## Iceland: Selected Issues

_IMF Staff Country Reports, December 19, 2019_

## Source details

**Canonical URL:** [Iceland: Selected Issues](https://www.imf.org/en/publications/cr/issues/2019/12/19/iceland-selected-issues-48892)

## Other formats

- [Markdown version](/en/publications/cr/issues/2019/12/19/iceland-selected-issues-48892/index.md)
- [Structured JSON version](/en/publications/cr/issues/2019/12/19/iceland-selected-issues-48892/index.json)
- [Bundle manifest](/en/publications/cr/issues/2019/12/19/iceland-selected-issues-48892/bundle-manifest.json)

## Bibliographic details
- Published: December 19, 2019
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781513523682.002

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### Overview and purpose
- Publication date: December 19, 2019
- This Selected Issues paper examines scope for improving Iceland’s fiscal framework.
- Focus areas: Fiscal policy, Fiscal rules, Fiscal stance, Output gap, Production, Public debt.

### Key findings
- Iceland’s fiscal framework provides for a forward-looking exercise in consolidated fiscal planning.
- The Icelandic fiscal framework shares most elements of successful fiscal frameworks but would benefit from more structured guidance in dealing with cyclical fluctuations.
- The framework is backed by a firm legal basis that reflects political support for the fiscal policy objectives, covers the consolidated general government, and is based on sound accounting practices and budget management arrangements.
- The current parameters of the policy rules have a bias to reduce net public debt and gradually build fiscal space to deal with adverse shocks to economic activity.

### Policy proposals and implications
- Adding a primary structural balance rule to the framework would ensure a countercyclical fiscal policy but would add significant complexity.
- Once the net public debt reaches a socially desirable level, the fiscal rule parameters may be modified to keep net public debt fluctuating around that level.

### Keywords and thematic tags
- countercyclical fiscal policy
- CR
- disp-formula id
- fiscal policy statement
- Fiscal rules
- Fiscal stance
- Global
- interest rate
- ISCR
- Output gap
- primary spending
- spending ratio

### Publication metadata and identifiers
- Pages: 24
- Volume: 2019
- Issue: 376
- Series: Country Report No. 2019/376
- DOI: https://doi.org/10.5089/9781513523682.002
- Stock No: 1ISLEA2019002
- ISBN: 9781513523682
- ISSN: 1934-7685

*Source: Iceland: Selected Issues (IMF Staff Country Reports 2019, 376), December 19, 2019.*

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## Content in this bundle

- **Iceland: Selected Issues; IMF Country Report No. 19/376; December 4, 2019**
  - [Iceland: Selected Issues; IMF Country Report No. 19/376; December 4, 2019 (Markdown version)](/-/media/files/publications/cr/2019/1islea2019002.pdf.md){rel="alternate" type="text/markdown"}
  - [Iceland: Selected Issues; IMF Country Report No. 19/376; December 4, 2019 (PDF)](/-/media/files/publications/cr/2019/1islea2019002.pdf){rel="external" type="application/pdf"}

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_Source: https://www.imf.org/en/publications/cr/issues/2019/12/19/iceland-selected-issues-48892_