Borrowing By Subnational Governments

Author : Mrs.Teresa Ter-Minassian
Publisher : International Monetary Fund
ISBN 13 : 1451973284
Total Pages : 20 pages
Book Rating : 4.80/5 ( download)

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Download or read book Borrowing by Subnational Governments written by Mrs.Teresa Ter-Minassian and published by International Monetary Fund. This book was released on 1996-04-01 with total page 20 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper presents various models of control with advantages and disadvantages, the balance of which would make it more or less suitable to a particular country's circumstances. As these circumstances evolve—as fiscal and macro imbalances improve or worsen—the preferable model may change over time. Although appealing in principle, sole reliance on market discipline for government borrowing is unlikely to be appropriate in many circumstances. This is so, because one or more of the conditions for its effective working frequently are not realized in each particular country. The increasing worldwide trend toward devolution of spending and revenue-raising responsibilities to subnational governments seems likely to come into growing conflict with systems of administrative controls by the central government on subnational borrowing. Rules-based approaches to debt control would appear preferable, in terms of transparency and certainty, to administrative controls and also to statutory limits defined in the context of the annual budget process, the outcome of which may be unduly influenced by short-term political bargaining.

Author : Raju Singh
Publisher :
ISBN 13 :
Total Pages : 40 pages
Book Rating : 4.24/5 ( download)

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Download or read book How Should Subnational Government Borrowing be Regulated? written by Raju Singh and published by . This book was released on 2005 with total page 40 pages. Available in PDF, EPUB and Kindle. Book excerpt: Countries have adopted various institutional responses to subnational government borrowing. Using a sample of 44 countries 1982-2000, this paper provides a panel data analysis to determine the most effective borrowing constraints for containing local fiscal deficits. The results suggest that no single institutional arrangement is superior under all circumstances. The appropriateness of specific arrangements depends upon other institutional characteristics, particularly the degree of vertical fiscal imbalance, the existence of any bailout precedent, and the quality of fiscal reporting.

Author : Mr. Alexander Plekhanov
Publisher : International Monetary Fund
ISBN 13 : 1451906099
Total Pages : 36 pages
Book Rating : 4.97/5 ( download)

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Download or read book How Should Subnational Government Borrowing Be Regulated? Some Cross-Country Empirical Evidence written by Mr. Alexander Plekhanov and published by International Monetary Fund. This book was released on 2005-03-01 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: Countries have adopted various institutional responses to subnational government borrowing. Using a sample of 44 countries 1982-2000, this paper provides a panel data analysis to determine the most effective borrowing constraints for containing local fiscal deficits. The results suggest that no single institutional arrangement is superior under all circumstances. The appropriateness of specific arrangements depends upon other institutional characteristics, particularly the degree of vertical fiscal imbalance, the existence of any bailout precedent, and the quality of fiscal reporting.

Author : Kahkonen, Satu
Publisher : World Bank Publications
ISBN 13 :
Total Pages : 121 pages
Book Rating : 4./5 ( download)

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Download or read book Subnational Debt Management and Restructuring written by Kahkonen, Satu and published by World Bank Publications. This book was released on 2016 with total page 121 pages. Available in PDF, EPUB and Kindle. Book excerpt: In the aftermath of the global financial crisis, policymakers around the world are focusing once again on government debt sustainability. In China, subnational government debt is an important part of total government debt, and therefore deserves the attention that policymakers have paid to the topic. Subnational debt has played an important role in financing China’s impressive infrastructure that is the envy of the world. It was instrumental in the economic stimulus that China so effectively staged after the global financial crisis, through which China maintained high levels of economic activity. This e-book reports on the proceedings of a joint P.R. China Ministry of Finance-World Bank international workshop on Subnational Debt Management held in Nanning, China in October 2015. Looking at both the Chinese perspective on this subject of subnational debt and selected international experiences along with experts’ perspectives together, we provide a syntheses of key issues which China needs to consider going forward in subnational debt management and restructuring. The roundtable discussion among international and Chinese experts oat the workshop on the way forward for China provided an illuminating discussion which highlighted the need for a transitional strategy for subnational financing, and the need to use debt sustainability as a guide for transition, which will involve tough fiscal policy choices and restructuring of the subnational economies concerned (not just debt restructuring alone). The urgency of strengthening budget and debt management prudent public investment prioritization and management in the subnational context cannot be emphasized enough.

