Policy Papers

Macroeconomic Developments and Prospects For Low-Income Countries—2024

Publication Date:

April 2, 2024

Electronic Access:

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Summary:

The outlook for Low-Income Countries (LICs) is gradually improving, but they face persistent macroeconomic vulnerabilities, including liquidity challenges due to high debt service. There is significant heterogeneity among LICs: the poorest and most fragile countries have faced deep scarring from the pandemic, while those with diversified economies and Frontier Markets are faring better. Achieving inclusive growth and building resilience are essential for LICs to converge with more advanced economies and meet the Sustainable Development Goals (SDGs). Building resilience will also be critical in the context of a more shock-prone world. This requires both decisive domestic actions, including expanding and better targeting Social Safety Nets (SSNs), and substantial external support, including adequate financing, policy advice, capacity development and, where needed, debt relief. The Fund is further stepping up its support through targeted policy advice, capacity building, and financing.

Series:

Policy Paper No. 2024/011

Subject:

External debt Household consumption Inflation Monetary policy National accounts Political economy Poverty Poverty Reduction Prices

Frequency:

occasional