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MacroeconomicPolicyinFragileStates MacroeconomicPolicyin FragileStates Editedby RALPHCHAMI,RAPHAELESPINOZA, ANDPETERMONTIEL
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Foreword PictureachildborntodaytoavillagerinSomaliaorLaos,oranotherfragilestate. Thinkaboutherprospectsinlife.Asareaderofthisbook,youareprobably worried:Willshehavecleanwaterandenoughtoeat?Willshebesafefrom violence?Willshebeabletogotoschool?Towork?Tolivebetterthanher parents?
Itdepends onleadershipinhercountry,andonsupportfromtheinternationalcommunity.
Stabilizingfragileandconflict-affectedstatesisamongtheworld’smostdifficultchallenges.Anditisoneofthemostpressing notonlyforthepeopleof thosecountries,butforallofus.Supportingthesestatesiscriticaltochallenges likeendingtheCOVID-19pandemic, fightingclimatechange,reducingglobal poverty,andamelioratingsomeofthecausesofinvoluntarymigration.
WorkingwithfragilestatesattheIMF,andthroughoutmycareer,Ilearned thatnotwocountriesarethesame.Knowledgeofeachcountry’speopleand historyisnecessary,inadditiontounderstandingitspoliticaleconomy.
Ralph,Raphael,Peter,andthecontributorstothisbookhavestudiedfragile statesandtheirproblemsfrommanyangles,takingabroadviewofthemacroeconomy.Theyhaveidentifiedthemostpressingchallengesandprovideda comprehensiveandtimelysetofsolutions.Itisbothamenuofoptionsfor policymakersseekingtoaddressthesestates’ urgentneeds,andamanualfor howtoexecutethem.
Inadditionaltowisdombornofdeepexperienceandanalyticalrigor,the authorsbringahumilityandhumanitythatrecognizestheuniquequalitiesof eachcountry,andtheenormityofthechallengestheyface.Andthediscussionis enrichedbycountrycasestudiesshowingbothpolicysuccessesandfailures,and lessonslearned.
Informedbythisperspectiveandtheongoingpandemic,theIMFisimplementingastrategytoimprovethequalityandeffectivenessofitsengagementwith thesecountries.Wehaverespondedquicklytoacrisislikenoother,withnearly$2 billioninnewlendingto12fragileorconflict-affectedstates,whichwillhelp catalyzedonorsupport.AndtheIMFisalsograntingdebtreliefto21fragilestates, hometoabout313millionpeople.
Wearechangingourlendingfacilitiestoallowforquickerandbettertargeting of financialsupport,andadaptingourpolicyadviceandtechnicalassistanceto accountforthepeculiaritiesofthecrisis.Someofthesechangeswilldoubtless outlastthepandemic.
TheFundandourmostvulnerablememberstatesareonajourneytowarda greener,fairer,smarterrecovery andasafer,brighterfutureforthatchildborn today,andallthosetocome.
Thisbookhelpsusgetthere.
KristalinaGeorgieva ManagingDirector
Preface Theconceptofstatefragilityisoftentakentocaptureasituationinwhicha country’sgovernmentalapparatusisoflimitedeffectivenessindeliveringabroad rangeofpublicservices.Althoughtheprovisionofsecurityisessential,other publicgoodsarealsoimportant,inparticularthosethatpromotesocialcooperation(suchaslawsthatarefairandconsistentwithpersonalfreedom),thosethat providesomebasicsocialinsurance(suchasdisasterreliefandhealthcare,which isparticularlyimportanttoaddresstheCOVID-19pandemic),andthosethat createtheconditionsforeconomicprosperity.
Fromourperspective,a failed stateisthenonethatfailstodeliveralongallfour ofthesedimensions,anda fragile stateisonethatfacesahighprobabilityof becomingafailedone.Afragilestateisthereforenotnecessarilyanineffectual one;whileastate’sinabilitytodeliverbasicpublicgoodsmaycertainlybegrounds forcitizendisaffectionandthereforeforsocialupheaval,arepressivestatethat minimizescrimeandmakesthetrainsrunontimemayonlytemporarilybe suppressingasocialexplosion.
Settingmacroeconomicpolicyisespeciallydifficultinfragilestates.Political legitimacyconcernsareheightened,raisingissuessuchaswhothepolicymakers are,whatincentivestheyface,andhowtheprocessofpolicymakingislikelyto workunderlimitedlegitimacyandhighuncertaintybothaboutthemacroeconomicenvironmentandaboutpolicyeffectiveness.Inaddition,fragilityexpands therangeofpolicyobjectivesinwaysthatmayconstraintheattainmentof standardmacroeconomicobjectives.Speci fically,inthecontextoffragilitypolicymakersalsoneedtofocusonmeasurestomitigatefragilityitself;thatis,they needtoaddressissuessuchasregionalandethnicdisparitiesineconomic outcomesandaccesstopublicservices,youthunemployment,andfoodprice inflation.Sociopoliticaldevelopmentsaroundtheworldhavethuspushedpolicymakerstoexpandtheirtoolkittoimprovetheeffectivenessofmacroeconomic managementinthefaceoftheseconstraints.
Thechaptersinthisbookaddresstheseissues,bygivingananalyticalcontext fromwhichpolicymakerscanbuildtoanswerthequestionstheyfaceinfragile situationsaswellasbyprovidinglessonsdrawnfromempiricalanalysesandcase studies,leveragingtheextensiveexperienceofthecontributors.Itisourhopethat thisvolumewillfurtherstimulatethinkingonpolicymakinginfragilestatesand promotetheimportanceofthatwork.
WeacknowledgethegeneroussupportofDFIDwhichallowedthisworkto happen,aswellasthesupportoftheinstitutionsthathostedus:theIMFInstitute forCapacityDevelopment,FiscalAffairsDepartment,ResearchDepartment,and EuropeanDepartment,andWilliamsCollege.