Author : Marcelo Giugale
Publisher : World Bank Publications
ISBN 13 :
Total Pages : 30 pages
Book Rating : 4./5 ( download)

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Download or read book A New Model for Market-based Regulation of Subnational Borrowing written by Marcelo Giugale and published by World Bank Publications. This book was released on 2000 with total page 30 pages. Available in PDF, EPUB and Kindle. Book excerpt: To bring fiscal discipline to state and municipal governments, Mexico's federal government has established a two-pillar framework that explicitly renounces federal bail-outs and establishes a Basel - consistent link between the capital-risk weighting of bank loans to subnational governments and the borrower's credit rating. Whether the framework succeeds will depend partly on market assessments of the government's commitment to enforce bank capital rules and refrain from bailing out defaulting subnational governments.

Author : International Monetary Fund. Fiscal Affairs Dept.
Publisher : International Monetary Fund
ISBN 13 : 1513514725
Total Pages : 56 pages
Book Rating : 4.27/5 ( download)

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Download or read book Brazil written by International Monetary Fund. Fiscal Affairs Dept. and published by International Monetary Fund. This book was released on 2019-09-19 with total page 56 pages. Available in PDF, EPUB and Kindle. Book excerpt: This Technical Assistance report on Brazil highlights strengthening the framework for substantial borrowing. A significant change in the institutional framework is needed to impose hard budget constraints and promote stable and sustainable policies. The approach proposed in this report is based on demanding greater transparency and accountability by subnational governments, while also making the framework more flexible. If adopted, the framework is expected to introduce risk sharing among states, within an enhanced insolvency framework, and tighten fiscal rules. The proposed changes would also put more emphasis in market incentives. The changes in the framework will also need to be accompanied by progress in addressing fiscal pressures from rising budget rigidities (including pensions) and excessive tax incentives (the so-called tax wars). It is recommended to create an independent fiscal council that monitors fiscal performance and compliance of fiscal rules by subnational governments. One possibility is to add this mandate to the Independent Fiscal Institution, while strengthening its independence and provide enough resources.

Author : Otaviano Canuto
Publisher : World Bank Publications
ISBN 13 : 0821397672
Total Pages : 654 pages
Book Rating : 4.71/5 ( download)

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Download or read book Until Debt Do Us Part written by Otaviano Canuto and published by World Bank Publications. This book was released on 2013-02-13 with total page 654 pages. Available in PDF, EPUB and Kindle. Book excerpt: With decentralization and urbanization, the debts of state and local governments and of quasi-public agencies have grown in importance. Rapid urbanization in developing countries requires large-scale infrastructure financing to help absorb influxes of rural populations. Borrowing enables state and local governments to capture the benefits of major capital investments immediately and to finance infrastructure more equitably across multiple generations of service users. With debt comes the risk of insolvency. Subnational debt crises have reoccurred in both developed and developing countries. Restructuring debt and ensuring its sustainability confront moral hazard and fiscal incentives in a multilevel government system; individual subnational governments might free-ride common resources, and public officials at all levels might shift the cost of excessive borrowing to future generations. This book brings together the reform experiences of emerging economies and developed countries. Written by leading practitioners and experts in public finance in the context of multilevel government systems, the book examines the interaction of markets, regulators, subnational borrowers, creditors, national governments, taxpayers, ex-ante rules, and ex-post insolvency systems in the quest for subnational fiscal discipline. Such a quest is intertwined with a country s historical, political, and economic context. The formal legal framework interacts with political reality to influence the dynamics of and incentives for reform. Often, the resolution of a subnational debt crisis unfolds in the context of macroeconomic stabilization and structural reforms. The book includes reforms that have not been covered by previous literature, such as those of China, Colombia, France, Hungary, Mexico, and South Africa. The book also presents a comprehensive review of how the United States developed its debt market for state and local governments, through a series of reforms that are path dependent, including the reforms and lessons learned following state defaults in the 1840s and the debates that shaped the enactment of Chapter 9 of the Bankruptcy Code in 1937. Looking forward, pressures on subnational finance are likely to continue from the fragility of global recovery, the potentially higher cost of capital, refinancing risks, and sovereign risks. This book is essential reading for anyone wanting to know the challenges and reform options in debt restructuring, insolvency frameworks, and public debt market development.

