This paper investigates the impact of workers’ remittances on equilibrium real exchange rates (ERER) in recipient economies. Using a small open economy model, it shows that standard "Dutch Disease" results of appreciation are substantially weakened or even overturned depending on: degree...

When does trade become a one-way relationship? We study bilateral trade balances for a sample of 18 European countries over the period from 1948 through 2008. We find that, with the introduction of the euro, trade imbalances among euro area members widened considerably, even after allowing for...

The Chinese government’s macroeconomic policy response to the crisis has delivered positive results, and mitigated the impact of the global downturn on its economy. The challenge now is to sustain this strong growth performance while switching decisively to an economy that is powered by...

This paper presents the key findings of the Republic of Azerbaijan’s 2010 Article IV Consultation. In 2009, overall GDP grew at 9.3 percent, but non-oil GDP growth slowed from 16 percent to 3 percent, fiscal and export revenues fell by more than 30 percent, and credit and liquidity...

This paper discusses key findings of the First Review Under the Stand-By Arrangement for Angola. The paper reveals that the authorities’ reforms are beginning to bear fruit in terms of achieving key program goals. The heavy foreign exchange market pressures that were evident at the...

The staff report on Belarus’ Third Review under the Stand-By Arrangement is examined. Belarus is beginning to emerge from the crisis. Output loss has been limited relative to neighbors, inflation has fallen, the foreign exchange market has stabilized, and de-dollarization is under way,...

This 2009 Article IV Consultation highlights that the Former Yugoslav Republic of Macedonia’s vulnerability at the outset of the global crisis was its large current account deficit in the context of the exchange rate peg to the euro. At the same time, it benefited from a small fiscal...