kazakhstan turkmenistan uzbekistan azerbaijan armenia georgia kyrgyz republic tajikistan oil &...
TRANSCRIPT
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Regional Economic Outlook:Caucasus and Central AsiaFall 2010
Kazakhstan
Turkmenistan
Uzbekistan
Azerbaijan
Armenia
Georgia
Kyrgyz Republic
Tajikistan
Oil & Gas Exporters
Oil & Gas Exporters
Oil & Gas ImportersOil & Gas Importers
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Overview
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Global outlook: Two-speed recovery in motion
Real GDP Growth(percent change from a year earlier)
2000 02 04
World
Emerging economies
Advanced economies
1006 08
Temporary slow-down2010:H2 — 2011:H1
Global Outlook
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A closer look at the two-speed recovery
Real GDP Growth(percent change from a year earlier)
Global Outlook
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Rebalancing is needed along two dimensions
Private demand
Demand from external surplus economies
Public demand
Demand from external deficit economies
Global Outlook
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Prospects for World GDP Growth(percent change)
Downside risks remain, but global double-dip unlikely
Global Outlook
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Major Food Crops, Nearest Futures Prices (index, Jul. 1, 2010 = 100)
Wheat
Corn
Temporary Wheat Supply Shock, Limited Spillovers
Global Outlook
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Inflationary pressures are forecast to remain subdued
Core Inflation(Twelve-month change in the core CPI)
062002 04 Jul.10
08
For countries with a peg to the USD or euro, this means that higher inflation rates may lead to real appreciation.
Global Outlook
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Oil Demand Growth(contributions to y-o-y growth in percent)
Oil demand is accelerating with the broadening of the global recovery but supply buffers are still substantial
Total demand
Global Outlook
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CCA: Exports and remittance inflows have recovered
Annual percentage change, unless otherwise indicated
Sources: Central Bank of Russia; EMED Emerging CIS; and National Authorities. ¹Excludes Turkmenistan and Uzbekistan.²Includes Georgia, Kyrgyz Republic, and Tajikistan.
Caucasus and Central Asia
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Growth is picking up in 2010…
…but remains below pre-crisis levels
Sources: National authorities; and IMF staff calculations.
Caucasus and Central Asia
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Per-capita disposable income to recover by 2011...
...except in Armenia,
Georgia, and the Kyrgyz Republic
Sources: IMF, World Economic Outlook; and IMF staff calculations.
Caucasus and Central Asia
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Fiscal consolidation on the agenda
Oil and Gas Importers: Overall fiscal balance(Percent of GDP)
Oil and Gas Exporters: Non-oil fiscal balance(Percent of non-oil GDP, except Uzbekistan)
Sources: National authorities; and IMF staff calculations and projections.¹Includes off-budget expenditures financed by Samruk-Kazyna under the anticrisis plan.²Overall fiscal balance in percent of GDP.
Caucasus and Central Asia
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Oil and gas importers need to address external vulnerabilities
Current account deficit; percent of GDP External debt; percent of GDP
Sources: National authorities; and IMF staff calculations and projections.
Caucasus and Central Asia
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Need to tackle high and rising NPLs in some countriesNonperforming loans(Overdue by 90 days or more, unless otherwise noted; percent of total loans)
Source: National authorities.¹Overdue by 60 days or more.²Overdue from 1 day to 270 days.³Overdue by 30 days or more.
Caucasus and Central Asia
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Monetary policy needs to pay attention to inflation
Consumer price index(End-of-period; annual percentage change)
Sources: IMF, International Financial Statistics; Haver Analytics; and national authorities.
Caucasus and Central Asia
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Monetary policy has limited traction...
... due to
•Low Financial market development•Lack of competition•Government intervention •Dollarization
Sources: National authorites; IMF staff calculations; and Mishra, Montiel, and Spilimbergo (2010), “Monetary Transmission in Low-Income Countries,” CEPR Discussion Paper No. 7951 (London: Centre for Economic Policy Research).¹Correlation for Georgia covers Mar 2007–Dec 2008.
Short-term correlation between policy and lending rates(Jan 2001—Dec 2008)
Caucasus and Central Asia
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Low levels of financial development
Foster financial deepening including by developing government securities markets
Caucasus and Central Asia
Banks’ assets, 2009(Percent of GDP)
Sources: National authorites; IMF staff calculations; and Mishra, Montiel, and Spilimbergo (2010), “Monetary Transmission in Low-Income Countries,” CEPR Discussion Paper No. 7951 (London: Centre for Economic Policy Research).
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Lack of competition in the banking sector and excessive government intervention
•Increase competition, including by encouraging the entry of foreign banks
•Interest rate controls and policy-directed lending should be phased out in some countries
Caucasus and Central Asia
Spreads between lending and deposit rates(Percentage points)
Sources: National authorites; IMF staff calculations; and Mishra, Montiel, and Spilimbergo (2010), “Monetary Transmission in Low-Income Countries,” CEPR Discussion Paper No. 7951 (London: Centre for Economic Policy Research).
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High dollarization
Dedollarize, including by:
• Allowing for greater exchange rate flexibility
• Continuing to strengthen prudential regulation
Caucasus and Central Asia
Foreign currency deposits(Percent of total deposits, 2009)
Sources: National authorites; and IMF staff calculations.
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Georgia
Armenia
AzerbaijanUzbekistan
Turkmenistan Tajikistan Kyrgyz Republic
Kazakhstan
Russia
Belarus
Kazakhstan
The Belarus-Kazakhstan-Russia customs union
Caucasus and Central Asia
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Kazakhstan to benefit from customs union
CCA3%
Asia18%
Russia7%Rest of
the world72%
Exports
CCA3%
Asia27%
Russia29%
Rest of the world
41%
Imports
Kazakhstan: Structure of Exports and Imports by Region, 2009
Sources: IMF, Direction of Trade Statistics; and IMF staf f calculations.
Caucasus and Central Asia
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Limited impact on other CCA countries
0
3
6
9
12
15
KGZ UZB TKM GEO TJK AZE ARM
Exports to Kazakhstan
Imports f rom Kazakhstan
CCA Countries' Trade with Kazakhstan(Percent of the country's total exports and imports, 2009)
Sources: IMF, Direction of Trade Statistics; and IMF staf f calculations.
Caucasus and Central Asia
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Challenges beyond the crisis
Caucasus and Central Asia
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Please visit the IMF’s website
Full report: Full report: http://www.imf.org/external/pubs/ft/reo/2010/mcd/
eng/mreo1024.htm
What do you think?What do you think?Make your point on the related blogs:Make your point on the related blogs:
http://blog-imfdirect.imf.org