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The Design of Fiscal Adjustment Strategies in Botswana, Lesotho, Namibia, and Swaziland

  • Luis-Felipe Zanna
  • Olivier Basdevant
  • Susan Yang
  • Geneviève Verdier
  • Joannes Mongardini
  • Borislava Mircheva
  • Dalmacio Benicio

Botswana, Lesotho, Namibia, and Swaziland face the serious challenge of adjusting not only to lower Southern Africa Customs Union (SACU) transfers because of the global economic crisis, but also to a potential further decline over the medium term. This paper assesses options for the design of the needed fiscal consolidation. The choice among these options should be driven by (i) the impact on growth and (ii) the specificities of each country. Overall, a focus on government consumption cuts appears to minimize the negative impact on growth, and would be appropriate given the relatively large size of the public sector in each country.

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Paper provided by International Monetary Fund in its series IMF Working Papers with number 11/266.

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Length: 38
Date of creation: 01 Nov 2011
Date of revision:
Handle: RePEc:imf:imfwpa:11/266
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  1. Arestoff, Florence & Hurlin, Christophe, 2010. "Are Public Investment Efficient in Creating Capital Stock in Developing Countries?," Economics Papers from University Paris Dauphine 123456789/5253, Paris Dauphine University.
  2. Ethan Ilzetzki & Enrique G. Mendoza & Carlos A. Végh, 2010. "How Big (Small?) are Fiscal Multipliers?," NBER Working Papers 16479, National Bureau of Economic Research, Inc.
  3. Alexander Plekhanov & Manmohan S. Kumar & Daniel Leigh, 2007. "Fiscal Adjustments; Determinants and Macroeconomic Consequences," IMF Working Papers 07/178, International Monetary Fund.
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