Ouracknowledgmentsalsogotothecontributorsofthevolume:Daron Acemoglu,ChristopherAdam,SarthakAgrawal,RamzyAl-Amine,Giorgia Albertin,NabilaAssaf,KatherineBaer,AdolfoBarajas,TimothyBesley, FrancescaCaselli,WarrenCoats,PaulCollier,CharlesCollyns,MattiaCoppo, PhilDeImus,IbrahimElbadawi,MichaelEngman,LarsEngstrom,Ekkehard Ernst,ConnelFullenkamp,EnriqueGelbard,JoseGijon,MarkGriffiths,Sanjeev Gupta,ErmalHitaj,KareemIsmail,KevinKuruc,ChrisLane,MarioMansour IsaacMartinez,GaryMilante,ClaraMira,HannesMueller,AnneOeking,Sailendra Pattanayak,MehtaPaulomi,AndreaPresbitero,AlexandrosRagoussis,Gustavo Ramirez,ThomasRisse,JamesA.Robinson,DaoudaSembene,RaimundoSoto, ShinjiTakaji,RobertTchaidze,RimaTurk,JamesWilson,MichaelWoolcock;tothe WorkshopparticipantsatOxford:NathalieBrajard,SharminiCoorey,Elizabeth Cunningham,ConorDoyle,ChadyEl-Khoury,TimGreen,SeanHagan,David Hidalgo,AndyHinsley,OussamaKanaan,AdnanKhan,NickLea,ViolaLucas, AlexandreMarc,EvaMyers,SeanNolan,JonathanOstry,SebastianPompe,David Robinson;andtoothercolleagueswhodiscussedthisprojectatdifferentstages: AndrewBerg,ChrisPapageorgiou,DominiqueDesruelle,AliMansoorand AbdelhakSenhadji.KiaPensoprovidedsuperbhelpwiththeeditingofthevolume. Ofcourse,wewouldnothavebeenabledothiswithoutthesupportand patienceofourrespectivefamilies,whotoleratedourdedicationtothisproject. Theyjoinusinhopingthatthisvolumewillcontributetobetterinternational understandingofhowtoimprovethelivesofourfellowhumanbeingswhohave tocopewiththechallengesoflivinginfragilestates.
RalphChami,RaphaelEspinoza,andPeterMontiel
HowthisBookCametoBe Icanstillrecallthedayin2009whenmydirectorwalkedintomyofficeandasked metotakeoverasmissionchiefforLibya.Hesaid, “Youare fluentinArabic,and notmuchishappeningthere.” Atthattime,Iwasheadoftheregionalsurveillance division,overseeing32countriesthatcomprisedtheMiddleEastandCentralAsia Department(MCD),attheInternationalMonetaryFund(IMF).True,goingby thetypicalstatisticsofGDPgrowth,inflation,andinternalandexternalbalances, Libyalookedliketheposterchildofaresource-richemergingeconomy.Acountry threetimesthesizeofFrancebutwith11percentofitspopulation,afast-growing economyheavilydependentonoil,withwellover$100billioninreservesalong withdouble-digitexternalandinternalsurpluses.Maskedbythesestatistics, however,wasamorealarmingpictureofacountrylaggingbehinditscomparators onsocial,institutional,andpoliticalindices,withayoungpopulationthatwasalso sufferingfromhighunemployment,especiallyamongtheyouth.
ItisnotsurprisingthatwhentheArabSpringstartedinneighboringTunisia andthenspreadtoLibya’sneighborinthewest,Egypt,Libya’sdisenfranchised populationwouldjointhequestforvoiceandinclusion.Overthenextfouryears, IledmanymissionsintoLibyawithagroupofdedicatedIMFstaff,oftenin perilouscircumstances,workingcloselywithauthorities,nongovernmental organizations(NGOs),otherinternational financialinstitutions(IFIs),aswellas otherstakeholderstohelpthecountrymakethetransitiontoanewLibyathat wouldliveuptoitstremendouspotential,therebydeliveringthepromised prosperityforitspeople,42yearsinwaiting.
Thepoliticalandsecuritysituation,however,wasquicklydeteriorating,andwe werenowdealingwithacountrythatwasshowingsignsoffragility,withrelentless pressuresonitsnascentleadershiptoacquiescetothemultitudeandimmediate requestsbyitsyoungpopulationtodeliver,evenifitmeantattheexpenseof medium-termsustainability.
Ourpositionwastoadvisethestateonhowtostabilizetheeconomyinthe shortterm,whileleavingroomformuch-neededstructuralreformsinthe mediumterm.Butthatwaseasiersaidthandone,formanyofthetoolshoned byexperienceinworkingonlow-incomeormiddle-incomecountries,letalonein advancedeconomies,couldnotbeusedinsuchafragilecondition;wherethe politicaleconomysituationwasmorphingquickly,wheredifferentactors appearedanddisappearedontheground,andwherethesecuritysituationwas quicklydeteriorating.
Wehadtotackleissuessuchashowtodesign fiscal,monetary,andexchange ratepoliciesinsuchasituation.Howtocreatetrustbetweentheauthoritiesand thesociety,aftermanyyearsofmistrust?Howtoenhancetheefficiencyofthe government,whichdespiteitswealthlackedthecapacitytodeliver?Howto empowertheprivatesector,inacountrythatsufferedfromtheheavyhandof thestate,lackedaconstitution,properdefinitionofpropertyrights,ortheability toenforcetheruleoflaw?OnequestionthatIhadtograpplewithwaswhetherthe countrywasevenreadyforalltheadvicethatwe,amongotherIFIsandstakeholders,werereadilyproviding.
Unfortunately,bylate2013thefast-deterioratingpoliticalandsecuritysituationmeantthatwecouldnolongermeetinLibya,andoureffortsbecame focusedondevelopingemergencybudgetsonasix-monthrollingbasis,awaiting thenormalizationofthesecuritysituation.
However,thecivilstrifeintensified,trumpingoureffortstostabilizethe economy,andthecountrywasplungedintoconflictamongitsvariousfactions. Atthesametimein2013,Ireceivedaphonecallfrommydirectorwho promptlyaskedme, “Mr.Chami,whoisthemissionchiefforSomalia?” Bythat time,Iwasdivisionchiefforanumberofstates,mostofthemexperiencingfragile situations:Egypt,Libya,Somalia,Sudan,SouthSudan,andYemen.Ireplied, “As youknow,Somaliahasbeenofflinefor22years,” towhichhequicklyreplied “So, youarenowthemissionchiefforSomalia.” ThoughSomalialackedLibya’sdeep centralbankresourcesandwasinfactinarrearstotheIMF,bothstatesshareda numberofcharacteristics,suchastheabsenceoforinabilityofthestatetodeliver publicservicesincludingsecurity;lackoftrustinthestate;certainpocketsof stabilityinthemiddleofchaos;warringfactionsjostlingforpower;andayoung populationinurgentneedofmeaningfuljobsandaspiringforabetterfuture.
Thoughbothcountrieswerefragileintheirownway,onestarkdifference betweenthesituationinLibyaandthatinSomaliawasthatwhiletheformer wasdescendingintochaosaftermanyyearsofmacroeconomicstabilityenforced byapredatorystate,theotherwasmakingitswayoutofchaos,drivenbyasociety thathaddecidedtocedepowertoarepresentativestate.Again,thesamesetof policyissuesanddesignquestionsthatwefacedindealingwithLibyawerepresent inthecaseofSomalia,aswellasinotherfragilestatessuchasYemen,among others,eventhougheachofthesecountrieshasitsownsocialnarrativeand experience.Whatdoesfragilitymeanintermsofdesigningmacroeconomic policy?Whatroledoesthecountry’ssociopoliticalsituationplayindefining whatispossible?Howtobuildtrustbetweenthestateandsociety?Howshould wetakefragilityintoconsiderationwhendesigningmacroeconomicpoliciesfor suchcountries?Whatdoesthatpreciselymeanfor fiscal,monetary,exchangerate, and financialpoliciesinsuchcountries?WhenandhowshouldIFIsengagein helpingcountriesfacingfragilesituations?Whatlessonscanwelearnfromthe successesandfailuresofcountriestoexitfragilesituations?
