4 –1.4 –1.5 –0.9
Türkiye 0.4 0.3 –0.8 –1.6 –2.6 –2.2 –1.8 –2.7 –1.1 –5.0 –3.4 –2.7 –2.3 –2.1 –2.0
Ukraine 0.0 5.4 3.0 2.3 1.1 1.3 –1.6 –0.5 ... ... ... ... ... ... ...
United Arab Emirates ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Uruguay 3 –1.2 0.2 –0.2 –0.2 0.5 –0.2 –0.7 0.2 –0.4 –0.7 –1.0 –0.7 –0.5 –0.3 –0.1
Venezuela ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: “Cyclically adjusted primary balance” is defined as the cyclically adjusted balance plus net interest payable/paid (interest expense minus interest revenue) following the World
Economic Outlook convention. For country-specific details, see “Data and Conventions” in text and Table C. MENA = Middle East and North Africa.
1 Data for these economies include adjustments beyond the output cycle. For country-specific details, see “Data and Conventions” in text and Table C.

2 The data for Ecuador reflect cyclically adjusted primary balance of the nonfinancial public sector. The authorities are undertaking revisions of the historical fiscal data with technical

support from the IMF.

3 Data are for the nonfinancial public sector, which includes central government, local government, social security funds, nonfinancial public corporations, and Banco de Seguros del

Estado. The coverage of fiscal data was changed from the consolidated public sector to the nonfinancial public sector with the October 2019 submission. With this narrower coverage, the
central bank balances are not included in the fiscal data. Historical data were also revised accordingly. Starting in October 2018, the public pension system has been receiving transfers
in the context of a new law that compensates persons affected by the creation of the mixed pension system. These funds are recorded as revenues, consistent with the IMF’s methodology.
Therefore, data and projections for 2018–22 are affected by these transfers, which amounted to 1.2 percent of GDP in 2018, 1.1 percent of GDP in 2019, 0.6 percent of GDP in 2020, and
0.3 percent of GDP in 2021 and are projected to be 0.1 percent of GDP in 2022 and 0 thereafter. See IMF Country Report No. 19/64 for further details. The disclaimer about the public
pension system applies only to the revenues and net lending/borrowing series.

International Monetary Fund | April 2023 81

 FISCAL MONITOR: On the Path to Policy Normalization

Table A13. Emerging Market and Middle-Income Economies: General Government Revenue, 2014–28
(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average 28.3 27.4 27.1 27.4 27.9 27.4 25.6 26.5 26.5 26.0 26.0 26.0 26.1 26.1 26.1
Asia 25.6 26.3 26.1 26.2 26.3 25.4 23.6 24.6 23.8 23.7 23.9 24.1 24.3 24.4 24.5
Europe 34.3 33.3 33.6 33.6 35.0 35.1 34.3 34.3 34.1 32.7 33.1 33.1 33.2 33.2 33.2
Latin America 28.9 28.1 28.9 28.8 28.6 29.0 27.3 28.8 30.3 28.6 28.6 28.6 28.6 28.7 28.8
MENA 32.5 26.3 23.9 25.5 29.7 29.5 26.9 27.9 30.2 29.4 28.7 28.2 27.8 27.4 26.9
G20 Emerging 28.3 27.8 27.9 28.1 28.2 27.6 25.6 26.6 26.2 25.6 25.8 25.9 26.1 26.2 26.2
Algeria 33.3 30.5 28.6 32.6 33.5 32.2 30.5 29.8 33.4 30.1 28.4 27.7 26.8 26.5 26.4
Angola 30.7 24.1 17.5 17.5 22.9 21.2 21.3 23.3 23.4 21.5 20.6 19.8 19.2 18.6 18.2
Argentina 34.6 35.4 34.9 34.4 33.5 33.3 33.5 33.5 33.4 32.3 33.9 34.9 35.6 35.8 35.9
Belarus 38.9 38.8 39.0 38.7 39.6 38.3 35.2 35.4 32.0 33.5 34.2 35.2 35.3 35.3 35.2
Brazil 33.7 32.9 35.4 34.9 35.4 36.6 33.7 36.9 38.7 35.8 35.5 35.4 35.3 35.3 35.2
Bulgaria 33.4 34.5 34.2 32.8 34.4 34.9 34.9 35.8 37.4 36.8 35.2 34.4 34.9 34.6 34.3
Chile 22.4 22.9 22.7 22.9 24.1 23.7 22.0 26.0 27.9 24.8 25.4 25.4 25.3 25.6 25.5
China 28.2 29.0 28.9 29.2 29.0 28.1 25.7 26.6 25.5 25.6 25.9 26.0 26.2 26.4 26.5
Colombia 29.5 27.8 27.7 26.8 30.0 29.4 26.6 27.2 27.6 31.4 32.1 31.0 30.6 30.7 30.7
Dominican Republic 14.2 16.6 13.9 14.0 14.2 14.4 14.2 15.6 15.5 14.9 15.0 15.0 15.0 15.0 15.0
Ecuador 1 34.8 33.0 30.0 32.2 35.6 33.7 29.4 34.2 36.1 ... ... ... ... ... ...
Egypt 23.2 20.9 19.2 20.7 19.7 19.3 18.2 18.6 18.9 18.7 19.8 20.1 20.4 20.7 20.9
Hungary 47.3 48.4 45.0 44.3 44.0 44.0 43.5 41.3 43.9 43.6 44.4 43.5 43.5 43.0 42.6
India 19.1 19.9 20.1 20.0 20.0 19.2 18.2 19.7 19.2 19.1 19.4 19.6 19.7 19.9 20.0
Indonesia 16.5 14.9 14.3 14.1 14.9 14.2 12.5 13.6 15.2 14.4 14.6 14.7 14.8 14.9 15.0
Iran 13.1 14.8 15.3 15.5 13.6 9.7 7.2 8.1 8.3 8.1 8.2 8.4 8.5 8.6 8.8
Kazakhstan 23.7 16.6 17.0 19.8 21.4 19.7 17.5 17.1 21.8 20.0 19.7 19.6 19.3 19.3 19.1
Kuwait 65.8 58.9 55.0 54.0 58.6 55.5 55.1 54.6 52.2 57.7 54.7 53.3 51.3 49.4 48.5
Lebanon 22.6 19.2 19.4 21.9 21.0 20.8 16.0 ... ... ... ... ... ... ... ...
Malaysia 23.3 22.2 20.3 19.6 20.2 21.6 20.2 18.6 19.0 16.8 15.9 15.5 15.5 15.5 15.6
Mexico 23.4 23.5 24.6 24.6 23.5 23.6 24.2 23.7 25.8 23.9 23.9 23.9 24.0 24.1 24.2
Morocco 25.9 23.9 24.1 24.6 24.2 23.8 27.0 25.1 25.9 26.9 26.7 26.5 26.5 26.6 26.5
Oman 39.8 31.1 25.0 29.0 31.6 33.9 29.6 33.0 35.4 32.4 31.8 31.0 30.2 29.3 28.4
Pakistan 13.5 12.9 13.8 14.0 13.4 11.3 13.3 12.4 12.1 12.2 12.5 12.5 12.5 12.5 12.5
Peru 22.3 20.2 18.7 18.2 19.3 19.8 17.8 21.0 21.8 21.5 21.5 21.5 21.4 21.4 21.4
Philippines 18.1 18.5 18.3 18.7 19.4 20.2 20.4 21.0 21.6 21.4 21.5 21.9 22.4 22.9 23.3
Poland 39.2 39.1 38.9 39.9 41.2 41.1 41.3 42.3 41.0 41.8 42.1 42.0 41.8 41.4 41.6
Qatar 47.7 60.2 35.2 32.1 34.8 37.3 36.0 33.7 39.6 41.8 37.7 36.1 35.7 36.1 36.2
Romania 31.8 32.8 29.3 28.2 29.0 28.8 28.6 30.5 31.0 30.6 30.6 30.8 31.2 30.9 30.9
Russia 33.9 31.9 32.9 33.4 35.5 35.7 35.2 35.6 34.3 31.2 32.3 32.3 32.5 32.6 32.7
Saudi Arabia 36.2 24.4 20.8 23.2 28.5 29.5 28.4 29.6 30.6 28.5 28.7 28.8 29.1 29.0 28.2
South Africa 25.4 25.8 26.2 25.8 26.5 26.8 25.0 27.1 27.7 27.5 27.2 27.2 27.3 27.3 27.3
Sri Lanka 11.2 12.6 13.2 12.8 12.6 11.9 8.7 8.3 8.5 ... ... ... ... ... ...
Thailand 21.4 22.3 21.9 21.1 21.4 21.0 20.6 20.2 20.1 20.4 20.5 20.5 20.5 20.5 20.5
Türkiye 31.6 31.9 32.5 31.2 30.8 31.0 28.9 27.2 26.4 27.6 27.9 28.0 28.0 28.0 28.3
Ukraine 40.3 41.9 38.3 39.3 39.8 39.4 39.7 36.3 53.2 47.3 ... ... ... ... ...
United Arab Emirates 34.2 20.7 29.7 28.0 30.5 31.0 28.7 30.4 35.4 33.0 32.0 31.2 30.7 30.3 30.1
Uruguay 2 26.6 26.6 27.1 27.5 28.8 28.3 28.1 28.2 26.9 26.7 26.6 26.7 26.7 26.7 26.8
Venezuela 21.8 14.9 11.2 8.5 6.4 8.7 4.3 5.9 6.0 ... ... ... ... ... ...
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For country-specific details, see “Data and Conventions” in text and Table C. MENA = Middle East and North Africa.
1 The data for Ecuador reflect revenue of the nonfinancial public sector. The authorities are undertaking revisions of the historical fiscal data with technical support from the IMF.

2 Data are for the nonfinancial public sector, which includes central government, local government, social security funds, nonfinancial public corporations, and Banco de Seguros del

Estado. The coverage of fiscal data was changed from the consolidated public sector to the nonfinancial public sector with the October 2019 submission. With this narrower coverage, the
central bank balances are not included in the fiscal data. Historical data were also revised accordingly. Starting in October 2018, the public pension system has been receiving transfers
in the context of a new law that compensates persons affected by the creation of the mixed pension system. These funds are recorded as revenues, consistent with the IMF’s methodology.
Therefore, data and projections for 2018–22 are affected by these transfers, which amounted to 1.2 percent of GDP in 2018, 1.1 percent of GDP in 2019, 0.6 percent of GDP in 2020, and
0.3 percent of GDP in 2021 and are projected to be 0.1 percent of GDP in 2022 and 0 thereafter. See IMF Country Report No. 19/64 for further details. The disclaimer about the public
pension system applies only to the revenues and net lending/borrowing series.

82 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

Table A14. Emerging Market and Middle-Income Economies: General Government Expenditure, 2014–28
(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average 30.7 31.5 31.6 31.2 31.4 32.0 34.4 31.8 31.8 31.8 31.4 31.2 31.0 30.9 30.9
Asia 27.3 29.4 29.8 29.9 30.5 31.2 33.3 31.1 31.2 30.5 30.3 30.3 30.3 30.4 30.4
Europe 35.8 35.9 36.5 35.4 34.7 35.6 39.7 36.2 36.9 38.5 37.1 36.6 36.2 35.9 35.6
Latin America 33.7 34.5 34.7 33.9 33.6 33.0 36.1 33.3 34.2 33.8 33.1 32.3 31.9 31.7 31.5
MENA 34.2 34.2 32.8 30.6 31.4 32.1 35.4 30.0 27.6 30.4 30.4 30.2 29.7 29.4 29.0
G20 Emerging 30.8 32.1 32.5 32.1 32.2 32.8 35.0 32.1 32.5 32.2 31.8 31.6 31.5 31.5 31.4
Algeria 41.3 46.2 42.0 41.1 40.3 41.8 42.4 37.0 31.2 38.0 36.2 35.7 34.8 34.6 34.5
Angola 36.5 27.1 22.0 24.1 20.6 20.4 23.3 19.5 21.8 21.7 22.6 22.3 22.1 21.9 21.7
Argentina 38.9 41.4 41.5 41.1 38.9 37.7 42.1 37.8 37.2 36.1 37.5 36.9 37.3 37.2 37.2
Belarus 38.8 41.8 40.7 39.0 37.8 37.4 38.0 37.1 36.8 35.3 34.7 34.6 34.7 34.6 34.6
Brazil 39.7 43.1 44.3 42.7 42.3 42.4 47.0 41.2 43.3 44.6 43.7 42.0 40.8 40.2 39.6
Bulgaria 37.1 37.3 32.7 32.0 34.3 35.9 37.8 38.6 38.2 40.0 38.3 37.4 37.2 36.8 36.5
Chile 23.9 25.0 25.4 25.5 25.6 26.5 29.1 33.5 26.6 26.6 26.6 26.1 25.7 25.6 25.2
China 28.9 31.6 32.3 32.6 33.3 34.2 35.4 32.7 33.1 32.5 32.3 32.4 32.4 32.5 32.5
Colombia 31.3 31.3 30.0 29.3 34.7 32.9 33.6 34.4 34.2 35.4 34.1 33.4 33.1 33.1 32.8
Dominican Republic 17.0 16.7 17.0 17.1 16.4 16.6 22.1 18.5 18.8 17.9 17.8 17.5 17.5 17.4 17.4
Ecuador 1 43.3 40.2 40.1 38.0 38.4 37.1 36.5 35.8 36.0 ... ... ... ... ... ...
Egypt 33.9 31.3 31.0 30.6 28.6 26.9 25.7 25.5 24.7 26.3 29.0 28.6 27.3 26.4 25.9
Hungary 50.0 50.4 46.8 46.7 46.2 46.1 51.1 48.4 50.0 47.5 46.9 46.4 45.7 45.1 43.7
India 26.2 27.1 27.2 26.2 26.3 26.8 31.1 29.3 28.8 28.0 27.7 27.5 27.5 27.6 27.6
Indonesia 18.6 17.5 16.8 16.6 16.7 16.3 18.6 18.2 17.5 17.0 17.1 17.1 17.1 17.1 17.1
Iran 14.2 16.3 17.0 17.1 15.3 14.1 13.0 12.2 12.3 13.9 14.4 14.8 15.2 15.6 16.1
Kazakhstan 21.3 22.9 21.5 24.1 18.8 20.2 24.5 22.1 21.7 21.8 20.6 20.4 20.5 20.6 20.6
Kuwait 44.3 54.4 54.0 52.0 51.8 53.0 66.5 52.3 40.7 50.7 50.5 50.5 50.9 51.4 51.7
Lebanon 28.8 26.7 28.3 30.6 32.3 31.2 19.6 ... ... ... ... ... ... ... ...
Malaysia 26.0 24.7 22.9 22.0 22.8 23.6 25.1 24.4 24.3 21.6 20.4 20.1 19.9 20.0 20.0
Mexico 28.0 27.5 27.4 25.7 25.7 26.0 28.6 27.6 30.2 28.0 26.6 26.5 26.6 26.8 26.9
Morocco 30.7 28.4 28.6 27.8 27.7 27.4 34.1 31.0 31.0 31.8 31.1 30.3 29.8 29.7 29.5
Oman 41.4 44.5 44.6 39.4 38.3 38.8 45.7 36.2 29.0 32.1 30.8 30.5 29.9 29.0 28.0
Pakistan 17.9 17.6 17.7 19.1 19.1 19.1 20.3 18.5 19.9 19.1 20.8 19.6 18.8 18.3 17.9
Peru 22.6 22.3 20.9 21.1 21.3 21.1 26.9 23.5 23.1 23.5 23.4 22.7 21.9 21.7 21.7
Philippines 17.3 18.0 19.1 19.5 20.9 21.7 25.9 27.3 26.8 25.6 25.2 25.1 25.3 25.3 25.5
Poland 42.9 41.7 41.3 41.4 41.4 41.9 48.2 44.1 44.1 46.3 45.9 46.0 46.0 45.3 45.1
Qatar 32.3 38.6 40.1 34.7 28.9 32.5 34.7 29.3 25.4 27.1 26.7 26.0 25.5 24.1 23.0
Romania 33.8 34.2 31.8 31.0 31.7 33.3 38.2 37.2 36.8 36.3 35.8 35.7 35.6 35.3 35.2
Russia 34.9 35.3 36.6 34.8 32.6 33.8 39.2 34.8 36.6 37.4 35.1 34.1 33.3 32.9 32.5
Saudi Arabia 39.7 39.9 34.5 32.1 34.0 33.7 39.1 31.9 28.1 29.6 29.9 29.7 29.3 29.1 28.5
South Africa 29.3 30.2 29.9 29.9 30.2 31.5 34.6 32.7 32.2 33.4 33.4 34.0 33.6 33.6 33.7
Sri Lanka 17.2 19.3 18.2 17.9 17.5 19.5 20.7 19.9 18.9 ... ... ... ... ... ...
Thailand 22.2 22.2 21.3 21.5 21.4 21.8 25.3 27.3 25.6 23.6 23.7 23.8 23.8 23.9 23.9
Türkiye 33.1 33.2 34.8 33.4 34.6 35.7 34.0 31.2 28.0 34.1 33.6 33.6 33.6 33.6 33.9
Ukraine 44.8 43.0 40.8 41.6 41.9 41.5 45.6 40.3 69.9 67.6 ... ... ... ... ...
United Arab Emirates 32.2 27.2 32.8 28.1 26.7 28.4 31.1 26.4 26.4 28.6 28.4 28.3 28.2 28.2 28.1
Uruguay 2 29.2 28.5 29.8 30.1 30.7 31.1 32.8 30.9 29.5 28.9 29.1 29.0 29.0 28.8 28.6
Venezuela 31.6 22.9 19.7 21.8 36.7 18.7 9.3 10.5 12.0 ... ... ... ... ... ...
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For country-specific details, see “Data and Conventions” in text and Table C. MENA = Middle East and North Africa.
1 The data for Ecuador reflect expenditure of the nonfinancial public sector. The authorities are undertaking revisions of the historical fiscal data with technical support from the IMF.

