New IMF releases

Policy Papers

Nepal - Assessment Letter for the Asian Development Bank
Summary: Assessment Letters or Statements may be prepared for member countries with Fund-supported programs; receiving Fund emergency assistance; with staff-monitored programs; or surveillance-only cases. They are typically produced for use by the country with multilateral or bilateral donors or creditors, in particular the World Bank and other International Financial Institutions.

Staff Guidance Note on the Application of the Joint Fund-Bank Debt Sustainability Framework for Low-Income Countries
Summary: The objective of the joint Fund-Bank debt sustainability framework for low-income countries is to support LICs in their efforts to achieve their development goals without creating future debt problems. Countries that have received debt relief under the Heavily Indebted Poor Countries (HIPC) Initiative and the Multilateral Debt Relief Initiative (MDRI) need to be kept on a sustainable track. Under the framework, country DSAs are prepared jointly by Bank and Fund staff, with close collaboration between the two staffs on the design of the macroeconomic baseline, alternative scenarios, the debt distress rating, and the drafting of the write-up.

Surveys

Middle East, Central Asian Growth Set to Remain High
The Middle East and Central Asia (MCD) has continued to see strong growth in 2008, outpacing global growth for the ninth year in a row, the IMF says in its latest regional economic outlook.

Constructing a New European Financial Stability Framework
Europe must be better prepared to deal with bank failures and should use the current crisis as an opportunity to focus on the European Union's financial stability arrangements, a senior IMF official told a conference in Frankfurt.

Financial Crisis Takes Harsh Toll on Europe
A confluence of multiple adverse shocks has depressed economic activity in Europe. Gradual recovery is expected late next year, the IMF says in its latest regional outlook. Restoring financial stability is the main policy priority, requiring a comprehensive and coherent global approach.

High Food, Fuel Prices a Threat Where Protection Limited
Inflation has been rising in the Pacific Islands on the back of strong increases in commodity prices. Although commodity prices have declined from recent peaks, food and fuel prices remain a concern in the islands as most have only limited social protection systems.

Putting Georgia on a Path to Recovery
In an interview, Prime Minister Lado Gurgenidze of Georgia talks about the impact of the recent armed conflict, the need for financial support, and how his country must continue the reforms that transformed Georgia's economy.

Developing Countries Need Strategy to Face Global Crisis Impact
Low-income countries should position themselves to respond to ripple effects from the global financial crisis, developing country ministers said during the IMF-World Bank Annual Meetings. They urged donors to fulfill aid commitments and pledged steps to improve their economies on their own.

IMF in Talks on Loans to Countries Hit by Financial Crisis
The IMF, which has announced its readiness to lend billions of dollars to support nations hit by fallout from the global financial turmoil, is holding talks with several countries about possible new lending programs, as well as advising governments how to react to the economic downturn.

Some Climate Policies Worsen Food Problems, Panelists Say
Commitments by advanced industrial countries to reduce carbon emissions through alternative fuels development, while well meaning, have exacerbated the food crisis and contributed to worldwide water shortages, seminars held during the IMF-World Bank Annual Meetings are told.

IMF and Iceland Outline $2.1 billion Loan Plan
The IMF announces an initial agreement with Iceland on a $2.1 billion two-year loan to support an economic recovery program to help the island restore confidence in its banking system and stabilize its currency.

IMF Set to Lend $16.5 Billion to Ukraine
The International Monetary Fund announces outline plans to lend $16.5 billion to Ukraine to support a policy package the country has assembled to maintain economic and financial stability. Ukraine's economy has been affected by the global financial turmoil and falling steel prices.

Country Reports

Lao People's Democratic Republic

South Africa: Selected Issues
South Africa: 2008 Article IV Consultation - Staff Report; Staff Statement; Public Information Notice on the Executive Board Discussions; and Statement by the Executive Director for South Africa
South Africa: Financial System Stability Assessment, Including Report on the Observance of Standards and Codes on the following topic: Securities Regulation
Ghana: 2008 Article IV Consultation - Staff Report; Staff Supplement; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Ghana
Tunisia: 2008 Article IV Consultation - Staff Report; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Tunisia
Togo: First Review Under the Three-Year Arrangement Under the Poverty Reduction and Growth Facility and Request for Modification of Performance Criteria and Augmentation of Access - Staff Report; Press Release on the Executive Board Discussion; and Statement by the Executive Director for Togo

Working Papers

Interest Rate Elasticity of Residential Housing Prices
Author/Editor: Iossifov, Plamen; Cihák, Martin; Shanghavi, Amar
Summary: We examine the interest rate elasticity of housing prices, advancingthe empirical literature in two directions. First, we take a commonly used cross-country panel dataset and evaluate the housing price equation using a consistent estimator in the presence of endogenous explanatory variables and a lagged dependent variable. Second, we carry-out a novel analysis of determinants of residential housing prices in a cross-section of countries. Our results show that the short-term interest rate, and hence monetary policy, has a sizable impact on residential housing prices.

Regional Economics Outlook

Western Hemisphere -- October, 2008: The ongoing global turmoil represents a confluence of negative shocks for Latin America and the Caribbean: a freeze in global credit markets, weaker external demand, and lower commodity prices. But the region is expected to deal with these global shocks better than in previous crises, reflecting progress made in improving macroeconomic fundamentals over the past decade. Still, there are a number of downside risks going forward. Against this uncertain background, the report discusses the implications of the global financial crisis for the regional outlook and the corresponding challenges facing policymakers.

Europe -- October, 2008: The financial crisis has reached extraordinary proportions in recent months. At the same time commodity prices increases have boosted headline inflation, depressing consumption. Growth is expected to stagnate in the near term in most advanced European economies as asset price booms deflate and banks curb credit to reduce leverage. Growth will slow down significantly in the emerging economies in Europe as well. Mutually reinforcing deterioration in financial and economic conditions is the main downside risk to the outlook. Stabilizing financial conditions and nurturing growth are the key policy priorities. In addition to the outlook, the report presents analytical work on the impact of high commodity prices, the turnaround in the credit and asset price cycles, and the macroeconomic effects of cross-border labor flows.

Middle East and Central Asia region -- October, 2008: Regional Economic Outlook: Middle East and Central Asia underlines that the region has continued to experience strong growth in 2008, and the short-term outlook is generally favorable. However, inflation has emerged as a key issue, and while the global credit crunch has thus far had a limited impact on regional financial markets, the financial turmoil and slowdown in developed economies could lower growth in the period ahead. Policies will need to focus on tightening the fiscal and monetary stance where appropriate, with greater exchange rate flexibility, and continuing efforts to strengthen the resilience of financial sectors.