First Macroeconomic Stability and Fiscal Resilience DPO

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The development objective of the First Macroeconomic Stability and Fiscal Resilience Development Policy Operation Project for Myanmar supports two pillars: (i) sustained macroeconomic stability; and (ii) enhanced fiscal resilience. As a rapidly opening economy, Myanmar faces new challenges to sustaining macroeconomic stability. Policy and institutional capacity to deal with macroeconomic pressures have faced intensified challenges, which in turn impact on public service delivery and broader stability. To help address these challenges, the macroeconomic stability and fiscal resilience development policy operation (SRDPO) can play a critical role in building a modern state, which requires a mix of institution building as well as policy reforms. In addition, concessional budgetary financing can support long‐term public investments and help build fiscal buffers. Lessons from other fragile and conflict affected countries have shown how critical policy‐based lending can be in strengthening policies and institutions for stability and growth over the medium to long‐term. The policy actions can help sustain confidence in economic policies, which is important for private investment, and help protect much needed fiscal space for public service delivery and poverty reduction.