IMF Executive Board Approves US$170.1 Million under the ECF Arrangement for Guinea
IMF News, December 12, 2017
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- Published: December 12, 2017
Approval and Financing Details
- Executive Board approved a three-year arrangement under the Extended Credit Facility (ECF) for Guinea for an amount equivalent to SDR 120.488 million (about US$170 million, or 56.25 percent of Guinea’s quota).
- The decision enables an immediate disbursement of SDR 17.2 million (about US$24.3 million).
- The remaining amounts will be phased over the duration of the arrangement, subject to semi-annual reviews.
- The ECF arrangement supports Guinea’s 2016–20 National Social and Economic Development Plan.
Program Objectives and Intended Outcomes
- Strengthen the resilience of the Guinean economy.
- Scale-up public investments in infrastructure to foster high and more broad-based growth while preserving medium-term debt sustainability.
- Strengthen social safety nets to reduce poverty and foster inclusion.
- Promote development of the private sector and facilitate structural transformation and diversification.
Key Policy Measures and Priorities
- Fiscal policy:
- Mobilize additional tax revenues.
- Gradually phase out electricity subsidies.
- Strengthen social safety nets.
- Enhance public finance and investment management.
- Maximize reliance on concessional borrowing and limit recourse to non-concessional borrowing to support debt sustainability.
- Monetary and financial sector policy:
- Accumulate international reserves to build external buffers and strengthen resilience.
- Maintain a prudent monetary policy to preserve moderate inflation while providing appropriate liquidity in the banking sector.
- Implement measures to improve financial stability and strengthen the autonomy of the central bank.
- Structural reforms:
- Strengthen the business climate and governance.
- Foster financial inclusion to support private sector development.
Expected Impact and Strategic Rationale
- The program aims to preserve macroeconomic stability while enabling higher and more inclusive growth.
- Priorities include reducing vulnerabilities, tackling widespread poverty, improving living standards, and promoting good governance.
- Scaling up growth-supporting public investments in infrastructure is central to fostering more broad-based growth while preserving debt sustainability.
Statement from IMF Management
- Deputy Managing Director Mr. Mitsuhiro Furusawa, and Acting Chair noted:
- “The Guinean economy has rebounded from the adverse impact of the Ebola epidemic and growth momentum is expected to be sustained.”
- “The three-year Extended Credit Facility (ECF) arrangement will support the authorities’ 2016–20 National Social and Economic Development Plan to foster higher and more inclusive growth while preserving macroeconomic stability.”
- Emphasis on fiscal strengthening, accumulating reserves, prudent monetary policy, financial stability, central bank autonomy, and advancing structural reforms to support private sector development.
Press Release No. 17/484 — December 12, 2017 — IMF Communications Department