Latest news with #ExtendedCreditFacility
Zawya
3 days ago
- Business
- Zawya
International Monetary Fund (IMF) Staff Conclude Article IV Discussions and Reach Staff-Level Agreement on the Third Review of the Extended Credit Facility for Ethiopia
IMF staff and the Ethiopian authorities have reached staff-level agreement on economic policies to conclude the third review of the four-year US$3.4 billion Extended Credit Facility arrangement. Once approved by the IMF Executive Board, Ethiopia will gain access to about US$260 million in financing. Ethiopia's macroeconomic performance has exceeded program expectations, with better-than-forecast results for inflation, export growth, and international reserves. Maintaining reform momentum remains essential for consolidating recent gains, correcting macroeconomics imbalances, restoring external debt sustainability, laying the foundations for high, private sector-led growth, and ensuring the success of Ethiopia's homegrown reform agenda. A staff team from the International Monetary Fund (IMF) led by Mr. Alvaro Piris, visited Addis Ababa from April 3 to 17, 2025, to discuss the 2025 Article IV consultation and the third review under the Extended Credit Facility (ECF). Discussions continued at the Spring Meetings in Washington DC, April 21-28, and subsequently. The ECF arrangement was approved by the IMF Executive Board on July 29, 2024, for a total amount of US$3.4 billion (SDR 2.556 billion). Subject to approval by the IMF Executive Board, the third review will make available about US$260 million (SDR191.7 million), bringing total IMF financial support under the ECF arrangement so far to about US$1,849 million (SDR1,406.4 million). Today, Mr Piris issued the following statement: 'The IMF staff team and the Ethiopian authorities have reached staff-level agreement on the third review of Ethiopia's economic program under the ECF arrangement. The agreement is subject to the approval of IMF management and the Executive Board in the coming weeks. A memorandum of understanding with official creditors is expected to be agreed ahead of the IMF Board's consideration of the third review. 'The authorities' policy actions in the first year of the program have yielded strong results. The transition to a flexible exchange rate regime has proceeded with little disruption. Measures to modernize monetary policy, mobilize domestic revenues, enhance social safety nets, strengthen state-owned enterprises, and anchor financial stability continue to show encouraging results. Macroeconomic indicators have performed better than expected, with substantially better outcomes than forecast for inflation, goods exports, and international reserves. 'Recent policy action should help deepen the FX market and tackle remaining distortions. While real exchange misalignment has been corrected and FX availability has improved from a year ago, the spread between the official and parallel market widened again in early 2025 and high fees and commissions persist. Actions that are being rolled out to enhance transparency, reduce costs, ease restrictions on current account transactions, and strengthen prudential regulation will help to improve the functioning of the FX market. 'Maintaining reform momentum will be key to consolidating gains and securing sustainable high growth. Continued tight monetary and financial conditions will be important for managing inflation and exchange rate expectations. Further revenue mobilization is needed to provide sustainable financing for critical development spending. Reforms to improve the business environment, ensure fair taxation practices, encourage foreign direct investment, and facilitate open dialogue with business will be important to secure private sector investment. Efforts to end the remaining elements of financial repression and develop the capital market will help to mobilize savings and support the efficient allocation of capital. 'The staff team is grateful to the authorities for the excellent policy discussions and their strong commitment to the success of the IMF-supported economic program. The team met with Minister of Finance Ahmed Shide, Governor of the National Bank of Ethiopia Mamo Mihretu, State Minister of Finance Eyob Tekalign, and other senior officials. Staff also had productive discussions with representatives of banks and businesses that are operating in a range of sectors and representatives of civil society.' Distributed by APO Group on behalf of International Monetary Fund (IMF).
Business Insider
25-05-2025
- Business
- Business Insider
IMF backs $630 million credit deal with Central African nation
Chad has reached a staff-level agreement with the International Monetary Fund (IMF) as it seeks to secure a four-year Extended Credit Facility (ECF) program valued at approximately $630 million. Chad has reached a staff-level agreement with the IMF for a prospective four-year Extended Credit Facility program worth $630 million. If approved by the IMF, the program aims to reduce Chad's public budget deficit and ensure fiscal consolidation through various reforms. This IMF support is expected to attract further international financing, aiding Chad's implementation of comprehensive development and reform plans. Announced in May 2025 following negotiations in N'Djamena, the agreement awaits approval by the IMF Executive Board and the securing of necessary financing assurances. The program is designed to support Chad's long-term development agenda, anchored by its Vision 2030 framework and the accompanying National Development Plan (NDP). Vision 2030, officially titled ' The Chad We Want, ' sets the country's strategic direction to become an emerging economy by 2030. It focuses on strengthening good governance and the rule of law, promoting national unity, and creating conditions for sustainable socio-economic development. The Vision 2030 framework is structured around four strategic axes: Strengthening national unity through promoting peace, civic values, and cultural inclusion. Enhancing good governance and the rule of law, including improving public administration, economic governance, democratic culture, and security. Developing a diversified and competitive economy, emphasizing infrastructure, domestic savings, and private investment. Improving the quality of life for the Chadian population, focusing on environmental sustainability and social well-being. If approved, the IMF program would align with these strategic priorities, aiming to reduce Chad's public budget deficit from over 4% of GDP to an average of 1.5% over the next four years. This fiscal consolidation would be supported by reforms in revenue mobilization, expenditure control, and restructuring of state-owned banks to enhance financial sector stability. Chad's economic outlook Chad's economy grew by an estimated 3.5% in 2024, down from 5% in 2023, with growth expected to slow slightly to 3.3% in 2025. The economic outlook remains vulnerable due to external shocks including fluctuating oil prices, Chad's main revenue source, regional security challenges, and reduced official development assistance. The proposed program also encourages Chad's continued collaboration with the Central African Economic and Monetary Community (CEMAC) to maintain macroeconomic and financial stability in the region. Beyond immediate fiscal objectives, the anticipated IMF support is expected to catalyze additional financing from international partners, bolstering Chad's efforts to implement its ambitious reform agenda and development strategy. Chad's Vision 2030 and the National Development Plans (2017–2021, 2022–2026, and forthcoming 2027–2030) provide a comprehensive roadmap for structural transformation. These plans emphasize social policy improvements, economic diversification, governance reforms, and environmental sustainability as key pillars for achieving long-term stability and growth. The IMF mission, led by Julien Reynaud, expressed appreciation for the Chadian government's cooperation during the May 5–16 discussions. The mission engaged with senior government officials, representatives from civil society, the financial sector, and development partners to ensure broad-based support for the program. As Chad navigates a complex regional environment marked by conflict and economic pressures, the IMF-backed program, if approved, would represent a critical opportunity to strengthen fiscal discipline, enhance governance, and accelerate development goals for the benefit of its population.
