This technical note explores the reasons for a comparatively high interest rate spread in Kazakhstan in the context of competition in the banking sector. In spite of significant gains in efficiency made in recent years, operational costs and provisioning for loan losses remain high compared with...

It is shown that the inefficiencies created by the “soft” budget constraint, enjoyed by enterprises in Eastern Europe and elsewhere, will continue so long as governments are unable credibly to threaten not to bail out loss-makers. Commitment to a “hard” budget constraint can best be...

This paper demonstrates that instability associated with investment risk is critical in explaining the level of foreign direct investment for the Middle East and North Africa (MENA) countries, which generally have higher investment risk than developed countries. The empirical results support...

This paper identifies tax factors in 21 developing countries that have an impact on foreign direct investment flows. It categorizes those factors into issues associated with tax coordination; tax rates and rate structures; and composition of the tax base. Recent actions by countries reveal no...

This Selected Issues paper analyzes the competitive threats to the tourism sector in the Eastern Caribbean Currency Union (ECCU). The paper concludes that the ECCU countries have lost competitiveness globally and vis-à-vis newly emergent Caribbean tourist destinations as a result of both price...

This technical note on strategic issues in Development Bank (DB) reform for Mexico examines advances in the area of DB and funds in 2000–05. There have been significant but uneven changes in the institutional setting, instruments, transparency of subsidies, and performance behavior of DBs...