2018年-IMF国际货币组织全球_Bhutan_2018_Article_IV_Consultation_63页_4mb

2018 Article IV Consultation Summary: Bhutan

Core Content

The 2018 Article IV consultation with Bhutan, conducted by the IMF, highlighted the country's progress in economic development and poverty reduction, as well as the challenges it faces in maintaining macroeconomic stability and promoting economic diversification. The consultation included a Press Release, Staff Report, and Statement by the Executive Director, all of which were published in accordance with the IMF's transparency policy.

Main Views and Findings

Economic Performance

• Poverty Reduction: Bhutan has significantly reduced poverty, from 12% in 2012 to 8.2% in 2017, with extreme poverty at 1.5%.
• Growth and Inflation: Economic growth remained robust, averaging 6% over the 11th Five-Year Plan. Inflation was low, at around 4.3% in 2017.
• Middle-Income Transition: Bhutan is on track to transition to middle-income status, with per capita income rising from $1,100 in 2004 to nearly $3,600 in 2018.
• Current Account Deficit: The deficit narrowed from an average of 26% of GDP in FY2012-16 to 22.8% in FY2017, with reserve coverage at 13 months of imports.

Fiscal Policy

• Fiscal Deficits: The 11th FYP saw a shift from surplus to deficit, with an overall deficit of 3.3% in FY2017. The FY2018 budget projected a deficit of 1% of GDP.
• Fiscal Withdrawal: The FY2019 interim budget implies a sharp fiscal withdrawal, leading to a 2.2% of GDP surplus, with a significant decline in capital expenditure from 17% to 5.6%.
• Debt Management: The country's external public debt is heavily reliant on hydropower financing, which is largely supported by India. The debt service ratio was 38% in FY2018, but is expected to fall to 9.9% in FY2022.
• Fiscal Reforms: The introduction of the Goods and Services Tax (GST) is seen as critical to broadening the domestic revenue base. The current draft of the 12th FYP implies an average overall budget surplus of 1.4% of GDP for FY2019-23, but capital spending is expected to be lower than previous years.

Monetary and Financial Policies

• Monetary Policy: The Royal Monetary Authority (RMA) is working on modernizing the monetary policy framework, including the establishment of an interest rate corridor and improvements in liquidity management.
• Debt Market Development: The development of a domestic public debt market is recommended, as the current reliance on Treasury bills poses high rollover risks.
• Financial Sector: The banking sector remains weak, with low profitability and high non-performing assets. However, liquidity and provision coverages are strong, and the introduction of a stabilization fund is being considered to manage hydropower revenues and business cycle fluctuations.

Structural Issues

• Economic Diversification: Bhutan's economy remains heavily dependent on hydropower, and the authorities are seeking to diversify into other sectors.
• Access to Finance: The Priority Sector Lending (PSL) program is being developed to improve access to credit for cottage and small industries.
• Labor Market and Investment: Efforts to improve the business climate and access to finance should be supported, including targeted training for workers and reducing barriers to skilled immigration. The minimum threshold for foreign direct investment (FDI) should be reconsidered.

Risks and Challenges

• Domestic Risks: Delays in implementing the GST and completing hydropower projects could lead to lower electricity exports and larger fiscal deficits.
• External Risks: Weaker growth and higher inflation in India, as well as global oil price increases, pose potential threats to Bhutan's economy.
• Fiscal Policy: A more gradual fiscal consolidation and increased domestic revenue mobilization are recommended to support growth and reduce the impact of the fiscal withdrawal in FY2019.

Key Policy Recommendations

• Implement GST: The authorities should implement a broad-based GST without delay, with a simple rate structure and inclusion of services.
• Stabilization Fund: Develop a stabilization fund with transparent and rules-based principles to manage hydropower revenues and business fluctuations.
• Fiscal Transparency: Improve fiscal transparency by enhancing the scope and content of budget documents and increasing the frequency of reporting.
• Public Financial Management: Strengthen public financial management by introducing a rolling multi-year budget framework and improving PFM systems.
• Debt Market Development: Establish a domestic public debt market to provide stable and inexpensive financing.
• Monetary Policy Framework: Continue efforts to modernize the monetary policy framework and consider abolishing the minimum lending rate once the interest rate corridor is operational.
• Prudential Regulation: Improve the prudential framework for the financial sector, including tightening loan loss classification requirements and introducing risk-based provisioning.
• Reduce Tax Exemptions: Rationalize and gradually curtail the use of tax exemptions, particularly indirect taxes, which are estimated to account for 2.75% of GDP in FY2017.

Conclusion

The IMF Executive Board welcomed Bhutan's progress in economic growth and poverty reduction but emphasized the need for continued reforms to address structural and fiscal challenges. The country is transitioning to middle-income status, with a strong focus on economic diversification and improving access to finance. The staff report and recommendations provided a comprehensive roadmap for sustainable growth, with an emphasis on fiscal prudence, monetary policy modernization, and financial sector stability.