Fiscal Policy in a Time of Global Turmoil
An Assessment of Fiscal Space
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Policymakers around the world are wrestling with the aftermath of a global pandemic, the humanitarian crisis and economic disruption from the Russia-Ukraine invasion, inflationary pressures from supply chain woes, and elevated geopolitical risks.
In this webinar, we consider the global outlook for fiscal policy as nations devise policies to manage these problems and discuss the constraints on deficit spending that some governments are likely to face from record-high debt loads that have shrunk their fiscal space. We review approaches to measuring the availability of fiscal space, linking it to debt sustainability, key macro drivers, and perceptions of sovereign risk. We provide estimates of fiscal space for more than 70 countries and discuss how it is likely to evolve in our current baseline and downside scenarios.
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