IMF - “Macroeconomic Issues in Small States and Implications for Fund Engagement”
Background
The Fund previously examined small states issues in 2000, informed by a Joint Task Force Report of the Commonwealth Secretariat and World Bank. Small states continue to face many of the same challenges they did then, and the 2000 Small States Report remains the foundation for much of the work in this area, both inside and outside the Fund. However, the relative macroeconomic performance of small states has deteriorated since the late 1990s, and a fresh look is warranted. The staff paper describes the key characteristics of small states (both low and middle income countries); examines the particular macroeconomic challenges faced by microstates; reviews the Fund’s past engagement in small states; and, on that basis, presents a number of proposals to strengthen the effectiveness of Fund engagement.
