{
  "title": "IMF Executive Board Completes the First and Second Review under the Extended Credit Facility for Liberia, and Approves US$48.86 Million Disbursement",
  "publication": "IMF News, December 21, 2020",
  "sourceUrl": "https://www.imf.org/en/news/articles/2020/12/21/pr20386-liberia-imf-executive-board-first-second-review-ecf-approves-us-million-disbursement",
  "canonical": "https://www.imf.org/en/news/articles/2020/12/21/pr20386-liberia-imf-executive-board-first-second-review-ecf-approves-us-million-disbursement",
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  "summary": "Completion of the first and second reviews enables an immediate disbursement of US$48.86 million.",
  "publishDate": "2020-12-21",
  "sections": [
    {
      "heading": "Disbursement and program status",
      "content": "- Completion of the first and second reviews enables an immediate disbursement of US$48.86 million.\n- Of the US$48.86 million disbursement, US$38 million will fill the fiscal financing gap arising from the impact of COVID-19.\n- The four-year ECF arrangement has total access of SDR155 million (60 percent of quota or about US$214.30 million) and was approved on December 11, 2019.\n- Completion of the first and second reviews brings total disbursements under the arrangements to SDR51 million (about US$72.20 million).\n- The authorities have taken corrective actions after mixed program performance initially and continue to make progress in structural reforms.\n- Liberia continues to be assessed as having a sustainable debt burden, but borrowing space is limited."
    },
    {
      "heading": "Macroeconomic outlook and projections",
      "content": "- Economic activity is projected to contract by about 3.0 percent in 2020.\n- Growth is projected to reach 3.2 percent in 2021, assuming global conditions gradually normalize; downside risks to the outlook are high.\n- The growth forecast for 2020 was revised down from 1.4 percent at the program’s inception to -3.0 percent.\n- Key projections (selected):\n  - Real GDP: 2018 Act. 1.2; 2019 Est. -2.5; 2020 ECF Approval 1.4; 2020 RCF Proj. -3.0; 2021 3.4; 2022 4.0; 2023 3.2; 2024 4.1; 2025 4.9; (continuation values shown in source table: 5.3, 5.4).\n  - Nominal non-mining per capita GDP (U.S. dollars): 2018 620; 2019 574; 2020 621; 2021 553; 2022 535; 2023 527; 2024 542; 2025 537; additional values in table: 549, 564, 613.\n  - Nominal GDP (millions of U.S. dollars): 2018 3264; 2019 3176; 2020 3099; 2021 2928; 2022 3067; 2023 3131; 2024 2954; 2025 3107; further values: 3247, 3411, 3601, 3828."
    },
    {
      "heading": "Inflation, monetary policy, and reserves",
      "content": "- Inflation (consumer prices, annual average): 2018 23.5; 2019 27.0; 2020 21.3; 2021 17.6; 2022 16.25; 2023 13.5; 2024 9.8; 2025 7.0; additional values: 5.5, 5.0.\n- Consumer prices (end of period): 2018 28.5; 2019 20.3; 2020 15.0; 2021 11.65; 2022 12.0; 2023 8.0; 2024 6.0.\n- The monetary policy stance is described as appropriately aligned with the inflation objective, and significant progress has been made in strengthening central bank independence.\n- Further efforts recommended: contain the central bank’s operational expenses and build up reserves; refine instruments for open market operations; enhance policy coordination between the central bank and the government.\n- Gross official reserves (millions of U.S. dollars): 2018 297; 2019 292; 2020 308; 2021 336; 2022 331; 2023 333; 2024 401; 2025 403; further values: 429, 448, 438, 443.\n- Months of next year’s imports: 2018 2.2; 2019 2.3; 2020 2.5; 2021 2.4; 2022 2.9; 2023 3.0; 2024 3.1; 2025 2.8.\n- CBL's net int'l reserves (millions of U.S. dollars): 2018 70; 2019 27; 2020 54; 2021 -16; 2022 13; 2023 63; 2024 28; 2025 75; further values: 82, 105, 135."
