## Fiscal Risk Management

## Source details

**Canonical URL:** [Fiscal Risk Management](https://www.imf.org/en/topics/fiscal-policies/fiscal-risks)

## Other formats

- [Markdown version](/en/topics/fiscal-policies/fiscal-risks/index.md)
- [Structured JSON version](/en/topics/fiscal-policies/fiscal-risks/index.json)
- [Bundle manifest](/en/topics/fiscal-policies/fiscal-risks/bundle-manifest.json)

---

### Overview
- Comprehensive analysis, disclosure and management of fiscal risks—factors that can cause fiscal outcomes to differ from expectations—is needed to ensure sound public finances, macroeconomic stability, and fiscal transparency.
- The past two decades have shown that fiscal risk realizations can be costly, occur frequently, and arise from a variety of sources.
- The COVID-19 pandemic triggered the largest fiscal risk realization since World War II and led to policy responses that, while necessary, have in many cases resulted in additional fiscal risk exposures.

### Main drivers of fiscal risk
- Macroeconomic shocks
- Financial crises
- Commodity price shocks
- Natural disasters
- Bailouts of public enterprises

### IMF tools, guidance, and capacity development
- The IMF’s Fiscal Risk Toolkit comprises a suite of analytical tools to guide government policy and capacity development; the tools provide a practical basis to help countries identify, analyze, manage, and disclose fiscal risks.
- The tools are regularly updated as revisions are made.
- The IMF’s Knowledge Hub includes high-level analytical and policy papers, detailed How to Notes on approaches to analyzing and managing specific fiscal risks, and individual country capacity development reports tailored to particular situations.

### Policy implications and recommendations
- Identify, monitor, and manage fiscal risks using structured analytical tools and capacity development.
- Improve transparency through regular and comprehensive disclosure of fiscal risks.
- Combine better understanding of fiscal risks with transparent reporting and effective risk management to underpin fiscal credibility and the sustainability of public finances.
- Regularly update analytical tools and guidance to reflect evolving risk environments and lessons from recent realizations, including the COVID-19 pandemic.

---


## References

- [Learn more about the IMF's Role in Fiscal Risk Management](https://www.imf.org/en/Topics/fiscal-policies/Fiscal-Risks/Fiscal-Risks-IMF-Role?sc_mode=1)
- [FISCAL RISK TOOLKIT](https://www.imf.org/en/Topics/fiscal-policies/Fiscal-Risks/Fiscal-Risks-Toolkit?sc_mode=1)
- [KNOWLEDGE HUB](https://www.imf.org/en/Topics/fiscal-policies/Fiscal-Risks/Fiscal-Risks-Knowledge-Hub?sc_mode=1)
- [Download](https://www.imf.org/en/Publications/Departmental-Papers-Policy-Papers/Issues/2023/06/08/Managing-Fiscal-Risks-in-the-Middle-East-and-North-Africa-529220)
- [Download](https://www.imf.org/en/Publications/WP/Issues/2023/06/02/Quasi-Fiscal-Implications-of-Central-Bank-Crisis-Interventions-534076)
- [Download](https://www.imf.org/en/Publications/CR/Issues/2022/10/25/Armenia-Technical-Assistance-Report-Quantifying-Fiscal-Risks-from-Climate-Change-525059)
- [Download](https://www.imf.org/en/Publications/Staff-Discussion-Notes/Issues/2022/10/11/The-State-as-Financier-of-Last-Resort-523706)

_Source: https://www.imf.org/en/topics/fiscal-policies/fiscal-risks_