Category Archives: IMF

(EUobserver) Who will succeed Lagarde at IMF?

(EUobserver)

On Monday European finance ministers discussed the succession of Christine Lagarde as head of the International Monetary Fund, traditionally a post held by a European. Last week EU leaders chose Lagarde as next president of the European Central Bank. During the meeting several names were mentioned: former Dutch president of the Eurogroup, Jeroen Dijsselbloem, former prime minister of Finland, Alexander Stubb and current CEO of the World Bank, Kristalina Georgieva.

(Reuters) Ecuador inks $4.2 billion financing deal with IMF: Moreno

(Reuters) Ecuador has reached a $4.2 billion staff-level financing deal with the International Monetary Fund (IMF), President Lenin Moreno said on Wednesday, as the Andean country grapples with a large fiscal deficit and heavy external debt.

The country will also receive $6 billion in loans from multilateral institutions including the World Bank, the Inter-American Development Bank, and the CAF Andean development bank, Moreno said in a message broadcast on national television and radio.

Ecuador’s sovereign bonds surged last week after the IMF confirmed it was engaged in formal talks with Moreno over a possible financial arrangement. Staff-level agreements between the IMF and member countries are subject to approval by the Washington-based lender’s executive board.

The OPEC nation’s debt grew under former leftist President Rafael Correa. Moreno earned Correa’s support during the 2017 election campaign, but has implemented more market-friendly economic policies since taking office.

Moreno said the maturities on the loans extended “up to 30 years” and that the interest rates “on average” did not exceed 5 percent.

“This money will create work opportunities for those who have not yet found something stable,” he said.

Moreno has begun to implement an austerity plan that includes layoffs of workers at state-owned companies and cuts to gasoline subsidies, also plans to find a private operator for state-run telecoms company CNT and other state-owned firms.

In his address, Moreno said most of the money would be dedicated to “social investment,” citing a rising number of police officers and promising retirees they would not lose out on an annual bonus.

Skepticism of the IMF runs strong in Ecuador and throughout Latin America, where many blame Fund-imposed austerity policies for economic hardship.

(ECO) FMI revê em baixa projeções para o preço do petróleo. Deverá ficar abaixo dos 60 dólares até 2023

(ECO)

Fundo reviu em baixa projeções para para o preço da matéria-prima tanto em 2019 como em 2020. O impacto da desaceleração económica na procura e os conflitos políticos são as maiores dúvidas.

O preço do petróleo deverá fechar o ano com uma desvalorização de 13,4%. A projeção é do Fundo Monetário Internacional (FMI), que reviu em baixa o valor da matéria-prima esperado em 2019 e 2020, apesar da incerteza política no mercado. Antecipa que o barril atinja os 60 dólares apenas em 2023.

“Com base nos contratos de futuros de petróleo, o preço médio do petróleo é projetado em 59,2 dólares em 2019 e 59 dólares em 2020 (abaixo dos 68,8 dólares e 65,7 dólares, respetivamente, no WEO de outubro de 2018)”, refere o World Economic Outlook do FMI, divulgado esta terça-feira. O valor compara com os 64 dólares em que o crude WTI norte-americano negoceia atualmente e com os 68,33 dólares em que fechou o ano passado.

Assim, a organização de Bretton Woods projeta uma desvalorização de 13,4% em 2019 e de 0,2% em 2020. “Os preços do petróleo deverão manter-se no mesmo intervalo, atingindo os 60 dólares por barril em 2023 (valor inalterado face ao WEO de outubro de 2018), em linha com as perspetivas de diminuição da procura a médio prazo e ajustamentos da produção para evitar excedente de oferta”, aponta.

A “montanha russa” dos preços do petróleo

Desaceleração económica e incerteza política vão determinar preços

preço da matéria-prima ultrapassou os 80 dólares por barril em outubro do ano passado, atingindo o valor mais elevado desde novembro de 2014 devido aos receios com as sanções petrolíferas dos EUA ao Irão. No entanto, a maior economia do mundo acabou por abrir exceções e permitir que grandes importadores continuassem a fazer negócio com o Irão. Além disso, países como os EUA, Canadá, Iraque, Rússia e Arábia Saudita produziram mais petróleo que o esperado, levando a uma forte quebra nos preços no final do ano passado.

Em dezembro, os países da Organização dos Países Exportadores de Petróleo (OPEP) e um grupo de outros países fora do cartel (incluindo a Rússia) prolongaram o acordo de cortes na produção para diminuir o excesso de oferta e causar um aumento gradual dos preços.

A recuperação foi conseguida (e ajudada por eventos pontuais como a crise na Venezuela), com o barril de WTI a ultrapassar os 60 dólares em fevereiro. Desde o início do ano já valorizou 19%, enquanto o Brent negociado em Londres já acumula um ganho de 17,3% para mais de 70 dólares. Mas o fundo antecipa que o acumulado do ano irá revelar uma realidade diferente. “Apesar de um equilíbrio nos riscos, há uma incerteza substancial em torno das projeções para os preços do petróleo devido à elevada incerteza política”, sublinhou o FMI.

“Os riscos para uma subida dos preços a curto prazo incluem eventos geopolíticos no Médio Oriente, distúrbios civis na Venezuela, uma postura mais dura dos EUA contra o Irão ou a Venezuela e um crescimento da produção norte-americano mais lento do que o esperado. Os riscos negativos incluem tanto produção dos EUA como não-cumprimento dos países da OPEP e não-OPEP mais fortes que o esperado. As tensões comerciais e outros riscos para o crescimento global também podem afetar ainda mais a atividade global e respetivas perspetivas, reduzindo a procura por petróleo“, acrescentou.

(ECO) FMI agrava previsão de défice para Portugal para 2019. Vê défice três vezes maior que Centeno

(ECO)

O Fundo revê em alta previsão de défice e da dívida pública para este ano. Más notícias para Centeno em cima da atualização do Programa de Estabilidade.

Faltam cinco dias para Lisboa enviar para Bruxelas o Programa de Estabilidade para 2019-2023 e de Washington chegam sinais de aviso. Com menos PIB, o défice vai ser maior. O Fundo Monetário Internacional (FMI) piorou a previsão para o défice deste ano, antevendo agora que ele fique em 0,648%o triplo do objetivo traçado pelo Governo português, que Mário Centeno se prepara para manter na atualização do documento que segue para a Comissão Europeia.

Em outubro, o FMI previa que o défice deste ano ficasse em 0,4% do PIB, uma projeção já pior do que a do Executivo. Na atualização que fez à base de dados do World Economic Outlook, que foi publicado esta terça-feira, a projeção para o saldo orçamental degrada-se, para um défice de 0,648%. Um valor que corresponde ao triplo da meta do Governo e iguala a previsão que a Comissão Europeia tem para Portugal. Se se confirmar, significa que Portugal piora o desempenho orçamental face a 2018, quando conseguiu um défice de 0,5%.

Para esta quarta-feira está agendada a publicação do Fiscal Monitor, um documento do FMI sobre a área orçamental. Mas a nova previsão consta da atualização feita, entretanto, à base de dados do Fundo, como avançou primeiro o Expresso.

O FMI está também mais pessimista quanto à dívida pública. Esta ainda vai diminuir este ano para 119,5%, mas este rácio fica um ponto percentual do PIB acima do previsto pelo Governo no Orçamento e mais 1,7 pontos percentuais que o previsto pelo FMI em novembro.

(IMF) Lessons from Portugal’s Recovery

(IMF)

March 25, 2019

Thank you for joining us today. It is an honor to take part in this event recognizing Portugal’s economic achievements. I would like to express my appreciation to Governor Costa da Silva for hosting us today.

When IMF Managing Director Christine Lagarde was here in Lisbon three weeks ago to speak before the State Council, she made a point that is well worth restating: in the depths of crisis, successive Portuguese governments and the Portuguese people themselves took ownership of the reforms needed to bring about recovery. There were difficulties along the way—as in any complex adjustment. But the positive results highlight the importance of political cohesion in responding to economic difficulties.

We have already had a chance this morning to hear about Portugal’s achievements, the tasks that remain, and the challenges that Portugal and Europe still face in a time of global uncertainty. I would like to examine each of these themes before circling back to the matter of political cohesion.

Global growth has slowed, including in Europe. Trade tensions continue to undermine confidence. Financial markets have been quick to react— and sometimes over-react—to perceptions of vulnerability. Political divisions have been heightened by rising inequality, economic divergence within the EU, migrant and refugee flows, and Brexit. And the post-World War II consensus on the importance of multilateral solutions to international problems appears to be fragmenting.

Growing Risks and Uncertainties

I am not saying that the sky is falling. It is not. In fact, most forecasts out there, including ours, see some recovery in Europe over the next several quarters. But we are facing growing risks and uncertainties. And that means that all countries need to renew their commitment to the reforms that will support growth now—and strengthen potential growth in the long term.

At our opening panel this morning, Wolfgang Munchau raised the topic of the next downturn. Whether we are talking about a garden variety recession or a worst-case scenario, we should anticipate that a downturn awaits us somewhere over the horizon.  So, the question we should address is whether Europe and Portugal are properly prepared to sustain growth, to prevent another systemic shock, and to react to whatever comes.

