nep-cis New Economics Papers
on Confederation of Independent States
Issue of 2023‒02‒06
twenty papers chosen by

  1. Republic of Slovenia: 2022 Article IV Consultation-Press Release; and Staff Report By International Monetary Fund
  2. Republic of Moldova: Second Reviews Under the Extended Credit Facility and Extended Fund Facility Arrangements, and Request for Waiver of Applicability for Performance Criteria-Press Release; Staff Report; and Statement by the Executive Director for Republic of Moldova By International Monetary Fund
  3. Arab Republic of Egypt: Request for Extended Arrangement Under the Extended Fund Facility-Press Release; and Staff Report By International Monetary Fund
  4. Financial Sanctions, SWIFT, and the Architecture of the International Payments System By Marco Cipriani; Linda S. Goldberg; Gabriele La Spada
  5. Chad: First and Second Reviews Under the Extended Credit Facility Arrangement, Requests for Waivers of Nonobservance of Performance Criteria and Modification of Performance Criteria-Press Release; Staff Report; Staff Supplement; and Statement by the Executive Director for Chad By International Monetary Fund
  6. Republic of Kazakhstan: 2022 Article IV Consultation-Press Release; and Staff Report By International Monetary Fund
  7. Net Zero Saudi Arabia: How Green Can the Oil Kingdom Get? By Krane, J.
  8. Geflüchtete aus der Ukraine in Deutschland : Flucht, Ankunft und Leben (Refugees from Ukraine in Germany: Fleeing the War and Starting over) By Brücker, Herbert; Ette, Andreas; Grabka, Markus M.; Kosyakova, Yuliya; Niehues, Wenke; Rother, Nina; Spieß, C. Katharina; Zinn, Sabine; Bujard, Martin; Cardozo, Adriana; Décieux, Jean Philippe; Maddox, Amrei; Milewski, Nadja; Naderi, Robert; Sauer, Lenore; Schmitz, Sophia; Schwanhäuser, Silvia; Siegert, Manuel; Tanis, Kerstin
  9. Impacts, Sustainability, and Resilience on the Egyptian Tourism and Hospitality Industry after the Russian Airplane crash in 2015 By Said El Atiek; Stéphane Goutte
  10. Fuel poverty in Queensland: horizontal and vertical impacts of the 2022 energy crisis By Simshauser, P.
  11. A Rapid Acquisition Strategy in Light of Recent Changes in the Global Security Environment: Policy Implications and Tasks for the Korean By Jang, Won-Joon; Song, Jae Pil
  12. Central African Economic and Monetary Community: Staff Report on the Common Policies of Member Countries, and Common Policies in Support of Member Countries Reform Programs-Press Release; Staff Report; and Statement by the Executive Director By International Monetary Fund
  13. Taxes and Subsidies in EU Energy Policy – Fit for 55? By Claudia Kettner; Eva Wretschitsch
  14. Republic of Kazakhstan: Selected Issues By International Monetary Fund
  15. An Anatomy of Crypto-Enabled Cybercrimes By Lin William Cong; Campbell R. Harvey; Daniel Rabetti; Zong-Yu Wu
  16. Canada: 2022 Article IV Consultation-Press Release; and Staff Report By International Monetary Fund
  17. Trade Policy in a ‘Double-Landlocked’ Transition Economy: Kyrgyzstan By Prema-chandra Athukorala; Hal Hill
  18. Georgia: Technical Assistance Report-Operationalizing the New Bank Recovery and Resolution Framework By International Monetary Fund
  19. The New Version of Latvian CGE Model By Konstantīns Beņkovskis; Oļegs Matvejevs

  1. By: International Monetary Fund
    Abstract: Slovenia recovered quickly from the pandemic but Russia’s war in Ukraine is posing new challenges, especially the negative terms of trade shock. A center-left government took office in June, with a broad social and green reform agenda.
    Date: 2023–01–18
  2. By: International Monetary Fund
    Abstract: Spillovers from the Russia’s invasion of Ukraine continued to weigh heavily on Moldova. Energy supplies have been disrupted, with significant impact on Moldova, given its dependance on Russia for gas, and on the breakaway region of Transnistria for electricity. The hardship from high energy and food prices and frequent anti-government protests are weighing on Moldova’s fragile social and political fabric.
