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IMF executive board approves US$95.9M ECF arrangement for Sierra Leone

IMF executive board approves US$95.9M ECF arrangement for Sierra Leone

The  Executive Board of the International Monetary Fund [IMF} has on October 21, 2013 approved a three year arrangement under the Extended Credit Facility [ECF] for Sierra Leone in an amount equivalent to SDR 62.22  million [about US$ 95.9 million]. The overall amount of the program represents 60 percent of Sierra Leone’s quota in the IMF and enables the immediate disbursement of SDR 8.89 million [about US$ 13.7 million]. The ECF – supported program seeks to underpin the government’s economic program and aims to facilitate high- quality public investment and growth enhancing reforms in the context of macroeconomic stability.

The Executive Board also concluded the 2013 article IV consultations with Sierra Leone, which will be detailed in a separate press release in due course. Following the executive Board’s discussion, Mr.  Min Zhu, Deputy Managing Director and acting Chair, made the following statement.

“Sierra Leone has achieved strong macroeconomic gains in recent years. Bolstered by iron production, economic growth has been robust, while inflation has been falling on the back of a tight monetary stance, a stable exchange rate, and lower food prices. The medium – term outlook is favorable, with policy focused on achieving strong broad- based growth, further disinflation, and an improved external position.

“Continued efforts will be needed to strengthen policy implementation, particularly in the fiscal area. The authorities’ plans to strengthen public financial management appropriately aim to enhance revenue mobilization, improve spending controls, and reduce domestic debt. Key revenue components in their fiscal strategy include improvements in tax administration, reductions in tax exemptions, and the adoption of a comprehensive fiscal regime for the natural resources sector. Timely implementation of these reforms will be critical to buttress macroeconomic stability and the credibility of fiscal policy.

“The new fund- supported program aims to underpin the authorities’ development and poverty – reduction strategy. This strategy aims at entrenching macroeconomic stability and promoting inclusive growth through further infrastructure investments and economic diversification. The program calls for continued fiscal consolidation, strong monetary and exchange rate policies to support the single – digit inflation target, prudent borrowing policies, and growth- enhancing structural reforms.”

By Hawanatu Bockari

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