I recognize that this is a well-trodden path for the EU, and that it is all about risk rather than the baseline. But it is important.  If Europe is going to strengthen its defenses against crisis and make further progress toward integration, then it must overcome the policy shortcomings that could exacerbate the next downturn—whenever it eventually comes.

The bottom line is this: the tools used to confront the Global Financial Crisis may not be available or may not be as potent next time. The space for additional monetary policy accommodation will surely be more constrained; fiscal resources may not be as available in many countries; and political resistance to bailouts may be greater because many people feel that those who brought about the last crisis did not shoulder their share of the burden.

Strengthened EU Architecture

Despite the narrowing policy space, there has been good progress. The EU has strengthened its institutional architecture. The ESM provides firepower to support countries in need of financing. The Single Supervisory Mechanism has bolstered bank surveillance. The Single Resolution Mechanism has enhanced the credibility of bank resolution and made it less likely that taxpayer-funded bailouts will be needed. And, after long deliberations, there is agreement on establishing a common backstop for the Single Resolution Fund.

But there is still more to be done—especially in the realm of risk sharing across the EU. Bank supervision remains too fragmented; banking union is missing the pillar of a common deposit insurance scheme. Capital markets are still fragmented along national lines, which limits the potential for cross-border risk sharing.

While some fiscal reforms have been put in place, a fiscal-stabilization capacity at the center is needed to respond to macroeconomic shocks and improve the fiscal-monetary policy mix. In its absence, the euro area will remain over-reliant on monetary policy for stabilization and too much of the burden of crisis response will fall on individual countries, with their ability to respond depending on each country’s fiscal space.

Within bounds, this is as it should be. Each country has the responsibility to reduce risks and to sustain—or raise—growth.  But in a severe downturn, those bounds may be tested.

Of course, greater risk sharing must go hand-in-hand with risk reduction that is ensured through strong regulation and supervision. All countries have an obligation to put—and keep—their own house in order. That will strengthen the case for more risk sharing without creating moral hazard.

Global Challenges

Obviously, this is not a matter for Europe alone. The U.S. needs to get its fiscal house in order as well. U.S.-China trade tensions pose the largest risk to global stability. Beijing needs to continue its shift toward high-quality growth and should support a sustainable globalization. All emerging markets should face up to external shocks and volatile capital flows.

While most baseline forecasts show some recovery ahead for Europe, many have been surprised by the size and pace of the recent deceleration. So, it is important to acknowledge the continuing uncertainty about the coming year, including with the crucial issue of Brexit still unresolved.

Each country should act now to strengthen their defenses ahead of a potential downturn. That includes those who have not addressed glaring vulnerabilities, most notably Italy. A serious recession could be very damaging for these countries, because they will be shown to be ill prepared. Their weaknesses could present a serious setback for Europe’s goal of convergence—of standards of living, productivity, of national well-being.

On the other hand, there are countries that are in a strong position to face a downturn—most notably Germany, which continues to have space to increase spending. I will return to this point in a moment.

Portugal’s Progress

So where does Portugal fit into this picture? Portugal has made remarkable progress since the time of its adjustment program.

Consider these three sets of numbers:

  • Unemployment peaked at 16 percent in 2013, with the young particularly hard hit. Now joblessness is at 7 percent, its lowest level since 2004. There has been a sharp decline in the long-term unemployed and an impressive reduction in youth unemployment, which is not far above the EU average.
  • Yields on Portugal’s bonds were in double-digit territory during 2011-2012. By contrast, the yield on the 10-year bond is currently around 1.3 percent, showing a remarkable improvement.
  • The overall fiscal deficit in 2010 was about 11 percent of GDP. The government is targeting a small deficit this year, and the primary balance is expected to hit its highest level since 1992. This will contribute to the reduction of public debt as a ratio to GDP, continuing the downward path that began in 2017.

In addition, exports and tourism have boomed, and the current account has been nearly balanced for the last several years. That followed a long period of very large external deficits. All of these achievements have reduced Portugal’s risk profile and strengthened its resilience to shocks.

But there is still room for more improvement. Public debt remains very high—about 120 percent of GDP last year, the third highest in the euro area, and unlikely to fall below 100 percent until 2025. Continuing on the path of debt reduction will help restore fiscal space that can be useful in a downturn.

The private sector remains highly leveraged: non-financial corporate debt is about 140 percent of GDP, and households some 75 percent. And the banking system remains vulnerable despite significant progress repairing balance sheets. NPLs declined to about 11 percent in the third quarter of 2018 from above 17 percent in 2015. But that is still high, and bank profitability continues to be low.

Lifting Productivity

Portugal’s future is not just a matter of addressing vulnerabilities. Growth has been above its estimated potential for some time, reflecting the momentum of the recovery and the positive external environment. But the real challenge is to improve the longer-term growth prospects while continuing the job of repairing balance sheets. That means lifting productivity and enabling Portugal to participate in the global competition for future prosperity.

An important challenge is to inject new vitality into the country’s labor markets. Yes, joblessness has been reduced markedly, and a high proportion of new jobs are permanent. But too many of the new jobs have been minimum wage.

There is reason to think this can change. The economy is increasingly focusing on export markets, and that is forcing companies not only to compete with goods from other European countries, but with the whole world. That places a premium on a flexible work force equipped with advanced skills. And the level of education among young Portuguese is much higher than in earlier generations.

Meanwhile, the decline of non-performing loans in the banking sector is freeing capital that can be allocated to meet the needs of the 21st century economy. But here, too, there is a long way to go because the NPL ratios remain high, as we will hear this afternoon.

Portugal’s product market needs reforms, and the business sector needs to reshape itself to deal with the coming wave of artificial intelligence, robotics, and e-commerce. The government can play a key role in facilitating this change if it remains focused on the reform effort and makes sure that the regulations it controls do not discourage dynamic and innovative activities.

Providing a Supportive Environment

The rest of Europe is essential to this effort. Portugal’s top five export markets are in the EU, led by Spain, France and Germany. Their ability to sustain higher growth can provide countries like Portugal a supporting environment as they continue transforming themselves. In a sense, this is addressing risk without hammering out agreements in Brussels.

All of which brings us back to the point I made at the beginning about Portugal’s economic success being built on a foundation of political consensus in a time of crisis. This is no small achievement.  As we face a period of heightened uncertainty and risk, this country has shown that there is a way forward by rising above differences in the face of common challenges.

It is also a lesson for the rest of Europe—indeed, the world. In the realm of economic policy, conflict and unilateral action only heighten vulnerabilities. Countries that follow this path ultimately will be hard pressed to produce higher levels of high-quality growth.

The issues in front of the EU are tough, but not intractable. Nevertheless, the way toward future accords will lie with a combination of cooperation and reforms. Portugal achieved this amid a crisis. There is no reason that Europe can’t do it without one!

Thank you.

(IMF) Portugal and the Global Economy: The Way Forward –

(IMF)

Managing Director’s Speech to the State Council 
Lisbon, Portugal

March 1, 2019

As prepared for delivery

Introduction

Dear President Marcelo Rebelo de Sousa, President of the Assembly of the Republic, Eduardo Ferro Rodrigues, Prime Minister Antonio Costa, and distinguished members of the Council. Thank you very much for the opportunity to speak to this Conselho de Estado today. It’s an honor for me to be here.

Last October, before we held our Annual Meetings in Bali, Indonesia, I delivered a speech in Washington, warning about the growing risks to the global economy and the need for global international cooperation to manage these risks, step up reforms, and modernize the multilateral system. In that speech, I quoted an American poet who said the following:

“To reach a port, we must sail sometimes with the wind and sometimes against it—but we must sail, and not drift, nor lie at anchor.” To summarize, I said: We need to steer the boat, not drift!

Preparing my visit to your country, I thought again about that quote. Why? Because I believe Portugal knows a thing or two about steering ships through dangerous and unchartered waters. You have been doing precisely that over the last few years, with remarkable success.

We at the IMF are keenly aware of the resolve that allowed Portugal to steer out of its economic crisis. The 2011 program with Portugal was then the third largest in IMF history, measured as a percent of a country’s GDP—which points to the seriousness of the situation at that time.

The economic adjustment program was negotiated by one government, but a large part of it ended up being implemented by the following government. From our side of the table, so to speak, we saw a seamless transition. We saw in the Portuguese teams under both governments the same determination to find effective solutions. That sense of national unity at a time of crisis was key for the success of the program, and it is something that has stayed with us.

In the post-program period, largely under yet another government, we have witnessed again a commitment to sound macroeconomic policies, which has helped the economy on its recovery path.

Portugal and the Portuguese people deserve tremendous credit for their efforts. I am sure that you are proud of them. Just as I am proud of how the IMF was able to support Portugal ―as a steadfast partner and friend.

Portugal Has Made Great Progress

And so, after a decade of crisis and recovery, we can say that Portugal has made great strides:

Its real GDP is now back above the level it was before the crisis, and its unemployment rate is at a fifteen-year low, with the program-era labor reform facilitating strong job creation;

Its business climate is more attractive to investors. For example, in the mid-2000s it used to take almost a month to start a business. Now it takes less than five days;

Its economy has rebalanced to become more export-oriented, including a reinvigorated tourism sector, leading the external current account to move from chronic deficits of around 10 percent of GDP to balanced;

It has made impressive progress in cutting the fiscal deficit and reducing borrowing costs;

…and, let me add, it has repaid its obligations to the IMF, five years ahead of schedule―Muito obrigada!

