Central African Republic: Request for Disbursement under the Rapid Credit Facility-Press Release; Staff Report; and Statement by the Executive Director for the Central African Republic
IMF Staff Country Reports, April 28, 2020
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- Central African Republic: Request for Disbursement under the Rapid Credit Facility-Press Release; Staff Report; and Statement by the Executive Director for the Central African Republic
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Bibliographic details
- Published: April 28, 2020
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781513542362.002
Overview
- Paper presents Central African Republic’s Request for Disbursement Under the Rapid Credit Facility.
- Emphasis on implementing policies and structural reforms committed under the Extended Credit Facility (ECF) arrangement adopted in December to:
- ensure macroeconomic stability,
- ensure debt sustainability,
- restore sustained inclusive growth.
- Additional external support, preferably in the form of grants, is urgently required to meet C.A.R.’s elevated financing needs and ease the financial burden of the pandemic.
- Authorities intend to allow the fiscal deficit to increase to accommodate most of the fiscal impact of the pandemic, which will comprise a significant shortfall in revenue and additional outlays as part of the response plan.
- Authorities intend to streamline nonpriority expenditures while maintaining pressing social, infrastructure, and security spending needs.
- Authorities reiterated intention to pursue policies and structural reforms committed under the ECF arrangement approved last December.
Key findings and implications
- Implementation of ECF policies and structural reforms is central to:
- macroeconomic stability,
- debt sustainability,
- restoring sustained inclusive growth.
- Elevated financing needs due to the pandemic necessitate additional external support; grants are preferable to mitigate financial burden.
- Fiscal accommodation (allowing fiscal deficit to increase) is planned to absorb pandemic-related revenue shortfalls and additional response outlays.
- Streamlining nonpriority expenditures is planned, but accommodation preserves capacity for social, infrastructure, and security spending.
Policy recommendations and authorities’ stance
- Continue implementing ECF-supported policies and structural reforms (as committed in the ECF arrangement adopted in December).
- Seek additional external support, with preference for grants to meet elevated financing needs and ease pandemic-related financial burdens.
- Allow a temporary increase in the fiscal deficit to absorb pandemic impacts while streamlining nonpriority spending.
- Maintain spending on pressing social, infrastructure, and security priorities despite fiscal accommodation.
Subject coverage and keywords
- Subjects: Arrears, COVID-19, Credit, Debt sustainability analysis, External debt, Fiscal policy, Fiscal stance, Health, Money, Public debt
- Keywords: Arrears, assistance, balance, Bank-Fund Debt Sustainability Analysis, C.A.R. authorities, Central African Republic authorities, COVID-19, CR, Credit, current account, Debt sustainability analysis, financing, financing gap, financing needs, Fiscal stance, Global, ISCR
Content in this bundle
- Executive Summary