## Press Release: IMF Executive Board Concludes 2015 Article IV Consultation with Djibouti _IMF News, December 28, 2015_ ## Source details **Canonical URL:** [Press Release: IMF Executive Board Concludes 2015 Article IV Consultation with Djibouti](https://www.imf.org/en/news/articles/2015/09/14/01/49/pr15587) ## Other formats - [Markdown version](/en/news/articles/2015/09/14/01/49/pr15587/index.md) - [Structured JSON version](/en/news/articles/2015/09/14/01/49/pr15587/index.json) - [Bundle manifest](/en/news/articles/2015/09/14/01/49/pr15587/bundle-manifest.json) ## Bibliographic details - Published: December 28, 2015 --- ### Overview and context - Press Release No. 15/587; December 28, 2015. - On December 4, 2015, the Executive Board concluded the Article IV consultation discussions with Djibouti and considered and endorsed the staff appraisal without a meeting. - Djibouti strategy: developing infrastructure and port facilities to foster rapid growth and reduce poverty; growth driven by large investment projects but widespread poverty and unemployment persist; high external debt limits scope for additional borrowing. ### Growth, inflation, and investment projections - Aggregate investment reached 44 percent of GDP in 2014 and is expected to peak at 57 percent in 2015–16. - GDP growth: - 2014: 6 percent - 2015–16: about 6.5 percent - 2017–19: 7 percent - Inflation: - Projected at 3 percent in 2015 - About 3.5 percent in 2016–18 - Infrastructure spending impact: expected to increase demand for housing and services and contribute to inflationary pressure. ### Fiscal and external balance pressures - Fiscal deficit (commitment basis, incl. grants): - 2014: 12.2 percent of GDP - 2015: projected 16.5 percent of GDP - 2016: projected 11.4 percent of GDP (decline in tandem with investment profile) - Total public and publicly guaranteed (PPG) debt: - 2014: 60.5 percent of GDP (reflecting high non-concessional borrowing) - Projected to peak at 80 percent in 2017 - Current account deficit: - 2014: 25.6 percent of GDP - 2015: projected 31 percent of GDP (due to large capital goods imports) - 2017–19: projected 14 percent of GDP after completion of large investment projects - Financing of deficit: loans and foreign direct investment (FDI) - Central bank gross foreign assets: projected to remain strong, permitting full currency board coverage over 2015–20. ### Financial sector and monetary conditions - Commercial banks’ non-performing loans: ratio of non-performing loans to total loans rose to more than 22 percent in June 2015. - Concerns: deterioration in loan portfolio and decline in return on equity. - Financial inclusion: access to financial services remains low despite increase in number of banks. - Planned measures: establishment of a credit guarantee fund and development of microfinance to promote financial inclusion. - Anti-money laundering/combating financing of terrorism: need to reinforce instruments. ### Executive Board assessment and staff recommendations - Strengthen public capacity to manage the investment program, including evaluation and monitoring of investment projects. - Prioritize proposed projects based on absorptive capacity and resource constraints; conduct cost-benefit analyses before undertaking projects. - Expedite reform of public enterprises that will manage large investment projects to improve efficiency, financial standing, commercial viability, and reduce contingent liabilities. - Caution on non-concessional financing: - Urged to be cautious with additional borrowing and limit non-concessional borrowing. - Enhance debt management capacity, including monitoring contingent liabilities. - Improve coordination among government units responsible for contracting, monitoring, and servicing debt. - Tax reform: - Commended June 2015 tax conference with broad stakeholder participation. - Underscored need to design and implement comprehensive tax reform based on conference recommendations. - Implement a simple and transparent tax regime that reduces tax exemptions and levels the playing field for all investors. - Banking sector: - Strengthen banking supervision; adopt measures to address banks in difficulty. - Expedite credit guarantee fund and microfinance development. - Competitiveness and structural measures: - Currency board arrangement has served Djibouti well. - Improve competitiveness by reducing cost of utilities and developing human capital. - Prioritize projects that foster inclusive growth through job-creation and poverty reduction. - Enhance measures to protect the poor. - Diversify into labor-intensive sectors such as fishing and tourism for employment and inclusive growth. ### Key economic and financial indicators (selected, exact values preserved) - Quota: SDR 15.9 million - Population: 