IMF Executive Board Completes the Sixth and Final Review under the Extended Credit Facility Arrangement for The Gambia and Approves US$ 6.66 Million Disbursement
June 12, 2023
- The IMF Executive Board decision allows for an immediate disbursement of about US$ 6.66 million to the Gambia to help meet the country’s financing needs, address the repercussions of the war in Ukraine, and support the post-pandemic recovery.
- The exogenous shocks continue to weigh on the country’s socio-economic environment, impeding vigorous economic activity. Inflation pressures persist.
- The Gambian authorities are taking measures to address the exogenous shocks and remain committed to strong policies and reforms.
Washington, DC : Today, the Executive Board of the International Monetary Fund (IMF) completed the sixth and final review under The Gambia’s Extended Credit Facility (ECF) arrangement. The completion of the review enables the disbursement of SDR 5 million (about US$ 6.66 million) to help meet the country’s balance-of-payments and fiscal financing needs amid challenges, related primarily to the war in Ukraine and the lingering impacts of the pandemic. This disbursement brings the total disbursements under the ECF arrangement to SDR 70.55 million (about US$ 94 million).
In completing the sixth review, the Executive Board also approved the authorities’ request for a waiver for nonobservance of the continuous performance criterion on the accumulation of new external payment arrears by the central government, based on corrective actions taken by the authorities.
The ECF arrangement for the Gambia was approved by the IMF’s Executive Board on March 23, 2020 , with an initial total access of SDR 35 million (or 56.3 percent of quota). Access under the ECF arrangement was augmented twice, at the completion of the first ECF review in January 2021 and at the completion of the fifth ECF review in December 2022 . The Gambia has also benefited from an IMF Rapid Credit Facility of SDR 15.55 million and received debt service relief from the IMF under the Catastrophe Containment and Relief Trust , totaling SDR 7.9 million.
The repercussions of the war in Ukraine and the lingering impacts of the COVID-19 pandemic are weighing on The Gambia’s socio-economic environment. Inflation pressures persist and are intensifying. The Gambian authorities are taking measures to address the exogenous shocks and remain committed to strong policies and reforms. The severe foreign exchange shortages that the country experienced in late 2022 have somewhat eased.
Following the Executive Board discussion, Mr. Bo Li, Deputy Managing Director and Acting Chair, made the following statement:
“The Gambia’s performance under the economic program supported by the Extended Credit Facility (ECF) has been broadly satisfactory despite challenges related to the war in Ukraine, the lingering impacts of the COVID-19 pandemic, a major flooding, and trade disruptions. These shocks have constrained economic activity and intensified inflationary pressures and are weighing on the country’s socio-economic environment.
“Despite pressures, fiscal policy remains appropriately anchored on the approved 2023 budget. Given high debt vulnerabilities, efforts should continue to bolster domestic revenue mobilization and prioritize investment projects. In anticipation of the expiration of the debt rescheduling period and to keep public debt on a downward path, it will be paramount to strengthen fiscal and external buffers by containing domestic borrowing, focusing on grants and highly concessional loans, andimplementing a strong medium-term fiscal framework. Strengthening social safety nets remains important.
“The Central Bank has appropriately tightened its monetary policy stance to help tame inflationary pressures. The foreign exchange pressures have eased following the high tourism season and the exchange rate movements. Going forward, the central bank is encouraged to make full use of its policy toolkit to fight inflation and to continue to ensure that the exchange rate reflects market forces. Deepening and strengthening the financial sector would also be important.
“The authorities made significant progress in their structural reform agenda, including in the areas of procurement and SOE institutional framework. They are encouraged to maintain this renewed reform momentum, including by preparing and enforcing the regulations of the newly approved laws, adopting the anti-corruption bill, implementing the recommendations from the recent IMF governance diagnostic mission, and improving financial inclusion and the business environment to support private sector-led growth and poverty reduction. The authorities’ commitment to meet zero emission targets by 2050 is commendable.