Togetherwithmytwoco-editors,RaphaelEspinoza,whohaswrittenextensively onmacroeconomicmanagementinresource-richcountries,andPeterMontiel, whohashadalongandcelebratedcareerinthinkingandadvisingonmacroeconomicpolicyinemerginganddevelopingcountries,wesetouttoanswerthese questions.Wesolicitedthebestexpertiseonthissubjecttohelp.Renowned scholars,whohavedevotedextensivetimeandefforttothinkingabouttheroleof politicaleconomyinfragilesatesandhighlightedtheneedtotailormacroeconomic policytothelocalsituation,havecontributedtothisbook,alongsideexpertswith extensive fieldexperienceinfragilestates.
Ouraimistohelppolicymakers,practitioners,andothersinterestedin engagingwithfragilestatesbytakingstockofwhatwehavelearnedaboutthe dauntingchallengeofframingmacroeconomicpolicyinthoseenvironments.We hopethatthebookcontributestodevelopinganunderstandingabouthowpolicy mayneedtoadaptincountriesexperiencingfragility,especiallyasthelistofsuch countriescontinues,alarmingly,togrow.
RalphChami
ListofContributors DaronAcemoglu isanInstituteProfessoratMITandanelectedfellowoftheNational AcademyofSciences,theTurkishAcademyofSciences,theAmericanAcademyofArts andSciences,theEconometricSociety,theEuropeanEconomicAssociation,andthe SocietyofLaborEconomists.Heistheauthorof fivebooks,including WhyNationsFail: Power,Prosperity,and PovertyandTheNarrowCorridor:States,Societies,andtheFateof Liberty (bothwithJamesA.Robinson).
ChristopherAdam isProfessorofDevelopmentEconomicsintheDepartmentof InternationalDevelopmentattheUniversityofOxford,UK.HeisanIMFVisiting ScholarundertheIMF-DFIDprogramonMacroeconomicResearchinLow-Income Countries,aFellowoftheEuropeanDevelopmentNetwork,andanassociateeditorof the JournalofDevelopmentEconomics. HeholdsaDPhilinEconomicsfromNuffield College,Oxford.
SarthakAgrawal isaResearchEconomistwiththeInstituteforFiscalStudiesinLondon, workingintheirCentreforTaxAnalysisinDevelopingCountries.HehasaBAin Economics(Hons.)fromShriRamCollegeofCommerce,UniversityofDelhiandan MPhilfromtheUniversityofOxford.Hisresearchinterestsincludeissuesaroundfragility andconflict,theeconomicsofeducation,andtaxpolicyinlow-incomecountries.
RamzyAl-Amine isaResearchAnalystintheFrontOfficeoftheIMF’sStrategy,Policy, andReviewdepartment.Previously,heworkedintheMiddleEastandCentralAsia department,wherehefocusedoneconomicissuesrelatingtoMaghrebcountries.Ramzy isagraduateoftheAmericanUniversityofBeirutandholdsanMAfromGeorgetown University.Hisworkfocusesonbigdata,textmining,anddatavisualization.
GiorgiaAlbertin isDeputyDivisionChiefattheAfricanDepartmentoftheIMFand missionchiefforGuinea.Shehasextensiveexperienceworkingonemergingmarkets andlow-incomeandfragilecountries.ShewastheIMFResidentRepresentativefor TunisiaandworkedoncapacitybuildingattheIMFInstitute.SheholdsaPhDin EconomicsfromtheLondonSchoolofEconomicsandPoliticalScience.
NabilaAssaf isthePracticeManagerintheFinance,Competitiveness,andInnovation GlobalPracticeattheWorldBank,coveringtheMiddleEast,Afghanistan,andPakistan, andwaspreviouslypartoftheFragility,Conflict,andViolencegroup.Shespenttheearlier yearsofhercareerinmanufacturing,agribusiness,andexportdevelopment,andtranslated thatexperienceintoprivatesectordevelopmentindevelopingandfragilecountries.She holdsamaster’sdegreeinindustrialengineeringandmanagementfromtheUniversityof Washington.
KatherineBaer isanAssistantDirectorintheFiscalAffairsDepartment(FAD).She managesthedivisioninFADthatprovidestechnicalassistanceintaxandcustoms
administrationtomorethan80IMFmembercountriesintheWesternHemisphereand Sub-SaharanAfrica.Shehasalsohelpeddesignandimplementtaxandcustomsreformsin Asia,Europe,andtheformerSovietUnion,includingincrisiscountries.Priortotakingup hercurrentpositionintheIMFshewasaFinancialEconomistintheUSTreasuryandhead ofresearchintheMexicanTaxAdministration.MsBaerhasanumberofpublicationsin the fieldoftaxadministrationandholdsaPhDfromCornellUniversity.
AdolfoBarajas isaSeniorEconomistintheMonetaryandCapitalMarketsDepartmentof theIMF,wherehisprimaryresponsibilityistoleadanalyticalchaptersoftheGlobal FinancialStabilityReport.HehasworkedintheInstituteforCapacityDevelopment, deliveringcoursesonmacroeconomicsand finance;andinregionaldepartmentsofthe Fund,whereheparticipatedincountryworkandauthoredchaptersoftheRegional EconomicOutlook.Previously,hehasworkedasaresearcherintheColombiancentral bankandatFedesarrollo,athinktankinBogotá.
TimBesley isSirW.ArthurLewisProfessorofDevelopmentEconomicsattheLSE.His researchfocusesonthepoliticaleconomyofpolicymaking.Apastpresidentofthe EconometricSociety,InternationalEconomicAssociation,andEuropeanEconomic Association,hispolicyexperienceincludesmembershipoftheBankofEngland MonetaryPolicyCommitteeandtheUKNationalInfrastructureCommission.Heserved ontheLSE-Oxfordcommissiononstatefragility,growth,anddevelopment.
FrancescaG.Caselli isaneconomistintheWorldEconomicStudiesDivisionoftheIMF ResearchDepartment.Previously,sheworkedintheIMFEuropeanDepartment.Her researchinterestsincludeappliedeconometricsandinternationaleconomics.Herrecent workfocusesontheimpactof fiscalrulesandtheroleofanchoringofinflationexpectations inthetransmissionofshocks.BeforejoiningtheIMF,sheworkedattheOECDandvisited theBankofItaly.SheholdsaPhDinInternationalEconomicsfromtheGraduateInstitute inGeneva.
RalphChami iscurrentlyAssistantDirectorintheInstituteforCapacityDevelopment, InternationalMonetaryFund.Mostrecently,hewasAssistantDirectorandMissionChief intheMiddleEastandCentralAsiaDepartment(MCD)whereheoversawsurveillanceand programworkonfragilestates:Egypt,Libya,Somalia,Sudan,SouthSudan,andYemen. Previously,hewastheChiefoftheRegionalStudiesDivisioninMCD.Heistherecipientof the2014IMFOperationalExcellenceAward.
