Low-Income Countries
The IMF has acted with unprecedented speed and scale to support low-income countries during the pandemic. The Fund provided financial support to 53 of 69 eligible low-income countries in 2020 and in the first half of 2021, with about US$14 billion disbursed as zero percent interest rate loans from the Poverty Reduction and Growth Trust.
Most of this support was through the Fund’s emergency financing instruments—the Rapid Credit Facility (RCF) and Rapid Financing Instrument (RFI)—which provide immediate, one-time disbursements to countries facing urgent balance of payments needs. The Fund was able to respond to a record number of requests for financial assistance through a series of temporary access limit increases to the RCF and RFI, and temporary increases in the Poverty Reduction and Growth Trust (PRGT) overall access limits.
The Executive Board of the International Monetary Fund (IMF) completed the Article IV Consultation for Angola. This also included a discussion of the findings of the Financial Sector Assessment Program (FSAP) exercise for Angola.
Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), announced today that Pierre‑Olivier Gourinchas will return to academia at the University of California, Berkeley, effective July 1, 2026. Mr. Gourinchas joined the Fund in 2022 as Economic Counsellor and Director of the IMF’s Research Department (RES).
IMF Reaches Staff Level Agreement with Côte d’Ivoire on the Sixth Review of the EFF/ECF Arrangements and the Fifth Review of the RSF Arrangement
IMF Executive Board Concludes 2026 Article IV Consultation with the Republic of Azerbaijan
Washington, DC – April 28, 2026: An International Monetary Fund (IMF) staff team, led by Mr. Sergei Antoshin, visited Kingstown and held discussions with St. Vincent and the Grenadines’ authorities and other counterparts during April 21–28 for the 2026 Article IV consultation. At the end of the consultation, the mission issued the following statement:
The United Kingdom (UK) has successfully completed the transitions plans required under the International Monetary Fund’s (IMF) Special Data Dissemination Standard (SDDS) Plus—the highest tier of the IMF’s Data Standards Initiatives. As part of this achievement, the UK now publishes three additional SDDS Plus data categories:
Shipping and flight disruptions highlight new fault lines in the global economy and their costs for growth and livelihoods
To weather the shock, policymakers should ensure that any near-term measures are time-bound and targeted at the most vulnerable, and maintain the focus on medium-term development objectives
Countries face vastly different exposure to higher oil prices and supply uncertainty, shaped by whether they import or export, and how much policy space they have to respond
Impact on economic activity will vary across countries, but inflation will rise for all
The region must respond to energy shocks through disciplined policies that protect the vulnerable and strengthen resilience
The region can best cope by protecting vulnerable people, letting prices adjust, anchoring inflation expectations, and accelerating structural reforms
Diriyah Guiding Principles on IMF Quota and Governance Reforms
Domestic Resource Mobilization (DRM is central to achieving sustainable financing for development, building fiscal buffers, and strengthening state capacity. Recent work by the IMF and the World Bank shows that many countries—especially low-income countries (LICs) and fragile and conflict-affected states (FCSs)—are still collecting less than 15 percent of GDP in tax revenue. World Bank and IMF research suggests that collection beyond this threshold is linked to lasting improvements in growth, public service delivery, and state capacity. DRM—central to the IMF-WBG three pillar approach to helping countries address liquidity challenges (IMF and World Bank 2024a)—is crucial for building fiscal space to advance public spending for development, reduce reliance on volatile external financing, support jobs and growth, and strengthen the social contract between the state and its citizens.
The war in the Middle East, in addition to its human toll, has triggered spillovers that represent another major test for the global economy. At the same time, profound transformations in technology, demographics, and the environment continue creating complex challenges but also opportunities. In this highly uncertain environment, supporting macroeconomic stability and resilience remains essential to support private sector led investment and growth. This requires addressing fiscal and debt challenges, tackling global imbalances, lifting medium term growth prospects, and reinforcing core national economic institutions. And while trade uncertainty weighs on the outlook, building more resilient supply chains and diversifying trade relationships could also present opportunities.
The world faces the spillovers from the war in the Middle East. In addition to the human toll, its economic effects are global and uneven, once again hitting the poorest and most vulnerable countries the hardest. This comes at a time when policy space has been eroded and geopolitical tensions have been increasing. Spillovers to Low-Income Developing Countries (LIDCs) will transmit through supply disruptions, higher commodity prices, second-round effects on inflation and expectations, tighter global financial conditions, exchange rate pressures, and reduced remittances from members of the Gulf Cooperation Council (GCC). The appropriate policy response depends on how the shock propagates through the domestic economy, calling for pragmatism and agility, supported by credible policy frameworks. In LIDCs, near term policies should be anchored in credible frameworks, while concerted efforts are key to enhance resilience and growth potential. Domestic structural reforms, including building strong institutions, also have an important role in the medium-term to attract stronger FDI inflows and create jobs. Robust support from the international community will be essential—especially for the most vulnerable LIDCs and fragile and conflict-affected states (FCS). The IMF stands ready to deploy all its tools to assist the membership—supporting sound policies, helping ensure this new test does not derail key medium-term priorities, and providing balance of payments financing where needed.
Since the 2025 Annual Meetings, the Independent Evaluation Office (IEO) completed its evaluation on IMF Advice on Fiscal Policy and announced plans to launch evaluations of “IMF Advice on Monetary Policy” and “Political Economy Considerations in IMF Work.” The IEO is also progressing on its ongoing evaluations of “The IMF and Climate Change” and “IMF Engagement on Debt Issues in Low-Income Countries.”
