Press Release No. 06/76

Press Release: Statement by IMF Staff Mission to Mali

April 19, 2006

Mr Christopher Lane, the International Monetary Fund's (IMF) mission chief for Mali, issued the following statement today in Bamako, Mali:

"An IMF mission visited Mali during April 6-19, 2006, for discussions on the fourth review under Mali's Poverty Reduction and Growth Facility (PRGF) arrangement.¹ The mission held discussions with the Minister of Economy and Finance Abou-Bakar Traoré, Central Bank of West Africa States (BCEAO) National Director Idrissa Traoré, other senior officials of the Government of Mali, private sector representatives and development partners.

"The three-year PRGF arrangement, approved by the Executive Board of the IMF on June 23, 2004, provides SDR 9.3 million (about US$13.5 million) to support implementation of Mali's economic program. Following completion by the IMF Executive Board of the second and third reviews in December 2005, a total of SDR 5.3 million (about US$ 7.7 million) was disbursed under the PRGF arrangement (see Press Release No. 05/283).

"The mission found the macroeconomic outlook promising. The recent strengthening of export prices for gold and cotton as well a good cereal harvest are expected to contribute to a year of robust growth and low consumer price inflation.

"The mission worked with the Malian authorities to assess performance under the PRGF program. On the basis of preliminary data, quantitative targets for end-March 2006 for domestic borrowing, non-accumulation of arrears, contracting of non-concessional debt and wages were met. However, tax receipts fell short of objectives for end-March. The mission supports the authorities' efforts to strengthen tax collection, particularly through customs receipts and limits of tax exemptions.

"The mission found that implementation of structural reforms has advanced, particularly the privatization of the cotton company CMDT. Nonetheless, some structural reforms have been delayed, in particular the implementation of banking sector reforms and those aimed at ensuring adequate financing of the civil service pension system.

"The mission reached understandings on additional high-quality spending to be financed by resources provided by the IMF under the Multilateral Debt Relief Initiative (see Press Release No. 05/297), which aims to contribute to achievement of the Millennium Development Goals."

¹ The PRGF is the IMF's concessional lending facility for low-income countries. PRGF loans carry an annual interest rate of 0.5 percent, and are repayable over 10 years with a 5½-year grace period on principal payments.