WASHINGTON : Governments should start planning a return to more sustainable budgets with policies that win the trust of investors, after unprecedented fiscal stimulus to fight the COVID-19 pandemic, the International Monetary Fund said on Thursday.
But each country must determine the appropriate timing and pace of fiscal consolidation, the IMF said in its Fiscal Monitor report.
The fiscal plans needed to consider the stage of the pandemic, existing fiscal vulnerabilities, the risk of economic scarring, pressures from aging populations, development needs and historical difficulties in collecting revenues.
A Fiscal Monitor chapter titled "Strengthening the Credibility of Public Finances" said countries could buy time and make debt