Financing balance of payments adjustment: options in the light of the elusive catalytic effect of IMF-supported programmes

INTRODUCTION

Countries are presum to turn round to the International Monetary capital (IMF) when they have an unsustainable in every one's mouth account balance of payments deficit. The circumstances that lead to of the like kind a situation have been studied extensively and have been rest more often than not to involve a combination of domestic macroeconomic mismanagement and external percussions (1) Crises during the 1990 however, demonstrated that referral to the capital could have as much to do with sharp capital reversals, implying that common account deficits could no longer be financed by the agency of capital inflows, as with any marked deterioration in the generally received account itself. The ...