0.939298 million; 2014 - Per capita nominal GDP: $1,383; 2010 - Poverty rate: 79 percent; 2012 - Unemployment rate: 48.4 percent; 2012 - Main export: Port-related services Selected time-series (est./proj. where provided) - Real GDP (annual change in percent): 2013: 5.0; 2014: 6.0; 2015: 6.5; 2016: 7.0 - Consumer prices (annual average): 2013: 2.4; 2014: 2.9; 2015: 2.7; 2016: 3.5; 2017: 3.0 - Total fixed capital investment (percent of GDP): 2013: 40.5; 2014: 44.1; 2015: 60.1; 2016: 53.6; 2017: 33.4; 2018: 30.9; 2019: 27.0; 2020: 26.6 - Private: 2013: 26.9; 2014: 24.0; 2015: 30.0; 2016: 28.7; 2017: 20.2; 2018: 19.3; 2019: 17.8 - Public1/: 2013: 13.7; 2014: 30.1; 2015: 24.9; 2016: 13.2; 2017: 11.6; 2018: 9.2; 2019: 8.8 - Gross national savings (percent of GDP): 2013: 17.3; 2014: 18.5; 2015: 29.1; 2016: 27.8; 2017: 18.6; 2018: 16.4; 2019: 14.4; 2020: 13.6 - Savings/investment balance (percent of GDP): 2013: -23.3; 2014: -25.6; 2015: -31.0; 2016: -25.8; 2017: -14.8; 2018: -14.5; 2019: -12.6; 2020: -13.1 - Total revenue and grants (percent of GDP): 2013: 31.8; 2014: 37.1; 2015: 36.2; 2016: 33.9; 2017: 29.4; 2018: 28.3; 2019: 27.2 - Tax revenue (percent of GDP): 2013: 19.8; 2014: 18.7; 2015: 18.1; 2016: 17.6 - Expenditure and net lending (percent of GDP): 2013: 37.7; 2014: 43.1; 2015: 47.6; 2016: 35.1; 2017: 32.3; 2018: 29.0; 2019: 27.3 - Current expenditure (percent of GDP): 2013: 22.9; 2014: 23.5; 2015: 22.8; 2016: 21.9; 2017: 20.8 - Overall balance (commitment basis, incl. grants, percent of GDP): 2013: -5.9; 2014: -12.2; 2015: -16.5; 2016: -11.4; 2017: -1.2; 2018: -3.0; 2019: -0.7; 2020: -0.1 - Overall balance (cash basis, incl grants, percent of GDP): 2013: -6.9; 2014: -12.7; 2015: -17.0; 2016: -11.9; 2017: -1.6; 2018: -3.4; 2019: -1.1 - Overall balance (excluding grants, percent of GDP): 2013: -10.3; 2014: -16.8; 2015: -24.2; 2016: -19.7; 2017: -8.6; 2018: -7.2; 2019: -4.8; 2020: -3.9 - Claims on the private sector (change): 2013: 15.6; 2014: 8.6; 2015: 12.0; 2016: 14.0; 2017: 16.0; 2018: 18.0 - Broad money (percent change): 2013: 6.9; 2014: 9.4; 2015: 10.2; 2016: 10.7; 2017: 10.4 - Exports of goods and services (in millions of U.S. dollars): 2013: 485; 2014: 511; 2015: 601; 2016: 642; 2017: 684; 2018: 741; 2019: 800; 2020: 870 - Imports of goods and services (in millions of U.S. dollars): 2013: -913; 2014: -1022; 2015: -1318; 2016: -1325; 2017: -1173; 2018: -1203; 2019: -1249; 2020: -1339 - Balance of goods and services (in millions of U.S. dollars): 2013: -428; 2014: -511; 2015: -718; 2016: -683; 2017: -489; 2018: -462; 2019: -449; 2020: -468 - FDI (in percent of GDP): 2013: 19.7; 2014: 9.1; 2015: 8.5; 2016: 9.7; 2017: 9.8; 2018: 10.8 - Stock of external public and publicly guaranteed debt (in millions of U.S. dollars): 2013: 704; 2014: 833; 2015: 1142; 2016: 1506; 2017: 1689; 2018: 1838; 2019: 1901; 2020: 1937 - Stock of external public and publicly guaranteed debt (in percent of GDP): 2013: 48.4; 2014: 52.5; 2015: 65.7; 2016: 78.7; 2017: 79.6; 2018: 78.3; 2019: 73.5; 2020: 68.6 - Gross official reserves (in millions of U.S. dollars): 2013: 411; 2014: 381; 2015: 350; 2016: 399; 2017: 476; 2018: 495; 2019: 479; 2020: 460 - In months of next year's imports of goods and services: 2013: 4.8; 2014: 3.2; 2015: 4.7; 2016: 4.3; 2017: 3.7 - Gross foreign assets of commercial banks (in millions of U.S. dollars): 2013: 835; 2014: 903; 2015: 958; 2016: 1015; 2017: 1076; 2018: 1140; 2019: 1209; 2020: 1281 - In months of imports of goods and services: 2013: 8.2; 2014: 8.7; 2015: 11.0 - Nominal GDP (in millions of Djibouti francs): 2013: 258,658; 2014: 282,228; 2015: 308,688; 2016: 340,260; 2017: 376,820; 2018: 417,310; 2019: 459,917; 2020: 502,137 - Currency board cover (in percent): 2013: 107; 2014: 110; 2015: 109 - Private credit to GDP (in percent): 2013: 32.4; 2014: 32.9; 2015: 34.1; 2016: 34.9; 2017: 36.3; 2018: 38.4; 2019: 40.8; 2020: 42.8 - Exchange rate (DF/US$) end-of-period: 2013: 177.7 - Real effective exchange rate (yearly average, 2005=100): 2013: 95.8; 2014: 96.4; 2015: 102.3 - Change in percent (depreciation -): 2013: 0.3; 2014: 0.5; 2015: 6.2 - Population (million): 2013: 0.913714; 2014: 0.939298; 2015: 0.965598; 2016: 0.992635; 2017: 1.02043; 2018: 1.04900; 2019: 1.07837; 2020: 1.10857 *Source: Press Release No. 15/587, IMF Communications Department, December 28, 2015.* --- ## Content in this bundle - [Pr15587apdf (PDF)](/-/media/websites/imf/imported/external/arabic/np/sec/pr/2015/pr15587apdf.pdf){rel="external" type="application/pdf"} --- ## References - [Djibouti and the IMF](http://www.imf.org/external/country/DJI/index.htm) - [Press Releases](https://www.imf.org/en/news/searchnews) - [PRESS CENTER](http://presscenter.imf.org/) - [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/pr15587_