IMF Staff Completes Discussions for the Fourth Review under the Extended Credit Facility Arrangement for The Gambia

IMF News, April 9, 2022

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Canonical URL: IMF Staff Completes Discussions for the Fourth Review under the Extended Credit Facility Arrangement for The Gambia

Mission dates: March 28–April 8, 2022.
Press release date: April 9, 2022.
Mission led by: Mr. Ivohasina Fizara Razafimahefa, Mission Chief for The Gambia.
Purpose: Fourth review of The Gambia’s economic program supported by the IMF’s Extended Credit Facility arrangement (ECF).
Staff-level agreement reached with the authorities on financial and economic policies to support the IMF Executive Board’s completion of the fourth review.
IMF Executive Board consideration of the staff report on the review is tentatively scheduled in June 2022.
Upon Board approval, SDR 5 million (equivalent to about US$7.0 million) will be made available to The Gambia.
Note: All statements reflect IMF staff views and do not necessarily represent the views of the IMF’s Executive Board.

2021 real GDP growth: 5.6 percent (rebound from COVID-19 low; driven by some recovery in the tourism sector and robust private construction).
2022 growth projection: around 5.6 percent.
Medium-term growth projection: strengthening to an annual average of 6 percent.
Inflation:
- December 2021: 7.6 percent.
- February 2022: 8.3 percent.
Foreign exchange reserves: strengthened further, reaching almost 6 months of prospective imports in December 2021 (partly reflecting the IMF’s August 2021 SDR allocation).

Fiscal performance in 2021: weakened due to mounting spending pressures, primarily additional health spending and election-related security spending, and a shortfall in external budget support grants.
Monetary policy: Central Bank continued to maintain a supportive monetary policy stance; IMF staff note monetary policy will need to be tightened in the face of increased inflationary pressures while safeguarding the fragile recovery.
External shocks: Repercussions of the war in Ukraine are weighing on the rebound and fueling inflationary pressures; government determined to take necessary measures to tackle implications, such as revenue loss stemming from the recent surge in global commodity prices.

Quantitative/indicative targets:
- All but one quantitative performance criterion at end-December 2021 were met.
- All but one indicative target at end-December 2021 were met.
Structural reforms progressing in areas including:
- Institutional framework of State-Owned Enterprises (SOEs).
- Transparency of COVID-19 spending.
- Public financial management.
- Revenue administration, including tax expenditure policy and digitalization of tax collection systems.
- Budget and debt management processes.
Transparency measures for COVID-19 spending:
- Authorities continue to publish the list of all COVID-19-related procurement contracts and their beneficiary owners on the Gambia Public Procurement Agency’s (GPPA) website.
- National Audit Office (NAO) completed and published the first phase of an ex-post audit of COVID-19 spending.
SOE governance: Good progress reported in strengthening the institutional framework.

Fiscal policy:
- Government determined to take all necessary measures to tackle implications of external shocks and revenue losses from surging global commodity prices.
Monetary policy:
- Need to tighten monetary policy in response to increased inflationary pressures while safeguarding the fragile economic recovery.
Continued commitment to:
- Full transparency of COVID-19-related spending.
- Advancing structural reforms in revenue administration, public financial management, and SOE governance.

Meetings with Gambian leadership and officials:
- His Excellency Adama Barrow, President of The Republic of The Gambia.
- Her Excellency Isatou Touray, Vice President of The Republic of The Gambia.
- Minister of Finance and Economic Affairs, Mambury Njie.
- Minister of Justice, Dawda Jallow.
- Minister of Trade of Trade, Industry and Regional Integration, Seedy Keita.
- Minister of Tourism and Culture, Hamat Bah.
- Governor of the Central Bank of The Gambia, Buah Saidy.
- Senior staff of multiple ministries and state-owned enterprises (ministries listed in mission statement).
Consultations with non-government stakeholders:
- Representatives of the private sector, civil society, banks and microfinance institutions, and development partners—who showed strong support for the reforms under the ECF-supported program.

International Monetary Fund, IMF Communications Department (Press Release No. 22/112), April 9, 2022.