2 Data are for the nonfinancial public sector, which includes central government, local government, social security funds, nonfinancial public corporations, and Banco de Seguros del

Estado. The coverage of fiscal data was changed from the consolidated public sector to the nonfinancial public sector with the October 2019 submission. With this narrower coverage, the
central bank balances are not included in the fiscal data. Historical data were also revised accordingly.

International Monetary Fund | April 2023 83

 FISCAL MONITOR: On the Path to Policy Normalization

Table A15. Emerging Market and Middle-Income Economies: General Government Gross Debt, 2014–28
(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average1 40.6 44.4 50.0 52.1 53.5 56.0 66.0 65.3 65.7 68.8 71.4 74.0 76.4 78.7 80.8
Asia 43.4 45.0 51.8 55.1 56.5 59.8 70.2 71.5 75.1 79.1 82.6 86.2 89.4 92.5 95.4
Europe 28.2 30.3 31.2 29.4 29.0 28.5 37.0 34.7 32.7 36.9 37.9 38.6 39.0 39.2 39.2
Latin America 51.6 57.6 61.3 63.6 67.4 68.3 77.3 71.9 69.7 68.6 69.3 70.1 70.3 70.3 70.1
MENA 23.6 33.9 42.0 42.3 40.3 43.9 55.4 52.1 43.0 42.5 41.2 41.6 42.0 42.3 42.5
G20 Emerging 40.9 43.9 50.0 53.0 54.6 57.6 67.4 67.0 68.5 72.6 75.9 79.2 82.2 85.0 87.6
Algeria 7.7 8.7 20.4 27.2 38.4 46.0 52.0 62.8 52.4 52.2 55.4 58.9 62.3 66.4 70.2
Angola 39.8 57.1 75.7 69.3 93.0 113.6 138.9 86.9 67.0 63.3 59.2 56.7 54.4 51.5 49.5
Argentina 44.7 52.6 53.1 57.0 85.2 88.8 102.8 80.9 84.5 76.3 73.6 73.3 70.7 67.9 65.4
Belarus 38.8 53.0 53.5 53.2 47.5 41.0 47.5 41.2 39.8 41.4 40.3 38.7 37.0 35.2 33.1
Brazil 2 62.3 72.6 78.3 83.6 85.6 87.9 96.8 90.7 85.9 88.4 91.5 93.7 95.2 96.0 96.2
Bulgaria 26.3 25.4 27.0 22.9 20.1 18.3 23.2 22.8 21.8 21.1 22.9 24.7 25.8 26.8 27.7
Chile 15.0 17.4 21.1 23.7 25.8 28.3 32.4 36.3 38.0 36.6 38.5 39.4 39.9 39.3 38.5
China3 40.0 41.5 50.7 55.0 56.7 60.4 70.1 71.8 77.1 82.4 87.2 92.0 96.5 100.8 104.9
Colombia 43.3 50.4 49.8 49.4 53.6 52.4 65.7 64.0 63.6 62.0 61.1 60.9 60.1 59.2 58.3
Dominican Republic 44.9 44.7 46.6 48.9 50.5 53.6 71.5 63.2 58.9 58.3 58.0 57.3 56.5 55.7 54.8
Ecuador4 28.0 35.2 44.6 47.0 49.1 51.4 60.9 62.3 57.3 ... ... ... ... ... ...
Egypt 80.9 83.8 91.6 97.8 87.9 80.1 86.2 89.9 88.5 92.9 87.0 85.4 83.4 80.8 78.0
Hungary 76.5 75.8 74.9 72.1 69.1 65.3 79.3 76.8 76.4 73.2 70.0 68.2 66.1 64.1 61.3
India 67.1 69.0 68.9 69.7 70.4 75.0 88.5 84.7 83.1 83.2 83.7 83.8 83.8 83.7 83.6
Indonesia 24.7 27.0 28.0 29.4 30.4 30.6 39.7 41.1 39.9 39.1 38.8 38.5 38.1 37.8 37.3
Iran 12.6 37.0 47.9 45.0 42.9 46.7 48.3 42.4 34.0 32.0 32.7 34.3 35.8 37.2 38.1
Kazakhstan 14.5 21.9 19.7 19.9 20.3 19.9 26.4 25.1 23.5 25.9 27.0 29.0 31.4 33.1 34.8
Kuwait 3.4 4.7 9.9 20.5 15.1 11.6 11.7 8.7 2.9 3.0 3.0 6.1 9.7 11.2 15.2
Lebanon 138.4 140.8 146.4 150.0 155.1 172.3 150.6 ... ... ... ... ... ... ... ...
Malaysia 55.4 57.0 55.8 54.4 55.6 57.1 67.7 69.3 66.3 67.0 67.1 67.5 68.0 69.0 70.0
Mexico 48.9 52.8 56.7 54.0 53.6 53.3 60.1 58.7 56.0 55.6 55.8 56.3 56.9 57.5 57.9
Morocco 58.6 58.4 60.1 60.3 60.5 60.3 72.2 68.9 68.8 68.3 68.4 68.2 67.7 66.9 66.2
Oman 4.0 13.9 29.3 40.1 44.7 52.5 69.7 61.3 40.1 42.8 40.6 39.8 38.9 38.4 36.8
Pakistan 57.1 57.0 60.8 60.9 64.8 77.5 79.6 73.6 75.8 73.6 68.9 67.8 67.6 67.1 66.1
Peru 20.6 24.0 24.3 25.2 26.0 26.9 35.0 36.4 33.4 33.0 33.3 33.2 32.8 32.3 31.9
Philippines 40.2 39.6 37.3 38.1 37.1 37.0 51.6 57.0 57.5 56.7 56.8 56.3 55.4 54.1 52.6
Poland 51.4 51.3 54.5 50.8 48.7 45.7 57.2 53.8 49.6 50.7 51.7 52.4 53.6 54.1 54.5
Qatar 24.9 35.5 46.7 51.6 52.2 62.1 72.6 58.4 45.3 45.5 42.9 40.4 37.9 35.9 33.9
Romania 40.5 39.4 39.5 37.1 36.2 36.6 49.4 51.1 48.7 48.3 49.3 50.3 51.4 52.8 54.3
Russia 15.1 15.3 14.8 14.3 13.6 13.7 19.2 16.5 19.6 24.9 25.3 25.3 24.3 23.2 21.5
Saudi Arabia 1.5 5.7 12.7 16.5 17.6 21.6 31.0 28.8 22.6 23.6 23.1 22.3 21.5 20.7 19.9
South Africa 43.3 45.2 47.1 48.6 51.7 56.2 69.0 69.0 71.0 72.3 74.0 77.1 80.0 82.4 84.9
Sri Lanka 69.6 76.3 75.0 72.3 83.6 82.6 95.7 102.2 117.7 ... ... ... ... ... ...
Thailand 43.3 42.6 41.7 41.8 41.9 41.1 49.4 58.4 60.5 61.0 61.6 59.9 59.0 58.1 57.3
Türkiye 28.4 27.3 27.9 27.9 30.1 32.6 39.7 41.8 31.2 35.0 36.7 37.7 38.8 40.4 42.3
Ukraine 70.3 79.3 79.5 71.6 60.4 50.5 60.5 48.8 81.7 98.3 ... ... ... ... ...
United Arab Emirates 13.8 16.1 19.3 21.9 21.3 26.8 41.1 35.9 30.0 30.5 29.4 28.3 27.2 26.2 25.2
Uruguay 5 51.3 58.0 56.6 56.5 58.6 60.6 68.2 65.6 61.0 62.3 62.7 63.1 63.4 63.7 63.8
Venezuela 84.9 129.8 138.4 133.6 174.6 205.1 327.7 250.6 157.8 ... ... ... ... ... ...
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For country-specific details, see “Data and Conventions” in text and Table C. MENA = Middle East and North Africa.
1 The average does not include the debt incurred by the European Union, and used to finance the grants portion of the NextGenerationEU (NGEU) package. This totaled €58 billion

(0.4 percent of European Union GDP) as of December 31, 2021, and €158 billion (1 percent of European Union GDP) as of February 16, 2023. Debt incurred by the EU and used to
on-lend to member states is included within member state debt data and regional aggregates.
2 “Gross debt” refers to the nonfinancial public sector, excluding Eletrobras and Petrobras and including sovereign debt held on the balance sheet of the central bank.

3 China’s deficit and public debt numbers presented in this table cover a narrower perimeter of the general government than IMF staff’s estimates in China Article IV reports (see IMF 2023

for a reconciliation of the two estimates).

4 In late 2016, the authorities changed the definition of “debt” to a consolidated basis, which in 2016 was 11.5 percent of GDP lower than the previous aggregate definition. Both the

historic and projection numbers are now presented on a consolidated basis.

5 Data are for the nonfinancial public sector, which includes central government, local government, social security funds, nonfinancial public corporations, and Banco de Seguros del

Estado. The coverage of fiscal data was changed from the consolidated public sector to the nonfinancial public sector with the October 2019 submission. With this narrower coverage, the
central bank balances are not included in the fiscal data. Historical data were also revised accordingly.

84 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

Table A16. Emerging Market and Middle-Income Economies: General Government Net Debt, 2014–28
(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average1 24.3 28.6 34.3 35.6 36.5 38.1 45.6 45.2 42.6 43.2 44.0 44.8 45.6 46.0 46.2
Asia ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Europe 29.1 28.2 30.3 28.9 29.2 28.9 36.0 36.4 30.8 32.1 33.2 33.6 34.6 35.0 35.2
Latin America 31.7 34.9 40.3 42.5 42.9 44.2 51.3 48.8 49.3 50.6 52.3 53.8 54.8 55.6 56.1
MENA –3.0 12.6 26.9 27.6 28.7 33.2 43.3 45.5 37.2 36.1 35.4 36.2 36.5 36.5 36.5
G20 Emerging 23.0 25.9 31.8 34.7 35.6 37.2 44.1 43.5 41.0 43.2 45.0 46.2 47.2 47.8 48.3
Algeria –21.8 –7.6 13.3 21.6 25.7 30.5 43.8 51.7 42.5 48.3 52.5 56.1 59.7 63.2 66.5
Angola ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Argentina ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Belarus ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Brazil 32.6 35.6 46.1 51.4 52.8 54.7 61.4 55.8 57.1 61.2 65.3 68.4 70.6 72.1 73.2
Bulgaria 13.1 15.4 11.3 10.3 9.0 8.4 13.3 13.0 11.2 13.2 15.4 17.5 18.8 20.1 21.2
Chile –4.4 –3.5 0.9 4.4 5.7 8.0 13.3 20.1 19.6 20.2 20.9 21.2 21.2 20.8 20.1
China 2 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Colombia 32.9 42.1 38.6 38.6 43.1 43.1 54.7 54.1 54.9 53.5 51.7 50.5 50.0 49.7 49.4
Dominican Republic 37.6 37.2 38.5 40.3 41.4 43.4 57.5 49.5 45.8 45.6 45.5 45.0 44.4 43.6 42.7
Ecuador ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Egypt 73.2 75.3 81.6 86.6 80.7 74.6 80.6 85.2 83.9 88.3 82.4 80.7 78.7 76.1 73.4
Hungary 70.3 70.5 67.9 65.2 62.1 58.4 72.3 69.9 69.4 66.2 63.0 61.3 59.1 57.2 54.4
India ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Indonesia 20.4 22.0 23.5 25.3 26.7 27.0 36.1 37.9 37.1 36.5 36.4 36.3 36.1 35.8 35.5
Iran –3.4 21.6 36.4 32.9 31.5 36.9 40.3 36.1 28.5 26.8 27.3 28.8 30.1 31.5 32.4
Kazakhstan –19.1 –30.8 –23.8 –15.8 –15.8 –13.9 –8.6 –3.3 –1.2 –0.7 –0.4 –0.2 0.2 0.8 1.6
Kuwait ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Lebanon 130.0 134.4 140.7 144.4 150.8 167.1 147.9 ... ... ... ... ... ... ... ...
Malaysia ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Mexico 42.6 46.5 48.7 45.7 44.9 44.5 51.6 50.8 49.7 49.3 49.5 50.0 50.6 51.2 51.6
Morocco 58.1 57.8 59.6 59.9 60.2 60.0 71.6 68.4 68.4 67.9 68.0 67.8 67.3 66.5 65.8
Oman –39.3 –37.0 –24.2 –10.4 6.4 11.2 28.5 24.9 11.2 10.5 9.2 8.5 7.8 7.6 6.5
Pakistan 52.2 52.5 55.1 55.9 59.9 70.2 72.9 66.0 69.5 68.7 65.0 64.5 64.6 64.4 63.7
Peru 2.7 5.3 6.9 8.7 10.2 11.1 21.0 19.8 19.6 20.1 20.9 21.1 20.6 19.9 19.3
Philippines ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Poland 45.4 46.4 47.9 44.4 41.5 38.4 45.1 40.8 36.6 37.7 38.7 39.5 40.6 41.2 41.6
Qatar ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Romania 28.4 28.3 26.8 25.9 26.2 28.6 40.0 42.0 40.1 40.0 41.2 42.3 43.5 45.0 46.6
Russia ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Saudi Arabia –46.4 –35.1 –16.6 –7.4 –0.1 4.7 15.2 17.0 10.8 12.3 13.3 13.7 13.5 13.1 12.9
South Africa 38.1 41.0 42.1 43.8 46.7 50.7 62.2 63.2 66.3 69.8 72.4 75.9 78.8 81.4 83.9
Sri Lanka ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Thailand ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Türkiye 23.7 22.8 23.3 22.1 24.0 25.4 30.1 33.7 24.3 27.5 29.6 30.1 31.7 32.0 32.4
Ukraine ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
United Arab Emirates ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Uruguay 3 40.9 44.6 44.5 44.8 47.2 50.7 57.4 55.2 50.7 52.1 52.6 53.0 53.5 53.8 53.9
Venezuela ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For country-specific details, see “Data and Conventions” in text and Table C. MENA = Middle East and North Africa.
1 The average does not include the debt incurred by the European Union, and used to finance the grants portion of the NextGenerationEU (NGEU) package. This totaled €58 billion

(0.4 percent of European Union GDP) as of December 31, 2021, and €158 billion (1 percent of European Union GDP) as of February 16, 2023. Debt incurred by the EU and used to
on-lend to member states is included within member state debt data and regional aggregates.
2 China’s deficit and public debt numbers presented in this table cover a narrower perimeter of the general government than IMF staff’s estimates in China Article IV reports (see IMF 2023

for a reconciliation of the two estimates).

3 Data are for the nonfinancial public sector, which includes central government, local government, social security funds, nonfinancial public corporations, and Banco de Seguros del

Estado. The coverage of fiscal data was changed from the consolidated public sector to the nonfinancial public sector with the October 2019 submission. With this narrower coverage, the
central bank balances are not included in the fiscal data. Historical data were also revised accordingly.

