Weathering the Storm So Far: The Impact of the 2003-05 Oil Shock on Low-Income Countries

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Author/Editor: Paolo Dudine, Luzmaria Monasi, Jörg Zeuner, James John, Mark Lewis, Helaway Tadesse
Release Date: © July, 2006
ISBN : 978-1-45186-431-1
Stock #: WPIEA2006171
English
Stock Status: Available

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Description

This paper examines the impact of the 2003-05 oil price increase on the balance of payments positions and IMF financing needs of low-income country oil importers. It finds that stronger exports reflecting favorable global conditions, a compression of oil import volumes due to the pass-through of world prices to domestic consumers, and a large increase in capital inflows helped low-income countries cope with the oil price shock. Preliminary data suggest that reductions in oil import volumes have not harmed growth. While fiscal balances generally improved, quasi-fiscal liabilities may be building. Lower demand for IMF assistance may reflect broader trends, but further oil price increases could put pressure on additional countries in 2006 and beyond.

Taxonomy

Balance of payments , Economic policy , Fiscal policy , IMF governance and operations , Operations , Use of Fund Resources




More publications in this series: Working Papers


More publications by: Paolo Dudine ; Luzmaria Monasi ; Jörg Zeuner ; James John ; Mark Lewis ; Helaway Tadesse