## Republic of San Marino: 2022 Article IV Consultation-Press Release and Staff Report

_IMF Staff Country Reports, November 23, 2022_

## Source details

**Canonical URL:** [Republic of San Marino: 2022 Article IV Consultation-Press Release and Staff Report](https://www.imf.org/en/publications/cr/issues/2022/11/21/san-marino-2022-article-iv-consultation-press-release-and-staff-report-525794)

## Other formats

- [Markdown version](/en/publications/cr/issues/2022/11/21/san-marino-2022-article-iv-consultation-press-release-and-staff-report-525794/index.md)
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## Bibliographic details
- Published: November 23, 2022
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400224447.002

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### Economic performance and shocks
- San Marino's economic activity "showed remarkable resilience throughout the pandemic."
- After Russia's invasion of Ukraine, San Marino experienced "an unprecedented energy price shock" which, "compounded with a food price shock, led to high inflation and real income erosion."
- Offsetting factors supporting activity "so far this year" include:
  - "Strong external demand amidst global supply chain constraints."
  - "An elevated inflow of tourists."
- San Marino "secured beneficial energy import prices this year and next" that have produced "tariffs below regional peers at minimal fiscal costs."

### Fiscal position and public debt dynamics
- Despite a strong economy, "the fiscal position in 2021 remained relatively weak."
- Favorable debt dynamics are supported by:
  - "Greater reliance on domestic debt."
  - "A large share of long maturing and low interest debt."
- Higher inflation is noted as a factor interacting with debt dynamics.

### Financial sector performance and vulnerabilities
- Banks' capitalization and profitability "improved in 2021."
- Deposit levels "continued to grow."
- Credit activity "contracted."
- Recent progress "halted recently" and vulnerabilities persist given:
  - "Very large nonperforming assets."
  - "Weak capitalization."

### Key findings (concise bullets)
- Pandemic resilience in economic activity.
- Energy and food price shocks following Russia's invasion of Ukraine caused high inflation and real income erosion.
- Tourism inflows and external demand have boosted activity in the current year.
- Beneficial energy import pricing secured for this year and next, yielding tariffs below regional peers at minimal fiscal cost.
- Weak fiscal position in 2021 despite economic strength.
- Domestic, long-maturity, low-interest debt structure aids debt dynamics amid higher inflation.
- Financial sector improvements in 2021 reversed recently; large nonperforming assets and weak capitalization remain material vulnerabilities.

*Source: Republic of San Marino: 2022 Article IV Consultation-Press Release and Staff Report (November 23, 2022).*

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_Source: https://www.imf.org/en/publications/cr/issues/2022/11/21/san-marino-2022-article-iv-consultation-press-release-and-staff-report-525794_