    Date: 2023–01–12
  3. By: International Monetary Fund
    Abstract: Egypt exhibited resilience to the COVID-19 pandemic shock following timely policy response supported by the 2020 Rapid Financing Instrument (RFI) and 2020–21 Stand-By Arrangement (SBA). While performance under the SBA was strong, the immediate health crisis delayed efforts to re-invigorate much needed structural reforms while high public debt vulnerabilities continued to expose the country to changes in global financial conditions and investor sentiments. As economic recovery gained momentum during FY2021/22, imbalances also started building amidst a stabilized exchange rate. The outbreak of Russia’s war on Ukraine crystallized pre-existing pressures, giving way to capital outflows and large reserves losses while high commodity prices led to rising inflation. Trade spillovers have also been significant given Egypt’s dependence on Russia and Ukraine for wheat and tourism. In October, the authorities took bold policy actions to unwind prior policy distortions including a shift to a flexible exchange rate while taking measures to help shield the Egyptian population from a mounting cost-of-living crisis. But global uncertainty casts a long shadow on Egypt’s recovery and the longstanding need for advancing deep structural reforms to spur sustainable, inclusive, and job-rich growth remains.
    Date: 2023–01–10
  4. By: Marco Cipriani; Linda S. Goldberg; Gabriele La Spada
    Abstract: Financial sanctions, alongside economic sanctions, are components of the toolkit used by governments as part of international diplomacy. The use of sanctions, especially financial, has increased over the last seventy years. Financial sanctions have been particularly important whenever the goals of the sanctioning countries were related to democracy and human rights. Financial sanctions restrict entities—countries, businesses, or even individuals—from purchasing or selling financial assets, or from accessing custodial or other financial services. They can be imposed on a sanctioned entity’s ability to access the infrastructures that are in place to execute international payments, irrespective of whether such payments underpin financial or real activity. This article explains how financial sanctions can be designed to limit access to the international payments system and, in particular, the SWIFT network, and provides some recent examples.
    Keywords: sanctions; Financial sanctions; cross-border payments; SWIFT; Russia-Ukraine war
    JEL: F3 F51 G15 G2
    Date: 2023–01–01
  5. By: International Monetary Fund
    Abstract: Growth was weaker than expected in 2021, reflecting primarily production disruptions in the oil sector, while inflation remained subdued. The poor 2021/2022 crop year, severe floods and Russia’s war in Ukraine have exacerbated food insecurity and increased inflation in 2022. Security and social conditions remain difficult, while the political transition has suffered significant delays.
    Date: 2023–01–12
  6. By: International Monetary Fund
    Abstract: Inflation has surged to 18 percent while growth is projected to slow to 2.7 percent this year. High oil prices have strengthened fiscal and external buffers, while the revised budget increased public spending by 2½ percentage points of GDP to support activity. Subsidiaries of sanctioned Russian banks have exited the domestic market and regulatory compliance is being enhanced to avoid secondary sanctions. Risks to the outlook remain tilted to the downside, as adverse global conditions could lower oil prices and raise borrowing costs, while oil exports through Russian territory remain a major source of vulnerability. Accelerated economic diversification and private sector development are needed to attain sustainable and inclusive growth.
    Date: 2022–12–14
  7. By: Krane, J.
    Abstract: Saudi Arabia’s stated goal of reaching net zero by 2060 puts the kingdom in a paradoxical position. The Saudi leadership proposes to decarbonize an oil-intensive society and economy while selling oil to the world. As such, the credibility of the Saudi commitment will remain an open question until concrete progress toward restructuring the kingdom’s energy system is demonstrated. Modest initial steps toward net zero include investments in renewables alongside pricing reforms of energy products and services. Another ongoing push involves oil-to-gas switching in the kingdom’s power sector, which can be augmented by carbon capture and storage and, eventually, gas-to-hydrogen substitution. Doubts and difficulties aside, Saudi Arabia holds major advantages in decarbonization. These include unused land with copious solar radiation, as well as geological storage near carbon emissions clusters. The kingdom is also equipped with relevant knowledge and investment capital. Fully compensating for reduced oil export rents may not be possible if worldwide carbon neutrality plans come to fruition. Despite the short-term benefits of high energy prices after the Russian invasion of Ukraine, economic and geopolitical decline is a likely medium-term outcome for the kingdom. However, there are also opportunities including replacing oil revenues with those arising from carbon disposal for countries and firms lacking the kingdom’s competitive advantages.