My main message for you today is that Portugal will have to continue relying on its illustrious tradition, because the waters of the global economy are likely to become more treacherous. Vasco da Gama was “not afraid of the darkness” [1] , and as he explored the Indian Ocean, he knew the importance of pushing ahead even when the horizon was dark.

I would strongly recommend that you to do the same today. To steer, not drift. Risks in the rest of the world are increasing and will likely constitute the most significant source of instability for the Portuguese economy. So, you should build on recent success to strengthen your resilience further. Pursuing reforms today might be difficult, but these reforms will help during a storm.

Outlook for the Global Economy

While global growth in 2018 remained close to post-crisis highs, the expansion is weakening and at a rate that is faster than expected. We are not staring at a recession, but downside risks have clearly risen.

What are the challenges?

Rising trade tensions. Further escalation of trade barriers could subtract almost half a percent from global growth going forward, as supply chains get disrupted, and the environment for investment becomes more uncertain.

The rising level of global debt is a challenge. At $182 trillion as of end-2017, almost 60 percent higher than in 2007, it leaves governments, firms, and households more vulnerable to weaker and asynchronous growth as well as higher interest rates.

A slowdown in China. Although the transition to lower, more sustainable growth is welcome, there is a risk that the deceleration in China could be faster than expected. Even if new stimulus in China is effective, it is being targeted at relatively less import-intensive activities, so the rest of the world might still feel a deceleration.

Closer to home, growth in the Euro Area has also passed its peak. Our growth forecast for 2019 is 1.6 percent, a 0.3 percentage point reduction compared to the forecast in October. We will review that forecast in about one month, during our Spring Meetings in Washington.

Within the Euro Area the significant revisions are for Germany, where difficulties in the auto sector and lower external demand will weigh on growth in 2019, and for Italy, where sovereign and financial risks are adding headwinds to growth.

A disorderly Brexit could also have significant consequences. All likely Brexit outcomes will involve net costs for the UK economy. But the higher the impediments that arise in the new relationship with Europe, the higher the cost.

An agreement that minimizes uncertainty and trade barriers will best support growth. Conversely, leaving without a withdrawal agreement and a framework for the future relationship with the EU is the most significant near-term risk to the UK economy.

And to varying degrees, others in Europe will be affected too. Ireland, of course, and others such as the Netherlands, with a close relationship to the UK.

A disorderly Brexit would also hit Portugal. Important trade and tourism links could be disrupted, and a loss of financial market confidence outside your borders could lead to higher sovereign and bank interest rates, which would weigh on growth.

The Need for Global Cooperation

Maneuvering through the economic challenges ahead will require leaders to have a clear sense of direction and steady but decisive hands on the tiller. The current environment still offers the opportunity to advance policies and reforms and build buffers (fiscal and financial defenses) for sustainable, robust, and inclusive growth. But the moment may not last for long. Leaders need to take advantage of this moment.

Navigating the new economic environment requires increasing international cooperation, not less. Many of the challenges facing us today transcend national borders and require coordinated responses. This is true both of traditional policies regulating international transactions (trade and capital flow measures) and the new challenges of our changing economic landscape, including rising inequality, addressing the impacts of climate change, and the challenges and opportunities of fintech.

While the global frameworks that have served the world well are being questioned, the answer must be to fix the system, not abandon it. We need to launch a “new multilateralism” that is more inclusive, people-oriented, accountable and results-oriented.

Priorities for Europe

Closer to home, there is a need for European leaders to prepare their region and their domestic economies for riskier times.

Some countries in the Euro Area have not made sufficient progress in cutting deficits and placing their debts on a downward path. This, coupled with weaker growth, increases the risk that interest rates for countries and banks may spike, causing a further weakening of growth and job creation. These countries would do well to rebuild their fiscal defenses now, rather than wait until poorer growth worsens their debt ratios or until markets force them to act.

Other countries, by contrast, enjoy ample fiscal space. In those countries, subject to observing fiscal frameworks in place, we recommend selectively boosting productive spending targeted at raising potential growth. This would have positive spillovers on other European economies.

We also think there is a need to enhance risk-sharing—in both the public and private sectors—within the Euro Area. We believe this needs to be done while preserving appropriate incentives. Risk reduction at the national level is indeed necessary for carefully designed risk-sharing frameworks to be viable and effective.

To improve public sector risk-sharing, the Euro Area needs a meaningfully sized central fiscal capacity. There are many proposals on the table—including one from the IMF, which seeks to address the legitimate concerns of some member states about the risk of permanent transfers and moral hazard. Developing consensus in this area will take time, but discussions need to continue at both the technical and political levels.

The Euro Area also needs more cross-border private sector risk-sharing through the financial markets—in other words, a much deeper financial sector union. This means advancing the Capital Markets Union, to facilitate more cross-border investment diversification through traded financial instruments. It also means completing the Banking Union, where the biggest missing piece is common deposit insurance.

All those Euro Area reforms would strengthen the monetary union. Nevertheless, the fundamental responsibility for improving economic resilience will remain national. This brings me back to Portugal.

Priorities for Portugal

Portugal needs to step up its efforts today so that it is prepared for the future.

Further strengthening the underlying fiscal balance would help accelerate the pace of debt reduction and positively differentiate Portugal from other high-debt countries. Adjustment today could allow policy to be loosened later, when it might be needed.

Continue the repair of the banking system. There has been much progress restoring the banks’ balance sheets in the last few years; here our message is to keep pressing with this important work.

Structural reforms to boost saving, investment and productivity are essential to raise living standards while helping the economy deleverage, reducing existing vulnerabilities. Key steps include making the labor market work better, simplifying regulations, and improving the efficiency of judicial processes. These reforms can be targeted in a way that shield the poorest in society and reduce inequality. In fact, Portugal has a strong track record of undertaking reforms whilst protecting the most vulnerable.

Preparing for the future . We are undergoing a period of rapid technological change which will reshape the way we live and work. These changes cannot be ignored, and it is critical that Portugal is prepared. This involves building regulatory institutions that protect consumers without stifling competition; developing an education system that is geared for the needs of the future workforce; and building sound safety nets so that those displaced by technology are not left behind.

Portugal is well placed to benefit from this technological revolution. It has long been an outward-facing country and is successfully reorienting its economy towards technology and innovation:

Here in Portugal, for example, Google has created a service center for Europe, the Middle East and Africa, which I understand has been recently expanded from about 500 to 1300 employees.

And you have brought the Web Summit Conference, a world-class event, to your shores.

Technology and innovation is marked by disruptions of the established order. Well, here too, you have a long tradition.

Back in the late 15th century, Vasco da Gama was what we today would call a ‘disruptor’. He showed that there was an alternative route to India that avoided the Ottoman-controlled Silk Route, opening up vast new trade networks. A few years later, another Portuguese explorer, Pedro Alvares Cabral, tried to further disrupt that earlier disruption, and ended up in Brazil!

Portugal needs to continue in this tradition―preparing for difficult times ahead, whilst being nimble enough to grasp new opportunities when they arise.

I would like to close by quoting one of your greatest poets, Luis de Camões, and I’m going to try to do it in Portuguese, so bear with me and pardon me in advance:Impossibilidades não façais, Que quem quis sempre pôde. [2]

Thank you very much, and I am most happy to hear your views and comments.


[1] Vasco da Gama―the first European to reach India by sea, circumnavigating the Cape of Good Hope―famously said: “I am not afraid of the darkness. Real death is preferable to a life without living.”

[2] “Don’t make up impossibilities/Cause those who’ve wanted always achieved.”

(DN) Largarde faz grandes elogios a Portugal em conferência na Alemanha

(DN) “Em Portugal, as empresas estão agora mais dispostas a arriscar nas novas contratações e a oferecer contratos permanentes em vez de temporários”.

Portugal recebeu grandes elogios da diretora-geral do Fundo Monetário Internacional (FMI) numa conferência que decorreu esta quinta-feira à noite, dia dos namorados, em Munique, na Alemanha.

O encontro reuniu dezenas de economistas, políticos, empresários e gestores de topo da maior economia da zona euro, que também é dos maiores investidores na economia portuguesa.

Na sua intervenção, que versou sobre o que é preciso para dar mais coesão e força ao projeto europeu, intitulada “O próximo capítulo da unidade na Europa”, Christine Lagarde foi buscar vários exemplos de sucesso, mas sublinhou sobretudo o caso português para mostrar como foram feitas coisas “boas” no mercado de trabalho e no ambiente de negócios.

A economista tinha começado o discurso, lembrando a audiência que iria tentar celebrar o dia dos namorados através de exemplos bonitos na economia. Portugal foi um dos escolhidos.

“Seria negligente da minha parte se não desejasse a todos um feliz Dia dos Namorados. Espero que a vossa ideia de uma noite romântica fique repleta de conversas sobre os benefícios da convergência económica. É isso que vou tentar fazer esta noite”, começou por dizer.