International Monetary Fund | April 2023 85

 FISCAL MONITOR: On the Path to Policy Normalization

Table A17. Low-Income Developing Countries: General Government Overall Balance, 2014–28
(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average –3.1 –3.8 –3.7 –3.7 –3.3 –3.5 –5.0 –4.7 –4.2 –4.2 –4.0 –3.8 –3.7 –3.7 –3.6
Oil Producers –2.9 –4.6 –5.3 –5.4 –4.1 –4.5 –5.3 –5.7 –5.0 –4.8 –4.9 –5.1 –5.3 –5.6 –5.7
Asia –3.5 –3.8 –3.2 –3.1 –2.8 –3.0 –4.3 –4.3 –3.5 –4.5 –4.2 –4.0 –3.7 –3.6 –3.5
Latin America –2.7 –1.2 –0.7 –0.6 –1.0 –0.6 –3.4 –2.5 –0.8 –1.9 –1.6 –1.3 –1.2 –1.2 –1.2
Sub-Saharan Africa –3.3 –4.1 –4.5 –4.5 –3.9 –4.0 –5.7 –5.5 –5.2 –4.3 –4.1 –4.0 –3.9 –4.0 –4.0
Others –1.7 –3.1 –2.5 –2.3 –1.9 –3.0 –3.6 –2.2 –2.6 –2.9 –2.6 –2.5 –2.5 –2.6 –2.6
Afghanistan –1.7 –1.4 0.1 –0.7 1.6 –1.1 –2.2 ... ... ... ... ... ... ... ...
Bangladesh –2.6 –3.3 –3.2 –4.2 –4.1 –5.4 –4.8 –3.6 –3.8 –5.6 –5.1 –5.0 –5.0 –5.0 –5.0
Benin –1.7 –5.6 –4.3 –4.2 –3.0 –0.5 –4.7 –5.7 –5.6 –4.3 –2.9 –2.9 –2.9 –2.9 –2.9
Burkina Faso –1.7 –2.1 –3.1 –6.9 –4.4 –3.4 –5.1 –7.4 –10.4 –7.8 –6.7 –5.5 –4.2 –3.0 –3.0
Cambodia –1.6 –0.6 –0.3 –0.8 0.7 3.0 –3.4 –7.1 –4.1 –5.0 –3.5 –3.1 –2.9 –2.8 –3.2
Cameroon –4.1 –4.2 –5.9 –4.7 –2.4 –3.2 –3.2 –3.0 –1.8 –0.8 –0.6 –0.3 –0.7 –1.1 –1.1
Chad –4.2 –4.4 –1.9 –0.2 1.9 –0.2 2.1 –1.6 5.1 7.0 4.5 4.3 6.0 4.7 5.1
Congo, Democratic Republic of the 0.0 –0.4 –0.5 1.3 0.0 –2.0 –1.4 –0.9 –1.6 –1.5 –2.5 –3.1 –3.0 –3.4 –3.8
Congo, Republic of –10.7 –17.8 –15.6 –5.9 5.6 4.7 –1.2 1.8 6.6 4.8 5.1 3.5 3.3 4.3 5.8
Côte d’Ivoire –1.6 –2.0 –3.0 –3.3 –2.9 –2.2 –5.4 –4.8 –6.7 –5.1 –4.0 –3.0 –3.0 –3.0 –3.0
Ethiopia –2.6 –1.9 –2.3 –3.2 –3.0 –2.5 –2.8 –2.8 –4.2 –3.5 –3.0 –3.0 –3.0 –3.0 –3.0
Ghana –7.8 –4.0 –6.7 –4.0 –6.8 –7.5 –17.4 –12.1 –9.9 –7.3 –8.4 –7.3 –5.9 –5.3 –5.4
Guinea –3.2 –6.6 –0.1 –2.1 –1.1 –0.3 –3.1 –1.7 –0.7 –2.3 –2.4 –2.4 –2.5 –2.6 –2.2
Haiti –3.6 –1.5 0.0 0.2 –1.0 –2.1 –2.4 –2.6 –2.2 –1.8 –1.8 –1.8 –2.1 –2.2 –2.5
Honduras –2.9 –0.8 –0.4 –0.4 0.2 0.1 –4.7 –3.1 0.7 ... ... ... ... ... ...
Kenya –5.8 –6.7 –7.5 –7.4 –6.9 –7.4 –8.1 –7.1 –6.0 –5.2 –4.4 –3.9 –3.9 –4.0 –3.9
Kyrgyz Republic –3.1 –2.5 –5.8 –3.7 –0.6 –0.1 –3.3 –0.8 –1.3 –3.8 –4.2 –4.2 –4.3 –4.5 –4.5
Lao P.D.R. –3.1 –5.6 –4.9 –5.5 –4.7 –3.3 –5.6 –1.3 –1.6 –3.4 –3.4 –3.3 –3.5 –2.9 –2.9
Madagascar –2.0 –2.9 –1.1 –2.1 –1.3 –1.4 –4.0 –2.8 –6.8 –3.0 –3.3 –4.3 –3.9 –4.6 –4.8
Malawi –3.1 –4.2 –4.9 –5.2 –4.3 –4.5 –8.2 –8.6 –10.4 –7.8 –8.0 –7.2 –5.9 –5.0 –4.0
Mali –2.9 –1.8 –3.9 –2.9 –4.7 –1.7 –5.4 –4.8 –4.8 –4.8 –4.3 –3.6 –3.0 –3.0 –3.0
Moldova –1.6 –1.9 –1.5 –0.7 –0.9 –1.5 –5.3 –2.6 –3.3 –6.0 –4.6 –3.8 –3.4 –3.1 –2.7
Mozambique –9.9 –6.7 –5.1 –2.0 –5.6 0.1 –5.4 –3.6 –5.2 –4.8 –3.1 –2.1 –1.2 –0.5 0.5
Myanmar –1.3 –2.8 –3.9 –2.9 –3.4 –3.9 –5.6 –11.0 –5.2 –4.8 –5.0 –5.0 –4.5 –4.0 –3.8
Nepal 1.3 0.6 1.2 –2.7 –5.8 –5.0 –5.4 –4.0 –3.3 –4.5 –4.1 –3.5 –2.7 –2.4 –2.5
Nicaragua –1.2 –1.5 –1.8 –1.8 –3.0 –0.3 –2.2 –1.2 –2.0 –1.1 –0.7 –0.2 0.1 0.1 –0.1
Niger –6.1 –6.7 –4.5 –4.1 –3.0 –3.6 –4.8 –5.9 –6.9 –5.3 –4.1 –3.0 –3.0 –3.0 –3.0
Nigeria –2.4 –3.8 –4.6 –5.4 –4.3 –4.7 –5.6 –6.0 –5.5 –5.3 –5.4 –5.6 –5.8 –6.0 –6.1
Papua New Guinea –6.3 –4.5 –4.7 –2.5 –2.6 –4.4 –8.9 –6.8 –5.4 –4.3 –3.9 –2.3 –1.2 0.0 0.2
Rwanda –3.9 –2.7 –2.3 –2.5 –2.6 –5.1 –9.5 –7.0 –6.5 –5.4 –6.1 –4.2 –3.4 –3.0 –2.9
Senegal –3.9 –3.7 –3.3 –3.0 –3.7 –3.9 –6.4 –6.3 –6.1 –4.9 –4.0 –3.0 –3.0 –3.0 –3.0
Sudan –4.7 –3.9 –3.9 –6.1 –7.9 –10.8 –5.9 –0.3 –2.1 –2.4 –2.6 –2.6 –2.7 –2.7 –2.7
Tajikistan 0.8 –2.0 –9.0 –5.7 –2.7 –2.1 –4.3 –0.7 –1.4 –2.5 –2.5 –2.5 –2.5 –2.5 –2.5
Tanzania –2.9 –3.2 –2.1 –1.2 –1.9 –2.0 –2.5 –3.4 –3.3 –2.9 –2.6 –2.5 –2.5 –2.5 –2.5
Uganda –2.7 –2.5 –2.6 –3.6 –3.0 –4.8 –7.5 –7.5 –5.8 –4.1 –3.3 –3.2 –2.0 –2.8 0.5
Uzbekistan 1.9 –0.3 0.7 1.1 2.0 –0.3 –3.3 –4.6 –3.9 –2.9 –2.9 –2.8 –2.8 –2.9 –2.9
Vietnam –5.0 –5.0 –3.2 –2.0 –1.0 –0.4 –2.9 –3.4 –2.5 –3.3 –3.1 –2.9 –2.5 –2.3 –2.0
Yemen –4.1 –8.7 –8.5 –4.9 –7.8 –5.9 –4.9 –1.0 –1.8 –2.2 –0.2 0.0 –0.8 –1.8 –2.0
Zambia –5.4 –8.9 –5.7 –7.5 –8.3 –9.4 –13.8 –8.1 –7.9 –6.3 –6.7 –5.5 –5.9 –3.7 –2.9
Zimbabwe –1.1 –1.8 –6.6 –10.6 –5.4 –0.9 0.8 –2.2 –2.1 –3.0 –2.2 –2.2 –2.2 –2.2 –2.2
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For country-specific details, see “Data and Conventions” in text and Table D.

86 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

Table A18. Low-Income Developing Countries: General Government Primary Balance, 2014–28
(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average –1.9 –2.5 –2.3 –2.2 –1.7 –1.9 –3.2 –2.8 –2.3 –2.4 –2.0 –1.9 –1.8 –1.7 –1.6
Oil Producers –1.6 –3.1 –3.7 –4.1 –2.5 –2.9 –3.3 –3.3 –2.3 –2.6 –2.6 –2.6 –2.6 –2.7 –2.6
Asia –2.0 –2.3 –1.7 –1.7 –1.3 –1.6 –2.7 –2.7 –2.0 –3.0 –2.6 –2.5 –2.3 –2.1 –1.9
Latin America –2.4 –0.7 –0.2 –0.1 –0.4 0.1 –2.6 –1.7 –0.1 –1.3 –1.1 –0.6 –0.5 –0.4 –0.5
Sub-Saharan Africa –2.2 –2.8 –2.9 –2.8 –2.0 –2.0 –3.6 –3.1 –2.6 –1.9 –1.6 –1.5 –1.4 –1.5 –1.4
Others –0.4 –1.8 –1.6 –2.1 –1.7 –2.8 –3.2 –2.0 –2.4 –2.5 –2.2 –2.0 –2.0 –2.1 –2.2
Afghanistan –1.7 –1.3 0.2 –0.6 1.7 –1.0 –2.2 ... ... ... ... ... ... ... ...
Bangladesh –0.9 –1.6 –1.6 –2.6 –2.5 –3.7 –3.0 –1.6 –2.1 –3.8 –3.3 –3.3 –3.3 –3.3 –3.2
Benin –1.4 –5.0 –3.4 –2.8 –1.4 1.1 –2.7 –3.5 –3.7 –2.7 –1.1 –1.2 –1.2 –1.3 –1.3
Burkina Faso –1.1 –1.5 –2.2 –6.0 –3.3 –2.1 –3.8 –5.7 –8.5 –5.9 –4.9 –3.4 –2.0 –0.7 –0.6
Cambodia –1.3 –0.3 0.1 –0.5 1.0 3.3 –3.0 –6.7 –3.8 –4.7 –3.1 –2.8 –2.5 –2.3 –2.7
Cameroon –3.7 –3.9 –5.2 –3.9 –1.5 –2.2 –2.3 –2.0 –0.9 0.3 0.5 0.8 0.3 0.0 0.0
Chad –3.6 –2.7 0.1 1.3 3.0 0.8 3.0 –0.4 6.6 8.3 5.5 5.5 6.7 5.3 5.6
Congo, Democratic Republic of the 0.3 –0.1 –0.2 1.6 0.4 –1.8 –1.2 –0.6 –1.2 –1.2 –2.1 –2.6 –2.5 –2.8 –2.9
Congo, Republic of –10.6 –17.2 –13.6 –4.3 7.5 7.8 0.1 4.1 9.2 7.5 7.8 6.3 6.2 7.1 8.3
Côte d’Ivoire –0.7 –0.9 –1.7 –2.0 –1.6 –0.8 –3.6 –2.9 –4.5 –2.5 –1.5 –0.7 –0.8 –0.9 –1.0
Ethiopia –2.2 –1.5 –1.8 –2.8 –2.5 –2.0 –2.4 –2.2 –3.5 –2.9 –2.3 –2.2 –2.1 –1.7 –1.7
Ghana –3.3 0.9 –1.5 1.2 –1.4 –2.0 –11.2 –4.8 –2.8 0.1 0.6 1.0 1.0 1.0 1.0
Guinea –2.2 –5.7 0.9 –1.2 –0.3 0.2 –2.4 –1.2 0.1 –1.6 –1.6 –1.5 –1.6 –1.7 –1.3
Haiti –3.4 –1.4 0.2 0.3 –0.8 –1.8 –2.1 –2.3 –1.9 –1.6 –1.6 –1.6 –1.9 –2.0 –2.3
Honduras –2.6 0.0 0.2 0.2 0.8 0.8 –3.8 –2.1 1.3 ... ... ... ... ... ...
Kenya –3.4 –4.2 –4.6 –4.2 –3.4 –3.8 –4.2 –3.1 –1.7 –0.6 0.4 0.6 0.6 0.7 0.8
Kyrgyz Republic –2.3 –1.7 –4.9 –2.9 0.4 0.8 –2.3 0.0 –0.2 –2.8 –3.0 –2.6 –2.3 –2.2 –2.0
Lao P.D.R. –2.4 –4.8 –4.0 –4.7 –3.5 –2.0 –4.1 –0.3 0.0 0.3 0.3 0.2 0.2 0.1 0.1
Madagascar –1.5 –2.2 –0.4 –1.4 –0.6 –0.7 –3.2 –2.2 –6.1 –2.0 –2.4 –3.3 –3.1 –3.9 –4.0
Malawi 0.0 –1.9 –1.8 –2.4 –1.6 –1.5 –5.0 –4.6 –5.6 –1.0 –0.7 0.0 1.0 1.4 1.8
Mali –2.3 –1.2 –3.3 –2.0 –3.9 –0.7 –4.2 –3.5 –3.3 –3.2 –2.7 –2.0 –1.4 –1.4 –1.4
Moldova –1.1 –1.2 –0.4 0.5 0.0 –0.7 –4.5 –1.8 –2.3 –4.2 –3.5 –2.7 –2.3 –2.0 –1.5
Mozambique –8.9 –5.5 –2.7 1.0 –1.2 3.3 –2.3 –0.9 –2.1 –1.6 0.0 0.8 1.5 2.0 2.6
Myanmar –0.1 –1.6 –2.6 –1.5 –1.6 –2.4 –4.0 –8.9 –2.5 –2.2 –2.3 –2.4 –1.8 –1.3 –1.1
Nepal 1.8 0.9 1.5 –2.4 –5.4 –4.5 –4.7 –3.3 –2.4 –3.3 –2.8 –2.3 –1.6 –1.3 –1.4
Nicaragua –0.9 –1.1 –1.2 –0.9 –1.9 0.9 –1.0 0.0 –0.8 0.0 0.3 0.7 1.1 1.1 0.9
Niger –5.8 –6.3 –3.8 –3.4 –2.1 –2.6 –3.8 –4.8 –5.6 –4.0 –2.9 –1.7 –1.8 –1.8 –1.8
Nigeria –1.5 –2.7 –3.4 –4.1 –2.6 –3.0 –3.5 –3.6 –2.7 –3.0 –3.0 –3.0 –3.0 –2.9 –2.8
Papua New Guinea –4.6 –2.8 –2.8 –0.4 –0.2 –1.9 –6.2 –4.4 –3.3 –2.2 –1.2 0.3 1.4 2.6 2.0
Rwanda –3.1 –1.8 –1.3 –1.5 –1.4 –3.8 –7.9 –5.2 –4.4 –3.2 –4.1 –2.4 –1.8 –1.5 –1.6
Senegal –2.6 –2.1 –1.6 –1.1 –1.7 –1.9 –4.4 –4.3 –3.9 –2.7 –1.8 –0.7 –0.7 –0.6 –0.6
Sudan –3.9 –3.2 –3.5 –5.6 –7.7 –10.6 –5.9 –0.2 –2.0 –2.0 –2.0 –2.0 –2.0 –1.6 –2.2
Tajikistan 1.4 –1.5 –8.3 –5.2 –1.6 –1.2 –3.4 0.2 –0.6 –1.8 –1.8 –1.9 –1.9 –2.2 –2.4
Tanzania –1.6 –1.7 –0.6 0.4 –0.2 –0.3 –0.9 –1.8 –1.7 –1.1 –0.6 –0.5 –0.5 –0.5 –0.5
Uganda –1.5 –1.1 –0.6 –1.5 –1.2 –2.7 –5.2 –4.6 –2.6 –0.9 –0.4 –0.7 0.3 –1.8 1.3
Uzbekistan 1.8 –0.4 0.6 0.9 1.6 –0.5 –3.4 –4.8 –4.1 –3.1 –2.9 –2.7 –2.7 –2.7 –2.8
Vietnam –3.7 –3.4 –1.6 –0.4 0.5 1.0 –1.5 –2.2 –1.3 –2.3 –2.0 –1.8 –1.4 –1.2 –0.8
Yemen 1.5 –2.6 –3.2 –4.7 –7.8 –5.7 –2.8 0.3 –0.6 –1.0 0.8 0.8 –0.1 –1.3 –1.5
Zambia –3.2 –6.0 –2.2 –3.5 –3.5 –2.5 –7.8 –2.0 –1.6 0.2 0.6 1.3 1.1 2.0 2.2
Zimbabwe –0.4 –0.9 –6.0 –9.7 –4.4 –0.5 0.9 –1.7 –2.0 –2.8 –2.1 –2.1 –2.1 –2.1 –2.1
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: “Primary balance” is defined as the overall balance, excluding net interest payments. For country-specific details, see “Data and Conventions” in text and Table D.

