IMF / FISCAL MONITOR

In the latest edition of its Fiscal Monitor, the IMF sees an improved picture across most of the world in terms of countries getting a handle on their deficits. IMF

• Categories: News & Features / News Stories / Unifeed
• Video Length: 00:02:20
• Production Date: 16 April 2013
• Asset Language: Original
• Corporate Name: INTERNATIONAL MONETARY FUND - IMF
• Subject Topical: ECONOMIC DEVELOPMENT; FINANCING; ECONOMICS; ECONOMIC CONDITIONS; ECONOMY; ECONOMIC DEVELOPMENT
• MAMS Id: U130416h

Description

STORY: IMF / FISCAL MONITOR
TRT:2.20
SOURCE: IMF
RESTRICTIONS: NONE
LANGUAGE: ENGLISH / NATS

DATELINE: 11 APRIL, 2013 WASHINGTON, DC

Shotlist

RECENT 2013, WASHINGTON, DC

1. Close up, IMF Seal

11 APRIL, 2013, WASHINGTON, DC

2. SOUNDBITE (English) Carlo Cottarelli, Director, Fiscal Affairs Department, IMF:
“Unfortunately those risks remain elevated. The fiscal accounts are not in a great shape in advanced economies but they are improving. We have considerable reduction in deficits. Over the last few years, there has been a considerable reduction. We project deficits to be about half of what they were on average in 2009. The other good news is that market sentiment, the propensity of markets to take up risks has improved which also makes things easier. But of course, there are still important challenges. Public debt is still quite high and is still rising in several of these advanced economies”.

FILE – RECENT, WASHINGTON DC

3. Wide shot, IMF Headquarters in Washington

11 APRIL, 2013, WASHINGTON, DC

4. SOUNDBITE: (English) Carlo Cottarelli, Director, Fiscal Affairs Department, IMF:
“If you exclude fairly small ones, there are major fiscal challenges in 10 countries. We have the US, Japan, the UK, plus seven countries in the euro area, seven euro area members: France, Italy, Spain, Belgium, and then three countries that have a program supported by financing from the IMF and the European Union Greece, Ireland, and Portugal. The good news is it’s only ten countries. Not a big number, but they are large countries and they account for 40 percent of the world GDP. So what happens to fiscal policy in these countries matter quite a lot for the world.”

FILE – RECENT, UNITED KINGDOM

5. Wide shot, London Parliament

FILE – RECENT, WASHINGTON DC, UNITED STATES

6. Wide shot, Capitol in Washington

11 APRIL, 2013, WASHINGTON, DC

7. SOUNDBITE: (English) Carlo Cottarelli, Director, Fiscal Affairs Department, IMF:
“For Japan, first of all, there is a need of a medium term fiscal plan to clarify how this country is going to stabilize the debt to GDP ratio, and then bring it down. And this will have to go beyond the measures that the government has already specified so far, such as the increase of the VAT area. That will not be enough. For the United States, there is also a need for a medium term plan that has the support from Congress that has been missing, although one has to say that the United States so far has already implemented quite a lot of fiscal adjustments over the last few years.”

FILE – RECENT, TOKYO, JAPAN

8. Wide shot, crowd shot in Tokyo

Storyline

In the latest edition of its Fiscal Monitor, the IMF sees an improved picture across most of the world in terms of countries getting a handle on their deficits. Many countries have also taken important first steps to bring overall debt down to levels needed to ensure strong and vibrant economies. But persistent high levels of debt still pose risks to future economic prosperity.

“Unfortunately those risks remain elevated”, says Carlo Cottarelli, Director of the Fiscal Affairs Department at the IMF. “The fiscal accounts are not in a great shape in advanced economies but they are improving. We have considerable reduction in deficits. Over the last few years, there has been a considerable reduction. We project deficits to be about half of what they were on average in 2009. The other good news is that market sentiment, the propensity of markets to take up risks has improved which also makes things easier. But of course, there are still important challenges. Public debt is still quite high and is still rising in several of these advanced economies”.

Bringing public debt back to prudent levels poses a long-term challenge, but it is a challenge that can be successfully met. For a certain number of countries, further adjustment efforts will be needed. According to Carlo Cottarelli, “If you exclude fairly small ones, there are major fiscal challenges in 10 countries. We have the US, Japan, the UK, plus seven countries in the euro area, seven euro area members: France, Italy, Spain, Belgium, and then three countries that have a program supported by financing from the IMF and the European Union Greece, Ireland, and Portugal. The good news is it’s only ten countries. Not a big number, but they are large countries and they account for 40 percent of the world GDP. So what happens to fiscal policy in these countries matter quite a lot for the world”.
In both the United States and Japan, the continued absence of a clear and credible medium- and long-term consolidation plan remains a concern. “For Japan, first of all, there is a need of a medium term fiscal plan to clarify how this country is going to stabilize the debt to GDP ratio, and then bring it down. And this will have to go beyond the measures that the government has already specified so far, such as the increase of the VAT area. That will not be enough. For the United States, there is also a need for a medium term plan that has the support from Congress that has been missing, although one has to say that the United States so far has already implemented quite a lot of fiscal adjustments over the last few years.”