WarrenCoats retiredfromtheInternationalMonetaryFundin2003asAssistantDirector oftheMonetaryandCapitalMarketsDepartment,whereheledtechnicalassistance missionstomorethan20countries.HewasAssistantProfessorofEconomicsatthe UniversityofVirginiafrom1970–75andadirectoroftheCaymanIslandsMonetary Authority2003–10.Hismostrecentbooksinclude OneCurrencyforBosnia:Creatingthe CentralBankofBosniaandHerzegovina (2007);BuildingMarketEconomyMonetary Systems MyTravelsintheFormerSovietUnion(2020);Afghanistan:Rebuildingthe CentralBankafter9/11 MyTravelstoKabul(2020);Iraq:AnAmericanTragedy,My TravelstoBaghdad(2020);andPalestine:TheOsloAccordsbeforeandafter,Mytravelsto Jerusalem(2020).HegraduatedinEconomicsfromUCBerkeley(BA),andtheUniversity ofChicago(PhD).
PaulCollier isProfessorofEconomicsandPublicPolicy,BlavatnikSchoolofGovernment, OxfordUniversity;Director(withRobinBurgess)oftheInternationalGrowthCentre; Director(withDennisSnower)oftheESRC-NIESRnetwork,theSocial-MacroHub. Formerly,DirectoroftheDevelopmentResearchDepartmentoftheWorldBank,andof theCentrefortheStudyofAfricanEconomies.Heistheauthorof TheBottomBillion (OxfordUniversityPress), Refuge (Penguin,withAlexBetts), TheFutureofCapitalism (Penguin)and GreedisDead:PoliticsAfterIndividualism,2020,AllenLane,(withJohn Kay).
CharlesCollyns joinedtheIMF’sIndependentEvaluationOffice(IEO)asDirectorin February2017,afterworkingasChiefEconomistattheInstituteofInternational Finance.HeservedasAssistantSecretaryforInternationalFinanceattheUSTreasury DepartmentfromFebruary2010toJuly2013.PriortojoiningTreasury,heworkedatthe IMF,includingasDeputyDirectorintheResearchDepartmentresponsiblefortheWorld EconomicOutlookandDeputyDirectorintheWesternHemisphereDepartment.Heholds adoctorateineconomicsfromtheUniversityofOxfordandaBAfromtheUniversityof Cambridge.
MattiaCoppo isaResearchOfficerintheResearchDepartmentattheIMF.Hehasworked aswellintheIMFInstituteofCapacityDevelopmentandInnovationUnit.Beforejoining theIMF,hehasbeenworkingattheRoyalBankofScotlandasariskanalyst.Heholdsa MAinEconomicsfromUniversityCollegeLondonandHigherSchoolofEconomics.
ThomasF.Cosimano isProfessorEmeritusfromtheMendozaCollegeofBusinessatthe UniversityofaNon-residentFellowattheCenterforGlobalDevelopment,Washington,D. C.HewasNotreDame.HewasaProfessorofFinanceandConcurrentProfessorof EconomicsandMathematicsattheUniversityofNotreDame,1987–2016.Hehasbeena VisitingScholarattheInstituteforCapacityDevelopmentuntilOctober2019, InternationalMonetaryFundfrom2000–19.
PhildeImus isaSeniorEconomistattheIMF’sMiddleEastandCentralAsiaDepartment currentlyworkingonSomalia.TheIMFissupportingthecountry’seffortstoachievedebt reliefundertheHighlyIndebtedPoorCountryInitiative.Hepreviouslyworkedonother countriesandcapitalmarketsissuesfortheIMF.Hespenttheearlierpartofhiscareerat theFederalReserveBankofNewYorkandtheprivatesectorandholdsgraduatedegrees fromtheUniversityofChicago.
IbrahimElbadawi isManagingDirectoroftheEconomi cResearchForum.Previouslyhe wasMinisterofFinanceandEconomyofSudanandheworkedfortheDubaiEconomic CouncilandtheWorldBank.Hisresearchfocusesonmacroeconomicpolicyand foreignexchangeratepolicy.Hislatestbookis UnderstandingandAvoidingtheOil CurseinResource-richArabEconomies ,publishedbyCambridgeUniversityPressin 2016.Mr.ElbadawiholdsaPhDinStatisticsandEconomicsfromNorthCarolinaState University.
MichaelO.Engman isasenioreconomistintheFinance,Competitiveness&Innovation GlobalPracticeattheWorldBank.Hisworkcoverstrade,investment,andtechnology diffusioninAfricaandSouthAsia.Hepreviouslycoveredtradeandeconomicpolicyatthe
OrganisationforEconomicCo-OperationandDevelopment,theWorldTrade Organization,andtheEuropeanCommission.HeholdsaPhDininternationaleconomics fromSciences-PoinParis.
LarsEngstrom isasenioreconomistintheIMFAfricanDepartmentandmemberofthe teamcoveringTogo.Hehasawideexperienceworkingonlow-incomeandfragileAfrican countries,includingastheIMFResidentRepresentativeforRwandaandBurundi.Priorto this,heworkedattheSwedishMinistryofFinance.Hedidhisgraduatestudiesin EconomicsattheUniversityofUmeå,Sweden.
EkkehardErnst isChiefoftheMacroeconomicPoliciesandJobsUnitattheInternational LabourOrganization,whereheanalysestheimpactoftechnologicalchangeandmacro policiesonproductivity,employment,wages,andinequality.Hiscurrentfocusison understandingtrendsintheFutureofWork.Togetherwithhisteamheanalyseshow artificialintelligence,demographicshifts,globalization,climatechange,andpoliticalvagariesmightunfoldintheworldofwork.
RaphaelEspinoza isDeputyDivisionChiefattheIMF,intheFiscalAffairsDepartment. Hehasworkedonseveralcrisiscases(Brexit,theeurocrisis,IMFStand-byArrangment programs,etc.)aswellasintheIMFResearchDepartmentandasLecturerandDirectorof theCentrefortheStudyofEmergingEconomiesatUniversityCollege,London.Hehas writtenabookon TheMacroeconomicsoftheArabStatesoftheGulf (OxfordUniversity Press,2013)andseveralpapersoninternationalmacroeconomicsand finance.
ConnelFullenkamp isProfessorofthePracticeofEconomicsandDirectorofthe EconomicsCenterforTeachingatDukeUniversityinDurham,NorthCarolina.His researchinterestsincludethemacroeconomicimpactsofmigrantremittances, financial marketdevelopment,and financialregulation.HeearnedMAandPhDdegreesin EconomicsfromHarvardUniversity.
