{
  "title": "Transcript of Fiscal Monitor October 2024 Press Briefing",
  "publication": "IMF News, October 23, 2024",
  "sourceUrl": "https://www.imf.org/en/news/articles/2024/10/23/tr-102224-transcript-of-fiscal-monitor",
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  "summary": "Good morning, good afternoon, and good evening to our viewers around the world. I am Tatiana Mossot, the IMF Communications Department, and I will be your host for today’s press briefing on the Annual Meetings 2024 Fiscal Monitor, “Putting a Lead on Public Debt.",
  "publishDate": "2024-10-23",
  "sections": [
    {
      "heading": "Global debt levels and projections",
      "content": "- Global public debt is projected to go above $100 trillion this year.\n- At the current pace, the global debt‑to‑GDP ratio will approach 100 percent by the end of the decade, rising above the pandemic peak.\n- The Fiscal Monitor emphasizes that \"public debt is very high, rising, and risky.\""
    },
    {
      "heading": "Country groupings and heterogeneity",
      "content": "- Three groups distinguished:\n  - About one third of countries: public debt is higher and projected to grow faster than pre‑pandemic (includes China, the United States, Brazil, France, Italy, South Africa, and the United Kingdom; together about 70 percent of global GDP).\n  - About one third of countries: public debt is higher but projected to grow slower or decline compared with pre‑pandemic.\n  - The rest of the world: debt is lower than pre‑pandemic."
    },
    {
      "heading": "Debt‑at‑risk framework and scenarios",
      "content": "- The Fiscal Monitor presents a novel \"debt at risk\" framework linking macroeconomic, financial, and political conditions to the spectrum of future debt outcomes; the framework covers 70 countries.\n- Key quantified risks:\n  - In a severe adverse scenario but plausible, debt‑to‑GDP could be 20 percentage points higher in the next 3 years than currently projected.\n  - Advanced economies: estimated debt risk about 135 percent to GDP by 2026.\n  - Emerging market economies: estimated debt risk about 88 percentage points of GDP.\n- Main sources of upside risk highlighted: weaker growth, tighter financial conditions, economic and political uncertainty."
    },
    {
      "heading": "Major findings for specific large economies and regions",
      "content": "- United States:\n  - Debt is considerably above pre‑pandemic and \"is growing at about 2 percentage points of GDP every year.\"\n  - The U.S. is important for global financial conditions; adjustment in the United States is \"not only good for the United States, it is good also for the rest of the world.\"\n- China:\n  - Debt is growing rapidly; China has \"ample policy space\" and means to put public debt under control.\n  - Four policy priorities noted: (1) fiscal policy to rebalance demand toward domestic consumption; (2) end financial misallocations tied to the property sector crisis; (3) address sub‑national public finance imbalances and constraints; (4) use fiscal policy to promote technological innovation and the green transition.\n- United Kingdom:\n  - Debt is substantially higher than pre‑pandemic and projected to increase over time (albeit at a declining pace).\n  - Concern emphasized about the combination of high debt and low growth; public investment has trended down and should be protected.\n- France:\n  - Debt‑to‑GDP ratio projected to increase by about 2 percentage points every year in the IMF projections; recommendation for appropriately frontloaded fiscal adjustment to credibly put public debt under control.\n- Western Balkans:\n  - Growth picked up since 2023 with differences across countries; North Macedonia projected growth 2.2 percent in 2024, down from 2.7 percent in 2023.\n  - Headline inflation easing but core inflation stubborn in some countries; interest‑growth differential projected to remain negative over the medium term but is narrowing.\n- Tunisia:\n  - Specific country numbers deferred to regional press briefs; concern noted about untargeted subsidies and importance of protecting public investment while targeting transfers to the vulnerable.\n- Ukraine:\n  - Outlook \"exceptionally uncertain\"; priorities are to complete external commercial debt restructuring in line with program commitments and to redouble domestic revenue mobilization and accelerate implementation of the national revenue strategy.\n- Sub‑Saharan Africa and Nigeria:\n  - Building fiscal space is crucial for development and to enable the state to play its role.\n  - Typical challenges: low revenue‑to‑GDP ratios (Nigeria cited as \"about 10 percentage points\") and rising debt service obligations relative to revenue.\n  - For the average low‑income country, the ratio of debt service to revenue is about 15 percent."
