The Commodities Roller Coaster: A Fiscal Framework for Uncertain Times -- October 2015
Fiscal Monitor, September 7, 2015
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- The Commodities Roller Coaster: A Fiscal Framework for Uncertain Times -- October 2015
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- Published: September 7, 2015
- Series: Fiscal Monitor
Overview
- Natural resource-rich countries experienced an exceptional commodity price boom during the 2000s, with metal and oil prices reaching historic highs.
- The more recent reversal in commodity prices demonstrates that commodity prices are volatile, unpredictable, and subject to long-lasting shocks.
- Commodity exporters face a need to adjust to a—possibly protracted—period of lower export and fiscal revenues.
- This Fiscal Monitor issue examines the conduct of fiscal policy under the uncertainty caused by dependence on natural resource revenues, drawing on past research on commodity-price behavior and IMF technical assistance to resource-rich economies.
Key findings on commodity cycles and fiscal outcomes
- Commodity booms provided a substantial fiscal windfall for resource-rich developing countries during the 2000s, supporting opportunities for economic transformation and development.
- Subsequent commodity price reversals have translated into lower export and fiscal revenues, with potentially prolonged effects.
- Commodity-price volatility implies significant uncertainty for fiscal planning and macroeconomic stability.
Fiscal policy implications and recommendations
- Fiscal policy for resource-rich countries should adopt a risk-based, comprehensive approach to manage uncertainty from natural resource revenues.
- Policy frameworks need to balance short-term stabilization with long-term fiscal management under uncertainty.
- Strengthening institutions and transparency is essential for successful long-term management of natural resource wealth.
- Fiscal management should prepare for prolonged periods of lower revenues and incorporate precautionary measures and buffers appropriate to countries’ risk tolerance.
Analytical scope and tools
- The analysis draws on extensive past research on commodity-price behavior and implications for macroeconomic outcomes.
- The issue incorporates lessons from IMF technical assistance to resource-rich economies aiming to improve management of natural resource wealth.
- Emphasis on designing fiscal policies that manage volatility, support growth-enhancing public investment where appropriate, and avoid procyclical spending patterns.
Italic source attribution: The Commodities Roller Coaster: A Fiscal Framework for Uncertain Times — October 2015 (Fiscal Monitor, IMF).
Content in this bundle
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- 2015年10月《财政监测报告》概要
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- The Commodities Roller Coaster: A Fiscal Framework for Uncertain Times, Fiscal Monitor, October 2015
- Infographic_fiscal Monitor_v3
- The Commodities Roller Coaster: A Fiscal Framework for Uncertain Times, Fiscal Monitor, October 2015
- Assumptions and Conventions, Fiscal Monitor, October 2015
- IMF Executive Board Discussion Summary, Fiscal Monitor, October 2015
- fmc1pdf — CHAPTER 1 The COMMOdITIeS ROLLeR COASTeR: A FISCAL FRAMewORk FOR UNCeRTAIN TIMeS
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- COUNTRY ABBREVIATIONS
- EXECUTIVE SUMMARY
- EXECUTIVE SUMMARY
- FURTHER INFORMATION AND DATA
- fmglossarypdf
- fmprefacepdf
- FISCAL MONITOR—THE COMMODITIES ROLLER COASTER: A FISCAL FRAMEWORK FOR UNCERTAIN TIMES
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- _fm1502s
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- Fmdata