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Assessing Fiscal Risks in Bangladesh

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  • Leandro Medina

Abstract

This paper identifies, quantifies, and assesses fiscal risks in Bangladesh. By performing sensitivity analysis and using stochastic simulations, it measures risks arising from shocks to GDP growth, the exchange rate, commodity prices, and interest rates. It also analyzes specific fiscal and institutional risks, such as those related to the pension system, the issuance of guarantees, the state-owned commercial banks, and the external borrowing and debt management strategy. The paper finds that fiscal aggregates are particularly sensitive to shocks to commodity prices and exchange rates. Other factors that could affect fiscal aggregates are the unfunded pension system and the limited institutional capacity.

Suggested Citation

  • Leandro Medina, 2015. "Assessing Fiscal Risks in Bangladesh," IMF Working Papers 2015/110, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2015/110
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    Cited by:

    1. World Bank, 2015. "Bangladesh Public Expenditure Review Update," World Bank Publications - Reports 22673, The World Bank Group.

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    More about this item

    Keywords

    WP; debt; expenditure; IMF staff calculation; Bangladesh; commodity prices; contingent liabilities; exchange rate; fiscal risks; sovereign debt; pensions; guarantees; Bangladesh authorities; commodity price; debt record; debt disbursement; vis-à-vis budget figure; basic salary; poverty line; collection data; Bangladesh face; Bangladesh's government; shocks to GDP growth; debt structure; Pension spending; Macroeconomic risks; South Asia; Global;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt
    • H68 - Public Economics - - National Budget, Deficit, and Debt - - - Forecasts of Budgets, Deficits, and Debt

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