2016年-IMF国际货币组织全球_El_Salvador_2016_Article_IV_Consultation_61页_1mb

EL SALVADOR 2016 ARTICLE IV CONSULTATION SUMMARY

Core Content

The 2016 Article IV consultation with El Salvador by the International Monetary Fund (IMF) highlighted the country's persistent low growth, fiscal challenges, and structural issues. The consultation aimed to evaluate economic developments, assess risks, and recommend policies to enhance growth, fiscal sustainability, and financial sector stability.

Main Points

Economic Performance and Outlook

• GDP Growth: El Salvador's GDP growth averaged 2% from 2000 to 2014, significantly below the Central American regional average of 4.5%.
• 2015 Growth: GDP grew by 2.5% in 2015, up from 1.5% in 2014, supported by US growth, Central American exports, and low oil prices.
• Inflation: Headline inflation was slightly negative (-0.7%) in 2015, anchored by the fully dollarized regime and lower energy prices.
• Current Account: The current account deficit fell to 3.5% of GDP in 2015, but is expected to rise to 5.5% by 2021 due to higher oil prices and weak export performance.
• Growth Projections: GDP growth is expected to be 2.3% in 2016 and 2.4% in 2017, falling to a potential growth rate of 2% over the medium term.

Fiscal Challenges

• Fiscal Deficit: The fiscal deficit fell to 3.4% of GDP in 2015, but is expected to widen to 5.5% by 2021 without additional measures.
• Fiscal Risks: Rising fiscal risks are due to domestic financing increases and legislative delays in accessing external financing.
• Revenue and Expenditure: Revenue was supported by the banking transactions tax (BTT), but lower than expected. Expenditure remained stable as a percent of GDP, with increases in wages and energy subsidies.
• Public Debt: Public debt is projected to exceed 70% of GDP by 2021, indicating a need for fiscal consolidation and structural reforms.

Financial Sector

• Stability: The financial sector remains stable, with a high capital adequacy ratio (17.2% of risk-weighted assets) and adequate provisioning (nearly 115% of non-performing loans).
• Credit Trends: Credit to the private sector increased by 6% in 2015, while credit to the public sector rose by nearly 15%.
• Liquidity and Profitability: Liquidity appears ample, but bank profitability is low due to high liquidity and a narrowing loan-to-deposit rate spread.

Structural Reforms

• Competitiveness: El Salvador faces low competitiveness due to high unit labor costs, high energy and logistics costs, and barriers to entry.
• Investment: Investment has been low, averaging 15.5% of GDP since 2000, and is a key constraint on growth.
• Crime and Emigration: High crime and emigration have reduced labor supply and competitiveness, and are linked to low growth.
• Pension Reform: A meaningful pension reform is needed, including raising the retirement age, increasing contributions, and linking benefits more closely to contributions.
• Political Gridlock: Political stalemate hinders structural reforms and legislative progress on key initiatives.

Key Recommendations

• Fiscal Consolidation: A front-loaded fiscal adjustment of at least 3% of GDP over 2017-19 is necessary to reduce public debt and ensure fiscal sustainability.
• Structural Reforms: Comprehensive reforms to enhance competitiveness, investment, and public sector efficiency are essential.
• Financial Sector Reforms: Strengthening the resolution and crisis management framework, enhancing risk-based supervision, and increasing budget allocations for the lender of last resort (LOLR) facility are recommended.
• Social Safety Nets: Safeguarding social spending safety nets while implementing revenue measures to reduce distortionary taxation.
• Contingency Planning: Developing contingency plans to manage potential losses in correspondent banking relationships.

Risks and Uncertainties

• Global Financial Turmoil: Increased global market volatility could raise the cost of external financing.
• Exchange Rate: A surge in the US dollar could weaken El Salvador's competitiveness and growth prospects.
• Trans-Pacific Partnership: Implementation of the agreement may intensify competition from Asia.
• Weak Global Growth: Slower global growth could depress Salvadoran growth, especially without the exchange rate as a shock absorber.
• De-risking by Banks: Reduced banking activities could increase intermediation costs and hinder remittances, affecting consumption and growth.
• Fiscal Confidence: Rising fiscal risks could undermine investor confidence and lower medium-term growth.

Conclusion

The IMF Executive Board agreed with the staff report and emphasized the need for strong fiscal consolidation and structural reforms to ensure long-term growth and fiscal sustainability. The consultation also highlighted the importance of addressing competitiveness, investment, and social safety nets to break the cycle of low growth and high fiscal risks.

Selected Economic Indicators

Summary

The 2016 Article IV consultation with El Salvador identified the country's persistent low growth, fiscal pressures, and structural issues as key challenges. The IMF recommended fiscal consolidation, structural reforms, and financial sector strengthening to ensure long-term growth and stability. Despite some improvements in 2015, risks remain high, particularly due to global economic conditions and domestic political challenges.