Selected Issues Papers
IMF Selected Issues Papers are prepared by IMF staff as background documentation for periodic consultations with member countries.
2025
July 11, 2025
Navigating Weather Shocks: Challenges and Investing to Strengthen Agriculture Resilience in Namibia
Description: Namibia’s arid climate makes it highly susceptible to severe weather shocks. The prolonged drought in 2023–24 caused a sharp decline in crop yields and exacerbated food insecurity. This paper documents Namibia’s vulnerabilities to future weather shocks, including droughts and changes in rainfall patterns, discusses potential economic and fiscal implications, and explores public investment strategies. Investing in agricultural resilience, including water infrastructure, drought-resistant crops, and farmer insurance schemes, can mitigate climate-induced economic losses and improve food security.
July 11, 2025
Namibia: Labor Markets and Resource Dependence
Description: With high unemployment, especially among the youth, Namibia lags behind the SSA region on labor market outcomes. Between 2012 and 2018, there was a structural shift in the economy from agriculture to services, as younger workers took up low-productivity service sector jobs. A shift-share analysis highlights that resources are not allocated to relatively more productive firms in the services sector, consistent with the weak real GDP per capita growth. The ongoing oil and gas exploration (and potential production in the future) offers an opportunity for economic growth and job creation, but also presents risks of worsened labor market outcomes.
July 11, 2025
Credit Developments and Macro-Financial Risks in Namibia: Namibia
Description: This chapter examines the evolution of bank credit in Namibia over the past two decades. It highlights notable trends and the composition of credit growth, with a particular focus on the private sector. Additionally, it identifies potential macro-financial vulnerabilities and provides policy recommendations to mitigate associated risks. Furthermore, it underscores the importance of promoting access to credit by businesses.
July 11, 2025
Fiscal Forecasting Errors in Nigeria
Description: The Ministry of Budget and Economic Planning's budget implementation reports reveal large fiscal forecast errors over the 2011-2023 period, for a range of fiscal aggregates including total revenues, expenditures, and the fiscal deficit. Revenues forecasts errors are driven by optimistic budget projections for oil production which consistently exceed actual outturn. Capital expenditures are also subject to systematic optimism bias, with outturn falling short of budget allocations. Large fiscal forecast errors limit the usefulness of the budget in providing a framework for the authorities' fiscal policy intentions. Cross-country experience suggests that the quality of budget forecasts can be improved by enhancing the capacity of the macro-fiscal unit responsible for forecasting, publishing internal and external forecast performance reviews, and enhancing political commitment to budget targets. By improving the quality of fiscal forecasts, the authorities can enhance the credibility of the budget in serving as a guide to fiscal policy in Nigeria.
July 11, 2025
Regulating the Crypto Market in Nigeria
Description: In recent years; the trading of crypto assets has surged among individuals and businesses in Nigeria. The authorities are strengthening the regulatory and supervisory framework for crypto assets to address potential risks including undetected capital outflows and currency speculation; money laundering; terrorism financing and consumer fraud. Moving forward; they should enforce this framework by identifying unlicensed crypto firms and preventing them from operating in Nigeria; collecting taxes on capital gains; and preventing crypto platforms from serving as informal channels to bypass capital flow restrictions. Authorities should also continue to develop robust analytical tools for effective market surveillance; ensure AML/CFT supervisory activity commensurate with money laundering and terrorism financing risks; and actively cooperate and share information with international counterparts.
July 11, 2025
Macroeconomic Implications of Climate Challenges: Nigeria
Description: Climate events significantly impact Nigeria's growth outlook, fiscal sustainability, balance of payments and financial sector, potentially undermining macroeconomic stability. Extreme weather events and their frequency have a direct effect on growth and the balance of payments. An expected sea level rise would pose significant economic cost for Nigeria, damaging infrastructure in coastal areas such as Lagos—the main commercial and financial center. While relatively small, the financial sector is exposed to spillovers to asset quality and may even be directly impacted via its physical presence in Lagos. Fiscal policy will have to address lower tax revenues from lower growth and higher demands for spending on disaster relief, infrastructure repair, and investments in climate adaptation and mitigation. As a result, Nigeria will face fiscal and associated external financing gaps.
July 11, 2025
Energy Subsidy Reform in Libya: Libya
Description: Energy subsidies have become a significant burden on government finances in Libya. The pervasive nature of subsidies has led to rampant corruption, smuggling, and a diversion of resources from essential public services. The paper identifies key barriers to reform, including opposition from vested interest groups and public apprehension regarding inflation and welfare loss. To address these challenges, a strategic reform plan is proposed, emphasizing a phased approach, a comprehensive communication plan and social protection measures to mitigate the adverse effects of subsidy removal. By taking these steps, Libya can transition towards a more sustainable framework that supports macroeconomic stability.
July 8, 2025
Benchmarking Public Spending Efficiency in Education, Health, and Infrastructure in Ireland
Description: The paper benchmarks Ireland’s public spending efficiency to peer countries in infrastructure, health, and education using a variety of indicators and maps the efficiency frontiers in these sectors using the Data Envelopment Analysis (DEA) method. It finds that while Ireland is at the efficiency frontier for education spending, there is room for potential gains in public spending efficiency on health and infrastructure. Achieving these gains could create further fiscal space to improve Ireland’s buffers for shocks in an environment of heightened global uncertainty and structural shifts.
July 8, 2025
Geoeconomic Fragmentation: Implications for Ireland
Description: Ireland’s economy is deeply connected to the global trade network and relies on foreign direct investment (FDI), notably from the US. This paper presents a framework to estimate the impact of geo-economic fragmentation through three channels: (1) supply chain disruptions, (2) trade distortions resulting from tariff increases, and (3) FDI relocation, including driven by tax policy changes. Our findings suggest that while the impact of supply disruptions and higher tariffs would be relatively contained under moderate shock assumptions, potential FDI relocations would be associated with a sizeable loss of value added but more limited impact on the indigenous economy.
July 7, 2025
Considerations for a Stronger Fiscal Framework in Ireland
Description: Ireland’s reliance on corporate income tax (CIT) receipts from multinational enterprises (MNEs), concentrated in a small number of companies, presents significant risks to the budget. This paper proposes to strengthen the national fiscal framework by establishing a prudent medium-term debt anchor and an expenditure rule to guide the annual budget process. We first establish a prudent debt anchor for Ireland by calibrating CIT shocks and simulating possible debt trajectories. Second, we propose an operational rule based on multi-year expenditure ceilings that stabilizes debt at the anchor level while accounting for the economy’s cyclical positions.