    Keywords: Saudi Arabia, Net Zero 2060, decarbonization, oil and natural gas, Saudi Aramco, greenhouse gas (GHG), carbon dioxide (CO2), emissions offsets, renewables, hydrogen, energy subsidy reform, carbon intensity, carbon capture and storage (CCS), emissions clusters, credible commitment, Paris Agreement NDC, climate pledge, peak oil demand, Scope 1, 2 and 3 emissions
    JEL: Q01 Q4 P16 P18 Q32 Q35 Q38 Q54 Q58 H23
    Date: 2023–01–12
  8. By: Brücker, Herbert (Institute for Employment Research (IAB), Nuremberg, Germany ; Humboldt Univ.); Ette, Andreas (BiB); Grabka, Markus M. (SOEP); Kosyakova, Yuliya (Institute for Employment Research (IAB), Nuremberg, Germany ; Univ. Bamberg); Niehues, Wenke (BAMF-FZ); Rother, Nina (BAMF-FZ); Spieß, C. Katharina (BiB); Zinn, Sabine (SOEP); Bujard, Martin (BiB); Cardozo, Adriana (SOEP); Décieux, Jean Philippe (BiB); Maddox, Amrei (BAMF-FZ); Milewski, Nadja (BiB); Naderi, Robert (BiB); Sauer, Lenore (BiB); Schmitz, Sophia (BiB); Schwanhäuser, Silvia (Institute for Employment Research (IAB), Nuremberg, Germany); Siegert, Manuel (BAMF-FZ); Tanis, Kerstin (BAMF-FZ)
    Abstract: "The Institute for Employment Research (IAB), the Federal Institute for Population Research (BiB), the Research Centre of the Federal Office for Migration and Refugees, and the Socio-Economic Panel at DIW Berlin have surveyed 11, 225 Ukrainian refugees in Germany from August to October 2022. The survey can be extrapolated to the refuge population who has arrived since the beginning of the war at February 24, 2022, to June 8, 2022, in Germany. The results show that the majority of refugees from Ukraine report war as the main flight motive, while personal contacts and respect of human rights were the main reasons to choose Germany as a destination. Roughly 80 percent of adult refugees are women. About the half lives together with minor-aged children, about 80 percent without a partner. Some 70 percent have tertiary education degrees. Yet, only 4 percent report good or very good, another 14 percent fair German language proficiency. About 50 percent visits or has already completed a German language class. 17 percent are employed, with some 70 percent of those performing qualified jobs. The health status of the refugee population is good, but life satisfaction well below the German population average. Above one-third of the refugees plans to stay in Germany forever or for several years, about one-third aim to leave Germany by the end of war, while 27 percent are not yet certain about their staying perspectives." (Author's abstract, IAB-Doku) ((en))
    Keywords: Bundesrepublik Deutschland ; Ukraine ; Aufenthaltsdauer ; IAB-Open-Access-Publikation ; IAB-BiB/FReDA-BAMF-SOEP-Befragung ; berufliche Integration ; Bildungsniveau ; Deutsch als Fremdsprache ; Geflüchtete ; Geschlechterverteilung ; Gesundheitszustand ; Herkunftsland ; Lebenssituation ; Rückwanderungsbereitschaft ; Spracherwerb ; Sprachkenntnisse ; IAB-BAMF-SOEP-Befragung von Geflüchteten ; Wanderungsmotivation ; Wohnsituation ; Zufriedenheit ; Zukunftsperspektive ; 2022-2022
    Date: 2022
  9. By: Said El Atiek (PSB - Paris School of Business - HESAM - HESAM Université - Communauté d'universités et d'établissements Hautes écoles Sorbonne Arts et métiers université); Stéphane Goutte (Université Paris-Saclay)
    Abstract: The Russian airplane crash in 2015 has severely affected the tourism industry in Egypt. The present article is focused on the impacts of economic, political, and social impacts on Egyptian tourism after this crisis. The present study aimed at dealing with the crisis to mitigate the consequences and allow the companies to make the best use of it to restore their business. The present article has also discussed the crisis impacts on the financial situation of company A which is one of the top five hospitality companies in Egypt. Crisis management and investments in human resources were the most effective strategies to overcome the harsh consequences of the crisis on tourism sector. The present study data is based on the Egyptian ministry of tourism figures, internet, articles, and international channels reports aimed to explain how the political, social, and economic events had a negative impact on the hotel industry in Egypt.
