Journal Issue
Back Matter

Back Matter

Mark Horton, Hossein Samiei, Natan Epstein, and Kevin Ross
Published Date:
May 2016
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    Ben NaceurS.A.Hosny and G.Hadjian. 2015. “How to De-Dollarize Financial Systems in the Caucasus and Central Asia?IMF Working Paper 15/203.

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    BleaneyM. and D.Greenaway. 2001. “The Impact of Terms of Trade and Real Exchange Rate Volatility on Investment and Growth in Sub-Saharan Africa.Journal of Development Economics65: 491500.

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    DincerN. and B.Eichengreen. 2014. “Central Bank Transparency and Independence: Updates and New Measures,International Journal of Central Banking 38 pp. 189253.

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    EichengreenBarryRicardoHausmann and UgoPanizza. 2003. “The Mystery of Original Sin” in BarryEichengreen and RicardoHausmann (eds.) Other People’s Money: Debt Denomination and Financial Instability in Emerging Market Economics (University of Chicago Press).

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    EpsteinN. and R.Portillo. 2014. “Monetary Policy in Hybrid Regimes: The Case of Kazakhstan,IMF Working Paper 14/108.

    García-EscribanoM.2010. “Peru: Drivers of De-dollarization,IMF Working Paper 10/169.

    GhoshA.J.Ostry and C.Tsangarides. 2010. “Exchange Rate Regime and the Stability of the International Monetary System,IMF Occasional Paper No. 270 (Washington DC: IMF).

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    KokenyneA.J.Ley and R.Veyrune. 2010. “Dedollarization,IMF Working Paper 10/188.

    MecagniMauro and others. 2015. Dollarization in Sub-Saharan Africa: Experience and Lessons (Washington: International Monetary FundApril2015).

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    MussaMichael. 1986. “Nominal Exchange Rate Regimes and the Behavior of Real Exchange Rates, Evidence and Implications.Carnegie-Rochester Conference Series on Public Policy Vol. 25 pp. 117213.

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    OstryJ.A.Ghosh and M.Chamon. 2012. “Two Targets, Two Instruments: Monetary and Exchange Rate Policies in Emerging Market Economies?IMF Staff Discussion Note 12/01 (Washington: International Monetary Fund).

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For CCA energy importers, lower energy prices have not translated into significant savings. This reflects the prevalence of long-term contracts priced in dollars and, in some countries, lack of competition and flexibility in supply arrangements.


Annual Report on Exchange Arrangements and Exchange Restrictions (AREAER).


While Kazakhstan officially adopted a floating ER regime in August 2015, the IMF’s AREAER reclassification to floating (de facto) requires a period of at least six months of increased volatility in the ER without noticeable short periods of stability. The Kazakh authorities have reaffirmed their commitment to a floating ER regime and noted increased volatility in the ER in recent months.


Armenia appears not to be overvalued at present, but this reflects to some extent supply side factors in 2015 that led to better-than-expected exports. These factors may be temporary in nature.


Six of the eight CCA countries have completed an FSSA report or update within the last three years.


The authors use central bank legislation to measure independence based on management control over mandates, policies, and objectives, and limits on lending to the public sector. They assess transparency by reviewing central bank publications and websites. Information is taken from 2010 or earlier.


After the breakdown of the Bretton Woods system and the adoption of the Second Amendment to the IMF’s Articles of Agreement, member countries have been free to adopt the ER regime of their choice with few limitations as set forth in the Articles. In this context, the Fund has produced analytical studies on countries’ choices of ER regime. These reviews are part of the IMF’s surveillance mandate, and help inform member countries of how their choice of ER regime can affect their own macroeconomic performance and contribute to the stability of the international monetary system.


In some cases, modernization of monetary policy frameworks may be achieved through a “hybrid” regime, combining interest rate policy with some ER management, including through use of sterilized intervention in the FX market (see, for example, Ostry and others (2012), Epstein and Portillo (2014)). A risk in such cases, however, is lack of sufficient clarity of the policy framework and operations.


Fund staff has provided guideposts as countries make the transition to a more flexible ER regime. For example, given the current commodity shock, MCM has produced a note (“Commodity Price Shocks and Greater Exchange Rate Flexibility: Why, If, What and How”), which reviews alternative regime options under greater flexibility and modalities of how to transition to another regime, if an exit from the prevailing regime is deemed desirable by the country. The note draws on the extensive policy and TA work conducted in the Fund.


Note that in the in the Balassa-Samuelson framework, a supply shock leads to a permanent appreciation of the real exchange rate. For example, see Gauthier and Tessier (2002).


The term “monetary institutions” denotes the central bank, its capacity/ability to deliver on its core functions (analytical, operational), the broader legal and political environment in which monetary policy decisions are made, and the scope for coordination with (and insulation from) fiscal policy and fiscal pressures.


In some CCA countries, market structure is another factor, as markets are characterized by limited entry and an absence of competition, particularly for imported goods.


For example, Ben Naceur and others (2015) looks at how to de-dollarize financial systems in the CCA; Mecagni and others (2015) describes effective de-dollarization strategies in sub-Saharan Africa; Garcia-Escribano (2010) discusses sources of dollarization and de-dollarization strategies in Latin America, and Kokenyne and others (2010) presents de-dollarization policies more generally across a number of regions.


The IMF is contributing to this effort by organizing media training programs—including for the CCA—and by inviting journalism fellows to the Spring and Annual Meetings.

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