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In response to the global financial crisis, governments provided
substantial support to the financial and other key sectors.
Although this cushioned the adverse effects of the crisis, it is
necessary now to articulate a strategy to ensure the sustainability
of public finances. This paper discusses the scale and composition
of fiscal adjustment that will need to occur once the recovery is
securely under way. Although specific country-level circumstances
will influence the composition of the adjustment and its political
feasibility, in many cases restoring fiscal sustainability will
require reforms to reduce spending and increase tax revenue.
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