2011年-IMF国际货币组织全球_Republic_of_Latvia_Fourth_Review_Under_the_Stand_91页_1mb

Summary of the Republic of Latvia: Fourth Review Under the Stand-By Arrangement

Core Content

The document outlines the Fourth Review Under the Stand-By Arrangement (SBA) and a Financing Assurances Review for the Republic of Latvia, conducted by the IMF staff in May 2011. It also includes a request for rephasing of purchases and a waiver of non-observation of a performance criterion due to an unapproved exchange restriction. The report details economic developments, policy discussions, and the country's progress toward meeting the conditions for euro adoption.

Main Views and Key Information

Economic Recovery and Performance

• Economic Recovery: Latvia's economy began recovering from the sharp contraction of 2008–09, with real GDP growth expected at 3.3% in 2011 and 4% in the medium term.
• Growth Drivers: The recovery is supported by net exports and improving domestic demand, although unemployment remains high at 17%.
• Inflation: Inflation has increased due to rising food and energy prices, reaching 4.1% in March 2011. Core inflation has remained flat due to weak domestic demand and high unemployment.
• Fiscal Performance: The 2010 deficit (ESA basis) was 7.7% of GDP, significantly below the 8.5% target, and the 2011 deficit is expected to be below 4.5% of GDP.
• Financial Sector: Banks have returned to profitability, and capital ratios are strong. However, non-performing loans remain high, and credit growth is still negative.
• Market Confidence: The 5-year CDS for Latvia has fallen to 200 basis points, and Fitch raised Latvia's credit rating to investment grade in March 2011.

Program Status

• SDR Purchases: A total of SDR 982 million has been purchased, with an additional SDR 108 million available upon completion of the Fourth Review.
• Performance Criteria: The authorities met all quantitative performance criteria for September and December 2010, and most structural benchmarks, though some were delayed.
• Reforms and Waiver: Staff supports the request for a waiver of the continuous performance criterion due to the unapproved exchange restriction and a rephasing of purchases due to delays in completing the review.

Policy Discussions

• Fiscal Policy: The 2011 budget and supplementary measures aim to reduce the deficit further. The budget relies heavily on tax increases and new fees, with limited expenditure cuts.
• Structural Reforms: The authorities are implementing reforms to improve productivity and competitiveness, including a strategy for state-owned enterprises (SOEs), wage restraint, and improving the competitiveness of public procurement.
• Bank Restructuring: The Mortgage and Land Bank (MLB) restructuring plan was submitted late, but the Parex and Citadele restructuring and sales plans are moving forward.
• Euro Adoption Strategy: The 2012 deficit is targeted to be below the Maastricht 3% reference value, with the goal of meeting the Maastricht criteria by 2014.

Risks and Challenges

• Moderate Risks: Overall economic risks are lower, but program exit strategy (euro adoption) could be affected by:
  • Political challenges: Reform fatigue and difficulty in securing further fiscal adjustment.
  • Global Commodity Prices: Further increases could push inflation above the Maastricht reference value.
  • Euro Area Scrutiny: Intensified scrutiny of euro entry candidates may delay the process.
• Unemployment: Despite a decline in the official rate, long-term unemployment and discouraged workers are increasing, which could affect domestic demand.
• Competitiveness: While there have been competitiveness gains, the real effective exchange rate has stabilized, and a moderate competitiveness gap is likely to persist.
• Social Safety Net: The social safety net remains crucial, and further adjustments may be needed if unemployment continues.

Key Structural Reforms

• Wage Restraint and Productivity: Measures to limit wage growth and boost productivity are being considered, especially to align with the fixed exchange rate regime.
• SOE Strategy: A strategy for state-owned enterprises is being developed, with a focus on cost reduction and efficiency.
• Competition and Public Procurement: Structural reforms include strengthening the Competition Authority, opening up public procurement, and improving state enterprise performance.
• Education and R&D: The authorities are working on education reforms, particularly vocational training, and promoting R&D to enhance competitiveness.

Conclusion

The IMF staff supports the waiver and rephasing of purchases, acknowledging the modest recovery and fiscal progress made by Latvia. The exit strategy of euro adoption is on track, but continued structural reforms, fiscal discipline, and addressing unemployment are essential to ensure sustainable growth and meeting the Maastricht criteria. The financial sector is showing signs of recovery, and international market confidence is improving, but long-term challenges remain.