Kas lemia skirtingus Tarptautinio Valiutos Fondo programų rezultatus skirtingose valstybėse? /

• Main Author: Šliokaitis, Deividas
• Format: Bachelor Thesis
• Language: Lithuanian; English
• Published: Institutional Repository of Vilnius University 2023
• Subjects: Iceland
• Online Access: https://repository.vu.lt/VU:ELABAETD192838188&prefLang=en_US

The International Monetary Fund is one of the primary institutions that provides financial assistance for countries in need. Reasons for requesting financial help differ from country to country, therefore IMF uses different instruments that correspond to all the needs. However, it is interesting that for some countries like Portugal or Iceland, a one-time bailout helps to solve balance of payments problems, but other countries like Peru or Romania seem to be stuck in a never-ending cycle of borrowing from the IMF. This research focuses on finding possible explanations for this phenomenon. As a possible explanation, 4 different independent variables were identified: type of the IMF program, change in government, structural reforms, and success of the program where 3 economic indicators (current account balance, inflation, and GDP growth) were evaluated. Countries that borrowed from IMF were divided into 2 groups: countries that borrowed not more than 2 times and countries that borrowed from the IMF more than 2 times. Bosnia and Hercegovina, Georgia, and Romania were analyzed as constant borrowers while Hungary, Ireland, and Portugal were analyzed as one-time borrowers. To examine the findings, the method of one difference and one similarity was used. The analysis provided the information that the main explanation of constant borrowing in the context of this research is not fully completed structural reforms. A variable of structural reforms was also connected with the change of government and the success of program variables. All analyzed programs with incomplete structural reforms proved to be unsuccessful and led countries to recurrent borrowing. The only exceptions of not borrowing after failed structural reforms were Hungary and Romania’s last program which were influenced by domestic political factors. This leads us to additional findings that political instability in the country has a negative effect on implementing structural reforms. If the government does not demonstrate a complete commitment to ...