Fiscal Monitor Update: Public Sentiment Matters: The Essence of Successful Energy Subsidies and Pension Reforms 

The Fiscal Monitor is prepared twice a year by the IMF’s Fiscal Affairs Department. Its projections are based on the same database used for the World Economic Outlook (WEO) and the Global Financial Stability Report (GFSR).

This chapter examines strategies to build public support for reforms to energy subsidies and public pensions. The chapter introduces a real-time measure of reform acceptability using large language models to quantify stakeholder sentiment. Findings show that careful design, timing, accompanying measures, and governance improve stakeholder sentiment and help advance ambitious and durable reforms. Redistribution policies and strategic communications can mitigate resistance.

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