“Ainda que a falta de investimento em educação e qualificações seja um fator crítico, há também a questão da flexibilidade no emprego. Muitas empresas enfrentam custos desnecessários indevidos quando precisam de contratar e despedir”, referiu a chefe do FMI.

“Se enfrentarmos este desafio, podemos ajudar a desbloquear oportunidades de emprego para todos os cidadãos – especialmente os jovens que tentam entrar no mercado de trabalho ou progredir na carreira”, continuou.

E logo de seguida concluiu com o caso nacional. “Em Portugal, por exemplo, as recentes reformas do mercado de trabalho deram maior flexibilidade às empresas. Como resultado, as empresas estão agora mais dispostas a arriscar em fazer novas contratações e a oferecer contratos permanentes em vez de temporários”.

Ou seja, na opinião de Lagarde, em Portugal “as reformas estão a funcionar”. “A maior parte do forte crescimento do emprego em Portugal nos últimos anos é impulsionado por empregos com contratos permanentes”.

Mas a líder do FMI, que era um dos maiores credores de Portugal até o país ter saldado em dezembro passado todo o empréstimo do tempo do resgate da troika (cerca de 27 mil milhões de euros), continuou a evidenciar outros pontos positivos.

(Reuters) IMF cuts global growth outlook, cites trade war and weak Europe

(Reuters)

DAVOS, Switzerland (Reuters) – The International Monetary Fund on Monday cut its world economic growth forecasts for 2019 and 2020, due to weakness in Europe and some emerging markets, and said failure to resolve trade tensions could further destabilize a slowing global economy.Swiss special police officer keeps watch from a rooftop, ahead of inauguration of World Economic Forum (WEF) in Davos, Switzerland, January 21, 2019. REUTERS/Arnd Wiegmann

In its second downgrade in three months, the global lender also cited a bigger-than-expected slowdown in China’s economy and a possible “No Deal” Brexit as risks to its outlook, saying these could worsen market turbulence in financial markets.

The IMF predicted the global economy to grow at 3.5 percent in 2019 and 3.6 percent in 2020, down 0.2 and 0.1 percentage point respectively from last October’s forecasts.

The new forecasts, released ahead of this week’s gathering of world leaders and business executives in the Swiss ski resort of Davos, show that policymakers may need to come up with plans to deal with an end to years of solid global growth.

“Risks to global growth tilt to the downside. An escalation of trade tensions beyond those already incorporated in the forecast remains a key source of risk to the outlook,” the IMF said in an update to its World Economic Outlook report.

“Higher trade policy uncertainty and concerns over escalation and retaliation would lower business investment, disrupt supply chains and slow productivity growth. The resulting depressed outlook for corporate profitability could dent financial market sentiment and further dampen growth.”

The downgrades reflected signs of weakness in Europe, with its export powerhouse Germany hurt by new fuel emission standards for cars and with Italy under market pressure due to Rome’s recent budget standoff with the European Union.

Growth in the euro zone is set to moderate from 1.8 percent in 2018 to 1.6 percent in 2019, 0.3 percentage point lower than projected three months ago, the IMF said.

The IMF also cut its 2019 growth forecast for developing countries to 4.5 percent, down 0.2 percentage point from the previous projection and a slowdown from 4.7 percent in 2018.

“Emerging market and developing economies have been tested by difficult external conditions over the past few months amid trade tensions, rising U.S. interest rates, dollar appreciation, capital outflows, and volatile oil prices,” the IMF said.Slideshow (2 Images)

The IMF maintained its U.S. growth projections of 2.5 percent this year and 1.8 percent in 2020, pointing to continued strength in domestic demand.

It also kept its China growth forecast at 6.2 percent in both 2019 and 2020, but said economic activity could miss expectations if trade tensions persist, even with state efforts to spur growth by boosting fiscal spending and bank lending.

“As seen in 2015–16, concerns about the health of China’s economy can trigger abrupt, wide-reaching sell-offs in financial and commodity markets that place its trading partners, commodity exporters, and other emerging markets under pressure,” it said.

Britain is expected to achieve 1.5 percent growth this year though there is uncertainty over the projection, which is based on the assumption of an orderly exit from the EU, the IMF said.

China’s economic growth hits 28-year low

The rare bright spot was Japan, with the IMF revising up its forecast by 0.2 percentage point to 1.1 percent this year due to an expected boost from the government’s spending measures, which aim to offset a scheduled sales-tax hike in October.

The IMF has been urging policymakers to carry out structural reforms while the global economy enjoys solid growth, with its managing director, Christine Lagarde, telling them to “fix the roof while the sun is shining”. The IMF has stressed the need to address income inequality and reform the financial sector.

However, as growth momentum peaks and risks to the outlook rise, policymakers must now focus on policies to prevent further slowdowns, the IMF said.

“The main shared policy priority is for countries to resolve cooperatively and quickly their trade disagreements and the resulting policy uncertainty, rather than raising harmful barriers further and destabilizing an already slowing global economy,” it added.

(EurActiv) Germany proposes tough conditions for ‘European IMF’

(EurActiv)

(L-R) President of the Eurogroup, Portuguese Finance Minister Mario Centeno, French Economy Minister Bruno Le Maire, Italian Minister of Economy and Finance Giovanni Tria and European Commissioner for Economic and Financial Affairs Pierre Moscovici at the start of the Eurogroup meeting in Luxembourg, 1 October 2018. [Julien Warnand/EPA/EFE]

Germany’s plans for a “European Monetary Fund” to help eurozone states in difficulty would set strict eligibility criteria that shut out those who are failing to tackle high national debt.

Many euro zone governments want the existing European Stability Mechanism (ESM) to be built up into a more robust bailout fund to help tackle future crises on the scale of the post-2008 Greek debt crisis, but ideas differ greatly.

Germany’s Constitution Court today (12 September) rejected efforts to block the European Stability Mechanism – the eurozone’s €500-billion  bailout fund – paving the way for the country’s ratification of the fiscal compact.

According to German Finance Ministry proposals seen by Reuters, the fund would be accessible without strings only to countries that had experienced an “asymmetric economic shock outside their political control”.

The proposals, first reported by the newspaper Die Zeit on Wednesday (21 November), do envisage a role for the fund in helping heavily indebted states out of crisis, a task currently carried out by the European Commission. But this would take the form of a more stringent “macro-economic adjustment programme with ex-post conditionality”.

Germany, Europe’s largest economy, has traditionally been among the European Union’s most fiscally hawkish members, and the new proposals sit squarely in that tradition.

The euro ‘hawks’ want bigger say for crisis fund in cuts and reforms

The so-called Hanseatic League of EU countries called for a “strict conditionality” and more powers for the European Stability Mechanism over those countries requesting assistance to avert a full-blown crisis.

Making the fund available to countries with unsound finances would risk creating “moral hazard”, the document says, “where low-interest ESM loans are misused to postpone necessary budgetary adjustments and structural reforms”.

To qualify for no-strings assistance, the country would need to have a budget deficit below 3% of GDP and a public debt below 60% of economic output – or else show that it had cut its public debt by 0.5 percentage point of GDP in each of the three previous years.

Eurozone finance ministers are expected to agree by the end of the year on how they want to develop the zone’s financial stabilisation funds.

Italy, which had a debt-to-GDP ratio of 131% in 2017, is often described as a country whose $2 trillion economy is large enough to endanger the entire region’s economic stability if it ever entered a serious debt crisis.

The European Commission took the first step on Wednesday toward disciplining Italy over its 2019 budget, which Brussels said would not reduce the debt mountain.

The European Commission hedged its bets and called for the opening of an excessive deficit procedure against Italy on Wednesday (21 November) as Rome refused once again to revise its draft budget plan.

The row, triggered by the expansionary policies of Rome’s new eurosceptic government, has hammered the value of Italian bonds, and also the share price of Italian banks that hold large quantities of those bonds, unnerving Italy’s eurozone partners.

(JN) Ex-director-geral do FMI pede perdão antes de dar entrada na prisão por corrupção

(JNO antigo director-geral do FMI e ex-ministro da Economia espanhol Rodrigo Rato pediu hoje, em Madrid, “perdão à sociedade” antes de dar entrada na prisão para cumprir uma pena de quatro anos e meio pelo delito de corrupção.

“Peço perdão à sociedade e às pessoas que se possam sentir decepcionadas ou afectadas”, disse Rodrigo Rato aos jornalistas que o aguardavam à porta da prisão.

O ex-director-geral do FMI (Fundo Monetário Internacional) explicou que assume os “erros cometidos” e aceita as suas “obrigações” para com a sociedade, numa alusão à pena de prisão confirmada há três semanas pelo Tribunal Supremo.

Rodrigo Rato foi condenado pelo seu envolvimento no escândalo financeiro dos “cartões black” do banco Caja Madrid.

O ex-banqueiro, de 69 anos, tinha sido condenado inicialmente em Fevereiro de 2017 pelo desvio de fundos da Caja Madrid, que agora se chama Bankia, entidade que presidiu de 2010 a 2012.

O escândalo dos “cartões black” (negro em inglês, a cor dos cartões de crédito) era um esquema que a Caja Madrid dava aos seus dirigentes e pessoas de confiança, para pagar despesas pessoais sem limite e sem declarar nada ao fisco.

