Press Release No. 08/281

Press Release: Statement by an IMF Mission to Burundi

November 13, 2008

A mission from the International Monetary Fund (IMF), led by Mr. Bernardin Akitoby, visited Burundi October 29-November 12, 2008 to conduct the first review of the government economic and financial program supported by an arrangement under the Poverty Reduction and Growth Facility (PRGF). In cooperation with the World Bank, the mission also assessed progress on implementing the triggers for completion of debt relief under the Heavily Indebted Poor Countries (HIPC) initiative.

The mission met with President Pierre Nkurunziza; the Second Vice-President, Gabriel Ntisezerana; the President of the National Assembly, Pie Ntavyohanyuma; the Minister of Economy, Finance and Development Cooperation, Clotilde Nizigama; the Ministers responsible for National Education, and Agriculture; the Vice-Minister in charge of the Fight against AIDS; and the Governor of the Central Bank, Mr Gaspard Sindayigaya. The mission had constructive discussions with members of the donor community and civil society.

The mission issued the following statement in Burundi on November 12, 2008:

"Performance under the PRGF-supported program has been broadly satisfactory. All quantitative and structural performance criteria for September 2008 were observed, and good progress was made in implementing key structural reforms and the triggers for the HIPC completion point. This performance was achieved against the backdrop of the recent food and oil price shocks. As a result, the year-on-year inflation at end-December 2008 is projected to be higher than targeted (22 percent compared with 14 percent).The macroeconomic outlook for 2009 is positive, with real GDP projected at 4.8 percent and inflation declining to 9 percent. Downside risks include mainly the highly uncertain external environment, with declining coffee prices and higher international oil prices—coffee still accounts for some 70 percent of burundi's exports.

"For 2009, policy discussions focused mainly on the 2009 budget and the need to preserve macroeconomic stability and revive growth in the face of the challenging economic environment. The mission was encouraged by the authorities' efforts to consolidate progress on revenue collection and reallocate spending to priority sectors. The mission encouraged the authorities to consolidate progress in good governance and deepen structural reforms, including in the coffee sector.

"The mission confirmed that the IMF will continue to help Burundi to address these challenges. The IMF Board is expected to consider the staff report on the first review of the PRGF-supported program and the HIPC completion point in January 2009. The mission would like to thank the authorities for their warm hospitality and the very close and constructive cooperation."