    },
    {
      "heading": "Spending and financing needs in developing countries",
      "content": "- Previous Fiscal Monitor estimate: the envelope of spending needs for sustained development and climate goals could be \"as much as high as 16 percent of GDP.\"\n- Policy actions emphasized:\n  - Revenue mobilization: broaden tax base, reduce informality, increase efficiency in revenue collection, and improve progressivity.\n  - Spending-side reforms: improve quality, composition, and efficiency of spending; protect public investment; target transfers to the vulnerable.\n  - Strengthen fiscal institutions and public finance management to build public trust and support for reforms.\n- IMF support cited: over the past 4 years, about $60 billion of funding has been provided to African economies; IMF also provides policy advice and capacity development in taxation, revenue mobilization, public finance management, and climate-related areas."
    },
    {
      "heading": "Policy recommendations and design principles",
      "content": "- Timing and magnitude:\n  - \"Delaying adjustment is costly and risky.\" The time to act is now.\n  - Where countries are sufficiently away from debt distress: adjust in a sustained and gradual way to contain debt vulnerabilities without unnecessary adverse effects on growth and employment.\n  - In countries in debt distress or at high risk: timely and frontloaded decisive action, including possible debt restructuring, may be necessary.\n- Composition and distribution:\n  - Avoid cuts in public investment; protect public investment within a framework of rules and budgetary procedures that foster sound macroeconomic performance.\n  - Design \"people‑focused\" fiscal adjustment to balance impacts on growth and inequality; prioritize preserving social spending and improving spending efficiency and composition.\n  - Use progressive taxes and broad‑based, fair tax systems where possible; reduce untargeted subsidies and reallocate toward targeted transfers.\n- Governance and transparency:\n  - Strengthen fiscal governance, transparency, and accountability to build trust and public support for reforms.\n  - Leverage technology to promote transparency, build trust, and increase tax compliance (\"three Ts\": technology → transparency → trust).\n- Role of fiscal policy:\n  - Fiscal policy should act as a structural policy that contributes to growth, jobs, rebalancing demand, and the green transition."
    },
    {
      "heading": "Risks emphasized",
      "content": "- Upside tilt to risks around debt projections; many governments’ fiscal plans are \"insufficient to deliver stable or declining public debt ratios with a high degree of confidence.\"\n- Political pressures and election-related fiscal pledges can complicate fiscal consolidation efforts; both left and right political platforms have tended toward fiscal support and expansion.\n- For countries with limited fiscal space and high debt, exchange rate depreciation can amplify public debt burdens denominated in foreign currency.\n\nSource: Transcript of Fiscal Monitor October 2024 Press Briefing, October 23, 2024.\n\n---\n\n\n References\n\n- PRESS CENTER\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2024/10/23/tr-102224-transcript-of-fiscal-monitor"
    }
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    "Published: October 23, 2024",
    "Global public debt is projected to go above $100 trillion this year.",
    "At the current pace, the global debt‑to‑GDP ratio will approach 100 percent by the end of the decade, rising above the pandemic peak.",
    "The Fiscal Monitor emphasizes that \"public debt is very high, rising, and risky.\"",
    "Three groups distinguished:",
    "The Fiscal Monitor presents a novel \"debt at risk\" framework linking macroeconomic, financial, and political conditions to the spectrum of future debt outcomes; the framework covers 70 countries.",
    "Key quantified risks:",
    "Main sources of upside risk highlighted: weaker growth, tighter financial conditions, economic and political uncertainty.",
    "United States:",
    "China:",
    "United Kingdom:",
    "France:",
    "Western Balkans:",
    "Tunisia:",
    "Ukraine:",
    "Sub‑Saharan Africa and Nigeria:",
    "Previous Fiscal Monitor estimate: the envelope of spending needs for sustained development and climate goals could be \"as much as high as 16 percent of GDP.\"",
    "Policy actions emphasized:",
    "IMF support cited: over the past 4 years, about $60 billion of funding has been provided to African economies; IMF also provides policy advice and capacity development in taxation, revenue mobilization, public finance management, and climate-related areas.",
    "Timing and magnitude:",
    "Composition and distribution:",
    "Governance and transparency:",
    "Role of fiscal policy:",
    "Upside tilt to risks around debt projections; many governments’ fiscal plans are \"insufficient to deliver stable or declining public debt ratios with a high degree of confidence.\"",
    "Political pressures and election-related fiscal pledges can complicate fiscal consolidation efforts; both left and right political platforms have tended toward fiscal support and expansion.",
    "For countries with limited fiscal space and high debt, exchange rate depreciation can amplify public debt burdens denominated in foreign currency.",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
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