"This paper relaxes some key assumptions in the probabilistic approach to fiscal sustainability. First, the authors identify structural breaks over the sample period used to estimate the covariance matrix of the shocks to the debt ratios. Second, the assumption of normality of the shocks is...

"Despite significant progress in economic reform throughout the 1990s and an exemplary development of the policymaking framework in the second part of the decade, Brazil suffered a major public debt and currency crisis in 2002. Though the political origin of the uncertainty cannot be ignored,...

This paper derives the optimal composition of the Brazilian public debt by looking at the relative impact of the risk and cost of alternative debt instruments on the probability of missing the stabilization target. This allows to price risk against the expected cost of debt service and thus to...

The Central African Republic (C.A.R.) remains at high risk of external debt distress and overall high risk of debt distress under the revised Debt Sustainability Framework (DSF), unchanged from the 2018 DSA. Solvency indicators (the present values of the external public and publicly guaranteed...

This paper is part of a broader on-going effort to bring a more cross-country perspective to bilateral surveillance, taking advantage of a cluster of Article IV consultations with five systemically important economies concluded in July. With the five economies-the United States, the Euro area,...

This 2006 Article IV Consultation highlights that economic activity in Cyprus has recovered from a relatively weak performance in 2002–03. Declines in interest rates and strong capital inflows associated with Cyprus’s accession to the European Union in May 2004 spurred growth in private...

The staff report for the 2007 Article IV Consultation on the Lao People’s Democratic Republic (PDR) explains economic performance. Growth is robust and increasingly reliant on large export-oriented mining and hydropower projects. The economic outlook is promising, but the outcome clearly...

Iraq’s 2005 Article IV Consultation reports that there has been a marked deterioration in Iraq’s human development indicators over the last twenty years. There is relatively little firm data on the balance of payments other than on oil exports, government imports of goods and services, and...

This 2005 Article IV Consultation highlights that the economy of the Democratic Republic of Timor-Leste remains fragile. Cumulative growth over the last three years was near zero—mainly reflecting the drawdown in the presence of international agencies. Unemployment is high, 40 percent of the...

This 2005 Article IV Consultation highlights that macroeconomic imbalances in Serbia and Montenegro widened in 2004, putting at risk some of the impressive earlier achievements. Growth, about 5 percent in nonagriculture since 2002, has been fueled by a surge in domestic demand. Lack of...