The world faces the spillovers of a new war. In addition to the human toll, the economic effects of the war in the Middle East are global, and will once again hit the poorest and most vulnerable countries the hardest. This comes at a time when policy space has eroded and international cooperation is weaker. The appropriate policy response depends on how the shock propagates through the domestic economy, calling for pragmatism and agility, backed by credible policy frameworks. The IMF stands ready to deploy all its tools to assist the membership. We will support good policymaking—advising also that this new test must not derail essential medium-term priorities—and provide balance of payments financing where needed.
This paper assesses estimates of the economic impacts of climate change by leveraging the IMF’s World Economic Outlook (WEO) forecasts (1990-2023) as climate-free counterfactuals. Placebo tests confirm WEO forecasts do not capture climate effects. By adding climate damage estimates to forecasts and comparing with actual GDP growth, we find climate damage functions explain only a small share of forecast errors—reducing mean absolute errors by up to 0.4 percentage points (about 6% of the forecast error). The most severe damage functions predict contractions in some countries that are inconsistent with observed growth, suggesting overstated near-term climate impacts.
The macroeconomic effects of fiscal policy are central to both research and policymaking, yet relatively little is known about how fiscal shocks impact men and women differently across diverse labor market and institutional contexts. This paper provides the first comparative analysis of gender-specific responses to exogenous fiscal shocks in the Balkans relative to the rest of Europe. Using a cross-country panel dataset and the local projection method, we trace the dynamic effects of fiscal expansions and contractions on labor force participation, employment, and wage outcomes. The results reveal substantial regional variation and pronounced gender asymmetries. Expansionary fiscal shocks lead to modest and delayed improvements in female labor market outcomes in the Balkans, whereas effects in other European countries are stronger and more immediate. Conversely, contractionary shocks disproportionately reduce female employment, especially during downturns, with greater volatility observed in Balkan economies. These patterns reflect differences in sectoral employment composition, care infrastructure, and public service provision. Overall, the findings suggest that fiscal policy operates within structurally gendered labor markets, highlighting important implications for macroeconomic stabilization and labor market resilience in transitional economies.
We find that public administration digitalisation, carried out state-by-state in India between 2010 and 2015, led to an improvement in micro-enterprise productivities, based on the Unincorporated Non-Agricultural Enterprises Surveys. We categorise the digitalisation of public administration into six groups: tax filing and payments, construction permits, environment and labour regulations, inspections, commercial disputes, and single-window systems. States are ranked according to the subsets of digitalisation carried out by them. Using the difference-in-difference estimations with propensity score matching, we find that the average firm-level productivities have risen in the states carrying out more digitalisation. There, also, dispersions in productivities have become narrower.
This paper studies how granular bank shocks propagate to aggregate credit in Mauritania’s banking system. Using confidential monthly data, we extract size-weighted innovations to lending growth and profitability. At the aggregate level, lending shocks are large and exhibit a near one-for-one mapping into monthly credit growth, accounting for roughly 80 percent of its short-run fluctuations. By contrast, profitability shocks are small, statistically insignificant, and contribute almost nothing to explaining aggregate credit. This pattern suggests that fluctuations in intermediation are driven by shifts in lending at a few dominant banks, while high earnings are largely retained as buffers rather than recycled into new credit, revealing a persistent wedge between profitability and the provision of financial services. The results have direct policy relevance for Mauritania and, more broadly, for low-income and emerging economies with concentrated and nascent banking sectors.
This paper describes the 2023 euro area consultation top-down stress test that focused on the resilience of 91 systemically important banks’ capital buffers as of end-2022 to macro baseline and adverse scenarios over the period 2023-25. As a result, the paper is an illustration of a top-down stress test framework with an application to euro are banks. The 2023 euro area consultation top-down stress test included unbiased dynamic panel data estimators based on Lancaster (2002) for projecting profitability components and information on Pillar 3 disclosures (exposure-at-default, probability of default, loss-given-default, expected losses). The paper also expands the 2023 euro area consultation top-down stress test by considering risk-weight functions with Skew-Normal and Transmuted-Normal probability distributions for the idiosyncratic and systemic risk factors. The results of the stress test with both distributions indicate that most euro area banks were resilient under the 2023 euro area consultation baseline and adverse scenarios as of July 2023 (publication of the Staff report).
This paper examines the impact of trade credit and bank loans on firms’ exchange rate passthrough. Using a comprehensive dataset combining customs transaction records and balance sheet data for Chinese exporters during 2000–2011, we document that firms that more intensively extend trade credit to their buyers exhibit more complete exchange rate pass-through. Further empirical investigation sheds light on the underlying mechanism. First, the use of trade credit is positively correlated with exporters’ dependence on bank loans. Second, firm-level bank loan interest rates decline following home currency depreciation. Motivated by these findings, we develop a theoretical model in which exporters constrained by working capital simultaneously extend trade credit to buyers and rely on bank borrowing. The model shows that home currency depreciation improves exporters’ profitability, lowers default risk, and reduces borrowing costs, ultimately enhancing exchange rate pass-through. By endogenizing the interest rate through firm-level default risk, the model reveals a novel channel through which firms’ financial activities shape the dynamics of exchange rate pass-through.