    Keywords: Egypt Russian air plane Sharm El-Sheikh Tourism crisis Economic impact Political impact social imact, Egypt, Russian air plane, Sharm El-Sheikh, Tourism crisis, Economic impact, Political impact, social imact
    Date: 2023–01–01
  10. By: Simshauser, P.
    Abstract: In 2022, wholesale prices in Australia’s National Electricity Market (NEM) rose to $225/MWh, up from $75/MWh a year earlier. The war in Ukraine led to a global tightening of coal and gas markets, and the effects were felt acutely by the NEM’s marginal coal- and gas-fired plants given tight links to seaborne prices. Household electricity tariffs are set for the financial year ahead but the wholesale cost element is built-up over the preceding three-year period, in line with forward hedging practices of prudent energy retailers. Consequently, households have been shielded from 2022 spot market dynamics in 2021/22 tariff determinations. However, by 2023/24 the impacts of wholesale price rises will be impounded into retail tariffs. In this article, fuel poverty in the Queensland region of the NEM is examined over three distinct periods, 2015/16, 2021/22 and 2023/24. These periods coincide with high (2015/16), low (2021/22) and expected high (2023/24) residential electricity tariffs. Results reveal an underlying level of fuel poverty in Queensland at 8.1% of households in 2015/16, falling to 6.8% in 2021/22 and rising to at least 10.0% in 2023/24. Queensland’s hardship policy unwinds these results by 1.6, 1.1 and 2.9 percentage points, respectively. 2023/24 tariff increases overwhelm existing hardship policy settings although policy performance operates as an automatic stabiliser, rising in effectiveness as price rises.
    Keywords: Fuel poverty, policy targeting efficiency, electricity prices.
    JEL: D4 L5 L9 Q4
    Date: 2023–01–12
  11. By: Jang, Won-Joon (Korea Institute for Industrial Economics and Trade); Song, Jae Pil (Korea Institute for Industrial Economics and Trade)
    Abstract: Today, the global state of affairs is extremely volatile, not least because of Russia’s invasion of Ukraine on February 24, 2022. In this report, we survey the recent changes in the global security environment with a view to identifying policy implications and tasks for the Korean defense industry. There are three main takeaways from the current state of global affairs for the Korean defense industry. First, Korea lacks military cybersecurity capabilities for dealing with the increasingly digital nature of warfare today, including hybrid warfare and gray-zone strategies. Second, efforts should be increased to use the military modernization policies of other developed countries as benchmarks and to develop cutting-edge weapons systems on the basis of priorities focusing on the effective response to threats from neighboring countries. Third, efforts should be commenced to reform and innovate Korea’s rigid weapons acquisition system, notwithstanding the high cost and lengthy periods of time involved, in the model of innovative systems in other developed countries. In order to strengthen Korea’s military cybersecurity industry, the government will need to earmark funding for cyberweapons systems, establish a new unit or agency within the Defense Acquisition Program Administration (DAPA) tasked with cybersecurity, and introduce a system for analysis and training in relation to cyberattacks and cyber-defense. The Korean government also needs to focus on developing cutting-edge weapons systems in response to arms buildups in neighboring countries, particularly with a view toward establishing a multi-tiered missile defense system on an accelerated timeline and enhancing capabilities for intelligence-gathering and surveillance, including by space-based means. Finally, the Korean government needs to push for an overhaul of the conventional weapons acquisition system in the model of the United States’ Middle Tier Acquisition (MTA) program. This requires tailoring pilot projects for rapid acquisition to meet specific needs, guaranteeing follow-up manufacturing opportunities when pilot projects succeed and meet certain criteria — including major weapons systems and their performance enhancements in the scope of rapid acquisition —and defining relevant roles and responsibilities, accordingly.
