{
  "title": "Fiscal Policy Coordination in the Waemu After the Devaluation",
  "publication": "IMF Working Papers, February 1, 1995",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/30/fiscal-policy-coordination-in-the-waemu-after-the-devaluation-1089",
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  "summary": "This paper examines the economic implications of fiscal policy coordination in the West African Economic and Monetary Union (WAEMU) in the light of the January 1994 devaluation of the CFA franc.",
  "sections": [
    {
      "heading": "Summary / Background",
      "content": "- Examines economic implications of fiscal policy coordination in the West African Economic and Monetary Union (WAEMU) in the light of the January 1994 devaluation of the CFA franc.\n- Identifies diverging tax, tariff, and budgetary policies across the zone and argues these generate fiscal externalities that have prevented the zone from reaping the full benefits of a monetary union.\n- Argues that the devaluation increases the desirability of closer policy coordination to prevent detrimental fiscal externalities.\n- Reviews and evaluates recent efforts in fiscal policy coordination within the WAEMU.\n- Offers recommendations on the optimal design of tax and tariff rate structures, and the choice of budgetary convergence criteria."
    },
    {
      "heading": "Key Findings and Analysis",
      "content": "- Diverging tax, tariff, and budgetary politics within the WAEMU create fiscal externalities that reduce the gains from a monetary union.\n- The January 1994 devaluation of the CFA franc intensifies the need for closer fiscal policy coordination.\n- Fiscal externalities identified include cross-border effects of tax and tariff rate differentiation and interactions between deficit countries and zone countries.\n- Specific technical terms and focal points used in the analysis: distortionary rate differentiation, effective tariff rate, excise rate, import VAT, rate level, rate structure, VAT rate, VAT system."
    },
    {
      "heading": "Recent Efforts Reviewed",
      "content": "- The paper reviews and evaluates recent efforts (as of publication) to improve fiscal policy coordination in the WAEMU. (No further specifics provided on the landing page.)"
    },
    {
      "heading": "Policy Recommendations (as reported)",
      "content": "- Recommendations address:\n  - Optimal design of tax rate structures.\n  - Optimal design of tariff rate structures.\n  - Choice of budgetary convergence criteria.\n- Emphasis that closer coordination is more desirable in the post-devaluation context to prevent detrimental fiscal externalities."
    },
    {
      "heading": "Subject Areas and Keywords",
      "content": "- Subject: Consumption taxes, Excises, Fiscal policy, Tariffs, Taxes, Value-added tax\n- Keywords: CFA franc, Consumption taxes, deficit countries vis-à-vis zone country, distortionary rate differentiation, effective tariff rate, excise rate, Excises, fiscal externality, import VAT, rate level, rate structure, tariff rate, tariff system, Tariffs, Value-added tax, VAT rate, VAT system, WAEMU economy, WAEMU imports, WAEMU partner country Togo, West Africa, WP, zone country\n\n---\n\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/30/fiscal-policy-coordination-in-the-waemu-after-the-devaluation-1089"
    }
  ],
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    "Authors: Christoph B. Rosenberg",
    "Published: February 1, 1995",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451844207.001",
    "Examines economic implications of fiscal policy coordination in the West African Economic and Monetary Union (WAEMU) in the light of the January 1994 devaluation of the CFA franc.",
    "Identifies diverging tax, tariff, and budgetary policies across the zone and argues these generate fiscal externalities that have prevented the zone from reaping the full benefits of a monetary union.",
    "Argues that the devaluation increases the desirability of closer policy coordination to prevent detrimental fiscal externalities.",
    "Reviews and evaluates recent efforts in fiscal policy coordination within the WAEMU.",
    "Offers recommendations on the optimal design of tax and tariff rate structures, and the choice of budgetary convergence criteria.",
    "Diverging tax, tariff, and budgetary politics within the WAEMU create fiscal externalities that reduce the gains from a monetary union.",
    "The January 1994 devaluation of the CFA franc intensifies the need for closer fiscal policy coordination.",
    "Fiscal externalities identified include cross-border effects of tax and tariff rate differentiation and interactions between deficit countries and zone countries.",
    "Specific technical terms and focal points used in the analysis: distortionary rate differentiation, effective tariff rate, excise rate, import VAT, rate level, rate structure, VAT rate, VAT system.",
    "The paper reviews and evaluates recent efforts (as of publication) to improve fiscal policy coordination in the WAEMU. (No further specifics provided on the landing page.)",
    "Recommendations address:",
    "Emphasis that closer coordination is more desirable in the post-devaluation context to prevent detrimental fiscal externalities.",
    "Subject: Consumption taxes, Excises, Fiscal policy, Tariffs, Taxes, Value-added tax",
    "Keywords: CFA franc, Consumption taxes, deficit countries vis-à-vis zone country, distortionary rate differentiation, effective tariff rate, excise rate, Excises, fiscal externality, import VAT, rate level, rate structure, tariff rate, tariff system, Tariffs, Value-added tax, VAT rate, VAT system, WAEMU economy, WAEMU imports, WAEMU partner country Togo, West Africa, WP, zone country"
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