PLH: Tough times. Global loosening of mon fis policy. Signs of recovery. Families under stress as breadwinner lose jobs+ food and oil price hikes made hh go deep in pockets. U going up, poverty growing. Danger is weak and jobless recovery. Financing needs highest in ECA by widest margin.
1. Clean up banking
2. Improve business climate
3. Make public exp. Efficient
4. Continue inv. In infrastructure.
I will share this message with Fin Min in next few days.
IL:
Bad news- crisis not close to over in ECA, esp. For workers and families but also true for gov. Working with smaller budgets.
- good news for businesses: IP stopped falling mid-year but external debt usd 350bn due.
- bad news for families: U, poverty- stress tests bad
- tough times for gov: fiscal def from 1.5-5.5; stress tests show pension def rising to 5-6 percent GDP.
1.
IP stopped contracting in Q2. Interest rates come down for gov and firms but still twice before crisis.
Business regulations better! (TR bir bok yapmadi burada)
But huge debt obligations due
So mixed news for firms
2.
Bad news for hh
Poverty rising throughout region
Numbers do not tell you how worse people become
Surveys in TR and Montenegro says people use access to utilities
Rising job losses: TR one of hardest hit- in TR doubled. (Rise in registered u)
ISKUR data used for TR
Incomes in TR falling
Reg U tip in iceberg: survey from june: self-employed especially hard
Income losses+ fuel+ finance: difficult to pay bills
HH hit fin, product, labor markets!
HH stress tests show distress:
1. Many poor hh insolvent before crisis (find graph for Turkey).
2. XXX
3. If public many used , it should be targeted at poor hh
3. GOV:
- countries making small progress in fiscal until crisis. Em changed 2008, 2009 for rest. This year all deficits.
Most countries did not save in goof times
- asked to do more with less!
- social assistance for needy
- soc second for elderly
Social assistance programs good in region and well-targeted (compare graphs for TR).
- reforms needed for social second, but possible: adjust pensions to COLAs, improves a lot! Increase retirement age, even more (purple line)
Messages:
Good news for firms, no good shoots for workers!!!
Tighter money ahead (lowe growth, higher deficit)- smaller deficits for government.
So need fiscal consolidation, not indis. cuts. More efficiency of spending. But not easy, so we are helping out.
Last slide shows how they are helping out.
QUESTIONS:
Q. Speed up reforms says reports. Are they doing well?
A. Difficult to generalize, but look at Doing Business report, region doing well. Risk is reforms stopping, don't forget EE convergence was mainly due to private. debt inflows. Now none so make sure there is rollover.
Q. Is EC doing well?
A. Yes, and coordination mechanism working as well.
Q. Can you talk about Baltics?
Baltics hit but they got demand inc. With inflows from Scandinavian, so important that these banks do not withdraw. IL: these are very small economies, so they needed to integrate markets. They did very well before crises, are giving back gains, but not all. On EU: I think done well in helping integrate markets, institutions. Q is whether this integration can continue. Key is strong institutions. Anecdote: german consumers bought cars in poland, this is well designed program, not national.
Sent by BlackBerry Internet Service from Turkcell
Posts
No comments:
Post a Comment