    Keywords: Korean Defense Industry; Military Cybersecurity Industry; Cyber-defense
    JEL: L64
    Date: 2022–03–31
  12. By: International Monetary Fund
    Abstract: CEMAC is broadly benefiting from the positive terms of trade shock amidst the fallout from Russia’s war in Ukraine. Post-pandemic economic recovery is taking hold, albeit slowly, supported by high oil prices and the lifting of COVID-19 containment measures. External reserves have started to build up, though still short of the desired level, owing in part to costly untargeted energy and food subsidies. Global inflation pressures have passed through to domestic prices, putting pressure on real incomes. Rebuilding buffers and sustaining a recovery that protects the most vulnerable will require stricter adherence to budget and reform plans consistent with Fund-supported programs and policy advice; this will ensure that part of the oil windfall is saved. Implementation of these policies in current favorable conditions is critical to strengthening resilience in the face of rising risks, including most notably to food security, debt vulnerabilities, and tightening of global financial conditions.
    Keywords: CEMAC authorities; IMF article; CEMAC country; consultation discussion; CEMAC member country; Oil prices; Inflation; Fiscal stance; Liquidity; Global
    Date: 2023–01–06
  13. By: Claudia Kettner; Eva Wretschitsch (WIFO)
    Abstract: In the "Fit for 55" package of July 2021, the European Commission proposed inter alia a revision of the energy taxation directive with the intent of increasing tax rates for fossil fuels that should contribute to achieving the EU's emission reduction targets for 2030. Since then, climate policy challenges in the EU have been amplified by sharp increases in electricity and gas prices mainly as a result of the war in Ukraine. Energy price spikes have led to the implementation of numerous compensation measures for households and firms in EU member countries. In this article, we provide an overview of the discussion on energy taxation in the EU and analyse compensation measures implemented during the energy crisis. We find that energy cost related compensation measures counter climate policy efforts. A stronger focus on vulnerable groups would have reduced the overall costs of measures and entailed stronger energy efficiency incentives.
    Keywords: EU, Energy taxation, Energy cost subsidies, Energy crisis
    Date: 2023–01–13
  14. By: International Monetary Fund
    Abstract: Selected Issues
    Date: 2022–12–14
  15. By: Lin William Cong; Campbell R. Harvey; Daniel Rabetti; Zong-Yu Wu
    Abstract: While the advent of cryptocurrencies and digital assets holds promise for improving and disrupting financial systems by offering cheap, quick, and secure transfer of value, it also opens up new payment channels for cybercrimes. A prerequisite to solving a problem is understanding the nature of the problem. Assembling a diverse set of public, proprietary, and hand-collected data, including dark web conversations in Russian, we conduct the first detailed anatomy of crypto-enabled cybercrimes and highlight relevant economic issues. Our analyses reveal that a few organized ransomware gangs dominate the space and have evolved into sophisticated corporate-like operations with physical offices, franchising, and affiliation programs. Their techniques have also become more aggressive over time, entailing multiple layers of extortion and reputation management. Blanket restrictions on cryptocurrency usage may prove ineffective in tackling crypto-enabled cybercrime and hinder innovations. Instead, blockchain transparency and digital footprints enable effective forensics for tracking, monitoring, and shutting down dominant cybercriminal organizations.
    JEL: H56 K24 O30
    Date: 2023–01
  16. By: International Monetary Fund
    Abstract: Canada has come through the pandemic relatively well and, as a commodity exporter, has been hit less hard than many other countries have been by Russia’s war on Ukraine. Nonetheless, inflation is well above target, housing affordability is a major concern following a long boom that may now have peaked, and the pandemic remains a source of risk.
