IMF Executive Board Completes Fourth Review Under ECF Arrangement for MaliPress Release No. 10/294
July 16, 2010
The Executive Board of the International Monetary Fund (IMF) today completed the fourth review of Mali’s economic performance under a program supported by the Extended Credit Facility (ECF)1. The Board’s decision enables the government to request a disbursement amounting to SDR 2 million (about US$3 million), bringing total disbursements to Mali to an amount equivalent to SDR 23.99 million (about US$36.1 million). The Executive Board also approved the modification of end-June 2010 performance criteria.
The Executive Board also concluded the 2010 Article IV consultation. Details of the findings of the Article IV will be published in a Public Information Notice in due course.
The ECF arrangement for Mali was approved in May 2008 (see Press Release No. 08/126) for an amount equivalent to SDR 27.99 million (about US$42.1 million).
At the conclusion of the Board's discussion, Mr. John Lipsky, First Deputy Managing Director and Acting Chair, stated:
“The authorities are to be commended for the satisfactory implementation of their economic and financial program in 2009, despite the global economic crisis. The 2010 economic outlook is positive, with a projected strengthening of economic activity. Continued commitment to prudent macroeconomic and structural reform will be necessary to reduce vulnerabilities, diversify the economy, raise economic growth, and reduce poverty.
“The authorities are implementing a modest fiscal stimulus package reflected in a revised budget law and financed by part of SOTELMA’s privatization revenue. The authorities are committed to ensure full transparency in the use of the privatization receipts. Budget execution will need to be carefully monitored and the necessary savings ensured to achieve the targets for the fiscal deficit and the reduction of pending bills.
“Prudent fiscal and debt policy will be critical to reduce the Malian economy’s vulnerability to external shocks. The authorities plan to streamline the tax system and broaden the tax base. They are also determined to strengthen public debt management and exercise prudence in managing and contracting external debt.
“Mali’s structural reform program is making satisfactory progress, with a further strengthening of public finance management targeted in 2010. The privatization of the cotton parastatal CMDT and the reform program of the Housing Bank of Mali are on track. Nevertheless, the authorities will need to redouble their reform efforts to enhance the environment for private sector activity, improve the provision of financial services, diversify the economic base, alleviate impediments to trade, and raise productivity” Mr Lpisky added.
1 The Extended Credit Facility (ECF) has replaced the Poverty Reduction and Growth Facility (PRGF) as the Fund’s main tool for medium-term financial support to low-income countries by providing a higher level of access to financing, more concessional terms, enhanced flexibility in program design features, and more focused streamlined conditionality. Financing under the ECF currently carries a zero interest rate, with a grace period of 5½ years, and a final maturity of 10 years. The Fund reviews the level of interest rates for all concessional facilities every two years.