A sentença sustenta que Rato “manteve e desenvolveu um sistema perverso desde sua origem”, tendo as dezenas de acusados no processo gastado mais de 12 milhões de euros, dos quais 2,6 milhões durante os anos em que Rodrigo Rato dirigiu a instituição.

Rodrigo Rato foi membro do Partido Popular (direita) que o expulsou na sequência deste escândalo financeiro.

O economista foi vice-presidente e ministro da Economia do Governo de José María Aznar, entre 1996 a 2004, e director-geral do Fundo Monetário Internacional (FMI), de Junho de 2004 até Junho de 2007.

(JN) Estado já paga pela dívida o mesmo do que antes da troika

(JNA despesa do Estado com a dívida pública desceu de tal forma nos últimos anos que está em mínimos de 2011.

Os encargos com juros estão em queda desde 2015. Portugal tem beneficiado do baixo custo da nova dívida assim como dos reembolsos antecipados ao Fundo Monetário Internacional (FMI) cujos empréstimos são caros face aos valores do mercado. A melhoria tem sido expressiva, de tal forma que no primeiro semestre deste ano a despesa do Estado com juros atingiu o nível de 2011, antes do pedido de ajuda externa à troika.

A redução dos gastos com a dívida pública “coloca a despesa com juros num valor semelhante ao verificado nos primeiros seis meses de 2011, ano do pedido de assistência financeira”, aponta o Conselho das Finanças Públicas na análise às contas públicas de Janeiro a Junho de 2018 publicada esta quinta-feira, dia 11 de Outubro. A despesa com juros diminuiu 6% no primeiro semestre deste ano.

Ao todo, nos primeiros seis meses do ano, o Estado teve de desembolsar 3.390 milhões de euros para fazer pagamentos relacionados com a dívida pública. Há sete anos, esse valor foi de 3.380 milhões de euros. Em 2014, esse valor chegou a um máximo de 4.106 milhões de euros (ver gráfico). De ressalvar que este montante refere-se apenas ao valor semestral e não ao total do ano.

“Esta despesa atingiu 3.390 milhões de euros na primeira metade do ano, menos 216 milhões de euros em termos homólogos, destacando-se a redução dos juros referentes aos empréstimos obtidos no âmbito do Programa de Assistência Económica e Financeira (PAEF), na sequência dos reembolsos antecipados ao FMI”, explica o CFP no relatório.

Como seria de esperar, depois de quedas expressivas, as poupanças com os juros tenderão a diminuir daqui para a frente. “O ritmo de diminuição dos juros desacelerou de 6,8% no 1.º trimestre para 6% no 1.º semestre, estando agora praticamente em linha com o implícito no PE/2018 (-5,7%)”, assinala o CFP.

Défice será inferior ao previsto
Esta redução da despesa com juros tem dado um contributo decisivo para a queda do défice orçamental. Para esse indicador, tal como antecipava em Setembro, o Conselho das Finanças Públicas aponta para -0,5% em 2018, abaixo dos -0,7% previstos pelo Governo.

“Os desenvolvimentos orçamentais do 1.º semestre e a informação já disponível relativa ao 3.º trimestre permitem perspectivar um défice orçamental inferior ao previsto pelo Ministério das Finanças para o conjunto do ano”, confirma a instituição liderada por Teodora Cardoso. Para que a meta de Mário Centeno seja cumprida o saldo orçamental tem de registar um excedente de, pelo menos, 0,4% no segundo semestre.

Mas o CFP prevê que esse excedente seja ainda maior. “Existem diversos factores que contribuem para a expectativa de um saldo orçamental na segunda metade do ano melhor do que no primeiro semestre”, considera o Conselho. Em causa está: a receita fiscal e contributiva a crescer acima do previsto, a despesa com prestações sociais aquém do esperado, a recuperação do que falta da garantia do BPP e a perda de impacto (em termos percentuais) de medidas anuais do lado da despesa, como é o caso do Novo Banco.

Para o Conselho das Finanças Públicas estes factores vão superar o impacto potencialmente negativo da alteração do perfil de pagamento do subsídio de natal na função pública, do descongelamento das carreiras, da integração de precários e das pressões orçamentais em áreas como a educação e a saúde.

(DN) FMI. Estado português é um dos mais pobres do mundo

(DN) Setor público português tem a sétima situação patrimonial mais fraca num grupo de quase 70 países. Grécia está na pior posição e a Noruega na melhor.

A riqueza pública portuguesa, medida pela diferença entre ativos e passivos (responsabilidades) em proporção do produto interno bruto (PIB), é uma das mais negativas do mundo, indica um estudo do Fundo Monetário Internacional (FMI), divulgado nesta quarta-feira, em Bali, Indonésia.

De acordo com a publicação Monitor Orçamental, que é coordenada pelo antigo ministro das Finanças português Vítor Gaspar, o setor público português terá uma riqueza líquida negativa na ordem dos 40% do PIB (isto é, os passivos superam os ativos nessa proporção), sendo assim o sétimo país mais desequilibrado num grupo de 69 territórios analisados. Os dados usados pelo FMI referem-se a 2016.

O FMI argumenta que estas contas podem ajudar a avaliar melhor a saúde financeira dos Estados do que, por exemplo, a dívida pública. Nesse sentido, os custos de financiamento soberanos (taxas de juro cobradas aos países) podem ser mais sensíveis ou mais bem explicados pelos indicadores patrimoniais (a tal riqueza líquida do setor público) do que propriamente pela dívida pública.

De acordo com esta medida de riqueza líquida (há várias), a Grécia aparece como o Estado mais pobre, com um saldo negativo de 111% do PIB. Os passivos superam largamente os ativos detidos.

Em contrapartida, a Noruega, um dos países mais ricos do mundo e um grande produtor de petróleo, lidera este ranking com uma riqueza líquida equivalente a 348% do seu PIB (isto é, quatro vezes mais o valor da sua economia).

Em 2012, o retrato era bastante pior. Numa amostra de 31 Estados soberanos, Portugal aparecia com a pior situação patrimonial

Estes cálculos usam apenas os dados relativos aos ativos e passivos dos governos centrais e excluem responsabilidades com pensões e ativos referentes a recursos naturais (como o petróleo).

O FMI explica que isto assim é porque os países (os Estados) empobreceram bastante na última crise ao assumirem enormes responsabilidades (prejuízos) com o setor financeiro e bancário. Foi para salvaguardar a estabilidade financeira, alegaram os vários governos na altura.

“Os balanços patrimoniais públicos expandiram-se rapidamente durante a crise financeira, tanto do lado do ativo quanto do passivo, acompanhados por uma queda acentuada no património líquido, à medida que os governos permitiam que as políticas orçamentais anticíclicas operassem”, observa o novo estudo do departamento chefiado por Vítor Gaspar.

Apesar de a crise ter terminado, “os declínios modestos na riqueza pública continuaram após a crise financeira global, mesmo com a redução dos défices”, acrescenta o FMI.

Melhoria em relação a 2012

Em 2012, o retrato era bastante pior. Numa amostra de 31 Estados soberanos, Portugal aparecia com a pior situação patrimonial, sendo que nesta equação foi incluída a responsabilidade com pensões. A Noruega era, uma vez mais, o Estado com situação mais folgada.

O FMI defende que esta nova abordagem para captar a posição patrimonial líquida dos Estados “fornece a visão mais abrangente da riqueza pública, mas é pouco compreendida, mal medida e apenas parcialmente gerida”. Pior: “a maioria dos governos não fornece aos seus cidadãos” a necessária transparência sobre o que é que os Estados efetivamente detêm e devem e qual o grau de risco subjacente.

“A análise orçamental tradicional concentra-se nos fluxos – receitas, despesas e défices – com as avaliações aos stocks a limitarem-se, em larga medida, à dívida bruta”, considera o mesmo estudo.

Os Estados detêm ativos, como, por exemplo, partes de bancos através dos mecanismos de capital contingente, e partes de empresas públicas. Ao mesmo tempo, são responsáveis (passivos) por dívidas avultadas e podem sempre ser chamados a pagar garantias quando estas tiverem de ser executadas. Além disso, têm no passivo os valores relativos aos pagamentos de pensões, indica o mesmo estudo.

FMI reafirma défice de 0,3% em 2019

O Orçamento do Estado de 2019 (OE 2019) deve assentar num crescimento económico de 2,2% no ano que vem, valor que fica assim ligeiramente abaixo da projeção do Programa de Estabilidade avançado em abril (2,3%), indicam dados provisórios que o governo fez circular ontem, dia em que reuniu, no Parlamento, com os vários partidos por causa do OE.

Segundo essa mesma informação, a meta do défice público mantém-se nos 0,2% do produto interno bruto (PIB). Já o rácio da dívida pública deve ser revisto em baixa face a abril. Segundo os novos dados, o peso da dívida baixará para 117% do PIB, menos do que os 118,4% que aparecem no Programa de Estabilidade de abril.

Por seu lado, o FMI defende que o défice português deve descer até 0,3% do PIB em 2019, ficando nos 0,7% em 2018 (meta igual à do governo). O rácio da dívida deve descer de 120,8% em 2018 para 117,2% do PIB no ano que vem, acrescenta a instituição chefiada por Christine Lagarde.