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The Gambia: Selected Economic Indicators, 2021–2028 |
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|
2021 |
2022 |
2023 |
2024 |
2025 |
2026 |
2027 |
2028 |
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|
Prel. |
Prog. |
Prel. |
Prog. |
Proj. |
Projections |
|||||
|
(Percent change; unless otherwise indicated) |
||||||||||
|
National account and prices |
||||||||||
|
GDP at constant prices |
4.3 |
4.5 |
4.4 |
6.0 |
5.6 |
6.3 |
5.8 |
5.0 |
5.0 |
5.0 |
|
GDP deflator |
7.8 |
9.0 |
10.3 |
9.3 |
11.2 |
7.0 |
5.1 |
4.1 |
4.4 |
4.6 |
|
Consumer prices (average) |
7.4 |
11.3 |
11.5 |
11.1 |
12.9 |
9.5 |
6.0 |
5.0 |
5.0 |
5.0 |
|
Consumer prices (end of period) |
7.6 |
12.4 |
13.7 |
9.7 |
12.0 |
7.1 |
5.0 |
5.0 |
5.0 |
5.0 |
|
External sector |
||||||||||
|
Exports, f.o.b (US$ values) |
6.2 |
-38.3 |
-38.6 |
151.1 |
151.2 |
27.4 |
6.9 |
5.7 |
5.7 |
5.8 |
|
Imports, f.o.b (US$ values) |
6.9 |
26.2 |
22.9 |
18.3 |
21.4 |
10.1 |
6.1 |
3.4 |
5.4 |
4.7 |
|
Terms of trade (deterioration = -) |
-7.5 |
-3.9 |
-2.2 |
-1.0 |
-1.2 |
-4.0 |
-1.8 |
-0.9 |
2.2 |
2.8 |
|
Real effective exchange rate (depreciation = -) |
0.1 |
… |
7.9 |
… |
… |
… |
… |
… |
… |
… |
|
(Contributions to broad money growth; percent) |
||||||||||
|
Money and credit |
||||||||||
|
Broad money |
19.5 |
4.0 |
7.1 |
6.5 |
11.6 |
10.7 |
10.7 |
6.8 |
6.1 |
6.9 |
|
Net foreign assets |
8.8 |
-10.7 |
-4.5 |
1.6 |
3.5 |
4.9 |
4.1 |
0.3 |
0.4 |
0.6 |
|
Net domestic assets |
10.7 |
14.7 |
11.6 |
4.8 |
8.1 |
5.9 |
6.6 |
6.5 |
5.7 |
6.3 |
|
Of which: |
||||||||||
|
Credit to central government (net) |
9.3 |
5.5 |
7.5 |
3.1 |
4.8 |
2.4 |
2.1 |
1.0 |
0.0 |
0.0 |
|
Credit to the private sector (net) |
3.1 |
6.0 |
3.8 |
1.7 |
3.3 |
3.5 |
4.5 |
5.5 |
5.7 |
6.3 |
|
Velocity (GDP/broad money) |
1.7 |
1.8 |
1.8 |
2.0 |
1.9 |
2.0 |
2.0 |
2.0 |
2.1 |
2.1 |
|
(Percent of GDP; unless otherwise indicated) |
||||||||||
|
Central government finances |
||||||||||
|
Domestic revenue (taxes and other revenues) |
14.3 |
11.9 |
12.0 |
12.5 |
12.1 |
12.7 |
13.5 |
14.1 |
14.5 |
14.8 |
|
Of which:Tax Revenue |
10.3 |
9.3 |
9.2 |
9.8 |
9.5 |
10.0 |
10.7 |
11.2 |
11.6 |
11.9 |
|
Grants |
2.5 |
5.9 |
5.6 |
6.6 |
6.7 |
6.1 |
6.3 |
5.4 |
5.1 |
4.8 |
|
Total expenditures |
21.4 |
22.7 |
22.5 |
21.7 |
21.6 |
20.8 |
20.7 |
20.0 |
20.1 |
20.0 |
|
Of which: Interest (percent of government revenue) |
21.2 |
21.4 |
18.0 |
16.9 |
17.6 |
24.0 |
18.8 |
15.3 |
12.5 |
11.0 |
|
Net lending (+)/borrowing (–) |
-4.6 |
-4.8 |
-4.9 |
-2.7 |
-2.7 |
-2.0 |
-0.9 |
-0.5 |
-0.6 |
-0.4 |
|
Fiscal financing |
4.7 |
4.8 |
4.8 |
2.7 |
2.7 |
