07908oam 22015014 450 991079115700332120230803222124.01-4983-6399-71-4983-5647-81-4983-2695-1(CKB)2550000001352323(EBL)1779695(SSID)ssj0001399038(PQKBManifestationID)11773311(PQKBTitleCode)TC0001399038(PQKBWorkID)11447605(PQKB)10587778(MiAaPQ)EBC1779695(Au-PeEL)EBL1779695(CaPaEBR)ebr10928033(CaONFJC)MIL642240(OCoLC)890530201(IMF)1TONEE2014001(IMF)1TONEA2014001(EXLCZ)99255000000135232320020129d2014 uf 0engur|n|---|||||txtccrTonga : Staff Report for the 2014 Article IV ConsultationWashington, D.C. :International Monetary Fund,2014.1 online resource (72 p.)IMF Staff Country ReportsDescription based upon print version of record.1-4983-8887-6 1-322-10989-3 Cover; CONTENTS; THE MACROECONOMIC SITUATION; A. Authorities' Views; COPING WITH EXTRA FINANCING NEEDS; A. Background; B. Staff Views; C. Authorities' Views; REINVIGORATING FINANCIAL INTERMEDIATION; A. Background; B. Staff Views; C. Authorities' Views; REVERSING THE TREND OF SLOWER GROWTH; A. Background; B. Staff Views; C. Authorities' Views; STAFF APPRAISAL; BOXES; 1. The Macroeconomic Impact of the Cyclone; 2. Macroeconomic Implications of Hosting the 2019 Pacific Games; 3. Exchange Rate Assessment; 4. Previous Fund Recommendations; FIGURES; 1. Stylized Facts; 2. Economic Developments3. Exchange Rate and Fiscal Policy Developments4. Monetary Policy and Financial Sector Developments; TABLES; 1. Tonga: Selected Economic Indicators, 2008/09-2014/15; 2. Tonga: Summary of Government Operations, 2008/09-2014/15; 2.a: Summary of Government Operations, 2008/09-2014/15; 3. Tonga: Depository Corporations Survey, 2008/09-2013/14; 4. Tonga: Balance of Payments Summary, 2008/09-2014/15; 5. Tonga: Medium-Term Scenario, 2009/10-2018/19; 6. Tonga: Financial Soundness Indicators, 2008/09-2012/13; 7. Tonga: Millennium Development Goals, 1990-2012; APPENDIX; I. Risk Assessment MatrixCONTENTSFUND RELATIONS; PACIFIC FINANCIAL TECHNICAL ASSISTANCE CENTRE (PFTAC) COUNTRY STRATEGY 2013-14; WORLD BANK-IMF COLLABORATION; RELATIONS WITH THE ASIAN DEVELOPMENT BANK; STATISTICAL ISSUESKEY ISSUES Context: Tonga’s economy is rebounding, partially owing to a recovery in agricultural exports. The outlook for tourism is also improving. The reconstruction from a recent cyclone is expected to lead to both a temporary boost to growth and additional financing needs. Risks to the inflation outlook and the external position are low. Fiscal Policy: The projected fiscal cost relating to the cyclone will be largely met by confirmed funding mainly from donor agencies. In the near term, the authorities should focus on reconstruction activities, while a medium-term fiscal strategy should aim at gradually stabilizing and then reducing the debt-to-GDP ratio, in order to improve Tonga’s moderate risk of debt distress. This will require careful execution of investments related to the 2019 South Pacific Games. Monetary Policy: The deleveraging cycle of the Tongan banks appears to be ending, and thus National Reserve Bank of Tonga should prepare to gradually withdraw liquidity and tighten monetary conditions once the current signs of a recovery of credit growth are confirmed. The authorities plan to lower the cost of credit through supportive credit policies, including by commercializing the Tonga Development Bank. The successful implementation of such plan requires sound safeguards, including a robust governance structure and firm risk management and accountability frameworks. Structural Policy: Structural reforms to facilitate the functioning of credit markets need to be implemented with renewed vigor. The authorities’ intention to gradually phase out existing ad hoc tax incentives is well placed. The promotion of foreign direct investments should focus on business-enabling structural reforms, while the use of tax incentives should be minimized and well targeted.IMF Staff Country Reports; Country Report ;No. 2014/240Economic developmentTongaFiscal policyTongaBanks and BankingimfExports and ImportsimfMoney and Monetary PolicyimfPublic FinanceimfNatural DisastersimfMacroeconomicsimfStatisticsimfInternational Lending and Debt ProblemsimfDebtimfDebt ManagementimfSovereign DebtimfMonetary Policy, Central Banking, and the Supply of Money and Credit: GeneralimfMonetary PolicyimfBanksimfDepository InstitutionsimfMicro Finance InstitutionsimfMortgagesimfNational Government Expenditures and Related Policies: GeneralimfFiscal PolicyimfInternational economicsimfPublic finance & taxationimfMonetary economicsimfBankingimfEconometrics & economic statisticsimfExternal debtimfPublic debtimfPublic and publicly-guaranteed external debtimfInternational reservesimfPublic financial management (PFM)imfCentral banksimfDebts, ExternalimfDebts, PublicimfCreditimfForeign exchange reservesimfBanks and bankingimfFinance, PublicimfFiscal policyimfTongaimfEconomic developmentFiscal policyBanks and BankingExports and ImportsMoney and Monetary PolicyPublic FinanceNatural DisastersMacroeconomicsStatisticsInternational Lending and Debt ProblemsDebtDebt ManagementSovereign DebtMonetary Policy, Central Banking, and the Supply of Money and Credit: GeneralMonetary PolicyBanksDepository InstitutionsMicro Finance InstitutionsMortgagesNational Government Expenditures and Related Policies: GeneralFiscal PolicyInternational economicsPublic finance & taxationMonetary economicsBankingEconometrics & economic statisticsExternal debtPublic debtPublic and publicly-guaranteed external debtInternational reservesPublic financial management (PFM)Central banksDebts, ExternalDebts, PublicCreditForeign exchange reservesBanks and bankingFinance, PublicFiscal policy338.99612DcWaIMFBOOK9910791157003321Tonga3748047UNINA