(ECO) FMI só antecipou 47 das últimas 313 recessões desde 1991. Em Portugal, previu metade das recessões

(ECOFMI só conseguiu prever uma em cada sete recessões nas principais economias do mundo. Mas em Portugal a taxa de sucesso é de 50%: os técnicos anteciparam as últimas três recessões portuguesas.

Fundo Monetário Internacional (FMI) conseguiu antecipar apenas 47 das últimas 313 nas principais economias do mundo desde 1991, o que faz com que apenas uma em cada sete recessões tenha sido prevista pelos peritos internacionais, num registo que a própria instituição admite que é “pobre”. Mas, olhando para o caso de Portugal, as previsões da organização foram mais certeiras já que anteviram metade das seis recessões que a economia nacional registou nos últimos 27 anos.

É o próprio FMI que o admite com algum embaraço: “As previsões do World Economic Outlook (WEO) deveriam ser melhores, tendo em conta que já incorporam juízos sobre políticas, fatores externos e notícias económicas recentes que afetam as trajetórias das economias. Contudo, uma análise às previsões do WEO e do setor privado entre 1991 e 2016 confirma as dificuldades em fazer previsões de recessões económicas”.

Os técnicos do Fundo falam mesmo de um “registo pobre” em matéria de previsão de recessões e mostram a dimensão concreta daquilo a que chamam de “Uma Missão Dantesca”: “Enquanto os países da amostra registaram em média 2,7 recessões entre 1991 e 2016, das 313 recessões de uma amostra de 117 economias, apenas 47 foram antecipadas”, revela a instituição que, apesar de reconhecer as dificuldades e os erros — a taxa de sucesso de previsão de uma recessão é de apenas 15% neste período –, volta esta terça-feira a divulgar as suas perspetivas para a evolução da economia mundial, incluindo Portugal.

No relatório hoje publicado, os experts não deixam de meter o dedo na ferida e insistem: “Mesmo em 2009, o ano após a contração económica na sequência do colapso do Lehman Brothers, apenas seis economias avançadas (e não mercados emergentes ou economias em desenvolvimento) tiveram previsões de recessão no WEO de outubro de 2008; subsequentemente, estima-se que o Produto contraiu em 56 (quase metade) das economias da amostra“.

Sobre Portugal, segundo os dados acedidos pelo ECO, os especialistas do FMI conseguiram um score melhor. Isto é, das seis recessões que a economia portuguesa atravessou no mesmo período (nos anos 1993, 2008, 2009, 2011, 2012 e 2013), três delas foram previstas pela instituição. Mais concretamente as últimas três, em pleno período de ajuda financeira internacional que implicava a presença regular dos técnicos internacionais em Lisboa para acompanhar o plano de ajustamento.

Apesar do relativo sucesso quanto ao caso português, os resultados globais “não satisfazem” o Fundo, que diz, porém, que não acertar nas previsões é algo “comum entre quem faz previsões”.

Na verdade, esse é também o caso da Consensusb Economics, que reflete a média das expectativas de previsores privados para 44 economias. Comparando os dados, “há um padrão que é surpreendentemente comparável” entre FMI e Consensus Economics no que toca ao sucesso das previsões: esta última apenas conseguiu prever duas de 75 novas recessões nas suas previsões (sem contar economias que já se encontravam em recessão), segundo as contas da instituição liderada por Christine Lagarde.

Já a prever abrandamentos da economia, “as previsões do WEO fazem um trabalho de alguma forma melhor”. “Entre 1991 e 2016, abrandamentos económicos ocorreram em cerca de metade do tempo e cerca de metade dos abrandamentos foram previstos com precisão”, sublinha o FMI.

Mesmo em 2009, após a falência do Lehman Brothers, o registo revela uma maior eficácia das previsões dos técnicos do FMI quando se trata de prever abrandamentos da economia: três quartos dos abrandamentos registados naquele ano foram efetivamente antecipados pela instituição.

“Resumindo, as previsões do WEO revelam um melhor desempenho na antecipação de abrandamentos económicos do que na antecipação de recessões”, diz o FMI. “Mas o registo histórico deixa muito espaço para melhoria em ambos os casos e os erros de previsão durante episódios de abrandamentos severos são grandes”, reconhece.

No WEO hoje publicado, o FMI aponta para um crescimento de mundial de 3,7%, tanto para 2018, como para 2019, uma revisão em baixa de 0,2 pontos percentuais face às previsões feitas em abril. Entre os vários países para os quais o Fundo apresenta previsões, apenas uma mão cheia deverá registar uma contração da economia este ano e no próximo: Venezuela (-18% em 2018 e -5% em 2019); Argentina (-2,6% e -1,6%); Porto Rico (-2,3% e -1,1%, respetivamente); Irão (-1,5% e -3,6%) e Sudão (-2,3%este ano e -1,9% no próximo). De frisar que, para este ano, a instituição liderada por Christine Lagarde prevê que a economia angolana registe uma quebra de 0,1% depois da contração de 2,5% de 2017. Mas para o próximo ano, Angola já deverá crescer (3,1%).

(ZH) IMF’s Lagarde Warns “Clouds On Horizon Have Materialized”, Global Growth To Slow

(ZH) IMF Managing Director Christine Lagarde just stole the consensus jam out of the global recovery donut, warning during a speech in Washington that trade wars and tighter credit are dimming economic outlooks, signaling that her outlook for 3.9% growth may be overdone.

The fund will update its World Economic Outlook on Oct. 9 ahead of opening its annual meeting in Bali, Indonesia.

“Six months ago, I pointed to clouds of risk on the horizon,” Lagarde said, according to her prepared remarks.

“Today, some of those risks have begun to materialize.”

One glimpse at the collapse in global economic data and it’s perhaps more than obvious that consensus needs some adjustment…While Lagarde acknowledged the global expansion is still the fastest in seven years, recent data suggest a cooling.

As Bloomberg reports, Lagarde said protectionist rhetoric was turning into “actual trade barriers,” spreading uncertainty among businesses and consumers. A strengthening U.S. dollar and tightening financial conditions have increased challenges for many emerging markets, she said.

Specifically, Lagarde called on countries to resolve their trade disputes, warning that the fracture of corporate supply chains could have “devastating” effects.

“History shows that, while it is tempting to sail alone, countries must resist the siren call of self-sufficiency — because as the Greek legends tell us, that leads to shipwreck,” she said, without naming countries that are putting up new barriers.

Additionally, Lagarde warned nations to guard against “fiscal and financial turbulence.” She said global public and private debt has reached a record $182 trillion, up almost 60 percent from 2007. Emerging markets and developing countries are being pinched as central banks raise interest rates in advanced economies, she said.

“That process could become even more challenging if it were to accelerate suddenly,” she said.

“It could lead to market corrections, sharp exchange rate movements, and further weakening of capital flows.”

And finally, in what appears to be a dig at President Trump, Lagarde urged world leaders to rebuild trust in institutions and policymakers…

“In too many cases, workers and families are now convinced that the system is somehow rigged, that the odds are stacked against them,” she said.

Ironically, she urged this rebuilding of trust while noting that since 1980, the top one percent of income earners have captured twice as much of the gains from growth as the bottom 50 percent.. but we should all trust them now…?

(EUobserver) IMF warns global trade war could cost $430bn

(EUobserver) The global economy could suffer a $430bn loss in GDP as a result of a trade war between the US and the rest of the world, the International Monetary Fund has warned, adding that the US itself would be “especially vulnerable”, the Guardian reported. The IMF said the new tariffs risked lowering global growth by 0.5 percent by 2020, and the US would find itself “the focus of global retaliation”.

(Reuters) IMF says supports Argentina floating exchange rate as peso tumbles

(Reuters) The International Monetary Fund said on Monday a target exchange rate for the peso will not be a condition of a financing deal with Argentina, as the currency closed more than 6 percent weaker at a record low of 25 per U.S. dollar.

Argentina requested a “high access stand-by arrangement” from the IMF last week after the peso depreciated rapidly, prompting the central bank to sell reserves and hike interest rates to 40 percent in a bid to contain one of the world’s highest inflation rates and stop the peso’s slide.

The bank sold $408 million (£300.8 million) in reserves on Monday as part of its effort to shore up the peso. During all of last week, the currency weakened 6.30 percent, and for the first 11 days of May it weakened 12.03 percent.

The Merval stock index rose 2.16 percent on Monday.

In a statement, an IMF spokesman said the Fund had not discussed any specific target for the exchange rate with Argentine authorities during negotiations in Washington.

“Argentina has a floating, market-determined exchange rate, and we fully support that,” the spokesman said. “The exchange rate should continue to be determined by market forces, with the central bank continuing to use all the policy tools that are at its disposal.”

The IMF negotiations carry political risks for President Mauricio Macri. Many Argentineans blame IMF-backed policies of the late 1990s for the country’s 2001-2002 economic meltdown. Some opposition politicians and activists have voiced concerns that the deal being drawn up in Washington will require painful fiscal belt tightening.

