IMF Executive Board Completes the First Review Under the Extended Credit Facility and the Resilience and Sustainability Facility with the Republic of Madagascar

IMF News, February 26, 2025

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Canonical URL: IMF Executive Board Completes the First Review Under the Extended Credit Facility and the Resilience and Sustainability Facility with the Republic of Madagascar

The Executive Board completed the First Reviews under the 36-month Extended Credit Facility (ECF) arrangement and under the Resilience and Sustainability Facility (RSF) arrangement.
The ECF and RSF arrangements were approved by the IMF Executive Board in June 2024.
The completion of the reviews allows for an immediate disbursement of US$101 million.
Disbursement breakdown:
- SDR 36.7 million (about US$48 million) under the ECF arrangement.
- SDR 40.7 million (about US$53 million) under the RSF arrangement.
Press Release No. 25/47; publication date: February 26, 2025.

Madagascar’s performance under the ECF and RSF programs has been adequate albeit uneven.
Program performance at end-June 2024 was broadly assessed as mixed, stressing the need for continued strong political ownership to support program implementation.
Key reform priorities highlighted:
- Continued implementation of the automatic fuel pricing mechanism to help contain fiscal risks and create space for more public investment and social spending.
- Reform of JIRAMA remains a priority and requires efforts to "firmly secure the financial recovery of JIRAMA."
- Further efforts to continue improving domestic revenue mobilization.

The automatic fuel pricing mechanism is expected to create fiscal space for social spending and investment.
Reinforcing public financial and investment management processes is critical to improve budget execution and traceability.
Better cash flow projections and management should facilitate spending and limit the accumulation of arrears.
Continued improvements in governance, building on the ongoing Governance Diagnostic Assessment, and the implementation of the newly published Anti-Corruption Strategy for 2025-30 will support efforts to fight corruption and promote transparency.

The central bank (BFM) should stand ready to raise its policy rates to keep inflation on a downward path.
Further improvements in the liquidity management framework and better communication about monetary policy decisions would bolster BFM’s credibility.

Further building adaptation and resilience to climate shocks as well as mobilizing climate finance should continue to be a key priority.
The new decree on environmental and social impact assessments provides a framework to evaluate and select investment projects, which should be applied to new investments, including road projects.

IMF Communications Department; MEDIA RELATIONS; PRESS OFFICER: Tatiana Mossot; Phone: +1 202 623-7100; Email: MEDIA@IMF.org; @IMFSpokesperson