## Creating Policy Space in Low-Income Countries during the Recent Crises

_Departmental Papers, March 16, 2010_

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## Bibliographic details
- Authors: Paolo Dudine, Sibabrata Das, Pritha Mitra, Yongzheng Yang, Eteri Kvintradze, Nkunde Mwase
- Published: March 16, 2010
- Series: Departmental Papers
- DOI: https://doi.org/10.5089/9781589069305.087

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### Summary
- Low-income countries were hit especially hard by sharp increases in world food and fuel prices in 2007-08 and the global financial crisis that followed.
- In response, the International Monetary Fund scaled up its financial assistance to low-income countries and revamped its concessional lending facilities to make them more flexible in meeting the diverse needs of these countries.
- The paper assesses empirically the outcome of the IMF response and provides insight into how IMF-supported programs in low-income countries have been adapted to the changing economic circumstances in these countries.
- The authors report that these programs have provided expanded policy space in the face of the global price shocks and financial crisis.

### Key findings and observations
- External shocks highlighted: sharp increases in world food and fuel prices in 2007-08; the global financial crisis of 2008-2009.
- IMF operational response: scaled up financial assistance to low-income countries; revamped concessional lending facilities to increase flexibility.
- Empirical assessment outcome: IMF-supported programs in low-income countries have been adapted to changing economic circumstances and provided expanded policy space during the crises.

### Subjects and keywords (as listed)
- Subjects: Financial crises, Fiscal policy, Food prices, Fuel prices, Global financial crisis of 2008-2009, Inflation, Prices
- Keywords: balance of payments, country, country authorities, current account, DP, DPPP, economic activity, fiscal policy, Food prices, fuel price, Fuel prices, Global, Global financial crisis of 2008-2009, Inflation, LICs, price, social spending, spending, The Fund

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_Source: https://www.imf.org/en/publications/departmental-papers-policy-papers/issues/2016/12/31/creating-policy-space-in-low-income-countries-during-the-recent-crises-23397_