Opposition politicians have even demanded any deal with the IMF pass through Congress but Federico Pinedo, the leader of Macri’s party in the Senate, said that would not be necessary.

“It is expressly stated in the Argentine laws that this is a negotiation that corresponds to the president,” Pinedo told Reuters in an interview.

In an earlier statement, the IMF said its board would discuss Argentina at an informal meeting scheduled for Friday. The Fund said that meeting was “part of our usual process of briefing the board on negotiations for high access IMF programs.”

LOWER GROWTH, HIGHER INFLATION

Weak fundamentals, skittishness regarding devaluation and concern over Argentina’s drought-hit soy harvest are pressuring the peso lower.

High interest rates will have a negative impact on activity, and the weaker peso resulting from a floating exchange rate regime will add to already sky-high inflation, but both are necessary to prevent a deeper crisis, Treasury Minister Nicolas Dujovne said.

“We will have somewhat less growth, and somewhat more inflation,” Dujovne told reporters on Monday. “It is obvious that will happen.”

The central bank said 617 billion pesos (£23.2 billion) of central bank notes known as Lebacs would mature on Tuesday. That is less than the 670 billion pesos worth that traders had expected. Because of the peso’s volatility, the bank decided to buy back some of the assets.

Interest rates on the notes have been rising in secondary markets, as the bank is widely expected to hike rates in Tuesday’s auction to entice traders to roll over their maturing notes.

“The possibility of a complete renewal of the maturing (Lebacs) is not expected,” consultancy Portfolio Personal said in a note, adding that in the four auctions so far this year, 14 percent of maturing Lebacs had not been renewed.

Argentina has also received proposals for $3 billion worth of repurchase deals from banks in recent weeks, Finance Minister Luis Caputo told reporters. In recent months, the country has inked $2 billion in such deals with Credit Suisse and HSBC.

Unions marched through the city centre on Monday to protest the IMF deal and Macri’s increases in utilities prices, part of his effort to reduce the fiscal deficit.

In a statement, Macri’s office said he had spoken by phone with U.S. President Donald Trump on Monday morning, and that Trump had said he supported Macri’s discussions with the IMF. The United States has the most voting power of any IMF member country, with 16.5 percent of the votes.

(IMF) Portugal: IMF Executive Board Concludes Sixth Post-Program Monitoring

(IMF) On February 21, 2018, the Executive Board of the International Monetary Fund (IMF) concluded the Sixth Post-Program Monitoring [1] of Portugal and considered and endorsed the staff appraisal on a lapse-of-time basis. [2]

Portugal’s repayment capacity is expected to be adequate under the baseline. With improved market access and sovereign outlook and ratings, as well as additional early repayments to the Fund in 2017, risks to repayment capacity have moderated significantly since the last PPM.

The Portuguese economy has strengthened. Supported by a benign external environment, job-rich growth has gathered momentum since late 2016. The headline fiscal balance continued to benefit from stronger growth, controlled budget execution, and falling interest costs, with the 2017 deficit target of 1.4 percent of GDP likely to have been met with some margin. Financial stability has also improved with various bank capital augmentations and the sale of Novo Banco in 2017 while banks have also reduced their NPLs and returned to modest profitability. Growth is projected at 2.2 percent in 2018. Downside risks in the near term are mostly external in nature and appear moderate.

Executive Board Assessment [3]

The Portuguese economy has continued to strengthen. Supported by a benign external environment, job-rich and broad-based growth has gathered momentum since late 2016, contributing to better than anticipated fiscal outcomes in 2017, including the exiting from the European Commission’s excessive deficit procedure. Financial stability also improved in the last year. Downside risks in the near term are mostly external in nature and appear moderate.

Portugal has further improved its access to financial markets. Portugal maintains prudent liquidity buffers, and its sovereign debt has become eligible for inclusion in several international bond indexes, which should help support it even as the ECB’s asset purchase program is eventually wound down. Portugal’s capacity to repay the Fund is adequate in the baseline and robust to the risk scenarios in the DSA. In fact, owing to substantial early repurchases to date, no repurchases are due until 2021.

Despite the recent positive economic developments, important crisis legacies remain. The nonfinancial private sector’s debt is large (including by European standards) and remains a source of vulnerability. The still large stock of bad loans on banks’ books constrains their ability to provide new credit for investment. Public debt, at 126 percent of GDP, is the euro area’s third largest. While the public debt ratio is expected to decline to 108 percent of GDP by 2023, this ratio would still leave Portugal vulnerable to unexpected rises in interest rates, the wind-down in the monetary stimulus of the last few years, and cyclical downturns in Portugal and its trading partners.

Favorable borrowing conditions and the economic upswing provide an auspicious opportunity for an even faster reduction of public debt. Structural consolidation in the primary fiscal balance remains essential to keep public debt on a firmly downward trajectory over the medium-term. An adjustment focused on durable expenditure reform is likely to prove more sustainable and supportive of growth. The authorities should be cautious about permanent increases in spending that might reduce the flexibility of public expenditure when cyclical conditions change. Such caution is especially important in relation to decisions that may affect the trajectory of the government wage bill in coming years.

Banks will need to continue strengthening their business models and cleaning their NPLs. Although financial stability has improved over the past year, the high level of NPLs limits banks’ internal capacity to generate stronger returns and increase their capital. Also, some upcoming regulatory changes in the euro area, although aiming to boost resilience, could affect some banks’ funding structure and costs. Banks’ improved financial results in 2017 are encouraging, as is the ongoing implementation of ECB guidance to banks on NPLs. Continued efforts in these areas, including by improving business models and cost efficiency, so banks can generate new capital from their own profits, are necessary to ensure that they remain resilient and better support the economy. New initiatives to further improve the legal framework to support the debt restructuring of viable but distressed debtors and the recovery of collateral, including through out-of-court mechanisms, need to be implemented and closely monitored. In addition, there is a need to monitor carefully developments in the housing markets. Macroprudential authorities should also stand ready to take additional macroprudential measures if needed to prevent the build-up of imbalances and to strengthen the resilience of banks and borrowers.

Raising the economy’s growth potential and resilience to shocks will also require further structural reforms and higher investment and productivity. For the economy to absorb negative shocks and adapt to new opportunities, a flexible labor market is key. Flexibility needs to be preserved even as an environment with more stable jobs is sought. Investment needs to increase substantially to raise the economy’s medium-term growth potential. Preserving external balance while raising investment requires strengthening national saving rates as well. Along with ongoing initiatives to develop human capital, structural reforms should include efforts to continue improving the business environment.

Portugal: Selected Economic Indicators
(Year-on-year percent change, unless otherwise indicated)
Projections
2016 2017 2018 2019
Real GDP 1.5 2.6 2.2 1.8
Private consumption 2.1 2.2 2.0 1.6
Public consumption 0.6 1.1 0.2 -0.1
Gross fixed capital formation 1.6 8.7 8.1 5.1
Exports 4.1 7.0 6.6 4.5
Imports 4.1 7.5 7.0 4.5
Contribution to growth (Percentage points)
Total domestic demand 1.6 3.0 2.7 1.9
Foreign balance -0.1 -0.4 -0.4 -0.1
Resource utilization
Employment 1.5 3.1 1.3 1.1
Unemployment rate (Percent) 11.1 9.0 7.8 7.2
Prices
GDP deflator 1.4 1.6 1.5 1.5
Consumer prices (Harmonized index) 0.6 1.5 1.5 1.6
Money and credit (End of period, percent change)
Private sector credit -3.7 -1.5 0.1 0.8
Broad money -0.4 3.7 3.2 2.8
Fiscal indicators (Percent of GDP)
General government balance -2.0 -1.2 -1.1 -0.9
Primary government balance 2.2 2.7 2.6 2.6
Structural primary balance (Percent of potential GDP) 2.9 2.7 2.4 2.0
General government debt 130.1 125.7 121.7 118.4
Current account balance (Percent of GDP) 0.7 0.4 0.2 -0.1
Nominal GDP (Billions of euros) 185.2 193.0 200.2 206.8
Sources: Bank of Portugal; Ministry of Finance; National Statistics Office (INE); Eurostat; and IMF staff projections.



[1] Member countries with IMF credit outstanding exceeding the smaller of SDR1.5 billion or 200 percent of quota are subject to post-program monitoring. Post program monitoring takes place between successive Article IV consultations. Post-program monitoring gives especial attention to matters related to capacity to repay the Fund, vulnerabilities, and risks.

[2] The Executive Board takes decisions under its lapse-of-time procedure when the Board agrees that a proposal can be considered without convening a formal meeting.

(ECO) Portugal pagou mais 2,8 mil milhões ao FMI

(ECO) Portugal realizou um novo reembolso de 2,8 mil milhões de euros ao Fundo Monetário Internacional esta quinta-feira. Fica por pagar cerca de 25% do empréstimo oficial do Fundo.

Portugal realizou um novo reembolso antecipado de 2,8 mil milhões de euros ao Fundo Monetário Internacional (FMI), anunciou o Ministério das Finanças em comunicado. Com este pagamento, fica por pagar cerca de 25% do empréstimo contraído junto do Fundo aquando do pedido de resgate, em 2011.

