Responding to COVID-19 challenges: Fiscal Rules and Fiscal Risk

Thursday, July 02

Tom Richardson, JVI Director

Paulo Medas, Deputy Division Chief of the Fiscal Policy and Surveillance Division at IMF’s Fiscal Affairs Department
Jason Harris, Deputy Division Chief of the Public Financial Management Division at IMF’s Fiscal Affairs Department

To protect lives and support livelihoods, governments globally have responded to the pandemic with an unprecedented $10 trillion of fiscal stimulus (IMF Fiscal Monitor, June update). Of these, an estimated $4.4 trillion are on-budget measures, which together with automatic stabilizers directly affect fiscal deficits and public debts. This is putting rules-based fiscal frameworks to the test. Further, governments have supported their economies with another $4.6 trillion off-budget measures such as public sector loans, equity injections, or guarantees. These measures create new fiscal risks at a time where the sharp global economic contraction and worsening macroeconomic and financial conditions are increasing existing fiscal risks. 

This webinar therefore focuses on the strategies that governments should apply to ensure their fiscal responses to the pandemic preserve the credibility of their fiscal frameworks and prudently deal with fiscal risks. How should governments address limited fiscal space in a rule-based fiscal framework, and how can the credibility of the fiscal framework and long-term fiscal discipline be ensured? What is the effect of the COVID-19 pandemic fiscal policy responses on fiscal risks? How can a risk-based approach to fiscal policy be implemented? And what longer-term lessons can be drawn from the current crisis for the way PFM systems operate? 

The webinar is the second of a series focusing on the recent IMF special series on fiscal policies to respond to the COVID-19 challenges.

Paulo Medas will present the note “Fiscal Rules, Escape Clauses, and Large Shocks” (English / Russian)

Jason Harris will present the IMF Fiscal Affairs Department’s special note on “Managing Fiscal Risks Under Fiscal Stress” (English / Russian)

The webinar will be opened by Tom Richardson, JVI Director and Carolina Renteria, Chief of the Public Financial Management Division at IMF’s Fiscal Affairs Department.

Moderation will be provided by Barbara Dutzler and Tatiana Evdokimova (both JVI).

Participants are encouraged to ask written questions to the presenters using the webinar’s Q&A function.

The webinar will be held in English.

In the coming weeks and months, the JVI will organize further topical webinars in the field of financial stability, fiscal policy and macroeconomics.

Besides, we will conduct a number of our courses in a virtual format. The latest version of the JVI course schedule can be found here.

We look forward to engaging with you!

Thomas Richardson, Director, JVI


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