EnriqueGelbard isAdvisorattheAfricanDepartmentoftheIMFandmissionchieffor Tanzania.Priortothat,hehasworkedasmissionchiefforseverallow-andmiddle-income countriesandconductedanalyticalworkonpovertyreduction,fragilestates,tradeintegration,exchangerates,and financialsectordevelopment.Heobtainedhispost-graduate degreesineconomicsfromtheUniversityofTorontoandYaleUniversity.
JoseGijon isIMFResidentRepresentativeinCôted’Ivoire.Hehasextensiveexperience workingonlow-andmiddle-incomeAfricanandMiddleEasterncountries.Healsohas expertiseon financialsectorissuesandhaspreviouslybeeninacademiaandotherinternationalorganizations.Mr.GijonholdsaPhDfromJohnsHopkinsUniversity.
MarkGriffiths istheIMF’smissionchieftoLibyaandtoWestBankandGaza.Previously hewasmissionchieftoGeorgia(2012–16),Latvia(2008–12)andMacedonia(2005–08).At theIMFhehasworkedonEuropeantransitioneconomies,aswellastheThailand, Indonesia,andTurkeycrisisprograms.BeforejoiningtheIMFMarkheldteachingpositionsatExeterCollege,OxfordandattheVirginiaPolytechnicInstitute.HehasaDPhilin EconomicsfromOxfordUniversity.
SanjeevGupta isaseniorpolicyfellowattheCenterforGlobalDevelopment.Previously, hewasdeputydirectoroftheFiscalAffairsDepartmentoftheIMFandhasworkedinits
AfricanandEuropeanDepartments.PriortojoiningtheIMF,Mr.Guptawasafellowofthe KielInstituteofWorldEconomics,Germany;professorattheAdministrativeStaffCollege ofIndia;andsecretaryoftheFederationofIndianChambersofCommerceandIndustry. Hehasauthored/coauthoredover150papers,manyofwhicharepublishedinwell-known academicjournals,andhasauthored/coauthored/coedited13books.
ErmalHitaj isaSeniorEconomistattheEconomicsandMarketAnalysisDepartmentof theEuropeanStabilityMechanism.PriortothathewasanEconomistintheIMFStrategy, PolicyandReviewDepartment,andAfricaDepartment,whereheworkedonMaliand otherWestAfricancountries.
KareemIsmail istheIMFresidentrepresentativeforIraqandYemen.Hepreviously workedintheIMF’sStrategy,Policy,andReviewDepartmentonemergingmarketsand low-incomecountries,andintheAfricandepartment.Duringthattime,heledthe vulnerabilityexerciseforlow-incomecountries,helpeddesignandimplementprograms includingthoseinfragilestates,andco-authoredpolicypapersonIMFlending.Heholdsa PhDfromJohnsHopkinsUniversity.
KevinKuruc isanassistantprofessorofeconomicsattheUniversityofOklahoma.Priorto this,hewaspursuinghisgraduatestudiesattheUniversityofTexasatAustinwherehe earnedhisPhDinMayof2019.Duringhisgraduatestudies,ProfessorKurucspenttime workingin,andthenconsultingfor,theIndependentEvaluationOfficeoftheIMF.
ChrisLane isanAdvisorintheIMFStrategy,PolicyandReviewDepartmentand chairpersonoftheIMFFragileStatesTaskTeam.HispreviouspositionsincludeIMF SpecialRepresentativetotheUnitedNations,ChiefoftheDevelopingMarketsDivision, andMissionChieftoLiberiaandtoMali.
MarioMansour istheCoordinatoroftheIMF’sMiddleEastRegionalTechnicalAssistance Center,whichprovidesadvisoryandcapacitydevelopmentservicestoIMFMiddleEast members.PriortojoiningtheCenterinJanuary2019,Mr.MansourwasDeputyChiefof theTaxPolicyDivisionattheIMF,wherehemanagedtheprovisionoftaxpolicytechnical assistance.Mr.Mansourhasover27yearsofexperienceinpolicyadviceandproject management;hehasadvisedontaxationinover40countriesofallincomelevelsandhas publishedonawiderangeoftaxationissues.BeforejoiningtheIMFin2004,heworkedasa taxanalystattheCanadianDepartmentofFinance,andwithaprivateconsultancywhere heledtaxationprojectsintheEasternCaribbeanandtheMiddleEast.
IsaacZ.Martínez iscurrentlystudyinghisPhDinEconomicsattheLondonSchoolof EconomicsandPoliticalScience.HeholdsaMAinEconomicsfromthePontificia UniversidadCatólicadeChile,whereheservedaslecturerbetween2017and2019.His researchfocusesontheempiricalaspectsofmacroeconomicissues includingoptimal fiscalrules,unemploymentandsalarylevels,andemploymentdynamicsininformal markets aswellastheadoptionofinstitutions.
PaulomiMehta isaresearchanalystattheIMF.Shehasworkedextensivelyonprojects relatedtoIMFProgramssuchastheReviewofConditionality,theLow-IncomeCountries FacilitiesReview,theReviewofEligibilitytoUseFundFacilitiesforConcessional Financing,andtheEfficacyofFundProgramsinFragileStates.
GaryMilante isProgrammeDirectorfortheGlobalRegistryofViolentDeaths(GReVD) initiativeattheStockholmDirectorofStudiesattheStockholmInternationalPeace ResearchInstitute.Hisresearchdeploysawidearrayofmethods,focusingonmaking complexproblemsaccessibletopolicymakersandpractitioners,especiallyastheypertainto theneedsoffragileandconflict-affectedstates.HehasservedasanadvisortotheUnited Nations,NATO,andvariousgovernments,andwasleadeconomistonthe World DevelopmentReport2011:Conflict,SecurityandDevelopment.HereceivedhisPhDin EconomicsfromtheUniversityofCalifornia,Irvine.
ClaraMira istheIMFResidentRepresentativeinUganda.Beforethat,sheheldpositionsat theIMFAfricandepartment,theIMFExecutiveBoard,theBankofSpain,andthe EuropeanCommission.Shehasextensiveexperienceonsurveillanceandprogramcountriesaswellasonregionalintegrationissues.ShegraduatedfromtheCollegeofEuropein BelgiumandtheUniversityofManchester.
PeterMontiel istheFairleighS.DickinsonJr. ’41ProfessorofEconomicsatWilliams College.HehasalsoworkedattheIMFandattheWorldBank,andhasservedasa consultantfortheAfricanDevelopmentBank,theAsianDevelopmentBank,andtheInterAmericanDevelopmentBank,aswellasforseveralcentralbanks.Hisresearchison macroeconomicissuesindevelopingcountries.Hehaswrittenseveralbooksandanumber ofpapersinprofessionaljournals.
HannesMueller isatenuredresearcherattheInstituteforEconomicAnalysis(IAE(CSIC)) andanAssociateProfessorattheBarcelonaGraduateSchoolofEconomics.His fieldsof interestarepoliticaleconomy,developmenteconomics,machinelearning,andconflict studies.Hisworkhasbeenpublishedinleadingjournalsineconomicsandpoliticalscience andhehasprovidedexpertopiniononfragilityfortheWorldBank,theUN,andothers. Hisrecentworkisusingfeaturesextractedfromtextandsatelliteimagestoforecastand nowcastarmedconflictandviolence.
