Old Curses, New Approaches? Fiscal Benchmarks for Oil-Producing Countries in Sub-Saharan Africa

Author/Editor:

Jan-Peter Olters

Publication Date:

May 1, 2007

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:

Buoyant oil prices have allowed oil-producing countries in sub-Saharan Africa (SSA OPCs) to increase oil exports and fiscal revenues, providing them with resources necessary to address the pressing social needs. To preclude another boom-bust cycle, this paper advocates the definition of a fiscal benchmark anchored in sustainability grounds, following Leigh- Olters (2006). The difference between current primary deficits and those that could be maintained after oil reserves are exhausted represent an indication of the degree to which fiscal positions will have to be adjusted-either gradually, while the overall balances remain in surplus, or abruptly, once oil revenues begin to dwindle.

Series:

Working Paper No. 2007/107

Subject:

Expenditure Fiscal stance Oil Oil prices Oil, gas and mining taxes

English

Publication Date:

May 1, 2007

ISBN/ISSN:

9781451866711/1018-5941

Stock No:

WPIEA2007107

Pages:

42

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