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RBF numérique 2019/1

  • Mardi 5/2/2019
    Vitor Gaspard

    Fiscal rules are important commitment devices to limit fiscal profligacy. They have been an integral part of the euro area architecture and were introduced to insure against weaknesses in the functioning of the market discipline. Nonetheless, they have failed to provide sufficient fiscal discipline and avoid excessive market volatility. However, despite prevalent noncompliance, rules did –on average– influence the behavior of fiscal authorities. The evidence shows that well-designed rules worked better than others. Elevated debt levels and the record of weak compliance and lax enforcement make fundamental reform of the EU fiscal rules more urgent than ever. These reforms should aim at making the rules simpler and more transparent, and better aligning political incentives with rule compliance.

  • Mardi 5/2/2019
    Susanne Roehrig

    This article mainly summarises the content of a talk that Susanne Roehrig held at the Financial Forum in April last year. First it provides an overview of the general mechanics and relevant policies for the calculation of minimum capital requirements for credit risk. In the following the Article focuses on the assessment of capital requirements based on internal models (IRB) as mandated in Article 78 the CRD. This assessment includes a benchmarking exercise and entails tasks for EBA as well as for competent authorities. The methods and key results contained in EBAs report on the results from the 2017 Low defaults portfolios (LDP) exercise are summarised and some, more recently published results of the EBA Report on the results from the 2018 low and high default portfolios exercise are referred to. Lastly a possible amendment of the focus of EBAs benchmarking exercise as regards credit risk is discussed.

  • Mardi 5/2/2019
    Johan Van Gompel

    Over the last three years, Belgium's public debt has fallen by more than 4 percentage points of GDP, after having risen sharply during the financial crisis. This reversal is good news and was mainly due to stronger economic growth and fiscal consolidation. However, at 103.4% of GDP, the debt ratio remained among the highest in the euro area in 2017. To further reduce the debt to a sufficient extent, the primary budget surplus should continue to build up in the short term to above 2% of GDP, in line with the target set in the Stability Programme. In the longer term, new savings should -preferably be made at the same time to offset the costs of an ageing population. Otherwise, a declining primary surplus threatens to ultimately increase the debt without it having sufficiently fallen towards the 60% level. To reduce the debt ratio structurally in the context of a normalisation of the current historically low interest rate, the growth potential of the economy will also have to be increased. Despite the still high debt, Belgium is maintaining market confidence. This is related to the relatively healthy position of the private sector, as a result of which the Belgian economy as a whole is in a very positive net asset position vis-à-vis the rest of the world.

  • Mardi 5/2/2019
    Geert Gielens

    The budgetary situation of the local authorities in Flanders does not cause concern. Most municipalities recorded a surplus on their accounts at the end of last year and the municipal debt is also decreasing. A prudent spending policy axed at controlling the labour costs together with somewhat less investment spending are at the heart of this result. This being said, the future may be somewhat less rosy as rising pension costs and tax shift related lower municipal revenues are to be expected. 

  • Mardi 5/2/2019
    Book cover

    Book review of Sylvester Eijffinger’s and Donato Masciandaro’s (eds.) “Hawks and Doves: Deeds and Words. Economics and Politics of Monetary Policymaking.”

  • Mardi 5/2/2019
    Book cover

    Critique du livre “De l’or des templiers aux cryptomonnaies.

    Histoires d’économie” de Bruno Colmant.