Country Reports
2020
May 1, 2020
Democratic Republic of the Congo: Request for Disbursement Under the Rapid Credit Facility-Press Release; Staff Report; and Statement by the Executive Director for the Democratic Republic of the Congo
Description: This paper presents Democratic Republic of the Congo’s (DRC) Request for Disbursement Under the Rapid Credit Facility (RCF). DRC is experiencing a severe shock as a result of the Covid-19 pandemic. The short-term economic outlook has deteriorated quickly due to the fall of minerals’ prices and the impact of needed containment and mitigation measures. The IMF’s emergency financial support under the RCF is expected to address DRC’s urgent balance of payments needs while supporting this temporary fiscal loosening. Additional assistance from other development partners is expected to close the remaining external financing gap and ease budget financing needs. The authorities’ commitment to publish monthly audits of coronavirus disease 2019 related expenditures is welcome, to ensure transparency in the use of public funding. The implementation of the policies and structural reforms to which the authorities committed under the staff-monitored program agreed in December remains key to ensuring macroeconomic stability and restoring sustained inclusive growth. These include strengthening transparency and governance in the fiscal and mining sectors, boosting revenue mobilization, maintaining financial stability, and halting central bank financing of the deficit.
April 29, 2020
Nigeria: Request for Purchase under the Rapid Financing Instrument -Press Release; Staff Report; and Statement by the Executive Director for Nigeria
Description: This paper presents Nigeria’s Request for Purchase Under the Rapid Financing Instrument (RFI). The authorities’ immediate actions to respond to the crisis are welcome. The short-term focus on fiscal accommodation would allow for higher health spending and help alleviate the impact of the crisis on households and businesses. Steps taken toward a more unified and flexible exchange rate are also important and unification of the exchange rate should be expedited. Once the coronavirus disease 2019 crisis passes, the focus should remain on medium-term macroeconomic stability, with revenue-based fiscal consolidation essential to keep Nigeria’s debt sustainable and create fiscal space for priority spending. Implementation of the reform priorities under the Economic Recovery and Growth Plan, particularly on power and governance, remains crucial to boost growth over the medium term. The emergency financing under the RFI will provide much needed liquidity support to respond to the urgent balance of payments needs. Additional assistance from development partners will be required to support the government’s efforts and close the large financing gap.
April 29, 2020
Islamic Republic of Mauritania: Request for Disbursement Under the Rapid Credit Facility-Press Release; Staff Report; and Statement by the Executive Director for the Islamic Republic of Mauritania
Description: This paper focuses on the Islamic Republic of Mauritania’s Request for Disbursement Under the Rapid Credit Facility. The economic and social impact of the pandemic is rapidly unfolding, with a contraction of output expected in 2020. The authorities have responded swiftly with measures to contain the pandemic and alleviate its fallout. Going forward, prioritizing health spending and targeted support to the most vulnerable households and sectors in the economy remains critical. The authorities are committed to full transparency and reporting of resources deployed for the emergency response, to audit crisis-mitigation spending once the crisis abates, and to publish the results. At the same time, they remain committed to the economic reform program supported by the ongoing ECF arrangement with the IMF. The program aims at using the fiscal space to increase priority spending on education, health and social protection and infrastructure, while mobilizing domestic revenues and maintaining prudent borrowing policies to preserve debt sustainability.
April 29, 2020
Democratic Republic of São Tomé And Príncipe: Request for Disbursement Under the Rapid Credit Facility-Press Release; Staff Report; and Statement by the Executive Director for the Democratic Republic of São Tomé And Príncipe
Description: This paper presents São Tomé and Príncipe’s Request for Disbursement Under the Rapid Credit Facility (RCF). The authorities of São Tomé and Príncipe have moved swiftly to develop a plan to address the major challenges posed by the coronavirus disease 2019 pandemic. The authorities plan to increase well-targeted health and social spending to assist the most vulnerable, support the unemployed, incentivize private businesses to retain workers, and enhance fiscal transparency and good governance. These steps would help cushion the economic impact while ensuring that public funds are spent appropriately. Prudent loan restructuring while maintaining prudential standards will help alleviate liquidity pressures and safeguard financial stability. The authorities’ policies focus on immediate measures to protect against the virus, assistance to the most vulnerable, and countercyclical measures during this crisis. Public financial management will be reinforced to ensure the disbursement is used appropriately and steps will be taken to speed up the recovery next year. The IMF staff assesses that the eligibility requirements for the RCF are met and supports the authorities’ request. While the country is in debt distress due to long-standing external arrears, the debt level is deemed sustainable, and there is adequate capacity to repay the IMF. The financing would help prevent a much more severe and prolonged contraction, with a substantial social impact.
April 29, 2020
Republic of Mozambique: Request for Disbursement Under the Rapid Credit Facility-Press Release; Staff Report; and Statement by the Executive Director for the Republic of Mozambique
Description: This paper discusses Republic of Mozambique’s Request for Disbursement Under the Rapid Credit Facility (RCF). Mozambique is expected to be significantly affected by the coronavirus disease 2019 pandemic, dashing prospects of a nascent economic recovery following two powerful tropical cyclones that struck in 2019. The IMF’s emergency financial support under the RCF, along with the additional donor grant financing it will help to catalyze, will contribute to addressing Mozambique’s urgent balance of payments needs generated by the pandemic. The authorities are committed to prevent corruption and misuse of emergency financing, by strengthening transparency and accountability. In this connection, they will publish large public procurement contracts and conduct and publish ex-post audits of funds’ use. Once the pandemic eases, it will be critical to resume fiscal consolidation and strengthened debt management and transparency to ensure that public debt remains sustainable. It will also be important to implement structural reforms to support inclusive and sustainable growth.