International Monetary Fund | April 2023 87

 FISCAL MONITOR: On the Path to Policy Normalization

Table A19. Low-Income Developing Countries: General Government Revenue, 2014–28

(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average 15.7 14.2 13.7 14.2 14.8 14.5 13.8 14.3 14.7 14.9 15.0 15.2 15.3 15.2 15.2
Oil Producers 12.8 8.2 6.1 7.2 9.2 8.6 7.4 8.1 9.8 9.9 9.4 9.1 8.8 8.5 8.3
Asia 15.8 15.5 15.0 14.9 15.3 14.9 14.3 14.4 14.1 14.5 14.8 15.1 15.4 15.5 15.6
Latin America 19.9 20.6 21.8 21.4 20.9 21.2 19.7 20.5 20.4 19.9 20.4 20.8 21.0 21.1 21.2
Sub-Saharan Africa 14.3 12.3 11.7 12.8 13.3 13.1 12.3 13.1 13.7 13.9 13.9 13.8 13.7 13.6 13.4
Others 21.4 18.1 17.2 17.2 20.7 20.3 19.2 20.5 22.4 21.5 22.3 23.0 23.3 23.5 23.7
Afghanistan 23.7 24.6 28.2 27.1 30.6 26.9 25.7 ... ... ... ... ... ... ... ...
Bangladesh 9.1 8.2 8.4 8.1 8.9 8.1 8.5 9.4 8.7 8.8 9.3 9.7 10.3 10.2 10.2
Benin 12.6 12.6 11.1 13.6 13.6 14.1 14.4 14.1 13.9 14.4 15.1 15.6 15.9 16.3 16.8
Burkina Faso 19.2 18.3 18.6 19.2 19.8 19.9 19.1 20.3 21.0 20.6 20.6 20.5 20.5 20.7 21.3
Cambodia 20.1 19.6 20.8 21.6 23.7 26.8 23.9 21.6 22.1 22.0 23.0 23.4 23.5 23.5 23.6
Cameroon 16.0 15.8 14.3 14.5 15.5 15.4 13.4 14.0 16.1 15.5 15.3 15.2 15.2 15.4 15.4
Chad 17.8 14.0 12.4 14.6 15.3 14.2 21.1 16.8 21.7 24.7 21.2 21.0 21.6 19.9 19.8
Congo, Democratic Republic of the 17.3 15.9 13.5 11.3 10.9 10.7 9.0 13.8 17.2 16.8 16.5 16.5 16.9 16.8 15.9
Congo, Republic of 37.8 23.5 26.0 22.4 24.9 26.5 21.9 24.9 31.3 29.9 29.3 28.3 27.9 28.3 28.1
Côte d’Ivoire 13.6 14.5 14.6 14.8 14.7 14.7 14.6 15.5 14.7 15.8 16.2 16.6 17.2 17.2 17.2
Ethiopia 14.9 15.4 15.6 14.7 13.1 12.8 11.7 11.0 8.5 8.9 9.4 9.7 10.0 10.2 10.4
Ghana 13.2 14.6 13.1 13.6 14.1 15.0 14.1 15.3 15.6 17.2 17.9 18.4 18.7 18.7 18.7
Guinea 17.0 15.2 16.0 15.3 14.9 14.7 13.9 13.6 13.1 13.2 13.8 14.5 14.9 15.3 15.2
Haiti 11.0 11.3 10.7 9.9 10.1 8.0 7.5 8.2 8.0 8.8 8.9 9.3 9.6 9.7 9.8
Honduras 24.7 25.2 27.0 26.5 26.4 25.8 23.4 25.3 25.1 ... ... ... ... ... ...
Kenya 17.7 17.1 17.9 17.8 17.5 17.0 16.7 16.7 17.4 17.6 17.9 17.9 18.0 18.1 18.4
Kyrgyz Republic 35.4 35.6 33.1 33.3 32.5 32.5 30.8 33.2 38.5 34.5 34.6 34.5 34.4 34.3 34.3
Lao P.D.R. 21.9 20.2 16.0 16.3 16.2 15.4 13.0 15.0 14.9 15.1 15.1 15.1 15.1 15.0 15.0
Madagascar 10.6 10.2 12.4 12.8 13.0 13.9 12.4 11.2 13.6 14.6 15.3 15.3 15.1 14.8 14.4
Malawi 15.2 15.4 14.8 15.8 15.0 14.8 14.5 15.1 14.0 16.5 17.5 16.7 16.9 16.6 17.0
Mali 17.1 19.1 18.3 20.1 15.6 21.5 20.5 21.6 19.9 20.7 21.0 21.9 22.2 22.4 22.6
Moldova 31.8 30.0 28.6 30.3 30.7 30.5 31.4 32.0 33.5 32.6 31.4 31.8 32.1 32.0 32.1
Mozambique 30.4 26.0 23.9 27.1 25.8 29.9 27.5 27.9 29.2 28.6 27.8 28.0 28.6 27.4 26.2
Myanmar 22.5 21.4 19.6 17.9 17.6 16.3 16.0 13.1 13.2 13.9 14.2 14.5 14.8 15.0 15.3
Nepal 17.9 18.2 20.1 20.9 22.2 22.4 22.2 23.7 23.5 21.6 22.9 23.6 24.8 25.5 25.4
Nicaragua 23.3 23.8 24.9 25.5 24.6 27.6 26.9 29.3 27.0 26.3 26.4 26.4 26.6 26.4 26.4
Niger 17.5 17.5 14.9 15.4 18.2 18.0 17.5 18.4 15.0 17.8 19.4 19.8 19.9 20.1 20.2
Nigeria 10.9 7.3 5.1 6.6 8.5 7.8 6.5 7.3 8.8 8.9 8.5 8.2 7.9 7.7 7.6
Papua New Guinea 20.8 18.3 16.1 15.9 17.7 16.3 14.7 15.0 15.8 17.1 16.6 17.0 17.1 17.3 17.5
Rwanda 23.6 23.9 22.9 22.6 23.8 23.1 23.9 24.6 25.2 23.2 23.7 23.7 24.0 24.2 24.0
Senegal 19.2 19.3 20.7 19.5 18.9 20.3 20.2 19.4 20.7 21.3 22.3 23.4 23.5 23.8 24.4
Sudan 8.8 8.5 6.1 6.7 8.9 7.8 4.8 9.5 10.1 10.1 10.4 10.5 10.7 10.6 10.7
Tajikistan 28.4 29.9 29.7 28.1 28.2 26.8 24.8 27.0 27.5 28.2 26.2 26.6 26.8 27.0 27.2
Tanzania 14.4 14.0 14.8 15.4 14.7 14.7 14.3 14.4 15.0 15.3 15.6 15.9 16.1 16.0 16.0
Uganda 10.8 12.6 12.4 12.7 13.2 13.5 13.9 14.1 14.9 15.3 15.8 16.8 18.2 19.0 20.2
Uzbekistan 26.8 24.3 24.0 23.5 26.8 26.8 25.5 25.9 29.4 27.0 27.6 28.3 28.7 29.0 29.4
Vietnam 17.7 19.2 19.1 19.6 19.5 19.4 18.4 18.4 18.3 18.2 18.4 18.6 18.9 19.2 19.5
Yemen 23.6 10.7 7.6 3.5 6.4 7.3 6.8 8.3 10.9 8.3 10.6 12.9 12.7 11.8 11.7
Zambia 18.9 18.8 18.2 17.5 19.4 20.4 20.3 22.3 20.8 22.0 22.1 22.3 22.3 22.6 22.8
Zimbabwe 19.3 18.7 17.0 18.1 14.9 10.8 13.3 15.4 16.0 15.6 15.6 15.6 15.6 15.6 15.6
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For country-specific details, see “Data and Conventions” in text and Table D.

88 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

Table A20. Low-Income Developing Countries: General Government Expenditure, 2014–28

(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average 18.8 18.0 17.5 17.8 18.0 18.0 18.7 19.0 18.9 19.1 19.0 19.0 19.0 18.9 18.8
Oil Producers 15.7 12.7 11.4 12.5 13.3 13.1 12.7 13.8 14.8 14.7 14.3 14.3 14.1 14.1 14.0
Asia 19.2 19.3 18.2 18.0 18.1 17.9 18.6 18.7 17.6 19.0 19.0 19.1 19.2 19.1 19.0
Latin America 22.7 21.8 22.4 22.0 21.9 21.8 23.1 23.1 21.2 21.8 21.9 22.0 22.2 22.2 22.4
Sub-Saharan Africa 17.6 16.4 16.2 17.2 17.2 17.1 18.0 18.6 18.9 18.3 18.0 17.8 17.7 17.6 17.4
Others 23.0 21.2 19.7 19.5 22.6 23.3 22.8 22.8 25.1 24.4 24.9 25.4 25.8 26.1 26.3
Afghanistan 25.4 25.9 28.0 27.7 28.9 28.0 27.9 ... ... ... ... ... ... ... ...
Bangladesh 11.7 11.5 11.6 12.2 13.0 13.6 13.3 13.0 12.6 14.5 14.4 14.8 15.3 15.2 15.2
Benin 14.2 18.2 15.4 17.8 16.6 14.6 19.1 19.9 19.5 18.7 18.0 18.5 18.8 19.2 19.7
Burkina Faso 20.9 20.4 21.7 26.1 24.2 23.2 24.3 27.8 31.3 28.4 27.3 26.1 24.8 23.7 24.3
Cambodia 21.7 20.3 21.1 22.4 23.0 23.8 27.3 28.6 26.2 27.0 26.4 26.6 26.4 26.3 26.8
Cameroon 20.1 20.1 20.2 19.2 18.0 18.7 16.6 16.9 18.0 16.2 16.0 15.5 15.9 16.4 16.4
Chad 22.0 18.3 14.4 14.9 13.3 14.3 19.0 18.4 16.6 17.7 16.7 16.8 15.6 15.2 14.7
Congo, Democratic Republic of the 17.3 16.3 13.9 10.0 10.9 12.7 10.4 14.6 18.8 18.3 19.0 19.5 19.9 20.3 19.7
Congo, Republic of 48.6 41.3 41.5 28.4 19.2 21.8 23.1 23.1 24.7 25.1 24.2 24.8 24.7 24.0 22.3
Côte d’Ivoire 15.2 16.5 17.6 18.1 17.6 16.9 20.0 20.3 21.4 20.9 20.1 19.6 20.2 20.2 20.2
Ethiopia 17.5 17.3 17.9 18.0 16.1 15.4 14.5 13.8 12.7 12.4 12.4 12.7 13.0 13.2 13.4
Ghana 21.0 18.6 19.9 17.6 20.9 22.5 31.5 27.4 25.6 24.5 26.4 25.8 24.6 24.0 24.1
Guinea 20.2 21.7 16.1 17.3 16.0 15.0 17.0 15.3 13.8 15.6 16.2 16.9 17.4 17.9 17.5
Haiti 14.6 12.7 10.6 9.8 11.1 10.1 9.9 10.8 10.2 10.6 10.7 11.1 11.7 12.0 12.4
Honduras 27.6 26.0 27.4 26.9 26.2 25.7 28.0 28.4 24.4 ... ... ... ... ... ...
Kenya 23.4 23.8 25.3 25.2 24.5 24.4 24.8 23.9 23.5 22.8 22.3 21.9 21.9 22.2 22.3
Kyrgyz Republic 38.5 38.1 38.9 37.0 33.1 32.6 34.1 33.9 39.9 38.3 38.8 38.7 38.7 38.8 38.8
Lao P.D.R. 25.0 25.8 20.9 21.8 20.9 18.8 18.6 16.3 16.5 18.4 18.5 18.5 18.6 18.0 17.9
Madagascar 12.6 13.0 13.5 14.9 14.4 15.4 16.4 14.0 20.3 17.6 18.6 19.5 19.0 19.4 19.2
Malawi 18.3 19.5 19.7 21.0 19.4 19.3 22.7 23.7 24.4 24.3 25.5 23.9 22.9 21.6 21.0
Mali 20.0 20.9 22.3 22.9 20.3 23.1 25.9 26.4 24.7 25.5 25.3 25.5 25.2 25.4 25.6
Moldova 33.4 31.9 30.1 31.0 31.5 32.0 36.7 34.6 36.8 38.6 36.0 35.6 35.5 35.1 34.8
Mozambique 40.3 32.7 29.0 29.1 31.3 29.8 32.9 31.5 34.4 33.4 31.0 30.0 29.8 27.8 25.7
Myanmar 23.8 24.2 23.4 20.8 21.0 20.3 21.6 24.1 18.4 18.6 19.2 19.5 19.3 19.1 19.1
Nepal 16.6 17.7 19.0 23.6 28.0 27.3 27.6 27.7 26.8 26.1 26.9 27.1 27.5 28.0 27.9
Nicaragua 24.6 25.3 26.8 27.3 27.6 27.8 29.1 30.6 29.0 27.3 27.1 26.7 26.5 26.4 26.5
Niger 23.6 24.2 19.4 19.5 21.2 21.6 22.4 24.3 21.9 23.1 23.5 22.8 22.9 23.1 23.3
Nigeria 13.4 11.0 9.8 12.0 12.8 12.5 12.1 13.3 14.3 14.2 13.9 13.8 13.7 13.7 13.7
Papua New Guinea 27.1 22.8 20.9 18.4 20.3 20.7 23.5 21.8 21.2 21.4 20.5 19.3 18.2 17.3 17.3
Rwanda 27.5 26.6 25.1 25.1 26.4 28.2 33.4 31.6 31.7 28.6 29.8 27.9 27.4 27.1 26.8
Senegal 23.1 22.9 24.0 22.5 22.6 24.2 26.6 25.7 26.9 26.2 26.3 26.4 26.5 26.7 27.4
Sudan 13.5 12.4 10.0 12.8 16.8 18.7 10.7 9.8 12.2 12.6 12.9 13.1 13.3 13.3 13.4
Tajikistan 27.5 31.9 38.7 33.8 30.9 28.8 29.2 27.6 28.9 30.7 28.7 29.1 29.3 29.5 29.7
Tanzania 17.3 17.2 16.9 16.6 16.6 16.7 16.8 17.8 18.3 18.2 18.2 18.4 18.5 18.5 18.5
Uganda 13.6 15.1 15.0 16.3 16.2 18.3 21.4 21.6 20.7 19.4 19.1 20.1 20.2 21.8 19.7
Uzbekistan 24.9 24.6 23.3 22.4 24.8 27.1 28.7 30.5 33.4 29.9 30.5 31.1 31.5 31.9 32.3
Vietnam 22.8 24.2 22.2 21.5 20.5 19.8 21.3 21.9 20.7 21.5 21.4 21.5 21.4 21.5 21.4
Yemen 27.8 19.4 16.1 8.4 14.3 13.2 11.7 9.3 12.7 10.5 10.8 12.9 13.4 13.6 13.7
Zambia 24.3 27.6 23.9 25.0 27.7 29.8 34.1 30.4 28.7 28.3 28.9 27.8 28.2 26.3 25.6
Zimbabwe 20.4 20.5 23.7 28.7 20.3 11.7 12.5 17.5 18.1 18.5 17.8 17.8 17.8 17.8 17.8
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For country-specific details, see “Data and Conventions” in text and Table D.

International Monetary Fund | April 2023 89

 FISCAL MONITOR: On the Path to Policy Normalization

Table A21. Low-Income Developing Countries: General Government Gross Debt, 2014–28
(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average 31.1 35.3 38.7 41.3 41.7 42.8 48.4 48.4 48.2 48.3 46.8 45.8 44.9 44.2 43.2
Oil Producers 20.7 24.6 29.0 31.3 32.4 33.9 39.0 40.2 40.9 41.2 40.8 41.2 41.8 42.3 42.9
Asia 36.0 36.7 37.2 36.9 36.9 37.0 39.2 41.0 41.5 42.3 42.0 41.8 41.5 41.0 40.3
Latin America 28.8 30.8 32.0 32.8 34.8 37.6 42.7 41.5 41.5 38.9 39.6 39.6 40.2 39.3 40.5
Sub-Saharan Africa 27.3 32.8 37.1 40.2 41.6 43.1 49.6 50.8 51.5 50.7 48.6 47.3 46.3 45.3 44.2
Others 38.6 44.0 51.3 65.7 67.7 70.8 90.6 74.9 63.2 64.4 62.2 58.1 54.6 54.5 52.1
Afghanistan 8.7 9.2 8.4 8.0 7.4 6.1 7.4 ... ... ... ... ... ... ... ...
Bangladesh 28.7 28.2 27.7 28.3 29.6 32.0 34.5 35.6 39.1 42.1 42.4 42.8 43.1 43.3 43.6
Benin 22.3 30.9 35.9 39.6 41.1 41.2 46.1 50.3 52.4 52.8 51.6 50.4 49.5 48.7 47.4
Burkina Faso 24.9 31.1 33.5 33.2 38.2 42.0 44.9 48.2 54.3 58.0 60.2 61.3 61.3 60.1 58.9
Cambodia 31.9 31.2 29.1 30.0 28.4 28.2 34.4 35.9 36.5 37.5 38.8 39.7 40.4 41.2 41.6
Cameroon 20.7 31.6 32.1 36.5 38.3 41.6 44.9 46.8 46.4 42.8 40.4 38.5 37.5 37.2 36.8
Chad 38.2 42.5 50.0 48.7 48.4 52.3 54.1 55.9 50.4 43.7 40.1 36.4 33.0 31.0 28.8
Congo, Democratic Republic of the 15.7 16.0 18.8 18.5 14.8 14.8 16.7 16.3 14.6 11.0 9.0 7.2 5.8 4.6 3.6
Congo, Republic of 42.3 74.2 90.5 94.4 77.0 84.0 112.1 107.9 99.6 96.5 89.2 85.9 81.7 76.7 70.2
Côte d’Ivoire 26.7 29.2 31.1 32.6 35.3 37.5 46.3 50.9 56.8 63.3 60.6 57.3 55.1 53.7 51.6
Ethiopia 44.2 50.7 53.1 55.2 58.4 55.8 53.9 53.8 46.4 37.6 33.3 30.9 29.8 29.1 28.5
Ghana 50.1 53.9 55.9 57.0 62.0 58.3 72.3 79.6 88.8 98.7 92.8 91.6 90.4 88.6 86.8
Guinea 35.2 44.4 43.0 41.9 39.3 38.6 47.5 40.6 33.4 30.0 30.1 30.3 28.8 28.6 28.4
Haiti 20.8 21.7 21.6 18.9 21.5 25.4 22.0 25.6 25.0 20.3 19.9 19.9 20.4 21.2 22.8
Honduras 35.0 38.3 39.4 41.3 42.4 42.9 52.7 50.3 50.0 ... ... ... ... ... ...
Kenya 41.3 45.8 50.4 53.9 56.4 59.1 67.8 67.0 67.9 66.6 65.4 64.1 62.7 61.1 59.5
Kyrgyz Republic 53.6 67.1 59.1 58.8 54.8 51.6 67.6 59.5 53.5 53.0 52.9 53.7 54.5 55.6 57.1
Lao P.D.R. 53.5 53.1 54.5 57.2 60.6 69.1 76.0 92.4 128.5 123.0 119.9 115.8 112.2 108.1 104.1
Madagascar 37.8 44.1 40.3 40.1 42.9 41.0 51.2 52.3 57.0 53.1 52.0 52.2 53.1 54.6 56.0
Malawi 33.5 35.5 37.1 40.3 43.9 45.3 54.8 61.6 70.1 72.2 69.4 66.6 63.5 60.4 56.6
Mali 26.9 30.7 36.0 36.0 37.5 40.7 46.9 50.7 53.2 54.1 54.9 55.4 55.5 56.0 56.7
Moldova 35.0 42.4 39.2 34.9 31.8 28.8 36.6 33.1 33.5 34.5 36.7 36.9 36.9 36.9 34.9
Mozambique 64.3 87.4 126.2 104.1 106.7 99.0 120.0 107.2 76.1 102.8 103.1 101.4 97.8 82.9 67.6
Myanmar 35.2 36.4 38.3 38.5 40.4 38.8 39.3 65.5 63.9 61.3 63.3 65.4 67.3 66.5 65.2
Nepal 27.6 25.7 25.0 25.0 31.1 34.0 43.3 44.0 43.8 47.8 48.8 49.8 50.2 50.0 49.9
Nicaragua 28.7 28.9 30.9 33.8 37.4 41.4 47.7 47.6 46.0 44.5 45.0 45.4 46.5 46.8 46.1
Niger 22.1 29.9 32.8 36.5 39.5 40.5 45.0 51.3 51.1 52.5 49.4 48.1 47.2 46.7 46.3
Nigeria1 17.5 20.3 23.4 25.3 27.7 29.2 34.5 36.5 38.0 38.8 39.0 40.3 41.5 42.3 43.1
Papua New Guinea 26.9 29.9 33.7 32.5 36.7 40.2 48.7 52.1 49.2 48.0 47.6 46.7 43.5 40.5 39.3
Rwanda 28.3 32.4 36.6 41.3 44.9 49.8 65.6 66.6 64.4 67.1 71.1 70.7 68.9 67.0 62.9
Senegal2 42.4 44.5 47.5 61.1 61.5 63.6 69.2 73.2 75.0 73.1 69.9 69.3 69.0 69.0 65.0
Sudan 84.4 93.2 109.9 149.5 186.7 200.3 275.0 187.9 127.6 151.1 166.4 163.2 160.4 173.2 157.7
Tajikistan 27.9 35.0 42.2 46.3 46.6 43.5 49.8 42.5 34.6 32.3 31.3 31.2 31.1 31.0 28.9
Tanzania 36.1 39.2 39.8 40.7 40.5 39.1 39.8 42.1 41.6 40.1 38.5 37.2 36.1 35.0 34.0
Uganda 24.8 28.5 31.0 33.6 34.9 37.6 46.3 50.6 50.8 50.2 49.2 47.7 45.4 41.0 36.7
Uzbekistan 6.1 6.7 8.2 19.3 19.6 28.5 37.1 35.4 34.3 33.9 32.9 31.5 30.2 28.8 27.1
Vietnam 43.6 46.1 47.5 46.3 43.5 40.8 41.3 39.3 37.1 36.3 35.4 34.6 33.8 32.9 31.3
Yemen 48.9 57.1 75.3 84.0 89.5 94.6 98.5 85.1 73.5 68.7 57.1 44.2 36.3 33.1 30.6
Zambia 33.9 61.9 58.0 63.4 75.2 94.4 140.2 110.8 ... ... ... ... ... ... ...
Zimbabwe 42.3 48.0 49.9 74.1 51.0 82.3 84.4 59.8 92.8 102.3 100.0 90.9 83.5 83.6 72.7
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For country-specific details, see “Data and Conventions” in text and Table D.
1 Debt includes overdrafts from the Central Bank of Nigeria and liabilities of the Asset Management Corporation of Nigeria.