AnneOeking isaneconomistintheIMF’sAsiaandPacificDepartment,currentlyonan externalassignmentattheASEAN+3MacroeconomicResearchOfficeinSingapore.She holdsaMaster’sDegreeinEconomicsfromtheUniversityofAmsterdamandaPhDin EconomicsfromtheUniversityofDuisburg-Essen,Germany.Shehaspublishedonarange oftopics,mainlyinthe fieldofinternationalmacroeconomicsandinternational finance.
SailendraPattanayak iscurrentlyaDeputyDivisionChiefintheFiscalAffairsDepartment oftheIMF.Hehasextensiveexperienceinthepublic financialmanagementareaandthe widerpublicsector.SincejoiningtheIMFin2006,hehasadvisedawiderangeofcountries, ofallincomelevels,onpublic financialmanagementand fiscaltransparency.Beforejoining theIMF,heheldseniorpositionsintheIndianfederalgovernment,includingatthe ministryof finance.Hehaswrittenseveralpapersonpublic financialmanagementand hasledanalyticalprojectsattheIMFonabroadrangeof fiscalissues,includingthe developmentofstandardsandguidancematerialintheareaof fiscaltransparency.
AndreaF.Presbitero isAssociateProfessorofEconomicsattheJohnsHopkinsUniversity SchoolofAdvancedInternationalStudies(SAIS)andmemberoftheMoney&Finance Research(MoFiR).HeisonleavefromtheInternationalMonetaryFund,wherehewasa
SeniorEconomistintheResearchDepartment’sMacro-FinancialDivision.Heisanapplied economistwhoseresearchcovers financialintermediation,development finance,and international finance.HisworkhasbeenpublishedintheReviewofFinancialStudies, theJournalonInternationalEconomics,andtheJournalofDevelopmentEconomics.Heis AssociateEditoroftheJournalofFinancialStabilityandEconomia(LACEA).
AlexandrosRagoussis isaSeniorEconomistattheInternationalFinanceCorporation, WorldBankGroup,andaFellowoftheGermanDevelopmentInstitute.Inpastyearshe haswrittenextensivelyinthe fieldofprivatesectordevelopment,andinternational economicsandpolicy,andhasheldpositionsattheOECDandtheGerman DevelopmentInstitute,andtaughteconomicsattheUniversityofSydneyandat Sciences-Po,Paris.HestudiedengineeringandgeographyinAthensandBrussels,and holdsaPhDineconomicsfromtheUniversityofSydney.
GustavoRamirez isanIMFEconomistintheMiddleEastandCentralAsiaDepartment. HehasworkedonYemenforthepast18months.Priortothat,heworkedonseveralsubSaharanAfricancountries,someoftheminconflictorpost-conflict.Hehasalsoworkedon LatinAmericancountriesattheWorldBankandtheUNEconomicCommissionforLatin AmericaandtheCaribbean(ECLAC).HegraduatedfromGeorgetownUniversityandisa Colombiannational.
ThomasRisse isProfessorofInternationalPoliticsattheOttoSuhrInstituteofPolitical Science,FreieUniversitätBerlin,Germany.Hismostrecentpublicationsinclude Effective GovernanceUnderAnarchy.Institutions,LegitimacyandSocialTrustinAreasofLimited Statehood (CambridgeUniversityPress,2021,withTanjaA.Börzel)andthe Oxford HandbookofGovernanceandLimitedStatehood (OxfordUniversityPress,2018,ed.with TanjaA.BörzelandAnkeDraude).RissereceivedhisPhDinpoliticalsciencein1987from theUniversityofFrankfurt,Germany.HehastaughtintheUnitedStatesatCornell,Yale, Stanford,andHarvarduniversitiesaswellastheUniversityofWyoming,inEuropeatthe UniversityofKonstanz,Germany,andtheEuropeanUniversityInstitute,Florence,Italy.
JamesA.Robinson isaUniversityProfessorattheHarrisSchoolforPublicPolicy,oneof onlynineUniversityProfessorsattheUniversityofChicago.HeisalsoInstituteDirectorat ThePearsonInstitutefortheStudyandResolutionofGlobalConflicts.Heisco-author withDaronAcemogluof EconomicOriginsofDictatorshipandDemocracy and Why NationsFail.Theirlatestbookis TheNarrowCorridor (2020).
DaoudaSembene isaDistinguishedNonresidentFellowattheCenterforGlobal Development.HeservedasasenioreconomicadvisortothePresidentofSenegal.He waspreviouslyanExecutiveDirectoroftheIMF,whereherepresented23Africancountries.HebeganhiscareerattheWorldBankinWashington,beforejoiningtheIMF.His researchinterestsinclude:poverty,growth,fragility,trust,development financeandglobal governance.HeholdsaPhDindevelopmenteconomicsfromAmericanUniversity.Hecoeditedandcontributedtothebook RacetotheNextIncomeFrontier HowSenegaland OtherLow-IncomeCountriesCanReachtheFinishLine (IMF,2018).
RaimundoSoto isassociateprofessorofeconomics,PontificiaUniversidadCatólicade Chile.HereceivedhisPhDinEconomicsfromGeorgetownUniversity.ProfessorSotohas
publishedextensivelyonlong-termgrowth,resourcecurse,institutions,andexchangerate misalignment.Hiscurrentresearchfocusesonpolicyreformsinconflict-affectedcountries. Hisvolumeon TheEconomyofDubai waspublishedbyOxfordUniversityPressin2016. HeservedaspresidentoftheChileanEconomicAssociationbetween2009and2010.
ShinjiTakagi isDistinguishedResearchProfessorattheAsianGrowthResearchInstitute, Kitakyushu,JapanandProfessorEmeritusofEconomicatOsakaUniversity.From2013to 2018,hewasAssistantDirectorattheIMF’sIndependentEvaluationOffice,wherehe managedprojectstoevaluate,amongotherthings,theIMF’sengagementinfragilestates andtheeuroareacrisis.ProfessorTakagiobtainedhisPhDineconomicsfromthe UniversityofRochester.
RobertTchaidze anationalofGeorgia,joinedtheIMFin2002.Hehasworkedonawide rangeofcountriesandissues,andcurrentlyisaResidentRepresentativeinWestBankand Gaza.HetaughtattheInternationalSchoolofEconomicsinTbilisi,Georgiain2007–9and hasbeenamemberofitsGoverningBoardsincethen.HeholdsaPhDinEconomicsfrom JohnsHopkinsUniversity.
RimaTurk isaSeniorEconomistintheIMFStrategy,PolicyandReviewDepartment. Beforethat,shewasatenuredAssociateProfessorin financeattheLebaneseAmerican University.Hercross-countryresearchonmacro-financiallinkages,thebankcompetitionstabilitynexus,andcorporategovernance,amongothers,ispublishedinpeer-reviewed journals.