Foi reembolsada esta quinta-feira, “antecipadamente, mais uma parcela do empréstimo ao FMI, equivalente a 2.780 milhões de euros, que se vencia entre junho de 2020 e maio 2021. Durante o corrente ano foram já pagos 9.012 milhões, o valor máximo amortizado, em termos anuais, até à presente data”, informou o ministério liderado por Mário Centeno.

Após esta devolução, ficam liquidados 76% do empréstimo do FMI de 26 mil milhões de euros, salienta o Governo.

“Demos mais um passo na redução do custo do nosso financiamento”, declarou Centeno no Parlamento.

“Em 2018, a gestão da dívida publica deverá prosseguir objetivos muito concretos:minimizar os custos diretos e indiretos do financiamento, numa estratégia de longo prazo; garantir a distribuição adequada das amortizações pelos vários exercícios orçamentais; prevenir a excessiva concentração temporal das amortizações; evitar a exposição a riscos excessivos; alargar a base de investidores, tirando partido da melhoria do rating e da expansão para novos mercados de dívida”, sublinhou o ministro das Finanças.

Custos baixam

Portugal tem estado a acelerar o ritmo de devoluções para fazer baixar os custos das sua dívida por duas vias: em primeiro lugar, através da substituição do empréstimo mais oneroso do Fundo por colocação de nova dívida no mercado a taxas bem mais favoráveis; depois, porque ao baixar a exposição junto do Fundo, também alivia os juros cobrados pelo valor da dívida que permanece por pagar ao FMI.

Conforme explicou o ECO, Portugal paga uma penalização (um spread agravado) sobre o valor da dívida ao FMI que ultrapassa o limite que decorre da sua quota. Assim, ao amortizar antecipadamente estes nove mil milhões de euros, spread médio exigido ao Tesouro português baixa em quase um terço.

Para o próximo ano estão previstos reembolsos de 1.400 milhões de euros e o custo do empréstimo vai cair ainda mais. Ainda não será o suficiente para que o país se liberte desta penalização extra já em 2018. Para isso será preciso enviar um cheque para Washington de mais 1.400 milhões além do que está previsto na proposta do Orçamento do Estado.

Mas o ECO sabe que o Governo está a trabalhar para isso, aproveitando o bom momento nos mercados de dívida.

(JE) FMI: Portugal deve aproveitar recuperação económica para reduzir dívida

(JE) A instituição liderada por Christine Lagarde considera que esta política “é particularmente importante” para este conjunto de países, até porque, alerta, as taxas de juro “provavelmente vão subir”.

O Fundo Monetário Internacional (FMI) defende que os países europeus com dívidas públicas, como Portugal, devem aproveitar a recuperação económica para criar ‘almofadas’ orçamentais e reduzir o endividamento.

“Os decisores políticos devem tirar vantagem das perspetivas positivas para reconstruir ‘almofadas’ orçamentais e desenvolver a capacidade de a economia crescer e absorver choques”, aconselha o FMI no relatório de outono sobre as perspetivas económicas da Europa para 2017, divulgado hoje.

Para o Fundo, países como a Bélgica, França, Itália, Espanha, Reino Unido e Portugal, que têm ainda dívidas elevadas, mas onde a economia está a recuperar, deviam “gradualmente reconstruir espaço de manobra e colocar a dívida numa trajetória descendente”.

A instituição liderada por Christine Lagarde considera que esta política “é particularmente importante” para este conjunto de países, até porque, alerta, as taxas de juro “provavelmente vão subir”.

Ao mesmo tempo, e para todos os países europeus (e não apenas aqueles com uma dívida pública elevada), o FMI defende que a política orçamental “pode ser mais amiga do crescimento e da distribuição” de rendimentos.

“Fazer com que a despesa pública seja mais eficiente e orientada ao crescimento, ao mesmo tempo que se desenha uma política fiscal que apoie a criação de emprego e o crescimento da produtividade, pode fortalecer as fundações da recuperação económica e suportar o potencial de crescimento no médio prazo”, afirma o Fundo no relatório.

O FMI estima que a economia europeia cresça 2,4% este ano e 2,1% no próximo, uma recuperação que, afirma, tem impactos positivos no resto do mundo, mas cuja sustentabilidade “continua em dúvida”.

“No longo prazo, é provável que as tendências demográficas adversas e a produtividade ainda subjugada possam atrasar o crescimento”, admite o Fundo.

Nesse sentido, aconselha “mais progresso” nas reformas estruturais para aumentar a produtividade e defende que a limpeza dos ativos dos bancos “continua uma prioridade”.

(ECO) Portugal quase livre do spread agravado na dívida ao FMI

(ECO) O spread pago pelo Estado português ao FMI pelo empréstimo no âmbito da troika vai cair 32% em 2018. Os custos baixam por causa dos pagamentos antecipados este ano.

Os reembolsos antecipados ao Fundo Monetário Internacional (FMI) que Portugal deverá concretizar até ao final deste ano vão permitir baixar em quase um terço o spread exigido pelo Fundo à República. Depois, em 2018, à medida que o Tesouro português for continuando a amortizar a dívida ao FMI, o custo do empréstimo ainda vai cair mais. O objetivo é libertar o país da penalização extra no empréstimo já no próximo ano, sabe o ECO.

A primeira meta que o Governo tinha fixado para os reembolsos ao FMI, no Orçamento do Estado para 2017, era de cerca de 1,5 mil milhões de euros. Contudo, o Executivo chegou ao final do ano e anunciou mais amortizações do que o previsto. Ainda esta terça-feira o ministro das Finanças, Mário Centeno, voltou a subir em mil milhões os reembolsos antecipados, elevando o total para 9,4 mil milhões de euros em apenas um ano.

Qual é a pressa? O interesse em pagar rápido ao FMI é duplo: primeiro, porque os juros cobrados no empréstimo do Fundo são mais elevados do que aqueles que Portugal consegue obter, neste momento, no mercado. Segundo, porque os juros cobrados pelo valor da dívida que permanece por pagar ao FMI também baixam.

É que Portugal paga uma penalização (um spread agravado) sobre o valor da dívida que ultrapassa o limite que decorre da sua quota. E ao amortizar antecipadamente cerca de nove mil milhões de euros, o spread médio exigido ao Tesouro português cai consideravelmente.

O próximo gráfico mostra a posição portuguesa em relação ao Fundo, a 31 de dezembro de 2016, em euros e em SDR (Direitos Especiais de Saque, na sigla inglesa) que é a moeda do Fundo. Mostra ainda a posição projetada, tendo em conta os anúncios de reembolsos antecipados, para o final deste ano.

Dívida ao FMI: 2016 vs. 2017

 

Mas a dívida ao FMI não custa toda o mesmo. Tal como explicou o FMI ao ECO, a linha de financiamento utilizada por Portugal no empréstimo determina que a taxa é fixada semanalmente, tendo em conta um cabaz de taxas de juro de referência. Neste momento, o valor do juro de referência está em 1,675%.

A este valor soma-se um spread de 100 pontos base. Mas este spread é penalizado no caso de dívidas muito elevadas face à quota do país no Fundo. Ao montante da dívida que supera o limite, aplica-se um spread de 200 pontos base e se o limite for ultrapassado por um período superior a 51 meses, o agravamento é ainda maior: 300 pontos base. O limite é definido como 187,5% da quota do país.

No caso de Portugal, esta fasquia corresponde a 3,86 mil milhões de SDR (cerca de 4,7 mil milhões de euros) e como a dívida se mantém acima do limiar por mais de 51 meses, spread que é aplicado à dívida que supera este valor é de 300 pontos base.

O que muda com as amortizações antecipadas?

A 31 de dezembro de 2016, Portugal devia 16.327 milhões de euros ao FMI, o equivalente a cerca de 13,5 mil milhões de SDR. Em termos médios (ponderando o spread mais baixo de 100 pontos aplicado a uma parte da dívida, com o de 300 pontos sobre o restante) o valor do spread exigido pelo FMI para o montante de dívida total era de 243 pontos base.

Mas com os reembolsos antecipados, a parcela da dívida de Portugal ao FMI à qual é aplicado o spread agravado diminui muito. Assumindo que o Governo concretiza os reembolsos anunciados até ao final do ano, no total de 9,4 mil milhões de euros, a dívida ao FMI cai para 6.927 milhões de euros, o equivalente a cerca de 5,7 mil milhões de SDR.

Feitas as contas, o valor médio, ponderado, do spread aplicado pelo FMI deverá baixar para 165 pontos base. São menos 32% face ao valor de arranque de 2017. Assumindo o valor do juro constante em 1,675%, implica baixar a taxa de juro de 4,105% para 3,325.

O próximo gráfico compara a situação a 31 de dezembro de 2016, com a que se espera atingir no final de 2017.

Que parte da dívida paga spread agravado?

 

Para deixar de sofrer a penalização, Portugal tem de amortizar ainda 2,8 mil milhões de euros ao FMI. Oficialmente, está planeada uma amortização de 1,4 mil milhões de euros em 2018, mas o objetivo do Governo é manter a estratégia de acelerar os pagamentos ao fundo, tal como fez este ano. Há mesmo a expectativa, sabe o ECO, de se conseguir atingir o limiar necessário para deixar de pagar o spread agravado já no próximo ano.