Operational Aspects of Fiscal Policy in Oil-Producing Countries

Author/Editor:

Steven A Barnett ; Rolando Ossowski

Publication Date:

October 1, 2002

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

Oil-producing countries face challenges arising from the fact that oil revenue is exhaustible, volatile, and uncertain, and largely originates from abroad. Reflecting these challenges, the paper proposes some important general principles for the formulation and assessment of fiscal policy in these countries. The main findings can be summarized in some key guidelines: the non-oil balance should feature prominently in the formulation of fiscal policy; it should generally be adjusted gradually; the government should strive to accumulate substantial financial assets over the period of oil production; and, where necessary, strategies should aim at breaking procyclical fiscal responses to volatile oil prices.

Series:

Working Paper No. 02/177

Subject:

English

Publication Date:

October 1, 2002

ISBN/ISSN:

9781451858884/1018-5941

Stock No:

WPIEA1772002

Price:

$15.00 (Academic Rate:$15.00)

Format:

Paper

Pages:

35

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