JamesWilson holdaPhDfromtheUniversityofOxford,wherehisresearchconcentrated ontheCFAFrancmonetaryzonesinWesternandCentralAfrica.Priortothis,hespent fiveyearsworkingatSorosFundManagementasaninvestmentanalystlookingatthe global financialsector.HereceivedaBAandMPhilinEconomicsfromtheUniversityof Cambridge.
MichaelWoolcock isLeadSocialScientistintheWorldBank’sDevelopmentResearch Group,wherehehasworkedsince1998.For14oftheseyearshealsobeena(part-time) LecturerinPublicPolicyatHarvardKennedySchoolofGovernment.Hisresearchexplores thevariouswaysinwhichsocialinstitutionsinteractwithdevelopmentoutcomes;its currentfocusisonstrategiesforenhancingimplementationcapabilityandassessing complexinterventions.AnAustraliannational,hehasaPhDinSociologyfromBrown University.
ListofIllustrations Figures
1.1.RelationshipbetweenDifferentIndicatorsofStateCapacity3
1.2.FragileIndicatorsCorrelations9
1.3.TimeSpentBeingFragile9
1.4.MacroeconomicCharacteristicsofFragileStates10
1.5.FiscalandExternalSituationinFragileStates12
1.6.ThePovertyTrapandtheFragilityTrap15
2.1.TheNarrowCorridor44
2.2.DoorsintotheCorridor48
3.1.GeneratingSocialPressureforCompliance70
4.1.NumberofViolentEventsinSomalia,1990–201089
4.2.RuleofLaw,HumanRights,andStatehood(2015)90
4.3.UndernourishmentandStatehood201591
4.4.InfantMortalityandAreasofLimitedStatehood(2015)92
4.5.WhatMakesGovernanceEffectiveinAreasofLimitedStatehood?93
5.1.FragilityandPoliticalLegitimacy111
5.2.TheSlipperySlopeFramework114
5.3.TheExtendedSlipperySlopeFramework115
6.1.TheFragileStatesIndexin2018,byCountry130
6.2.DiscontinuitiesinEconomicVariablesatVariousLevelsofFragility131
6.3.NewBusinessDensity(3-YearAverage)138
6.4.AgeofEstablishment139
6.5.FormalityatStartofOperation140
6.6.LengthofInformality140
6.7.InformalEmploymentinTotalEmployment,excl.Agriculture141
6.8.SoleProprietorship(%ofTotal)142
6.9.RealAnnualSalesGrowth(%)143
6.10.AnnualEmploymentGrowth144
6.11.CapacityUtilization145
6.12.AnnualLaborProductivityGrowth(%)145
6.13.TariffRate,Applied,WeightedMean,ManufacturedProducts(%)147
6.14.ShareofEnterprisesExportingDirectlyorIndirectly148
6.15.ShareofEnterprisesExportingDirectly148
6.16.ShareofTotalSalesExportedDirectly(%)149
6.17.ExportDiversification151
6.18.ExportQuality152
6.19.EconomicGrowthVolatility153
6.20.InflationRateVolatility153
6.21.InterestRateVolatility154
6.22.ExchangeRateVolatility155
6.23.EnterpriseswithBankLoan/LineofCredit(%ofTotal)155
6.24.CredittoPrivateSector(%ofGDP)156
6.25.EnterprisesUsingBankstoFinanceInvestments(%ofTotal)157
6.26.NationalInvestmentsFinancedbyBanks(%)157
6.27.CorruptionasaMajorConstraint(%)160
6.28.PracticesofInformalSectorasaMajorConstraint(%)160
6.29.EnterprisesExperiencingWaterInsufficiencies(%)162
6.30.#ofWaterInsufficienciesinTypicalMonth162
6.31.ElectricalOutagesinaTypicalMonth163
6.32.LossesduetoElectricalOutages(%ofsales)163
6.33.NationalSalesLosttoTheftandVandalism(%oftotal)165
6.34.ShareofSalesLosttoTheft/Vandalism(%)165
6.35.ShareofEnterprisesPayingforSecurity(%)166
6.36.AverageSecurityCosts(%ofSales)167
6.37.GeneratorOwnership167
6.38.ElectricityGeneratedbyGenerators168
7.1.FinancialDepthinFragileStates188
7.2.BankingDepthThroughouttheWorld189
7.3.CompositeFinancialDevelopmentIndicators,2018193
7.4.FragileStates:IncomeLevelandFinancialDepth194
7.5.FragileStatesEstimatedGrowthCostsofFinancialUnderdevelopment, basedonFD204
8.1.EquilibriumforGivenValuesof π andLx218
8.2.PhaseDiagramNeartheSteadyState221
8.3.EmploymentAllocationandOutput,bySector;PoliticalPolicymaker OptimalPlan228
8.4.PublicEmploymentandProbabilityofStateFailure;byScenario.228
8.5.MacroeconomicOutcomes229
8.6.Steady-StatePublicEmployment ComparativeStaticswithRespect toForeignAid230
9.1.ComplementaritybetweenCapacitiesandIncome:IncomeTaxesand ContractEnforcementbyGDP243
9.2.TheViolenceTrapandFiscalCapacity244
9.3.ConflictRiskandFiscalCapacitybetweenandwithinCountryEvidence245
9.4.ConflictRiskandFiscalCapacity:CaseStudies246
9.5.EconomicFragilityandFiscalCapacitybetweenandwithin CountryEvidence256
10.1.TheLongRouteofAccountabilitySpiralandLeakage275
10.2.OddsRatiosofIncreasing/DecreasingActivityAcrossGivenGovernance Indicators(bothperiods)285
10.3.LowFMISBudgetCoverageMeansLowExpenditureControl288
10.4.NoSimpleRelationshipbetweenChangeinGovernanceandInfant MortalityOutcomes291
10.5.VariationsinGovernanceImprovementAcrossTwoTimePeriods292
11.1.TaxRevenueinFragileandNon-FragileStates301 (Simpleaveragefor2013–16)
11.2.TaxRevenuesinPermanentversusSuccessfulFragileStates302 (SimpleAverage,2013–16)
11.3.PublicExpenditureCompositioninFragileStatesversusNon-FragileStates314 (PercentofGDP simpleaveragefor2013–16)
11.4.AveragePublicExpenditureandFinancialAccountabilityScoresfor FragileStatesComparedtoLow-IncomeCountriesandEmerging MarketEconomies315
11.5.IMFConditionalityandTaxRevenue(126low-andmiddle-income countries,1993–2013)326
11.6.NumberofExpenditureConditionsperProgram328
13.1.DeFactoExchangeRateRegimes: “NeverFragile” Countries371
13.2.DeFactoExchangeRateRegimes: “AlwaysFragile” Countries372
13.3.Evolutionof “Post-Crisis” ofNominalAnchors(1971–2017)379
13.4.BankofUgandaPolicyRate:July2011–April2015387
14.1.ExchangeRegimesinFragileandNon-FragileEconomies409
