BAKU, Azerbaijan, October 15. The IMF’s
recommendations for addressing the risks associated with the crisis
in the Middle East focus on three key areas, the Director of the
Middle East and Central Asia Department at the International
Monetary Fund, Jihad Azour said, Trend's correspondent reports.
“First, it is necessary to continue prioritizing price
stabilization while ensuring the sustainability of public finances.
Amid mounting inflationary pressures, monetary policy must remain
the primary tool for curbing inflation. A tighter monetary policy
and restrictions on liquidity must be complemented by a balanced
fiscal and tax policy, especially in countries with limited scope
for increasing government spending,” he noted.
Second, according to Azour, it is necessary to rebuild budget
reserves.
“This is particularly important given the ongoing risks of a
worsening economic situation. To this end, countries should improve
the efficiency of domestic revenue mobilization, optimize
government spending, and strengthen fiscal and financial
mechanisms,” he explained.
Azour believes that governments should refrain from introducing
large-scale subsidies and instead provide assistance to the
hardest-hit segments of the population through targeted, temporary
cash payments that do not increase the budget deficit.
“Third, countries need to continue strengthening their ability
to withstand future shocks. Recent experience has once again
confirmed the importance of reliable economic policy mechanisms.
Countries with strong institutions, credible monetary policy
frameworks, independent central banks, and sufficient fiscal
reserves are generally better prepared to mitigate the effects of
external shocks,” he added.