2.0 |
0.9 |
0.5 |
0.6 |
0.4 |
|
Foreign |
0.5 |
1.1 |
1.6 |
1.2 |
1.3 |
0.9 |
0.0 |
0.0 |
0.6 |
0.4 |
|
Domestic |
4.2 |
3.8 |
3.2 |
1.5 |
1.4 |
1.1 |
0.9 |
0.5 |
0.0 |
0.0 |
|
Primary balance |
-1.6 |
-2.3 |
-2.7 |
-0.6 |
-0.6 |
1.0 |
1.6 |
1.7 |
1.2 |
1.2 |
|
Public debt |
83.5 |
80.8 |
83.9 |
75.4 |
72.8 |
69.0 |
64.0 |
59.8 |
55.6 |
51.7 |
|
Domestic public debt |
35.1 |
32.4 |
32.2 |
29.5 |
27.3 |
27.0 |
25.3 |
23.6 |
21.6 |
19.7 |
|
External public debt |
48.4 |
48.4 |
51.8 |
45.9 |
45.5 |
42.0 |
38.8 |
36.2 |
34.0 |
32.0 |
|
External public debt (millions of US$) |
965.9 |
1003.7 |
1029.3 |
1038.2 |
1,032.2 |
1,052.1 |
1,047.1 |
1,036.3 |
1,036.3 |
1,039.0 |
|
External current account balance |
||||||||||
|
Excluding official transfers |
-0.5 |
-16.8 |
-7.9 |
-14.6 |
-14.0 |
-11.0 |
-10.8 |
-9.3 |
-8.7 |
-8.1 |
|
Including official transfers |
-0.1 |
-14.7 |
-6.0 |
-12.6 |
-11.9 |
-8.9 |
-9.5 |
-8.6 |
-8.0 |
-7.5 |
|
Gross official reserves (millions of US$) |
530.4 |
424.6 |
454.7 |
416.4 |
471.5 |
469.7 |
466.3 |
452.9 |
453.5 |
458.1 |
|
(months of next year's imports of goods and services) |
7.1 |
4.8 |
5.1 |
4.4 |
4.9 |
4.6 |
4.4 |
4.0 |
3.8 |
3.6 |
|
Savings and investment |
||||||||||
|
Gross investment |
22.1 |
22.2 |
23.4 |
22.5 |
22.9 |
22.1 |
23.1 |
23.1 |
23.8 |
24.1 |
|
Of which: Central government |
6.2 |
8.9 |
8.4 |
9.0 |
9.1 |
8.2 |
8.7 |
8.2 |
8.4 |
8.3 |
|
Gross savings |
22.1 |
7.5 |
17.4 |
9.9 |
11.0 |
13.2 |
13.6 |
14.5 |
15.8 |
16.5 |
|
Memorandum items: |
||||||||||
|
Nominal GDP (billions of dalasi) |
104.9 |
119.5 |
120.9 |
138.5 |
142.0 |
161.5 |
179.6 |
196.3 |
215.3 |
236.4 |
|
GDP per capita (US$) |
816.4 |
845.2 |
830.8 |
881.7 |
870.1 |
932.7 |
977.2 |
1,006.5 |
1,039.6 |
1,075.4 |
|
Use of Fund resources (millions of SDRs) |
||||||||||
|
Disbursements |
35.0 |
26.4 |
26.4 |
5.0 |
5.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
|
Of which: ECF Augmentation |
20.0 |
… |
15.6 |
… |
… |
… |
… |
… |
… |
… |
|
Repayments |
-3.7 |
-2.0 |
-2.0 |
-4.1 |
-4.1 |
-3.9 |
-5.2 |
-9.5 |
-14.0 |
-16.8 |
|
CCRT debt relief 1 |
4.0 |
0.8 |
0.8 |
… |
… |
… |
… |
… |
… |
… |
|
PV of overall debt-to-GDP ratio |
70.8 |
67.9 |
69.8 |
63.3 |
60.4 |
57.6 |
53.7 |
49.6 |
45.3 |
41.1 |
|
Sources: The Gambian authorities; and IMF staff estimates and projections. |
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1The grant for debt service falling due through April 13, 2022 is available under the CCRT. |
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IMF Communications Department
MEDIA RELATIONS
PRESS OFFICER: Nico Mombrial
Phone: +1 202 623-7100Email: MEDIA@IMF.org