Indian Express
23-05-2025
- Business
- Indian Express
Chad seeks $630 million financial support from IMF
Chad has reached an agreement with the International Monetary Fund for a fresh four-year financial support programme potentially worth about $630 million, under the fund's Extended Credit Facility, the IMF said on Thursday. The requested support comes at a critical juncture for the oil-producing Central African nation which is looking to implement an ambitious national development plan amid declining oil prices, reduced public aid financing, and regional instability. 'Chad stands at a turning point in its history … The NDP will be implemented in a challenging global context. Conflicts and instability in the region, along with declining oil prices and reduced public development aid financing, will place additional pressure on the country's budgetary resources,' IMF mission head Julien Reynaud said in a statement. Following the conclusion of a political transition, Chad intends to implement a range of reforms and projects under its National Development Plan named 'Chad Connection 2030.' Chad's economy is estimated to have grown by 3.5% in 2024, down from 5% in 2023. Growth is projected to slow further to 3.3% in 2025, with a gradual increase expected over the medium term. The programme will aim to reduce Chad's deficit to an average of 1.5% of GDP over the four years of its duration from over 4% currently. The staff level agreement is subject to the approval of IMF's executive board and the securing of the necessary financing assurances, the statement said.
Yahoo
23-05-2025
- Business
- Yahoo
Chad seeks $630 million financial support from IMF
DAKAR (Reuters) -Chad has reached an agreement with the International Monetary Fund for a fresh four-year financial support programme potentially worth about $630 million, under the fund's Extended Credit Facility, the IMF said on Thursday. WHY IT'S IMPORTANT The requested support comes at a critical juncture for the oil-producing Central African nation which is looking to implement an ambitious national development plan amid declining oil prices, reduced public aid financing, and regional instability. KEY QUOTE "Chad stands at a turning point in its history ... The NDP will be implemented in a challenging global context. Conflicts and instability in the region, along with declining oil prices and reduced public development aid financing, will place additional pressure on the country's budgetary resources," IMF mission head Julien Reynaud said in a statement. CONTEXT Following the conclusion of a political transition, Chad intends to implement a range of reforms and projects under its National Development Plan named "Chad Connection 2030." BY THE NUMBERS Chad's economy is estimated to have grown by 3.5% in 2024, down from 5% in 2023. Growth is projected to slow further to 3.3% in 2025, with a gradual increase expected over the medium term. The programme will aim to reduce Chad's deficit to an average of 1.5% of GDP over the four years of its duration from over 4% currently. WHAT'S NEXT The staff level agreement is subject to the approval of IMF's executive board and the securing of the necessary financing assurances, the statement said. (Writing by Bate Felix; Editing by Matthew Lewis)
TimesLIVE
15-05-2025
- Business
- TimesLIVE
IMF ends Malawi programme after no review completed in 18 months
Malawi's $175m (R3.19bn) loan programme from the International Monetary Fund has been terminated after no review was completed over an 18-month period, the fund said late on Wednesday. The donor-dependent Southern African country only received an initial disbursement of $35m (R637.7m) under the four-year Extended Credit Facility approved in November 2023. The IMF said the programme was not able to restore macroeconomic stability. Inflation is running at over 30% in annual terms, while crippling foreign exchange shortages have curbed key imports such as fuel and fertiliser. "Fiscal discipline has proven difficult to maintain in the current environment due to elevated spending pressures and insufficient revenue mobilisation efforts," the IMF said on its website. The country's foreign exchange system had made it difficult to rebuild international reserves and its external debt remained unsustainable because it had not been fully restructured, it said. Malawi's finance ministry said the government would seek to negotiate a new IMF programme after national elections in September. It said government efforts to stabilise the economy had been dogged by "exogenous shocks" like a cholera outbreak, cyclones and last year's El Nino-induced drought