2 From 2017 onward, Senegal data include the whole of the public sector, whereas before 2017, only central government debt stock was taken into account.

90 International Monetary Fund | April 2023

 METHODOLOGICAL AND STATISTICAL APPENDIX

Table A22. Low-Income Developing Countries: General Government Net Debt, 2014–28
(Percent of GDP)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Average ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Oil Producers ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Asia ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Latin America ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Sub-Saharan Africa ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Others ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Afghanistan ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Bangladesh ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Benin ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Burkina Faso ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Cambodia ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Cameroon 19.1 27.6 30.5 33.3 35.9 39.5 43.0 45.4 45.0 41.0 38.7 36.8 35.8 35.5 35.3
Chad ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Congo, Democratic Republic of the ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Congo, Republic of ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Côte d’Ivoire ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Ethiopia 39.6 45.8 49.2 51.3 54.7 51.8 50.3 50.5 43.9 35.8 32.0 29.9 28.9 28.4 27.9
Ghana 45.3 49.8 50.9 51.9 60.7 54.6 68.2 74.8 83.9 93.9 88.0 86.8 85.6 83.7 82.0
Guinea ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Haiti ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Honduras ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Kenya 34.8 39.7 47.5 48.1 50.8 54.1 63.0 63.8 65.0 65.4 64.9 63.8 60.7 59.3 57.9
Kyrgyz Republic ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Lao P.D.R. ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Madagascar ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Malawi ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Mali 19.7 23.1 30.0 31.1 34.1 34.6 40.4 43.7 49.2 48.8 48.4 48.4 48.6 49.0 49.7
Moldova ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Mozambique ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Myanmar ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Nepal ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Nicaragua ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Niger 17.2 25.9 29.5 32.3 36.6 36.7 41.0 45.1 45.9 47.8 45.8 45.2 44.9 44.8 44.8
Nigeria1 13.8 15.9 19.0 20.9 23.5 25.5 34.1 36.4 37.7 38.6 38.9 40.1 41.3 42.2 43.0
Papua New Guinea ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Rwanda ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Senegal ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Sudan ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Tajikistan ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Tanzania ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Uganda ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Uzbekistan ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Vietnam ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Yemen 48.0 56.2 73.6 81.9 86.0 91.1 94.4 82.4 71.5 66.9 55.7 43.1 35.4 32.3 29.9
Zambia ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Zimbabwe ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
Source: IMF staff estimates and projections. Projections are based on staff assessments of current policies (see “Fiscal Policy Assumptions” in text).
Note: For country-specific details, see “Data and Conventions” in text and Table D.
1 Debt includes overdrafts from the Central Bank of Nigeria and liabilities of the Asset Management Corporation of Nigeria. The overdrafts and government deposits at the Central Bank of

Nigeria almost cancel each other out, and the Asset Management Corporation of Nigeria debt is roughly halved.

International Monetary Fund | April 2023 91

 Table A23. Advanced Economies: Structural Fiscal Indicators
(Percent of GDP, except when indicated otherwise)
Pension Net Present Health Care Net Present Value Gross Debt to Projected Interest Pre-Pandemic Projected Nonresident Holding

92
Spending Value of Pension Spending of Health Care Financing Average Term Average Rate–Growth Overall Overall of General Government
Change, Spending Change, Change, Spending Change, Need, to Maturity, Maturity, Differential, Balance, Balance, Debt, 2022
2022–301,8 2022–502,8 2022–303a,3b 2022–502 20234 2023 (years)5 2023 2023–28 (percent) 2012–19 2023–28 (percent of total)6
Average 0.6 17.3 2.3 94.9 24.0 7.3 16.6 –1.4 –3.2 –4.0 28.0
G7 0.6 16.2 2.6 106.2 28.4 7.0 19.0 –1.3 –3.9 –5.1 26.4
G20 Advanced 0.6 16.7 2.6 103.5 26.8 7.1 18.2 –1.3 –3.7 –4.9 26.5
Andorra 2.2 84.2 ... ... –1.3 7.5 5.0 ... 2.3 2.7 ...
Australia –0.1 –3.4 1.4 55.8 5.5 7.0 8.4 –0.3 –2.7 –2.4 27.4
Austria 1.1 24.7 1.2 53.4 10.0 11.6 6.4 –2.3 –1.2 –1.4 53.6
Belgium 1.3 41.1 1.5 68.5 14.1 9.8 10.8 –1.2 –2.3 –5.5 47.5
Canada 0.7 15.7 1.1 45.1 12.4 5.8 18.2 –0.4 –0.5 –0.2 19.0
Cyprus 0.7 18.5 ... ... 8.1 8.1 9.9 –3.5 –1.4 1.4 74.3
Czech Republic 0.4 28.3 0.6 25.4 9.2 2.9 15.4 –2.8 –0.6 –2.8 ...
Denmark –0.5 –18.8 1.3 47.2 0.6 8.8 3.4 0.4 0.2 0.2 22.4
Estonia –0.5 –19.1 0.5 23.9 ... 6.0 3.5 –5.3 –0.1 –2.7 74.5

International Monetary Fund | April 2023

Finland 0.4 –2.6 1.1 39.2 11.0 7.5 10.0 –1.4 –1.8 –2.7 40.6
France 0.5 2.4 1.2 49.4 16.0 8.3 13.4 –1.7 –3.6 –4.4 43.4
Germany 0.9 26.7 0.7 38.8 11.6 6.4 10.5 –2.2 0.9 –1.4 36.5
Hong Kong SAR 1.2 47.9 ... ... ... ... ... –0.9 2.5 –0.5 ...
Iceland 1.2 46.4 1.2 55.0 7.3 4.5 4.9 0.6 1.1 –0.5 13.3
Ireland 0.9 35.2 0.4 21.2 0.0 11.2 3.6 –4.4 –2.6 1.1 53.0
FISCAL MONITOR: On the Path to Policy Normalization

Israel 0.2 12.2 0.3 14.3 ... 7.8 7.3 –2.4 –2.8 –2.3 17.5
Italy 1.5 33.5 0.5 27.2 23.0 7.0 20.0 –0.6 –2.5 –2.2 24.1
Japan –0.6 8.0 1.1 39.8 48.8 8.0 32.2 –2.1 –4.7 –3.9 12.3
Korea 1.1 50.6 1.8 78.6 4.0 9.7 5.7 –2.5 1.3 –0.1 ...
Latvia –0.2 –9.9 0.7 29.5 ... 8.3 5.1 –4.5 –0.7 –2.0 ...
Lithuania 0.6 17.5 1.0 46.6 7.1 9.4 4.3 –4.0 –0.6 –2.2 51.2
Luxembourg 1.6 62.3 0.7 35.2 ... 7.0 3.9 –3.2 1.6 –1.2 42.5
Malta –0.5 –4.7 ... ... 11.7 8.3 6.9 –3.6 –0.2 –2.9 13.5
The Netherlands 1.0 34.3 1.6 62.7 6.4 8.5 5.7 –2.6 –0.8 –1.7 33.4
New Zealand 1.1 35.5 1.3 54.6 8.5 7.3 6.8 –0.1 –0.3 –1.4 28.0
Norway 1.0 25.1 1.4 55.9 ... 4.4 8.7 –0.1 7.8 21.2 55.5
Portugal 1.2 20.8 1.0 43.5 7.6 6.7 16.7 –2.0 –3.5 –1.1 42.9
Singapore7 0.8 30.5 ... ... 8.4 3.3 41.3 ... 4.6 2.7 ...
Slovak Republic 1.1 49.5 0.4 18.9 8.9 8.6 6.7 –3.7 –2.3 –4.2 40.5
Slovenia 0.8 59.6 0.7 35.3 6.2 9.9 6.8 –4.1 –3.4 –2.1 47.0
Spain –0.2 4.6 1.2 51.9 13.6 8.0 13.9 –1.7 –5.4 –4.0 38.6
Sweden –0.3 –10.7 0.5 21.7 4.1 5.9 5.5 –2.5 0.0 0.1 16.1
Switzerland 0.4 13.4 2.0 84.6 2.2 11.2 3.4 –2.1 0.5 0.2 7.9
United Kingdom 0.2 11.1 1.6 64.6 10.9 14.5 7.4 –1.5 –4.2 –4.3 22.6
United States 0.7 16.7 3.8 150.3 32.9 6.1 20.1 –1.2 –5.1 –6.8 26.5
Sources: Bloomberg Finance L.P.; Joint External Debt Hub, Quarterly External Debt Statistics; national authorities; and IMF staff estimates and projections.
Note: All economy averages are weighted by nominal GDP converted to US dollars at average market exchange rates in the years indicated and on the basis of data availability.
1 Pension projections rely on authorities’ estimates when these are available. When authorities’ estimates are not available, IMF staff projections use the method described in Clements, Eich, and Gupta, Equitable and Sustainable Pensions: Challenges and Experience

(IMF 2014). These pension spending projections may be different from the previous edition of the Fiscal Monitor because of new baseline pension numbers, new authorities’ projections, or updated demographic data from the UN World Population Prospects.
2 For net present value calculations, a discount rate of 1 percent a year in excess of GDP growth is used for each economy.

3a IMF staff projections for health care spending are driven by demographics and other factors. The difference between the growth of health care spending and real GDP growth that is not explained by demographics (“excess cost growth”) is assumed to start at

the economy-specific historical average and converge to the advanced economy historical average by 2050 (0.6 percent).
3b These health expenditure projections have been updated to include new available underlying health and economic data, as well as technical adjustments to the excess cost growth calculation and the age-expenditure profiles. The projections exclude health

expenditure growth during the COVID-19 pandemic in the underlying trend expenditure growth estimate.
4 “Gross financing need” is defined as the projected overall deficit and maturing government debt in 2023. For most economies, data on maturing debt refer to central government securities. Data are from Bloomberg Finance L.P. and IMF staff projections.

5 For most economies, the average-term-to-maturity data refer to central government securities; the source is Bloomberg Finance L.P.

6 Nonresident holding of general government debt data are for the first quarter of 2023 or latest available from the Joint External Debt Hub, Quarterly External Debt Statistics, which include marketable and nonmarketable debt. For some economies, tradable

instruments in the Joint External Debt Hub are reported at market value. External debt in US dollars is converted to local currency, then taken as a percentage of the 2022 gross general government debt.
7 Singapore’s general government debt is covered by financial assets and is issued to deepen the domestic market, meet the Central Provident Fund’s investment needs, and provide individuals with a long-term savings option.

8 In the case of all EU members, including Slovakia, pension spending projections reflect the estimates published in the latest available Aging Report. Reforms and changes in methodology or assumptions between Aging Report vintages are not incorporated into

the Fiscal Monitor annexes.

 Table A24. Emerging Market and Middle-Income Economies: Structural Fiscal Indicators
(Percent of GDP, except when indicated otherwise)
Pension Net Present Health Care Net Present Value Gross Debt to Projected Interest Pre-Pandemic Projected Nonresident Holding
Spending Value of Pension Spending of Health Care Financing Average Term Average Rate–Growth Overall Overall of General Government
Change, Spending Change, Change, Spending Change, Need, to Maturity, Maturity, Differential, Balance, Balance, Debt, 2022
2022–301 2022–502 2022–303a,3b 2022–502 20234 2023 (years)5 2023 2023–28 (percent) 2012–19 2023–28 (percent of total)6
Average 1.4 73.1 0.6 29.2 12.6 7.5 10.0 –3.0 –3.2 –5.2 12.0
G20 Emerging 1.5 76.1 0.6 29.4 12.4 7.7 9.9 –2.8 –3.4 –5.7 8.3
Algeria 3.0 142.2 0.6 29.4 ... 7.6 6.8 –3.4 –8.4 –8.0 1.0
Angola 0.1 2.3 0.1 5.9 ... 5.9 10.8 –2.1 –1.6 –2.4 ...
Argentina 0.7 46.2 1.0 46.5 15.7 8.7 8.8 ... –5.0 ... 28.6
Belarus 2.7 96.6 0.7 32.0 ... ... ... –3.2 –0.3 0.0 64.7
Brazil7 0.2 30.4 0.9 41.1 20.8 5.2 16.9 2.9 –6.4 –6.4 9.7
Bulgaria 0.0 5.4 0.9 41.5 ... 7.4 2.8 –1.5 –0.9 –2.7 41.9
Chile 1.0 44.1 1.2 55.5 3.8 10.0 3.7 –2.7 –1.6 –0.6 32.7
China 1.8 95.0 0.7 31.1 ... 7.3 11.3 –3.7 –2.7 –6.3 3.3
Colombia 2.0 91.4 1.7 79.9 5.5 10.6 5.8 0.1 –2.4 –2.6 32.2
Croatia 0.4 1.1 1.1 48.2 9.1 5.7 11.5 –2.7 –2.5 –1.4 36.3
Dominican Republic 0.1 2.5 0.6 27.3 5.2 9.2 6.3 –2.7 –2.9 –2.6 55.0
Ecuador 0.7 35.4 0.9 41.6 ... 12.4 4.4 ... –6.1 ... 70.3
Egypt 1.1 56.7 0.2 9.0 35.2 3.2 29.0 –3.6 –10.1 –7.1 ...
Hungary –0.1 21.7 1.0 42.7 13.9 6.5 11.3 –2.6 –2.3 –2.5 26.2
India 0.7 33.3 0.2 8.9 13.1 9.8 8.5 –3.2 –7.0 –8.0 4.4
Indonesia 0.1 6.7 0.3 14.9 4.4 8.8 4.5 –1.8 –2.2 –2.3 34.6
Iran 1.2 86.5 0.5 23.2 ... ... ... –12.9 –1.7 –6.6 ...
Kazakhstan 1.2 33.0 0.3 14.2 ... 6.3 4.1 –2.1 –0.1 –1.3 24.4
Kuwait 8.5 629.0 1.3 60.7 10.5 1.7 1.8 6.6 13.1 1.6 ...
Lebanon ... ... ... ... ... ... ... ... –8.8 ... ...
Malaysia 1.4 66.3 0.4 16.7 ... 8.6 7.8 –2.3 –2.7 –4.5 21.2
Mexico 0.8 44.7 0.6 28.1 12.5 8.5 6.6 2.8 –3.0 –2.9 23.6
Morocco 1.3 54.6 0.4 19.3 13.7 6.4 10.6 –2.2 –4.4 –3.7 21.8
Oman 0.2 16.4 0.6 33.1 8.6 7.4 5.8 5.5 –6.2 0.5 ...
Pakistan 0.2 6.3 0.1 5.3 26.8 2.7 26.8 –5.8 –5.8 –6.6 29.5
Peru ... ... 0.7 33.4 3.8 14.2 2.3 –1.7 –1.0 –1.0 49.4
Philippines 0.2 7.3 0.3 13.1 11.9 6.2 9.1 –5.1 –0.4 –3.1 24.4
Poland –0.1 –5.5 0.8 33.8 7.3 4.5 11.3 –3.6 –2.4 –4.0 24.8
Qatar 0.3 24.3 0.5 23.8 8.6 9.2 4.9 0.2 9.0 11.9 8.6
Romania 2.3 74.1 ... ... 12.2 7.3 6.6 –4.3 –2.6 –4.8 36.7
Russia 2.2 72.4 1.0 46.1 7.1 6.8 3.6 –0.4 –0.7 –2.0 ...
Saudi Arabia 2.8 161.2 0.8 36.2 11.6 10.2 2.3 2.2 –4.2 –0.6 34.2
South Africa 0.2 11.7 0.7 34.7 14.9 11.8 6.1 2.5 –4.1 –6.3 24.9
Sri Lanka ... ... ... ... ... ... ... ... –5.7 ... 27.6
Thailand 3.3 113.7 0.6 26.3 10.3 7.7 7.9 –1.4 –0.2 –3.3 8.8
Türkiye8 0.7 46.9 ... ... ... 5.5 ... ... ... ... ...
Ukraine ... ... ... ... ... ... ... ... –3.0 ... ...
United Arab Emirates 0.4 42.8 0.5 25.4 ... 4.4 6.9 –1.8 1.9 2.9 ...
Uruguay9 0.6 40.5 1.2 55.3 5.5 12.9 4.8 –3.6 –2.3 –2.2 43.5
Venezuela ... ... ... ... ... ... ... ... –12.5 –5.1 ...
Sources: Joint External Debt Hub, Quarterly External Debt Statistics; national authorities; and IMF staff estimates and projections.
Note: All country averages are weighted by nominal GDP converted to US dollars at average market exchange rates in the years indicated and on the basis of data availability.
1 Pension projections rely on authorities’ estimates when these are available. When authorities’ estimates are not available, IMF staff projections use the method described in Clements, Eich, and Gupta, Equitable and Sustainable Pensions: Challenges and Experience

(IMF 2014). These pension spending projections may be different from the previous edition of the Fiscal Monitor because of new baseline pension numbers, new authorities’ projections, or updated demographic data from the UN World Population Prospects.
2 For net present value calculations, a discount rate of 1 percent a year in excess of GDP growth is used for each economy.

