## Press Release: IMF Executive Board Completes Second Review under the Extended Credit Facility Arrangement for Chad and Approves US$28.7 Million Disbursement

_IMF News, December 14, 2015_

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## Bibliographic details
- Published: December 14, 2015

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### Review outcome and disbursement
- The Executive Board completed the second review of Chad’s economic performance under the program supported by an Extended Credit Facility (ECF) arrangement.
- Completion of the review enables the immediate disbursement of the equivalent of SDR 20.65 million (about US$28.7 million).
- This disbursement brings total disbursements under the arrangement to the equivalent of SDR 53.93 million (about US$75.1 million).

### Waivers and performance criteria
- The Board approved the authorities’ request for waivers for:
  - Non-observance of the performance criterion on the non-accumulation of non-concessional external debt, on the basis of the minor nature of the non-observance.
  - Non-observance of the performance criterion on the non-accumulation of domestic payment arrears, on the basis of corrective actions taken.
- Performance under the Fund-supported economic program has been described as broadly satisfactory, with most performance criteria met, in particular the non-oil primary deficit target—the main fiscal anchor of the program.

### ECF arrangement details and access
- Chad’s three-year ECF arrangement was approved by the Executive Board on August 1, 2014 for an amount equivalent to SDR 79.92 million (about US$111.3 million).
- An augmentation of access of 40 percent of quota was approved in April 2015, bringing total access to SDR 106.56 million (about US$148.4 million).

### Executive Board statement — macroeconomic impact and outlook
- Two external shocks have significantly impacted macroeconomic outcomes in Chad:
  - The collapse in oil prices.
  - The deterioration of regional security.
- Consequences cited:
  - Growth has slowed sharply.
  - Fiscal spending has been cut in response to the large shortfall in oil receipts.
- With oil receipts expected to be permanently lower, Chad has adjusted its medium-term fiscal strategy.
- The draft 2016 budget targets an additional tightening of the underlying fiscal policy stance (i.e., excluding one–off election–related and security spending that will be financed by extraordinary receipts).
- The strategy is underpinned by an emergency action plan with measures aimed at:
  - Rationalizing transfers and subsidies.
  - Supporting non-oil tax revenue collections.
- Social spending will continue to be protected, remaining one of the program’s quantitative targets.

### Risks, financing, and reform priorities
- Since projected exceptional receipts from asset sales are an important financing source for the 2016 budget:
  - It is critical that expenditures be phased prudently.
  - The contingency plan in the event of shortfalls or delays in those receipts must be implemented.
- Despite having reached the HIPC completion point, Chad remains at high risk of debt distress.
  - Prudent fiscal and borrowing policies remain essential.
- Continued progress in improving transparency of oil revenue is crucial, especially given recent significant changes in the oil sector.
- The structural reform agenda remains focused on:
  - Improving public financial management.
  - Removing obstacles to private sector development, economic diversification, and inclusive growth.

*Press Release No. 15/560 — December 14, 2015 — IMF COMMUNICATIONS DEPARTMENT*

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## References

- [Chad and the IMF](http://www.imf.org/external/country/TCD/index.htm)
- [Press Releases](https://www.imf.org/en/news/searchnews)
- [PRESS CENTER](http://presscenter.imf.org/)
- [Press Release No. 14/381](https://www.imf.org/external/np/sec/pr/2014/pr14381.htm)
- [https://www.imf.org/en/home](https://www.imf.org/en/home)

_Source: https://www.imf.org/en/news/articles/2015/09/14/01/49/pr15560_