April 28, 2020
Samoa: Request for Disbursement Under the Rapid Credit Facility-Press Release; Staff Report; and Statement by the Executive Director for Samoa
Description: This paper discusses Samoa’s Request for Disbursement Under the Rapid Credit Facility. Samoa has shown resilience to multiple past economic shocks, underpinned by the authorities’ strong commitment to support the economy, and financial assistance provided by the international community. The global coronavirus disease 2019 pandemic has exacerbated the impact of the measles outbreak of late-2019 on Samoa’s economy. The border closure, combined with a sudden stop of tourist arrivals and decline in remittances, has led to a precipitous fall in two vital sources of foreign earnings and resulted in an urgent balance of payments need. Beyond the immediate response, the authorities will continue to implement structural reforms, with policies appropriately balanced between safeguarding debt sustainability and promoting economic growth. They also need to continue their efforts to enhance spending efficiency, strengthen social protection programs and safety nets, further improve tax administration, strengthen public financial management, and safeguard financial stability. Addressing vulnerability to climate change remains a key medium-term challenge to create a fiscal buffer.
April 28, 2020
Central African Republic: Request for Disbursement under the Rapid Credit Facility-Press Release; Staff Report; and Statement by the Executive Director for the Central African Republic
Description: This paper presents Central African Republic’s Request for Disbursement Under the Rapid Credit Facility. The implementation of the policies and structural reforms to which the authorities committed under the Extended Credit Facility (ECF) arrangement adopted in December remains key to ensuring macroeconomic stability and debt sustainability and restoring sustained inclusive growth. Additional external support, preferably in the form of grants, is also urgently required to meet C.A.R.’s elevated financing needs and ease the financial burden of the pandemic. These are also essential to the authorities’ efforts to restore peace and prosperity in the country. The authorities intend to allow the fiscal deficit to increase to accommodate most of the fiscal impact of the pandemic, which will comprise a significant shortfall in revenue and additional outlays as part of the response plan. While they intend to streamline nonpriority expenditures, this accommodative stance will allow them to continue meeting pressing social, infrastructure, and security spending needs. The authorities have also reiterated their intention to pursue the policies and structural reforms to which they committed under the ECF arrangement approved last December.
April 23, 2020
Bosnia and Herzegovina: Request for Purchase Under the Rapid Financing Instrument-Press Release; Staff Report; and Statement by the Executive Director for Bosnia and Herzegovina
Description: This paper presents Bosnia and Herzegovina’s Request for Purchase Under the Rapid Financing Instrument (RFI). RFI is expected to help provide support for scaling up priority spending on health and social assistance, while preserving debt sustainability. Preserving the currency board arrangement and raising the resilience of the banking system play a crucial role for restoring external and internal balances. High frequency monitoring of the banks, including their liquidity positions and asset quality, is crucial at this juncture. Economic activity is tentatively projected to decline by 5 percent in 2020 on account of a pronounced fall in exports and remittances and reduced domestic demand and supply. High political uncertainties pose additional downside risks. Despite a recent easing of political tensions, the complexity of the political environment is a downside risk, which could lead to policy slippage and weakened response measures. The IMF staff supports the authorities’ request for a purchase under the RFI considering the urgent nature of the external financing needs caused by the coronavirus disease 2019 crisis.
April 23, 2020
Burkina Faso: Requests for Disbursement Under the Rapid Credit Facility and Rephasing of Access Under the Extended Credit Facility-Press Release; Staff Report; and Statement by the Executive Director for Burkina Faso
Description: This paper discusses Burkina Faso’s Requests for Disbursement Under the Rapid Credit Facility (RCF) and Rephasing of Access Under the Extended Credit Facility. The immediate challenge is to contain the spread of coronavirus disease 2019, strengthen medical care, implement the social distancing and other containment measures, and mitigate the socio-economic impact of the pandemic, especially on the most vulnerable. The authorities’ measures to contain and mitigate the socio-economic fallout of the pandemic have given rise to substantial and urgent fiscal and balance of payments needs. With uncertainties surrounding the duration and scope of the pandemic, the fallout could intensify further. The IMF emergency support under the RCF will provide much-needed resources to support the authorities’ response to the crisis and help catalyze further donor support. A widening of the fiscal deficit in 2020 is warranted to create room for health care spending, social safety nets and for the mitigation of the economic impact of the shocks. Prioritized, well-targeted and cost-effective spending would be critical.
April 23, 2020
Niger: Requests for Disbursement Under the Rapid Credit Facility and for Rephasing of Access Under the Extended Credit Facility -Press Release; Staff Report; and Statement by the Executive Director for Niger
Description: This paper discusses Niger’s Requests for Disbursement Under the Rapid Credit Facility and for Rephasing of Access Under the Extended Credit Facility. The coronavirus disease 2019 (COVID-19) pandemic is inflicting significant damage on Niger’s economy at a time when the government is already faced with the deteriorating security situation across the Sahel region. A first local infection was reported on March 19, 2020 and a state of emergency was declared on March 27, 2020. The authorities adopted a comprehensive response plan, comprising health care measures and steps to alleviate the social and economic fallout from the crisis. The 5th program review was concluded on January 8, 2019. Performance has since been mixed. Difficulties to reliably recalibrate program parameters while the global COVID-19 crisis is still unfolding preclude the conduct of the 6th program review on the regular schedule. As a result, the authorities previously requested an extension of the program and now request rephasing the final disbursement due to the delay.