3a IMF staff projections for health care spending are driven by demographics and other factors. The difference between the growth of health care spending and real GDP growth that is not explained by demographics (“excess cost growth”) is assumed to be the

income group historical average (1.2 percent).

3b These health expenditure projections have been updated to include new available underlying health and economic data, as well as technical adjustments to the excess cost growth calculation and the age-expenditure profiles. The projections exclude health

expenditure growth during the COVID-19 pandemic in the underlying trend expenditure growth estimate.

International Monetary Fund | April 2023

4 “Gross financing need” is defined as the projected overall balance and maturing government debt in 2023. Data are from IMF staff projections.

5 Average-term-to-maturity data refer to government securities; the source is Bloomberg Finance L.P.

6 Nonresident holding of general government debt data are the first quarter of 2023 or latest available from the Joint External Debt Hub, Quarterly External Debt Statistics, which include marketable and nonmarketable debt. For some countries, tradable instruments

in the Joint External Debt Hub are reported at market value. External debt in US dollars is converted to local currency, then taken as a percentage of 2022 gross general government debt.
METHODOLOGICAL AND STATISTICAL APPENDIX

93
7 Note that the pension spending projections reported in the first and second column do not include savings from the pension reform approved in October 2019.

8 The average-term-to-maturity data for Türkiye is in accordance with the published data for central government debt securities as of July 2022.

9 Data are for the nonfinancial public sector, which includes central government, local government, social security funds, nonfinancial public corporations, and Banco de Seguros del Estado. The coverage of fiscal data was changed from the consolidated public

sector to the nonfinancial public sector with the October 2019 submission. With this narrower coverage, the central bank balances are not included in the fiscal data. Historical data were also revised accordingly.
 Table A25. Low-Income Developing Countries: Structural Fiscal Indicators
(Percent of GDP, except when indicated otherwise)
Pension Net Present Health Care Net Present Value Debt to Projected Interest Pre-Pandemic Projected Nonresident Holding
Spending Value of Pension Spending of Health Care Average Term Average Rate–Growth Overall Overall of General Government

94
Change, Spending Change, Change, Spending Change, to Maturity, Maturity, Differential, Balance, Balance, Debt, 2022
2022–301 2022–502 2022–303a,3b 2022–502 2023 (years)4 2023 2023–28 (percent) 2012–19 2023–28 (percent of total)5
Average 0.5 19.8 0.2 8.1 7.5 9.7 –7.7 –3.3 –3.9 45.7
Afghanistan 0.1 6.6 0.1 6.6 ... ... ... –0.4 ... ...
Bangladesh 0.2 12.5 0.1 3.0 5.2 8.0 –6.6 –3.5 –5.1 31.4
Benin 0.0 1.2 0.1 4.5 8.1 6.5 –4.3 –2.6 –3.1 ...
Burkina Faso 0.0 2.2 0.4 16.4 3.3 17.3 –3.4 –3.5 –5.1 43.6
Cambodia 0.4 14.1 0.3 12.3 ... ... –7.2 –0.9 –3.4 90.8
Cameroon 0.0 3.2 0.1 3.3 4.9 8.8 –4.5 –3.7 –0.8 64.4
Chad 0.0 0.7 0.1 4.7 ... ... –2.7 –1.3 5.3 ...
Congo, Democratic Republic ... ... 0.1 3.3 ... ... –3.4 0.2 –2.9 ...
of the
Congo, Republic of 0.2 8.9 0.2 10.6 ... ... –2.1 –4.4 4.5 ...
Côte d’Ivoire 0.1 6.8 0.1 6.2 ... ... –3.8 –2.4 –3.5 ...
Ethiopia 0.0 1.8 0.1 5.8 ... ... –18.2 –2.3 –3.1 ...

International Monetary Fund | April 2023

Ghana 0.2 8.1 0.3 13.3 7.0 14.0 –8.1 –6.8 –6.6 ...
Guinea 0.0 0.0 0.1 5.3 ... ... –8.8 0.8 –2.4 ...
Haiti ... ... 0.1 2.6 ... ... –13.5 –1.8 –2.0 ...
Honduras ... ... ... ... ... ... ... –1.7 ... ...
Kenya 0.2 12.8 0.3 13.5 8.6 7.7 –2.5 –6.5 –4.2 45.2
Kyrgyz Republic 4.0 114.3 0.3 13.5 ... ... –6.4 –3.2 –4.3 70.4
FISCAL MONITOR: On the Path to Policy Normalization

Lao P.D.R. 0.1 6.9 0.2 6.9 ... ... –5.7 –4.2 –3.3 ...
Madagascar 0.2 10.8 0.2 7.9 ... ... –9.2 –2.1 –4.0 43.0
Malawi –0.1 0.4 0.2 11.2 2.7 26.7 –3.4 –3.9 –6.3 43.0
Mali –0.1 –0.6 0.2 7.6 3.2 17.1 –4.1 –2.7 –3.6 ...
Moldova 3.0 67.1 0.7 31.7 ... ... –6.5 –1.4 –3.9 56.0
Mozambique 0.0 4.3 0.3 14.2 3.1 32.7 –10.7 –4.4 –1.9 ...
Myanmar 0.2 9.6 ... ... ... ... –6.7 –2.8 –4.5 ...
Nepal 0.1 9.7 0.2 10.3 ... ... –7.7 –1.3 –3.3 ...
Nicaragua 0.6 38.3 0.7 33.9 1.3 35.1 –5.6 –1.3 –0.3 83.1
Niger 0.0 0.6 0.3 11.6 ... ... –6.1 –3.8 –3.6 ...
Nigeria 0.0 0.8 0.1 3.0 9.0 4.3 –5.7 –3.5 –5.7 ...
Papua New Guinea 0.1 4.5 0.2 10.5 ... ... –0.3 –4.1 –1.9 40.9
Rwanda 0.0 1.3 0.4 17.4 6.7 10.1 –9.1 –2.8 –4.2 73.0
Senegal 0.0 ... 0.2 10.7 9.1 8.0 –5.3 –3.7 –3.5 ...
Sudan 0.0 1.2 0.2 7.0 ... ... –22.4 –6.3 –2.6 ...
Tajikistan 0.4 13.4 0.3 12.5 ... ... –8.1 –2.6 –2.5 87.7
Tanzania 0.0 3.8 0.2 8.4 9.5 4.2 –5.3 –2.6 –2.6 ...
Uganda 0.1 3.7 0.1 3.8 ... ... –6.7 –3.1 –2.5 54.5
Uzbekistan 2.3 82.9 0.4 17.1 ... ... –11.7 1.6 –2.9 63.0
Vietnam 1.5 64.2 0.3 14.6 9.7 3.7 –7.9 –3.5 –2.7 ...
Yemen 0.1 8.8 0.1 2.7 ... ... –14.7 –6.7 –1.2 ...
Zambia 0.2 10.1 0.3 13.7 3.9 24.3 –3.7 –6.8 –5.2 ...
Zimbabwe –0.3 –1.8 0.1 4.4 3.7 27.8 –48.4 –3.5 –2.3 ...
Sources: Joint External Debt Hub, Quarterly External Debt Statistics; national authorities; and IMF staff estimates and projections.
Note: All country averages are weighted by nominal GDP converted to US dollars at average market exchange rates in the years indicated and on the basis of data availability.
1 Pension projections rely on authorities’ estimates when these are available. When authorities’ estimates are not available, IMF staff projections use the method described in Clements, Eich, and Gupta, Equitable and Sustainable Pensions: Challenges and

Experience (IMF 2014). These pension spending projections may be different from the previous edition of the Fiscal Monitor because of new baseline pension numbers, new authorities’ projections, or updated demographic data from the UN World Population
Prospects.
2 For net present value calculations, a discount rate of 1 percent a year in excess of GDP growth is used for each economy.

3a IMF staff projections for health care spending are driven by demographics and other factors. The difference between the growth of health care spending and real GDP growth that is not explained by demographics (“excess cost growth”) is assumed to be the

income group historical average (1.2 percent).

3b These health expenditure projections have been updated to include new available underlying health and economic data, as well as technical adjustments to the excess cost growth calculation and the age-expenditure profiles. The projections exclude health

expenditure growth during the COVID-19 pandemic in the underlying trend expenditure growth estimate.
4 The average-term-to-maturity data refer to government securities; the source is Bloomberg Finance L.P.

5 Nonresident holding of general government debt data are for the first quarter of 2023 or latest available from the Joint External Debt Hub, Quarterly External Debt Statistics, which include marketable and nonmarketable debt. For some countries, tradable

instruments in the Joint External Debt Hub are reported at market value. External debt in US dollars is converted to local currency, then taken as a percentage of 2022 gross general government debt.
SELECTED TOPICS

Fiscal Monitor Archives

On the Path to Policy Normalization April 2023
Helping People Bounce Back October 2022
Fiscal Policy from Pandemic to War April 2022
Strengthening the Credibility of Public Finances October 2021
A Fair Shot April 2021
Policies for the Recovery October 2020
Policies to Support People During the COVID-19 Pandemic April 2020
How to Mitigate Climate Change October 2019
Curbing Corruption April 2019
Managing Public Wealth October 2018
Capitalizing on Good Times April 2018
Tackling Inequality October 2017
Achieving More with Less April 2017
Debt: Use It Wisely October 2016
Acting Now, Acting Together April 2016
The Commodities Roller Coaster: A Fiscal Framework for Uncertain Times October 2015
Now Is the Time: Fiscal Policies for Sustainable Growth April 2015
Back to Work: How Fiscal Policy Can Help October 2014
Public Expenditure Reform: Making Difficult Choices April 2014
Taxing Times October 2013
Fiscal Adjustment in an Uncertain World April 2013
Taking Stock: A Progress Report on Fiscal Adjustment October 2012
Balancing Fiscal Policy Risks April 2012
Addressing Fiscal Challenges to Reduce Economic Risks September 2011
Shifting Gears April 2011
Fiscal Exit: From Strategy to Implementation November 2010
Navigating the Fiscal Challenges Ahead May 2010

I. Adjustment
Inflation and Disinflation: What Role for Fiscal Policy? April 2023, Chapter 2
Capitalizing on Good Times April 2018
Defining and Measuring Fiscal Space April 2017, Annex 1.1
China: What Do We Know about the General Government’s Balance Sheet? October 2016, Box 1.1
Brazil: Private Debt and the Strength of the Public Sector Balance Sheet October 2016, Box 1.3
Fiscal Consolidations with Progressive Measures April 2014, Box 2.4
Constructing an Index of the Difficulty of Fiscal Adjustment October 2013, Box 1
Medium-Term Fiscal Adjustment in an Uncertain World April 2013, Chapter 2
The Appropriate Pace of Short-Term Fiscal Adjustment April 2013, Box 2
Fiscal Adjustment in the United States: Making Sense of the Numbers April 2013, Box 5
Taking Stock: A Progress Report on Fiscal Adjustment October 2012, Chapter 2
Distributional Consequences of Alternative Fiscal Consolidation Measures: Reading from the Data October 2012, Appendix 1
Easy Does It: The Appropriate Pace of Fiscal Consolidation April 2012, Chapter 3
Experience with Large Fiscal Adjustment Plans in Ireland and Portugal April 2012, Box A2.1

International Monetary Fund | April 2023 95

FISCAL MONITOR: ON THE PATH TO POLICY NORMALIZATION

Fiscal Multipliers in Expansions and Contractions April 2012, Appendix 1

Early Lessons from Experiences with Large Fiscal Adjustment Plans April 2012, Appendix 2
Fiscal Adjustment Plans and Medium-Term Fiscal Outlook November 2010, Chapter 3
To Tighten or Not to Tighten: This Is the Question November 2010, Box 1.2
Fiscal Adjustment and Income Distribution in Advanced and Emerging Economies November 2010, Appendix 3
The Fiscal Policy Outlook: Adjustment Needs and Plans May 2010, Chapter 3
Adjustment Measures and Institutions May 2010, Chapter 4
Fiscal Adjustment Requirements: Gross and Net Debt Targets May 2010, Appendix 2

II. Commodities and Energy

On the Path to Policy Normalization April 2023, Chapter 1
Helping People Bounce Back October 2022, Chapter 1
Externalities from Energy Pricing Subsidies October 2022, Online Annex 1.5
Governance in the Extractive Industries April 2019, Box 2.1
Bolivia: Inequality Decline during a Commodity Boom October 2017, Box 1.3
The Fiscal Impact of Lower Oil Prices April 2015, Chapter 1
Reforming Energy Subsidies April 2015, Box 1.2
Reforming Energy Subsidies April 2013, Appendix 1
Fiscal Developments in Oil-Producing Economies September 2011, Box 3
Fuel and Food Price Shocks and Fiscal Performance in Low-Income Countries September 2011, Box 8
Pass-Through and Fiscal Impact of Rising Fuel Prices April 2011, Box 1.2
Reforming Petroleum Subsidies May 2010, Appendix 5

III. Country Cases

Inflation and Disinflation: What Role for Fiscal Policy? April 2023, Chapter 2
Income Stabilization before and during the COVID-19 Pandemic across EU Countries: October 2022,
   A Microsimulation Approach    Online Annex 1.2
Brazil’s Emergency Cash Transfer Program October 2022, Online Annex 1.3
Social Protection and Poverty During the Pandemic April 2022, Box 1.1
Analysis of Poverty, Social Safety Nets, and Informality April 2022, Online Annex 1.2
Global Spillovers from the Fiscal Packages in the European Union and the United States October 2021, Online Annex 1.1
Long-Term Distributional Impact of the American Families Plan October 2021, Box 1.1;
   Online Annex 1.2
Fiscal Developments in Countries Participating in the Debt Suspension Initiative October 2021, Box 1.2
Persistent Consequences of Wealth Inequality for the Next Generation’s Income: The Case of Norway April 2021, Box 2.1
A Wave of Protests: Economic Reforms and Social Unrest April 2020, Box 1.2
Fiscal Measures in Selected Economies in Response to the COVID-19 Pandemic April 2020, Special Feature
   Online Annex 1.1
The Macroeconomic Effects of Public Investment: A Model-Based Analysis April 2020, Online Annex 2.1
China: State-Owned Enterprises Remain Key Players April 2020, Online Annex 3.1
Brazil: A Complex and, at Times, Turbulent Relationship between SOEs and the Government April 2020, Online Annex 3.2
Ghana: Risks in SOEs Can Spill Over to Other Sectors and the Budget April 2020, Online Annex 3.5
How to Get the Most Out of SOEs: The Nordic Example April 2020, Online Annex 3.7
China: How Can Fiscal Policy Support Economic Activity and Rebalancing? April 2019, Box 1.2
The Distributional Effects of Income Tax Cuts in the United States April 2018, Box 1.2
International Tax Policy Implications from US Corporate Tax Reform April 2018, Box 1.3
General Government Debt and Fiscal Risks in China April 2018, Box 1.4
Digital Government April 2018, Chapter 2

96 International Monetary Fund | April 2023

 SELECTED TOPICS

Digitalization Advances in Revenue Administration in South Africa and Estonia April 2018, Box 2.1
The Digitalization of Public Finances: Country Case Studies April 2018, Annex 2.1
Bolivia: Inequality Decline during a Commodity Boom October 2017, Box 1.3
Adopting a Universal Basic Income to Support Subsidy Reform in India October 2017, Box 1.6
Model Simulations October 2017, Annex 1.3
Making Growth More Inclusive in China April 2017, Box 1.3
Colombia: Labor Tax Reform and the Shift from Informal to Formal Employment April 2017, Box 2.2
Mozambique: Differential Tax Treatment across Firms April 2017, Box 2.3
Innovation in Brazil, Russia, India, China, and South Africa (BRICS) October 2016, Box 2.4
Lowflation and Debt in the Euro Area October 2014, Box 1.1
Fiscal Challenges in the Pacific Island Countries April 2014, Box 1.3
Fiscal Reforms to Unlock Economic Potential in the Arab Countries in Transition October 2013, Box 2
Fiscal Adjustment in the United States: Making Sense of the Numbers April 2013, Box 5
Lessons from Sweden October 2012, Box 2
The “Two-Pack”: Further Reforms to Fiscal Governance in the Euro Area October 2012, Box 6
Ireland: The Impact of Crisis and Fiscal Policies on Inequality October 2012, Box 8
The “Fiscal Compact”: Reforming EU Fiscal Governance April 2012, Box 5
Experience with Large Fiscal Adjustment Plans in Ireland and Portugal April 2012, Box A2.1
Subnational Government Response to the Financial Crisis in the United States and Canada April 2012, Box A3.1
The Dog That Didn’t Bark (So Far): Low Interest Rates in the United States and Japan September 2011, Chapter 3
United States: Government-Sponsored Enterprises and Contingent Liabilities September 2011, Box 1
Fiscal Aspects of EU Economic Governance Reforms April 2011, Box 4.1
The U.S. National Commission Report April 2011, Box A5.1
The European Union: Reforming Fiscal Governance November 2010, Box 3.2
Increasing Social Expenditures and Household Consumption in China May 2010, Box 4
Health Care Reforms in the United States May 2010, Box 5

