Investor Presentaiton

Real assets FISCAL INSTABILITY ad e.g. acquisition of foreign companies, technology, infrastructure Public secto Options for resource revenue spending Investment MISJUDGING DURATION OF COMMODITY BOOM ELITE CAPTURE Resource rents Consumption Needed to tackle deficit of O&M of existing capital stock FISCAL INSTABILITY Financial assets F e.g. recurre expenditures inme Domestically e.g. KWAN fund in Malaysia; Fonds de régulation des recettes in Algeria Abroad Private sector Unlikely to stimulate productive domestic transformation POPULISM Unconditional transfer e.g. citizen dividend scher in Alaska or lowered ta (MENA region and G countries) Conditional transfer e.g. consumption bsidies, transfers for cific purposes individuals may better invest revenues than government officials General capabilitie ABSORPTIVE CAPACITY ific es e.g. Infrastructure, WA human capital, governance capabilities for investment efficiency estme ote the non Source tradab sector Targeted Conditional credit upon certain tivities (e.g. non NEEDED TO STIMULATE urce tradable EXPORT DIVERSIFICATION.tor) short term fiscal stabilisation Low-rish savings pu e.g. bonds (a h yield sets investr asse re Pushes benefits too far pursued by into the future Fund, Chile's ESSF) Fun Botswana's Pula Neoclassical/Standard policy advice/ Permanent Income hypothesis

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