2019年-IMF国际货币组织全球_Nepal_2018_Article_IV_Consultation_74页_2mb

Nepal 2018 Article IV Consultation Summary

Core Content

The IMF conducted the 2018 Article IV consultation with Nepal, which concluded on February 8, 2019. This consultation focused on Nepal's economic developments, policies, and macroeconomic risks, with an emphasis on fiscal and monetary policy adjustments to ensure long-term stability and growth.

Main Economic Developments

• Economic Growth: Nepal's economy experienced solid expansion, with real GDP growth estimated at 6.3 percent in FY 2017/18. The outlook for FY 2018/19 is for growth to reach 6.5 percent, driven by reconstruction, hydro-power investments, and tourism activity.
• Inflation: Headline inflation averaged 4.2 percent in FY 2017/18, held in check by subdued food price increases. However, non-food inflation rose to a 2-year high of 6.3 percent in December 2018.
• Fiscal Policy: Government expenditure increased by 32.4 percent in FY 2017/18, while revenue growth was 18.9 percent. Despite this, the fiscal deficit rose to 6.5 percent of GDP.
• Credit Growth: Private sector credit expanded rapidly, growing by 24 percent in December 2018, with an average of over 20 percent since FY 2015/16. The credit-to-GDP ratio has risen significantly above trend levels and those of peer countries.
• Current Account: The current account deficit widened to 8.2 percent of GDP in FY 2017/18, primarily due to strong import growth and higher oil prices.
• Remittances: Workers' remittances, a key source of financing, grew by 10.2 percent in FY 2017/18, reaching 25.1 percent of GDP. These inflows have helped offset the trade deficit.
• Foreign Exchange Reserves: Gross official foreign exchange reserves fell to US$8.3 billion by December 2018, down from a peak of US$9.5 billion in January 2018.

Key Policy Recommendations

• Fiscal Policy: Authorities are advised to contain spending pressures, especially from fiscal federalism, to ensure fiscal sustainability. Rationalization of the central government budget and medium-term planning for sub-national governments are recommended.
• Monetary Policy: The monetary policy should be tightened to support the exchange rate peg to the Indian rupee and to curb inflationary pressures.
• Macroprudential Policies: These should be strengthened to slow credit growth and mitigate financial sector risks.
• Structural Reforms: Efforts should focus on improving the business environment, especially for foreign direct investment (FDI), enhancing access to finance for underserved populations, and reducing corruption.
• Public Financial Management: Implementation capacity at the subnational level needs to be built to ensure efficient use of resources and effective fiscal management.

Macroeconomic Outlook and Risks

• Growth Outlook: Growth is expected to remain strong in the near term, but risks are rising due to inflationary pressures, current account deficits, and financial sector vulnerabilities.
• Inflation: Headline inflation is projected to rise to 6.5 percent in FY 2019/20, driven by non-food inflation.
• Current Account Deficit: The deficit is expected to remain wide, reaching 9.6 percent of GDP in FY 2018/19.
• Exchange Rate: The exchange rate peg to the Indian rupee is under pressure, and a marked slowdown in growth may be required to avoid balance-of-payments shortfalls.
• Downside Risks: Risks include a possible slowdown in remittances, weak implementation capacity at the subnational level, and financial sector vulnerabilities.

Executive Board Assessment

• The Executive Board commended the authorities for the improved economic activity and political stability.
• It emphasized the need for policy tightening, particularly in the fiscal and monetary areas, to address macroeconomic and financial vulnerabilities.
• The Board encouraged the continuation of financial sector reforms and the implementation of the 2014 FSAP recommendations.
• It stressed the importance of addressing structural weaknesses to enhance long-term growth and achieve the Sustainable Development Goals.

Summary of Key Issues

• Fiscal Federalism: The transition to fiscal federalism is a major challenge, requiring capacity building and efficient resource use.
• External Position: While external debt remains low, the external position is under pressure, and the IMF's external balance assessment indicates it is moderately weaker than desired.
• Financial Stability: The financial sector is under increasing vulnerability due to rapid credit growth and weak underwriting standards.
• Structural Reforms: Continued efforts to improve the business environment, reduce corruption, and enhance access to finance are critical.

Tables and Indicators

• Table 1 provides a detailed overview of selected economic indicators from 2015/16 to 2022/23, including GDP growth, inflation rates, fiscal indicators, and balance of payments data.
• The table highlights the trend of rising fiscal deficits, credit growth, and trade imbalances, with projections indicating a need for policy adjustments to ensure sustainability.

Conclusion

The IMF's consultation with Nepal highlights both the progress made and the challenges that remain. While economic growth is robust, macroeconomic and financial vulnerabilities are building, necessitating a shift towards more prudent fiscal and monetary policies to ensure long-term stability and inclusive growth.