IV. Crises and Shocks

On the Path to Policy Normalization April 2023, Chapter 1
Inflation and Disinflation: What Role for Fiscal Policy? April 2023, Chapter 2
Helping People Bounce Back October 2022, Chapter 1
Countercyclical of Fiscal Policies October 2022, Annex 1.1
Designing Government Support to Firms during a Crisis October 2022, Box 1.2
Fiscal Policy from Pandemic to War April 2022, Chapter 1
Evaluating How Well Scenarios in Debt Sustainability Analyses Capture Key Fiscal Risks October 2021, Box 2.1
Financing Constraints and the Strategy for Investment October 2020, Online Annex 2.1
Assessing the Impact of the COVID-19 Crisis on Monthly Investment Budgets October 2020, Online Annex 2.2
Database of Country Fiscal Measures in Response to the COVID-19 Pandemic October 2020, Online Only
An Unprecedented Fiscal Response: A Closer Look October 2020, Box 1.2
Policies to Support People During the COVID-19 Pandemic April 2020, Chapter 1
Fiscal Measures in Selected Economies in Response to the COVID-19 Pandemic April 2020, Online Annex 1.1
Fiscal Implications of Potential Stress in Global Financial Markets April 2019, Box 1.1
Learning from the Crisis? Taxation and Financial Stability October 2013, Box 3
Ireland: The Impact of Crisis and Fiscal Policies on Inequality October 2012, Box 8
The Impact of the Global Financial Crisis on Subnational Government Finances April 2012, Appendix 3
The Evolution of Seigniorage during the Crisis April 2012, Box 4
Subnational Government Response to the Financial Crisis in the United States and Canada April 2012, Box A3.1

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FISCAL MONITOR: ON THE PATH TO POLICY NORMALIZATION

The Legacy of the Crisis: How Long Will It Take to Lower Public Debt? September 2011, Chapter 5
The G-20 Economies: Crisis-Related Discretionary Fiscal Stimulus November 2010, Box 1.1
Update on Crisis-Related Discretionary Fiscal Stimulus in G-20 Economies May 2010, Appendix 1
The Impact of the Crisis on Subnational Governments May 2010, Appendix 4

V. Emerging Markets
Inflation and Disinflation: What Role for Fiscal Policy? April 2023, Chapter 2
Brazil Emergency Cash Transfer Program October 2022, Online Annex 1.3
General Government Debt and Fiscal Risks in China April 2018, Box 1.4
Digitalization Advances in Revenue Administration in South Africa and Estonia April 2018, Box 2.1
The Digitalization of Public Finances: Country Case Studies April 2018, Annex 2.1
Innovation in Brazil, Russia, India, China, and South Africa (BRICS) October 2016, Box 2.4
Nonresident Holdings of Emerging Market Economy Debt April 2014, Box 1.2
Potential Sources of Contingent Liabilities in Emerging Market Economies April 2013, Box 4
Fiscal Fundamentals and Global Spillovers in Emerging Economies April 2012, Box 2
Too Good to Be True? Fiscal Developments in Emerging Economies September 2011, Chapter 4
Determinants of Domestic Bond Yields in Emerging Economies September 2011, Box 4

VI. Employment
Income Stabilization before and during the COVID-19 Pandemic across EU countries: October 2022,
   A Microsimulation Approach    Online Annex 1.2
The Direct Labor Impact of Public Investment October 2020, Online Annex 2.4
Colombia: Labor Tax Reform and the Shift from Informal to Formal Employment April 2017, Box 2.2
Can Fiscal Policies Do More for Jobs? October 2014, Chapter 2
Methodology for Estimating the Impact of Fiscal Consolidation on Employment October 2014, Appendix 1
Do Old Workers Crowd Out the Youth? October 2014, Box 2.2
Fiscal Policies to Address Weak Employment October 2012, Appendix 2

VII. Financial Sector

Designing Government Support to Firms during a Crisis October 2022, Box 1.2
State-Owned Banks April 2020, Box 3.2
The Fiscal Implications of International Bond Issuance by Low-Income Developing Countries October 2014, Box 1.2
Nonresident Holdings of Emerging Market Economy Debt April 2014, Box 1.2
A One-Off Capital Levy? October 2013, Box 6
Bond Yields and Stability of the Investor Base April 2013, Box 3
Long-Run and Short-Run Determinants of Sovereign Bond Yields in Advanced Economies October 2012, Box 3
Financial Sector Support October 2012, Box 4
Reassuring Markets about Fiscal Sustainability in the Euro Area September 2011, Chapter 2
Determinants of Domestic Bond Yields in Emerging Economies September 2011, Box 4
Financial Sector Support and Recovery to Date September 2011, Box 7
Financial Sector Support and Recovery to Date April 2011, Box 1.1
Sovereign Financing and Government Debt Markets November 2010, Chapter 2
Market Concerns about Economies and Default Risks November 2010, Box 2.1
Advanced Economies: Financial Market Spillovers among Sovereigns November 2010, Box 2.2
Are Sovereign Spreads Linked to Fundamentals? November 2010, Appendix 2
Measures to Finance the Cost of Financial Sector Support May 2010, Box 3

98 International Monetary Fund | April 2023

 SELECTED TOPICS

VIII. Fiscal Outlook

On the Path to Policy Normalization April 2023, Chapter 1
Helping People Bounce Back October 2022, Chapter 1
Policy in an Uncertain Recovery October 2021, Chapter 1
Policies to Support People during the COVID-19 Pandemic April 2020, Chapter 1
Fiscal Policy for a Changing Global Economy April 2019, Chapter 1
Saving for a Rainy Day April 2018, Chapter 1
Recent Fiscal Developments and Outlook April 2017, Chapter 1
Navigating a Risky World October 2016, Chapter 1
Recent Fiscal Developments and Outlook April 2015, Chapter 1
Recent Fiscal Developments and Outlook October 2014, Chapter 1
Recent Fiscal Developments and Outlook April 2014, Chapter 1
Recent Fiscal Developments and the Short-Term Outlook October 2013, Chapter 1
Recent Fiscal Developments and the Short-Term Outlook April 2013, Chapter 1
The Fiscal Outlook October 2012, Chapter 1
Moving Forward October 2012, Chapter 3
Continued Fiscal Tightening Is in Store for 2012, Particularly among Advanced Economies April 2012, Chapter 1
Conclusion and Risk Assessment April 2012, Chapter 7
Addressing Fiscal Challenges to Reduce Economic Risks: Introduction September 2011, Chapter 1
Too Good to Be True? Fiscal Developments in Emerging Economies September 2011, Chapter 4
Addressing Fiscal Challenges to Reduce Economic Risks: Conclusion September 2011, Chapter 7
Risk to the Baseline September 2011, Box 2
Fiscal Developments in Oil-Producing Economies September 2011, Box 3
The Fiscal Indicators Index September 2011, Box 5
Shocks to the Baseline Fiscal Outlook April 2011, Chapter 3
Fiscal Developments and Near-Term Outlook November 2010, Chapter 1
Fiscal Adjustment Plans and Medium-Term Fiscal Outlook November 2010, Chapter 3
Assessing Fiscal Risks November 2010, Chapter 4
The Near- and Medium-Term Fiscal Outlook May 2010, Chapter 1

IX. Government Debt

On the Path to Policy Normalization April 2023, Chapter 1
Inflation and Disinflation: What Role for Fiscal Policy? April 2023, Chapter 2
Strengthening the Credibility of Public Finances October 2021, Chapter 2
Capitalizing on Good Times April 2018
Private Debt and Its Discontents April 2018, Box 1.1
General Government Debt and Fiscal Risks in China April 2018, Box 1.4
Can Countries Sustain Higher Levels of Public Debt? April 2017, Box 1.4
Do Fiscal Rules Lower Sovereign Borrowing Costs in Countries with Weak Track Records of Fiscal Performance? April 2017, Box 1.5
Debt: Use It Wisely October 2016, Chapter 1
Debt Data Set October 2016, Annex 1.1
Private and Public Debt and the Pace of the Recovery October 2016, Annex 1.2
Interlinkages between Public and Private Debt: Selected Summary of the Literature October 2016, Annex 1.3
Policies during Deleveraging Episodes October 2016, Annex 1.5
How Much Do Financial Markets Value Government Balance Sheets? October 2016, Box 1.5
Skeletons in the Closet? Shedding Light on Contingent Liabilities April 2016, Box 1.3

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FISCAL MONITOR: ON THE PATH TO POLICY NORMALIZATION

Lowflation and Debt in the Euro Area October 2014, Box 1.1
Moment of Truth: Unfunded Pension Liabilities and Public Debt Statistics April 2014, Box 1.1
Public Debt Dynamics and Fiscal Adjustment in Low-Income Countries in Sub-Saharan Africa April 2013, Box 6
Debt Ratios Are Still on the Rise, but Peaks Are within Sight April 2012, Chapter 2
High Gross Debt Levels May Overstate Challenges in the Short Run . . . April 2012, Chapter 4
. . . But Long-Run Debt-Related Challenges Remain Large April 2012, Chapter 5
The Legacy of the Crisis: How Long Will It Take to Lower Public Debt? September 2011, Chapter 5
Factors Underlying the Debt Increase Precrisis versus End-2015 September 2011, Box 6
The Importance of Monitoring Both Gross and Net Debt September 2011, Appendix 3
Stock-Flow Adjustments and Their Determinants September 2011, Appendix 4
Fiscal Deficits and Debts: Development and Outlook April 2011, Chapter 1
Sovereign Financing and Government Debt Markets April 2011, Chapter 2
Debt Dynamics and the Interest Rate–Growth Differential April 2011, Box 3.1
Sovereign Financing and Government Debt Markets November 2010, Chapter 2
Are Sovereign Spreads Linked to Fundamentals? November 2010, Appendix 2
Risks to Medium-Term Public Debt Trajectories; Methodological and Statistical Appendix November 2010, Appendix 4
Implications of Fiscal Developments for Government Debt Markets May 2010, Chapter 2
Debt Dynamics in G-20 Economies: An Update May 2010, Box 1
Gross versus Net Debt May 2010, Box 2
Fiscal Adjustment Requirements: Gross and Net Debt Targets May 2010, Appendix 2
Government Debt and Growth May 2010, Appendix 3

X. Growth
IDEAS to Respond to Weaker Growth April 2020, Chapter 2
Factors Underlying Low Growth and Low Interest Rates April 2020, Box 2.1
Fiscal Policy for a Changing Global Economy April 2019, Chapter 1
China: How Can Fiscal Policy Support Economic Activity and Rebalancing? April 2019, Box 1.2
Tackling Inequality October 2017, Chapter 1
A Greater Role for Fiscal Policy April 2017, Chapter 1
Upgrading the Tax System to Boost Productivity April 2017, Chapter 2
Making Growth More Inclusive in China April 2017, Box 1.3
Taxation and Growth: Details Matter October 2013, Box 4
Debt Dynamics and the Interest Rate–Growth Differential April 2011, Box 3.1
Interest Rate–Growth Differential November 2010, Appendix 1
Government Debt and Growth May 2010, Appendix 3

XI. Inflation
On the Path to Policy Normalization April 2023, Chapter 1
Inflation and Disinflation: What Role for Fiscal Policy? April 2023, Chapter 2
Fiscal Policy from Pandemic to War April 2022, Chapter 1
Inflation and Fiscal Nexus: Empirical Findings April 2022, Online Annex 1.3

XII. Innovation, Entrepreneurship, Research, Development, and Investment

Building a Resilient Future October 2022, Box 1.1
Public Investment for the Recovery October 2020, Chapter 2
Maintaining Quality When Scaling Up Public Investment October 2020, Online Annex 2.3
How Green Is the Fiscal Response to the COVID-19 Crisis? October 2020, Box 1.2
Estimating Public Investment Needs for Climate Change Adaptation October 2020, Box 2.1

100 International Monetary Fund | April 2023

 SELECTED TOPICS

The Macroeconomic Effects of Public Investment: A Model-Based Analysis April 2020, Online Annex 2.1
Digital Government April 2018, Chapter 2
The Role of Patents for Innovation October 2016, Box 2.1
Fiscal Policy and Green Innovation October 2016, Box 2.2
Does Preferential Tax Treatment of Income from Intellectual Property Promote Innovation? October 2016, Box 2.3
Innovation in Brazil, Russia, India, China, and South Africa (BRICS) October 2016, Box 2.4
Programs for Young Innovators and Start-Ups October 2016, Box 2.5
Fiscal Policy, Research and Development, and Total Factor Productivity Growth October 2016, Annex 2.1
Corrective Fiscal Incentives for Research and Development October 2016, Annex 2.2
Taxation and Entrepreneurship October 2016, Annex 2.4
Fiscal Policies for Innovation and Growth April 2016, Chapter 2

XIII. Interest Rates

Inflation and Disinflation: What Role for Fiscal Policy? April 2023, Chapter 2
Inflation and Fiscal Nexus: Empirical Findings April 2022, Online Annex 1.3
The Weakened Relation between Sovereign Spreads and Debt October 2021, Online Annex 2.2
Fiscal Credibility Indicators Using Private Forecasts October 2021, Online Annex 2.4
The Dog That Didn’t Bark (So Far): Low Interest Rates in the United States and Japan September 2011, Chapter 3
Debt Dynamics and the Interest Rate–Growth Differential April 2011, Box 3.1
Interest Rate–Growth Differential November 2010, Appendix 1

XIV. Low-Income Countries

Improving Tax Capacity in Emerging Market and Developing Economies April 2023, Box 1.1
The Long-Run Payoff of Tax Administration Reforms April 2023, Online Annex 1.1
Inflation and Disinflation: What Role for Fiscal Policy? April 2023, Chapter 2
Fiscal Developments in Countries Participating in the Debt Suspension Initiative October 2021, Box 1.2
Digital Government April 2018, Chapter 2
Digitalization and Property Taxation in Developing Economies April 2018, Box 2.2
Digitalizing Government Payments in Developing Economies April 2018, Box 2.3
The Digitalization of Public Finances: Country Case Studies April 2018, Annex 2.1
The Fiscal Implications of Slowing Global Trade for Emerging Market and Developing Economies April 2016, Box 1.1
The Fiscal Implications of International Bond Issuance by Low-Income Developing Countries October 2014, Box 1.2
Confronting Trade-Offs: Accommodating Spending Pressures in Low-Income Countries September 2011, Chapter 6
Global Fuel and Food Price Shocks and Fiscal Performance in Low-Income Countries September 2011, Box 8

XV. Policy and Reform

Inflation and Disinflation: What Role for Fiscal Policy? April 2023, Chapter 2
Helping People Bounce Back October 2022, Chapter 1
Coordinating Taxes across Borders April 2022, Chapter 2
The Need for Timely and Accurate Beneficial-Ownership Information April 2022, Box 2.1
Estimating the Revenue Impact of Pillar 1 and 2 April 2022, Online Annex 2.1
Emissions Equivalence of Other Mitigation Approaches to Carbon Pricing April 2022, Online Annex 2.5
Fiscal Policies to Address the COVID-19 Pandemic October 2020, Chapter 1
IDEAS to Respond to Weaker Growth April 2020, Chapter 2
Capitalizing on Good Times April 2018
Tackling Inequality October 2017, Chapter 1
Upgrading the Tax System to Boost Productivity April 2017, Chapter 2
What Are the Budgetary Costs and Gains of Structural Reforms? April 2017, Box 1.2

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FISCAL MONITOR: ON THE PATH TO POLICY NORMALIZATION

Do Fiscal Rules Lower Sovereign Borrowing Costs in Countries with Weak Track Records of Fiscal Performance? April 2017, Box 1.5
Debt: Use It Wisely October 2016, Chapter 1
Policies during Deleveraging Episodes October 2016, Annex 1.5
Benefits of Targeted Fiscal Interventions at Times of Private Deleveraging October 2016, Box 1.4
An Active, Supportive Role for Fiscal Policy April 2015, Chapter 1
Can Fiscal Policy Stabilize Output? April 2015, Chapter 2
Public Expenditure Reform: Making Difficult Choices April 2014, Chapter 2
Expenditure Rules: Effective Tools for Sound Fiscal Policy April 2014, Appendix 1
The Future of the State: Testing the Wagner and Baumol Hypotheses April 2014, Box 2.1
Fiscal Reforms to Unlock Economic Potential in the Arab Countries in Transition October 2013, Box 2
Tricks of the Trade October 2013, Box 5
How Can Fiscal Councils Strengthen Fiscal Performance? April 2013, Box 1
Commonly Used Definitions of the Fiscal Balance October 2012, Box 1
The “Two-Pack”: Further Reforms to Fiscal Governance in the Euro Area October 2012, Box 6
Anchoring Medium-Term Fiscal Credibility: The Second Generation of Fiscal Rules April 2012, Chapter 6
Measuring Fiscal Space: A Critical Review of Existing Methodologies April 2012, Box 1
The “Fiscal Compact”: Reforming EU Fiscal Governance April 2012, Box 5
Assessing the Cyclicality of Subnational Government Policies April 2012, Box A3.2
“Fiscal Devaluation”: What Is It—and Does It Work? September 2011, Appendix 1
Fiscal Aspects of EU Economic Governance Reforms April 2011, Box 4.1
Fiscal Transparency under Pressure April 2011, Appendix 2
The European Union: Reforming Fiscal Governance November 2010, Box 3.2
Fiscal Rules—Recent Developments May 2010, Box 7