14.2.Aid-for-DebtSwapShock428 (FloatingExchangeRegime,NoFrictions,andNoLearningbyExporting)
14.3.Aid-for-DebtSwapShock430
14.4.Aid-for-GovernmentExpendituresShock432
14.5.ShocktoGovernmentExpenditures434 (FloatingExchangeRegime,NoFrictions,andNoLearningbyExporting)
14.6.PositiveShocktoGovernmentExpenditures435
14.7.PositiveShocktoPublicInvestment437 (FloatingExchangeRegime,NoFrictions,andNoLearningbyExporting)
14.8.PositiveShocktoPublicInvestment439
15.1.StateFragilityandEconomicPerformance454
15.2.CountryFragility,Poverty,andInequality455
15.3.FinancialFlowsbyFragility460
15.4.VolatilityofFinancialFlows461
15.5.FinancialFlowsandGrowthAccelerationsandSlowdowns470
15.6.FinancialFlowsandEmploymentbyEconomicClass473
15.7.SectoralEmploymentChanges,byLevelofStateFragility474
16.1.MedianOfficialDevelopmentAssistanceoverTime499 (PercentofGDP)
16.2.OfficialDevelopmentAssistancetoGDP,byCountry500
16.3.Aid,ForeignDirectInvestment,andRemittancestoFragileStates501 16.4.UnpredictabilityofAid502
16.5.DifferentMeasuresofDonorFragmentationinFragileStates503
16.6.SectoralAllocationinFragileCountries504
16.7.EvolutionofBudgetSupportversusProjectAid504
16.8.AidDisbursedthroughNGOs506
16.9.ShareofSuccessfulProjects506
16.10.ProjectSuccessandConflictsinUganda512
16.11.ControlofCorruption:FragileandNon-FragileStates516
17.1.PersistenceofStateFragility,2000–18525 (NumberofCountries)
17.2.DistributionofFragileStateArrangementsorInstruments, byType,2006–17(Percent)529
17.3.IMFTechnicalAssistancetoFragileversusNon-FragileStates,FY2009–17530 (Person-YearsofFieldDelivery;Percent)
17.4.EvolutionofTaxRevenueSurroundingIMFArrangement,2000–12533
17.5.EvolutionofGDPSurroundingIMFFinancing,2000–13534
17.6.TheGrowthImpactofIMFFinancialArrangementinLow-Capacity Countries535
17.7.EvolutionofOfficialDevelopmentAssistanceInflowsSurroundingIMF Arrangement,2000–12537
18.1.PriorActionsandQuantitativePerformanceOptions551
18.2.StructuralConditionality553
18.3.CatalyticRoleoftheIMF555
18.4.ProgramSuccess558
18.5.ConcessionalFinancing:PerformanceinFiveCoreIndicators (PercentofTotal)559
18.6.CompletionofReviews:61Programsover2010–19560
18.7.CompletionofReview:53ProgramsExcludingCivilConflictsandCoups560
19.1.MeasuresofGovernance,2017574 (CountryRankingoutof210,OutsideIndicatesWorseOutcomes)
19.2.VolatilityofOilRevenues:Iraq,Libya,andYemen,2010–18576 (ValueofOilExports,US$Billions,BaseYear2010=100)
19.3.ImportanceofOil:Iraq,Libya,andYemen,2014577 (GDP,Exports,andTaxRevenues;PercentShare)
19.4.DeathandDisplacement578
19.5.UnemploymentRate,2018(PercentofLaborForce)581
19.6.GovernmentRevenues,ConflictCountries2010versus2017582 (PercentofGDP)
19.7.PressureonGovernmentSpending583
19.8.FiscalBalance:Iraq,Somalia,WestBankandGaza,andYemen,2010–18 (ExcludesGrants;PercentofGDP)584
19.9.FiscalBalance:Libya,2010–18(ExcludesGrants;PercentofGDP)585
19.10.RefugeesandAsylumSeekersasof2017(WidthoftheBandRepresents NumberofRefugees)587
20.1.The “FragilityTrap” 601
20.2.CountryPolicyandInstitutionalAssessmentIndex(0–6)606
20.3.Inflation(Percent)609
20.4.RealGDPperCapita(2011PPPInternationalDollars)610
20.5.TechnicalAssistanceDelivery(Person-Years)612
20.6.TotalRevenuesExcludingGrants(PercentofGDP)613
20.7.Grants(PercentofGDP)614
20.8.TotalPublicDebt(PercentofGDP)615
20.9.PublicInvestment(PercentofGDP)617
20.10.DomesticallyFinancedCapitalExpenditure(PercentofGDP)618
20.11.RegulatoryQuality(PercentileRank)619
20.12.RuleofLaw(PercentileRank)619
20.13.PrivateInvestment(PercentofGDP)620
20.14.SecurityApparatus(Index,1=LowestThreatto10=HighestThreat)621
20.15.PoliticalStability(PercentileRank)621
20.16.VoiceandAccountability(PercentileRank)622
20.17.ControlofCorruption(PercentileRank)622
20.18.FactorsinBuildingResilience625
Tables
1.1.FragileIndicatorsOverview6
7.1.ChangesinFinancialDepth:ComparingFragileStatestotheWorld190
7.2.StockMarketDepth,2015190
7.3.FinancialInclusion,LatestFigureAvailable192
7.4.FragileStates:GapswithRespecttoStructuralBenchmarks196
7.5.FragileStates:IndexofUnderperformanceinBankDepthandInclusion197
7.6.PerformanceGapsinFinancialDepthandInclusionandFragility198
7.7.EstimatedGrowthCostsofFinancialUnderdevelopment:PrivateCredit–GDP202
8.1.Calibration227
9.1.FailuresandExecutiveConstraints241
9.2.NationalIdentityandTaxComplianceintheWorldValuesSurveyData250
9.3.NationalIdentityandTaxComplianceintheAfrobarometerData251
9.4.ConfidenceinGovernmentandTaxComplianceintheWorldValuesSurveys252
9.5.InstitutionalTrustandTaxComplianceintheAfrobarometer253
10.1.Indicators:Coverage,Description,andSources280
10.2.Datacoverage,FullDataSet280
10.3.CountofCountryObservationsbyType(IncludingArtificialSetsfor MissingValues)284
11.1.FragileandNonfragileStates:SelectedIndicators(2013–16Average, SimpleAveragesinEachCategoryofCountries,MedianoftheCategory inParenthesis)299
11.2.ExamplesofTaxPolicyandTaxAdministrationConditionality326
14.1.Parameterization424
14.2.EstimatedStochasticProcessesforShocks,1990–2018425
14.3.EstimatesofWelfareLevelsandChanges441
15.1.DeterminantsofCountryFragility456
15.2.FinancialFlowsandFragilityDimensions463
15.3.FinancialFlowsandGrowthAccelerationsandSlowdowns: EstimationResults471