Author : Christine R. Martell
Publisher : Oxford University Press
ISBN 13 : 0190089334
Total Pages : 217 pages
Book Rating : 4.37/5 ( download)

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Download or read book Information Resolution and Subnational Capital Markets written by Christine R. Martell and published by Oxford University Press. This book was released on 2021 with total page 217 pages. Available in PDF, EPUB and Kindle. Book excerpt: Subnational capital finance -- A theory of subnational government capital market information -- Review of literature on subnational government borrowing -- System-level information resolution and contractibility -- Information resolution, information content, and city debt -- Understanding, managing, and communicating credit fundamentals -- Three contexts of information resolution reforms -- Subnational government capital financing : lessons for policy and practice.

Author : Sandeep Saxena
Publisher : International Monetary Fund
ISBN 13 :
Total Pages : 30 pages
Book Rating : 4.31/5 ( download)

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Download or read book How to Manage Fiscal Risks from Subnational Governments written by Sandeep Saxena and published by International Monetary Fund. This book was released on 2022-09 with total page 30 pages. Available in PDF, EPUB and Kindle. Book excerpt: Subnational governments can create sizable fiscal risks for central governments. In addition to impacting service delivery at the grassroots level, unsustainable subnational finances can be a continuous drain on central resources. The need for stronger public financial management systems and capacities to analyze and manage risks at the subnational government level cannot be overemphasized. Central governments need to develop sound institutional mechanisms to systematically monitor the health of subnational finances to be able to proactively manage associated risks. This How to Note provides a framework for central governments that seek to assess and manage fiscal risks stemming from weak subnational finances. It analyzes the sources of subnational finance vulnerabilities and argues that central governments would benefit from putting in place the following: (1) a stronger regulatory framework, (2) improved fiscal reporting, and (3) enhanced central oversight. The lessons distilled from the international experience are particularly useful for developing economies where the management of risks can be improved.

Author : Inaki Aldasoro
Publisher : International Monetary Fund
ISBN 13 : 1498384366
Total Pages : 39 pages
Book Rating : 4.60/5 ( download)

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Download or read book Vertical Fiscal Imbalances and the Accumulation of Government Debt written by Inaki Aldasoro and published by International Monetary Fund. This book was released on 2014-11-20 with total page 39 pages. Available in PDF, EPUB and Kindle. Book excerpt: Delegating fiscal decision making power to sub-national governments has been an area of interest for both academics and policymakers given the expectation that it may lead to better and more efficient provision of public goods and services. Decentralization has, however, often occurred on the expenditure and less on the revenue side, creating “vertical fiscal imbalances” where sub-national governments’ expenditures are not financed through their own revenues. The mismatch between own revenues and expenditures may have consequences for public finance performance. This study constructs a large sample of general and subnational level fiscal data beginning in 1980 from the IMF’s Government Finance Statistics Yearbook. Extending the literature to the balance sheet approach, this paper examines the effects of vertical fiscal imbalances on government debt. The results indicate that vertical fiscal imbalances are relevant in explaining government debt accumulation suggesting a degree of caution when promoting fiscal decentralization. This paper also underlines the role of data covering the general government and its subectors for comprehensive analysis of fiscal performance.