Press Release No. 12/365

Press Release No. 12/365
September 26, 2012

An International Monetary Fund (IMF) mission led by Ms. Catherine McAuliffe visited Monrovia September 14–21, 2012 to complete discussions for the 2012 Article IV Consultation and an economic program that can be supported under a successor three-year Extended Credit Facility (ECF). The mission held discussions with Minister of Finance Amara Konneh, Deputy Central Bank Governor Theophilus Bettie, and other senior officials.

At the end of the mission, Ms. McAuliffe issued the following statement in Monrovia:

“Liberia’s economic growth is on an upward trajectory and economic prospects over the medium term remain favorable. Real GDP growth is expected to reach close to 9 percent in 2012, driven by continued strong growth in the mining sector and rising activity in construction and other services; non-mining activity slowed in the first half of 2012 due to declining rubber export prices and the impact of elevated food and fuel prices on consumption. Risks to growth remain on the downside, especially from sluggish global demand for commodities. Inflation has declined to single digits and is expected to remain stable through end-2012, with upside risks from rising international food prices, although rice prices have so far not moved significantly in world markets. The external payments position remains stable.”

“The mission has reached preliminary understandings with the authorities on the key elements of their economic program that can be supported by the IMF. Policy discussions focused on creating fiscal space to boost spending on infrastructure and human development, while maintaining macroeconomic stability and debt sustainability, promoting financial sector deepening and access to credit, and creating a favorable business climate to support broad-based growth and job creation.”

“The authorities’ medium-term structural reform agenda rightly focuses on strengthening financial oversight and reporting of state owned enterprises; enhancing budget programming, control and monitoring; improving capital spending execution and containing non-priority current expenditures; developing the financial sector and supporting the stability of the banking system; and improving national accounts statistics.”

“The mission welcomed the authorities’ commitment to limit annual external borrowing to 4 percent of GDP in net present value terms to support the scaling up of infrastructure investment while maintaining low debt vulnerabilities. The planned issuance of government treasury bills will provide additional tool for meeting domestic financing needs and will support financial market development.”

“The mission wishes to thank the Liberian authorities and its other counterparts for the constructive and cooperative discussions that took place in Monrovia.”