XVI. Poverty and Inequality

Inflation and Disinflation: What Role for Fiscal Policy? April 2023, Chapter 2
Fiscal Policy from Pandemic to War April 2022, Chapter 1
Social Protection and Poverty During the Pandemic April 2022, Box 1.1
Poverty Projections using Growth Forecasts April 2022, Online Annex 1.1
Analysis of Poverty, Social Safety Nets, and Informality April 2022, Online Annex 1.2
Long-Term Distributional Impact of the American Families Plan October 2021, Box 1;
   Online Annex 1.2
Persistent Consequences of Wealth Inequality for the Next Generation’s Income: The Case of Norway April 2021, Box 2.1
Public Preferences for Progressive Taxation in the Post–COVID-19 World April 2021, Box 2.2
How Will the COVID-19 Pandemic Affect Poverty and Inequality? October 2020,
   Online Annex 1.1
Tackling Inequality October 2017, Chapter 1
Global Inequality Today and in 2035 October 2017, Box 1.1
Equally Distributed Equivalent Level of Income as a Measure of Social Welfare October 2017, Box 1.2
Bolivia: Inequality Decline during a Commodity Boom October 2017, Box 1.3
Inequality Dimensions: Wealth, Opportunities, and Gender October 2017, Annex 1.2

XVII. Private Debt

Private Debt and Public Sector Risk October 2020, Box 1.1
Private Debt and Its Discontents April 2018, Box 1.1
Debt: Use It Wisely October 2016, Chapter 1
Debt Data Set October 2016, Annex 1.1
Private and Public Debt and the Pace of Recovery October 2016, Annex 1.2
Interlinkages between Public and Private Debt: Selected Summary of the Literature October 2016, Annex 1.3

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 SELECTED TOPICS

Private Deleveraging and the Role of Fiscal Policy October 2016, Annex 1.4
Policies during Deleveraging Episodes October 2016, Annex 1.5
Benefits of Targeted Fiscal Intervention during Times of Private Deleveraging October 2016, Box 1.4

XVIII. Privatization and Public Enterprises

Experience with Privatization April 2020, Box 3.1
General Government Nonfinancial Assets: What Do We Know? October 2012, Box 7
Government Shares in Publicly Listed Companies April 2012, Box 3
United States: Government-Sponsored Enterprises and Contingent Liabilities September 2011, Box 1
Adjusting Public Capital Stock for Investment Inefficiency September 2011, Box 9
Insights for Privatization Plans from Previous Large Episodes September 2011, Appendix 2

XIX. Revenue
Improving Tax Capacity in Emerging Market and Developing Economies April 2023, Box 1.1
The Long-Run Payoff of Tax Administration Reforms April 2023, Online Annex 1.1
Inflation and Disinflation: What Role for Fiscal Policy? April 2023, Chapter 2
Coordinating Taxes across Borders April 2022, Chapter 2
Estimating the Revenue Impact of Pillar 1 and 2 April 2022, Online Annex 2.1
Corporate Tax Rate Strategic Reaction April 2022, Online Annex 2.2
Survey of International Coordination and Tax Administration April 2022, Online Annex 2.3
Revenue Implications of Cross-Border Remote Work April 2022, Online Annex 2.4
Emissions Equivalence of Other Mitigation Approaches to Carbon Pricing April 2022, Online Annex 2.5
Digital Government April 2018, Chapter 2
Digitalization Advances in Revenue Administration in South Africa and Estonia April 2018, Box 2.1
Digitalization and Property Taxation in Developing Economies April 2018, Box 2.2
Small Business Taxation and the P2P Economy April 2018, Box 2.5
The Digitalization of Public Finances: Country Case Studies April 2018, Annex 2.1
Estimating the Impact of Digitalization on Tax Evasion from Cross-Border Fraud April 2018, Annex 2.2
Estimating the Distribution of Tax Revenue Collection from Offshore Income and Wealth Following
   Improved Cross-Country Information Exchange April 2018, Annex 2.3
Upgrading the Tax System to Boost Productivity April 2017, Chapter 2
Past, Present, and Future Patterns in Revenues April 2015, Box 1.1
Assessing Potential Revenue: Two Approaches October 2013, Appendix 2
Increasing Revenue from Real Property Taxes October 2013, Appendix 3
Past Episodes of Sustained Fiscal Revenue Increases May 2010, Box 6

XX. Social Expenditures

Brazil’s Emergency Cash Transfer Program October 2022, Online Annex 1.3
Fiscal Policy from Pandemic to War April 2022, Chapter 1
Measures in Response to High Energy and Food Prices April 2022, Box 1.2
Smart Strategies to Contain the COVID-19 Pandemic October 2020, Online Annex 1.2
From Lockdown to Recovery: Spending Measures to Support Livelihoods during the COVID-19 Crisis October 2020, Online Annex 1.3
Understanding the Implications of Different Types of Fiscal Measures for Public Finances April 2020, Box 1.1
IDEAS to Respond to Weaker Growth April 2020, Chapter 2
State-Owned Enterprises: The Other Government April 2020, Chapter 3
Digital Government April 2018, Chapter 2
Tackling Inequality October 2017, Chapter 1
The Fiscal Response to the Refugee Influx in Europe April 2016, Box 1.2
The Pressure of Age-Related Spending on Public Debt in Advanced Economies April 2015, Box 1.3

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FISCAL MONITOR: ON THE PATH TO POLICY NORMALIZATION

Targeted Employer Social Security Contribution Cuts: Lessons from Experiences in Advanced Economies October 2014, Box 2.1
Public Expenditure Reform: Making Difficult Choices April 2014, Chapter 2
Moment of Truth: Unfunded Pension Liabilities and Public Debt Statistics April 2014, Box 1.1
Structural Measures and Social Dialogue April 2014, Box 2.2
Health System Inefficiencies April 2014, Box 2.3
Recent Developments in Public Health Spending and Outlook for the Future October 2013, Appendix 1
Confronting Trade-Offs: Accommodating Spending Pressures in Low-Income Countries September 2011, Chapter 6
Potential Reform Strategies to Contain the Growth of Public Health Spending April 2011, Box A1.1
The US National Commission Report April 2011, Box A5.1
Tackling the Challenge of Health Care Reform in Advanced Economies April 2011, Appendix 1
Selected Spending and Tax Issues November 2010, Chapter 5
Advanced Economies: The Outlook for Public Health Spending November 2010, Box 3.1
Increasing Social Expenditures and Household Consumption in China May 2010, Box 4
Health Care Reforms in the United States May 2010, Box 5

XXI. Stabilization
Inflation and Disinflation: What Role for Fiscal Policy? April 2023, Chapter 2
Income Stabilization before and during the COVID-19 Pandemic across EU Countries: October 2022,
   A Microsimulation Approach    Online Annex 1.2
Designing Fiscal Tools to Build Resilience: A DSGE-Based Analysis October 2022, Online Annex 1.4
Policy Options to Support the Economic Recovery October 2020, Online Annex 1.5
IDEAS to Respond to Weaker Growth April 2020, Chapter 2
Can Fiscal Policy Stabilize Output? April 2015, Chapter 2
Fiscal Stabilization under Alternative Estimates of the Output Gap April 2015, Box 2.1
Boosting the Effectiveness of Automatic Stabilizers April 2015, Box 2.2

XXII. Stimulus
Determining the Size of Fiscal Stimulus for Sustained Recovery October 2020, Online Annex 1.4
Public Investment Fiscal Multiplier and Macroeconomic Uncertainty October 2020, Online Annex 2.5
The G-20 Economies: Crisis-Related Discretionary Fiscal Stimulus November 2010, Box 1.1
Update on Crisis-Related Discretionary Fiscal Stimulus in G-20 Economies May 2010, Appendix 1

XXIII. Subsidies
Externalities from Energy Pricing Subsidies October 2022, Online Annex 1.5
Fiscal Policy from Pandemic to War April 2022, Chapter 1
Measures in Response to High Energy and Food Prices April 2022, Box 1.2
Digital Government April 2018, Chapter 2
The Digitalization of Public Finances: Country Case Studies April 2018, Annex 2.1
Adopting a Universal Basic Income to Support Subsidy Reform in India October 2017, Box 1.6
Reforming Energy Subsidies April 2015, Box 1.2
Reforming Petroleum Subsidies April 2010, Appendix 5

XXIV. Sustainability and Risk Management

Toward Green Public Finance Management April 2022, Box 1.3
Media Coverage of Suspension of Fiscal Rules October 2021, Box 2.2
Assessing Unexpected Increases in Debt October 2021, Online Annex 2.3
Investing in Resilience October 2020, Online Annex 2.6
Estimating the Adaptation Costs of Investing in the Resilience of Physical Assets October 2020, Online Annex 2.7

104 International Monetary Fund | April 2023

 SELECTED TOPICS

State-Owned Enterprises: The Other Government April 2020, Chapter 3

Can Countries Sustain Higher Levels of Public Debt? April 2017, Box 1.4
Developing a Fiscal Risk Management Framework April 2016, Box 1.4
Reassuring Markets about Fiscal Sustainability in the Euro Area September 2011, Chapter 2
Assessing and Mitigating Fiscal Sustainability Risks April 2011, Chapter 4
Assessing Fiscal Sustainability Risks: Deriving a Fiscal Sustainability Risk Map April 2011, Appendix 3

XXV. Taxation
Improving Tax Capacity in Emerging Market and Developing Economies April 2023, Box 1.1
The Long-Run Payoff of Tax Administration Reforms April 2023, Online Annex 1.1
Coordinating Taxes across Borders April 2022, Chapter 2
Estimating the Revenue Impact of Pillar 1 and 2 April 2022, Online Annex 2.1
Corporate Tax Rate Strategic Reaction April 2022, Online Annex 2.2
Survey of International Coordination and Tax Administration April 2022, Online Annex 2.3
Revenue Implications of Cross-Border Remote Work April 2022, Online Annex 2.4
Emissions Equivalence of Other Mitigation Approaches to Carbon Pricing April 2022, Online Annex 2.5
Persistent Consequences of Wealth Inequality for the Next Generation’s Income: The Case of Norway April 2021, Box 2.1
Public Preferences for Progressive Taxation in the Post–COVID-19 World April 2021, Box 2.2
Tax Policy and Automatic Stabilizers April 2020, Box 2.2
Curbing Corruption April 2019, Chapter 2
Avoiding International Tax Wars April 2019, Box 1.3
Digital Government April 2018, Chapter 2
The Distributional Effects of Income Tax Cuts in the United States April 2018, Box 1.2
International Tax Policy Implications from US Corporate Tax Reform April 2018, Box 1.3
Digitalization Advances in Revenue Administration in South Africa and Estonia April 2018, Box 2.1
Digitalization and Property Taxation in Developing Economies April 2018, Box 2.2
Small Business Taxation and the P2P Economy April 2018, Box 2.5
The Digitalization of Public Finances: Country Case Studies April 2018, Annex 2.1
Estimating the Impact of Digitalization on Tax Evasion from Cross-Border Fraud April 2018, Annex 2.2
Estimating the Distribution of Tax Revenue Collection from Offshore Income and Wealth Following
   Improved Cross-Country Information Exchange April 2018, Annex 2.3
Tackling Inequality October 2017, Chapter 1
Measuring Tax Progressivity October 2017, Box 1.4
Taxing Wealth and Wealth Transfers October 2017, Box 1.5
Upgrading the Tax System to Boost Productivity April 2017, Chapter 2
The Destination-Based Cash Flow Tax: A Primer April 2017, Box 1.1
What Is the Effective Marginal Tax Rate? April 2017, Box 2.1
Colombia: Labor Tax Reform and the Shift from Informal to Formal Employment April 2017, Box 2.2
Mozambique: Differential Tax Treatment across Firms April 2017, Box 2.3
Taxation and Foreign Direct Investment October 2016, Annex 2.3
Taxation and Entrepreneurship October 2016, Annex 2.4
Taxing Our Way out of—or into?—Trouble October 2013, Chapter 2
Learning from the Crisis? Taxation and Financial Stability October 2013, Box 3
Taxation and Growth: Details Matter October 2013, Box 4
A One-Off Capital Levy? October 2013, Box 6
Increasing Revenue from Real Property Taxes October 2013, Appendix 3
Do Pensioners Get Special Treatment on Taxes? October 2012, Box 5
Containing Tax Expenditures April 2011, Appendix 5
Selected Spending and Tax Issues November 2010, Chapter 5

International Monetary Fund | April 2023 105

IMF EXECUTIVE BOARD DISCUSSION OF THE OUTLOOK,
MARCH 2023

The following remarks were made by the Chair at the conclusion of the Executive Board’s discussion of the
Fiscal Monitor, Global Financial Stability Report, and World Economic Outlook on March 30, 2023.

E
xecutive Directors broadly agreed with staff’s ­ andemics. Most Directors also agreed that fragmen-
p
assessment of the global economic outlook, tation into geopolitical blocs could generate large
risks, and policy priorities. They considered output losses, including through effects on foreign
that the persistence of high inflation in many direct investment, and especially affecting emerging
countries and recent financial sector stresses increase market and developing economies; a few Directors
the challenges to global economic prospects and leave emphasized the need to build resilience and diversifi-
policymakers with a narrow path to restore price stabil- cation in supply chains. Noting that many countries
ity, while avoiding a recession and maintaining broad are contending with tighter financial conditions, high
financial stability. In addition, Directors generally con- debt levels, and pressures to protect the most vulner-
curred that many of the forces that shaped the world able segments from high inflation, Directors stressed
economy in 2022—including Russia’s war in Ukraine the need for multilateral institutions to stand ready to
and geopolitical tensions, high debt levels constrain- provide timely support to safeguard essential spending
ing fiscal responses, and tighter global financial and ensure that any crises remain contained. They also
­conditions—appear likely to continue into this year. In stressed the importance of improving debt transpar-
this context, they expressed concern that the medi- ency and of better mechanisms to produce orderly debt
umterm growth projections for the global economy ­restructurings—including a more effective Common
remain the lowest in decades. Framework—in cases where insolvency issues prevail.
Directors agreed that risks to the outlook have In this context, Directors encouraged the newly estab-
increased and are tilted to the downside. They noted lished Global Sovereign Debt Roundtable to become
that core inflation could turn out more persistent than an effective venue for solving coordination impedi-
anticipated, which would call for even tighter mon- ments in debt restructuring operations.
etary policies. They also emphasized that recent stresses Directors agreed that policy responses—monetary,
in the banking sector could amplify with contagion fiscal, and financial—differ across countries, reflecting
effects, pockets of sovereign debt distress could become their own circumstances and exposures. For most econ-
more widespread as a result of wider exchange rate omies, they generally considered that policy tightening
movements and higher borrowing costs, and the war in is necessary to durably reduce inflation, while standing
Ukraine and geopolitical conflicts could intensify and ready to take appropriate actions to mitigate financial
lead to more food and energy price spikes as well as sector risks as needed. Directors also emphasized that
further geoeconomic fragmentation. structural reforms remain essential to improve produc-
Directors reiterated their strong call for multilat- tivity, expand economic capacity, and ease supplyside
eral cooperation to help defuse geopolitical tensions constraints. They acknowledged that many emerging
and respond to the challenges of an interconnected market and developing economies face tougher policy
world. They emphasized the criticality of multilateral choices, as rising costs of market financing, higher food
actions to safeguard the functioning of global finan- and fuel prices, and the need to support the recovery
cial markets, manage debt distress, foster global trade and vulnerable populations can pull in different direc-
and reinforce the multilateral trading system, ensure tions, necessitating a difficult balancing act.
food and energy security, advance with the green and Directors agreed that central banks should maintain
digital transitions, and improve resilience to future a sufficiently tight, datadependent monetary policy

International Monetary Fund | April 2023 107

FISCAL MONITOR: INFLATION AND DISINFLATION: WHAT ROLE FOR FISCAL POLICY?

stance to durably reduce inflation and avoid a dean- efforts to increase tax capacity, given the importance of
choring of inflation expectations. At the same time, addressing heightened debt vulnerabilities, protecting
they called on policymakers to stand ready to take the poorest, and advancing the Sustainable Develop-
strong actions to restore financial stability and rein- ment Goals.
vigorate confidence as developments demand. With Directors commended the decisive responses by
respect to the future path of monetary policy, Directors policymakers to stem recent financial instability. They
stressed that clear communication about policy reac- noted that the recent stress in the banking sector
tion functions and objectives and the need to further has highlighted failures in internal riskmanagement
normalize policy would help avoid unwarranted mar- practices with respect to interestrate and liquidity risks
ket volatility. in some banks, as well as supervisory lapses. Against
Directors stressed that fiscal and monetary policies this backdrop, Directors stressed the importance of
need to be closely aligned to help deliver price and closely monitoring financial sector developments,
financial stability. They emphasized that tighter fiscal including in nonbank financial intermediaries (NBFIs);
policy is needed to help contain inflationary pressures, improving banking regulation, supervision, and resolu-
making it possible for central banks to increase interest tion frameworks; and a swift and appropriate use of
rates by less than otherwise, help contain govern- available policies, including macroprudential policies,
ments’ borrowing costs, and ease potential tradeoffs if further vulnerabilities materialize, while mitigating
between price and financial stability. At the same time, moral hazard. Directors noted that NBFIs play an
Directors agreed that fiscal restraint should be accom- important role in financial markets and are increas-
panied by temporary and carefully targeted measures ingly interconnected with banks and other financial
to protect the most vulnerable segments. Given the institutions. In this context, many Directors considered
heightened uncertainty, they generally concurred that the provision of central bank liquidity to NBFIs
that fiscal policy should remain flexible to respond if could lead to unintended consequences. In the event
risks materialized. To tackle the elevated debt vulner- that liquidity provision to NBFIs should be needed
abilities and rebuild fiscal buffers to cope with future to address systemic risks threatening the health of the
crises, Directors called for credible mediumterm fiscal financial system, Directors emphasized that appropriate
frameworks, while also cautioning against relying on guardrails, including robust regulation and supervision,
high inflation for public debt reduction. In lowincome should be in place and that progress in closing regula-
developing countries, they stressed the need for further tory data gaps in this sector remains vital.

108 International Monetary Fund | April 2023

IN THIS ISSUE:
CHAPTER 1
On the Path to Policy Normalization
CHAPTER 2
Inflation and Disinflation:
What Role for Fiscal Policy?

FISCAL MONITOR APRIL 2023