## Press Release: IMF Executive Board Completes Fourth Review under the Extended Credit Facility Arrangement for Liberia and Approves US$10.2 Million Disbursement _IMF News, December 21, 2015_ ## Source details **Canonical URL:** [Press Release: IMF Executive Board Completes Fourth Review under the Extended Credit Facility Arrangement for Liberia and Approves US$10.2 Million Disbursement](https://www.imf.org/en/news/articles/2015/09/14/01/49/pr15583) ## Other formats - [Markdown version](/en/news/articles/2015/09/14/01/49/pr15583/index.md) - [Structured JSON version](/en/news/articles/2015/09/14/01/49/pr15583/index.json) - [Bundle manifest](/en/news/articles/2015/09/14/01/49/pr15583/bundle-manifest.json) ## Bibliographic details - Published: December 21, 2015 --- ### Review completion and disbursement - The Executive Board completed the fourth review under an Extended Credit Facility (ECF) arrangement for Liberia on December 21, 2015. - Completion of the review enables the disbursement of SDR 7.38 million (about US$10.2 million). - Total disbursement under the arrangement after this payment: SDR 69.21 million (about US$95.8 million). ### Waivers, re-phasing, and extension - The Board approved waivers for the nonobservance of the performance criteria on government revenues and central bank net foreign exchange position. - The Board approved the re-phasing and extension of the arrangement to end-2016 in light of delays caused by the Ebola outbreak. - The ECF arrangement for Liberia was originally approved by the IMF’s Executive Board on November 19, 2012 (Press Release No 12/449) for SDR 51.68 million (about US$71.6 million). - The arrangement was extended on October 14, 2015 to allow for completion of the fourth review. ### Ebola-related assistance and total financing - The IMF provided an ad hoc disbursement of SDR 32.3 million (about US$44.7 million) in augmentation of access under the current ECF Arrangement (see Press Release No 14/441). - The Board approved an SDR 32.3 million (about US$44.7 million) disbursement under the Rapid Credit Facility (RCF). - The Board approved debt relief under the Catastrophe Containment and Relief (CCR) Trust. - Total financing provided to help the country meet urgent balance of payments and fiscal needs resulting from the epidemic: SDR 90.44 million (about US$125.2 million). ### IMF assessment and policy guidance (statement by Mr. David Lipton, First Deputy Managing Director and Acting Chair) - Progress and challenges: - Liberia has largely overcome the Ebola epidemic, credited to decisive policy actions, unprecedented international support, and strong community engagement. - The sharp decline in global commodity prices is holding back the economic recovery. - Performance under the authorities’ Fund-supported program has been uneven due to the epidemic and, to a lesser extent, policy slippages. - Policy priorities to sustain recovery and macroeconomic stability: - Strong program implementation is important to sustain macroeconomic stability, improve policy credibility, and secure additional donor financing. - Fiscal policy next year will remain accommodative to support the recovery. - Reallocation of resources toward the health and education sectors is appropriate. - In light of limited fiscal space, caution is needed in considering tax relief for companies in the commodity sector. - Authorities should press ahead with addressing public financial management weaknesses and further strengthen revenue administration. - Debt and financing strategy: - Borrowing policies should remain prudent in the context of lower growth prospects. - Financing needs, particularly for large investment projects, should be covered mostly with grants and concessional loans to facilitate capital projects while preserving debt sustainability. - External buffers, monetary policy, and financial stability: - Rebuilding external buffers in Liberia’s dual currency regime requires containing the central bank’s operational expenses and limiting foreign exchange intervention only to smoothing volatility. - More effective liquidity management and further development of monetary policy instruments will help safeguard price stability. - Strengthening the prudential oversight of the banking system and the framework for crisis management remains critical to tackle threats to financial stability. ### Program instruments and features (as noted in the press release) - ECF: The ECF replaced the Poverty Reduction and Growth Facility as the Fund’s main tool for medium-term financial support to low-income countries. Financing under the ECF currently carries a zero interest rate, with a grace period of 5½ years, and a final maturity of 10 years. The Fund reviews the level of interest rates for all concessional facilities every two years. - RCF: The RCF provides rapid financial support in a single, up-front payout for low-income countries facing urgent financing needs. Financial assistance under the RCF is provided as an outright disbursement to Poverty Reduction and Growth Trust (PRGT)-eligible members that face an urgent balance of payments need, and where a full-fledged economic program is either not necessary or not feasible. *IMF Press Release No. 15/583 — December 21, 2015* --- ## References - [Liberia and the IMF](http://www.imf.org/external/country/LBR/index.htm) - [Press Releases](https://www.imf.org/en/news/searchnews) - [PRESS CENTER](http://presscenter.imf.org/) - [Press Release No 12/449](https://www.imf.org/external/np/sec/pr/2012/pr12449.htm) - [Press Release No 14/441](https://www.imf.org/external/np/sec/pr/2014/pr14441.htm) - [Press Release No15/69](https://www.imf.org/external/np/sec/pr/2015/pr1569.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/pr15583_