    Date: 2022–12–08
  17. By: Prema-chandra Athukorala; Hal Hill
    Abstract: This paper examines trade and commercial policy in Kyrgyzstan in the context of that country’s distinctive historical and geographical characteristics, drawing on the World Trade Organisation’s latest Trade Policy Review. A former Soviet republic, it is a geographically isolated, effectively a ‘double-landlocked’, transition economy. The country was an early liberalizer, both economically and politically, among the former Soviet republics, and it is now a broadly open economy. After a catastrophic economic decline in the immediate transition era it also achieved macroeconomic stabilization relatively quickly. However the growth dividend from these major policy reforms has been modest, and the country has become one of the most remittance-dependent economies in the world. While its geographical handicaps are immutable, we argue that key explanations for the slow economic growth are the limited ‘behind-the-border’ reforms, the dualistic economic structure, and misdirected fiscal allocations. We also draw out some of the broader implications for trade policy reform in other transition economies.
    Keywords: Kyrgyzstan, landlocked, transition economy, behind-the-border reform
    JEL: F13 O53 P27 P33
    Date: 2023
  18. By: International Monetary Fund
    Abstract: In response to a request from the National Bank of Georgia (NBG), the Monetary and Capital Markets Department (MCM) of the International Monetary Fund (IMF) conducted a Technical Assistance (TA) mission between March 17 and April 20, 2022, which sought to support the operationalization of the bank recovery and resolution framework, building on recommendations from the 2021 Financial Sector Assessment Program (FSAP) for Georgia. In collaboration with the authorities, the mission identified several priority actions, including (i) reinforcing the NBG’s internal procedures for reviewing banks’ recovery plans; (ii) strengthening its resolution function and developing playbooks for the main resolution tools; (iii) clarifying the current crisis management escalation process; (iv) revising the credit hierarchy; (vi) introducing bank-specific targets for loss-absorbing capacity; (vii) performing a stock taking of contractual clauses in banks’ current subordinated and senior debt issuances; and (viii) undertaking further efforts to advance resolution planning.
    Date: 2023–01–10
  19. By: Konstantīns Beņkovskis (Latvijas Banka); Oļegs Matvejevs (Latvijas Banka)
    Abstract: This paper describes the new version of Latvian CGE model, which is now an integral part of the joint CGE-EUROMOD modelling system. Special attention is devoted to the labour market and consumption blocks of CGE that are substantially improved compared with the previous version. We briefly describe the motivation to link Latvian CGE with Latvian EUROMOD and provide major technical details. We also provide an example of the policy simulation by the joint CGE-EUROMOD system, demonstrating how the introduction of the progressive personal income tax rate affected the Latvian economy at macro, industry and micro level.
    Keywords: CGE model, Latvia, labour market, consumption, EUROMOD
    JEL: D58 C68 H2 H6 D9
    Date: 2023–01–18
  20. By: Vitaliy, Tryashchenko; Tetiana, Tytar
    Abstract: The article highlights the current issues related to the management of information provision of the enterprise. It has been specified that complete and reliable information support of business processes is a necessary condition for the effective functioning of the enterprise. It was determined that the information support mechanism for managing the development of business processes should include available information resources, technologies, systems and platforms, software, and qualified personnel responsible for this work. The article examines the works of domestic and foreign economists. It was established that the modern business environment is practically inseparable from scientific, information and intellectual achievements and the results of their implementation (information technologies, systems, and platforms), and the management of the development of business processes must be confirmed by a powerful information support of the enterprise. In the article contains information about the number of Ukrainian enterprises which were engaged in electronic trade. Nevertheless, it was revealed the number of Ukrainian enterprises, such as: 1) carried out electronic trade, in the total number of enterprises by type of sale; 2) have a website; 3) buy cloud computing services. It was found that of the analyzed number of Ukrainian enterprises that carried out electronic trade, the first place took enterprises in the field of information and communication technologies (9.5%), the second place – enterprises in the field of information and telecommunications. (9%), and the third – from the production of electrical equipment (8.2%). It has been proven that the successful operation of enterprises directly depends on the ability to make effective management decisions based on information generated in the information support system of enterprise management. In addition, it has been proven that in the era of digitalization, for the formation of proper information support, it is necessary to: 1) create and develop special data banks; 2) have special technical means and software products for working with large volumes of information; 3) making effective management decisions based on their processing.
    Date: 2022–12–14

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