Tonga: 2010 Article IV Consultation: Staff Report, Staff Supplement, and Public Information Notice on the Executive Board Discussion

International Monetary Fund

No 2010/112, IMF Staff Country Reports from International Monetary Fund

Abstract: Tonga’s high debt and the apparent ineffectiveness of the monetary transmission mechanism constrain the authorities’ ability to support growth. In the near term, the strength of the global recovery is by no means assured, and there are multiple risks that could weaken prospects in both Europe and the United States. A further rise in world commodity and food prices would also hit Tonga hard, feeding through to inflation, growth, and the current account deficit. Tonga’s high public debt now poses a major risk to economic prospects.

Keywords: ISCR; CR; debt; Tonga; lending; restart bank lending; fiscal policy stance; debt position; private sector; IMF sustainability framework; Bank credit; Remittances; Public and publicly-guaranteed external debt; Global; Pacific Islands; Australia and New Zealand; fiscal policy development; near-term policy stance (search for similar items in EconPapers)
Pages: 62
Date: 2010-05-13
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