    },
    {
      "heading": "Fiscal stance and public debt",
      "content": "- The fiscal stance has been loosened to meet humanitarian needs during COVID-19 while maintaining tight monetary policy and no central bank financing.\n- Authorities committed to fiscal discipline, improvements in cash management, transparency and accountability in spending, and domestic revenue mobilization.\n- Central government operations (percent of GDP, fiscal year):\n  - Total revenue and grants: 2018 25.9; 2019 28.0; 2020 29.9; 2021 27.6; 2022 28.1; 2023 29.8; 2024 27.7; 2025 29.1; further values: 28.9, 28.7, 28.2, 27.3.\n  - Total revenue: 2018 12.9; 2019 14.3; 2020 14.9; 2021 13.1; 2022 13.9; 2023 15.9; 2024 13.7; 2025 14.2; further values: 16.2, 17.0, 17.5, 17.8.\n  - Grants: 2018 13.0; 2019 13.8; 2020 15.1; 2021 14.5; 2022 14.1; 2023 14.0; 2024 12.7; 2025 11.7; further values: 10.7, 9.5.\n  - Total expenditure: 2018 30.8; 2019 34.2; 2020 34.6; 2021 33.6; 2022 31.7; 2023 33.5; 2024 33.2; 2025 32.3; further values: 30.6, 29.5.\n  - Current expenditure: 2018 23.3; 2019 22.7; 2020 22.6; 2021 21.7; 2022 22.0; 2023 21.6; 2024 20.4; 2025 19.3; further values: 19.1, 18.7.\n  - Capital expenditure: 2018 11.0; 2019 11.9; 2020 9.9; 2021 11.5; 2022 11.2; 2023 11.3; 2024 10.8.\n  - Overall fiscal balance, including grants: 2018 -4.9; 2019 -6.2; 2020 -6.0; 2021 -3.6; 2022 -3.7; 2023 -5.6; 2024 -3.2; 2025 -2.8; further values: -1.9, -1.7, -2.2.\n  - Overall fiscal balance, excluding grants: 2018 -17.9; 2019 -20.0; 2020 -19.7; 2021 -20.5; 2022 -17.7; 2023 -17.6; 2024 -19.5; 2025 -18.1; further values: -15.5, -13.6, -12.3, -11.7.\n- Public external debt (percent of GDP): 2018 31.5; 2019 38.0; 2020 39.2; 2021 37.2; 2022 42.7; 2023 45.4; 2024 43.1; 2025 46.2; further values: 46.9, 46.5, 46.1.\n- Public domestic debt: 2018 8.1; 2019 19.4; 2020 18.4; 2021 20.2; 2022 18.8; 2023 16.3; 2024 14.7."
    },
    {
      "heading": "Financial sector, governance, and policy recommendations",
      "content": "- Priority recommendations and actions:\n  - Rebuild confidence in the financial sector to support financial stability.\n  - Address risks from weak financial institutions and ensure the supply and quality of Liberian dollar banknotes.\n  - Contain central bank’s operational expenses and build up reserves.\n  - Refine instruments for open market operations and enhance policy coordination between the central bank and the government amid gradual de-dollarization of fiscal spending.\n  - Continue to clear the fiscal audits backlog, further enhance procurement transparency, and upgrade the anti-corruption legal framework.\n  - Work with donors and development partners to secure grants and concessional borrowing; carefully prioritize the use of public resources to increase borrowing space and support sustainable growth."
    },
    {
      "heading": "External sector and credit",
      "content": "- External sector indicators (percent of GDP, unless otherwise indicated):\n  - Current account balance including grants: 2018 -23.1; 2019 -22.5; 2020 -21.4; 2021 -22.8; 2022 -21.9; 2023 -20.2; 2024 -22.2; 2025 -22.6; further values: -22.9, -21.8, -20.7.\n  - Current account balance excluding grants: 2018 -37.8; 2019 -36.4; 2020 -35.9; 2021 -37.3; 2022 -36.1; 2023 -35.5; 2024 -33.8; 2025 -34.8; further values: -34.0, -31.9, -30.3.\n  - Trade balance: 2018 -19.2; 2019 -13.4; 2020 -18.5; 2021 -16.4; 2022 -18.9; 2023 -18.3; 2024 -16.5; 2025 -15.6.\n  - Exports: 2018 12.8; 2019 13.4; 2020 15.6; 2021 21.9.\n  - Imports: 2018 -35.0; 2019 -32.5; 2020 -33.7; 2021 -31.4; 2022 -34.2; 2023 -32.1; 2024 -33.2; 2025 -32.3; further values: -31.3, -30.2.\n  - Grants (donor transfers, net): 2018 14.6; 2019 14.4; 2020 13.6; 2021 12.2; 2022 10.1; 2023 9.6.\n\n- Monetary and credit indicators:\n  - M2/GDP: 2018 19.6; 2019 16.7; 2020 22.3.\n  - Credit to private sector (percent of GDP): 2018 14.8; 2019 17.3; 2020 15.7; 2021 16.5; 2022 16.1; 2023 16.4; 2024 16.6; 2025 16.6.\n  - Credit to private sector (annual percent change): 2018 -11.3; 2019 1.3; 2020 -1.1; 2021 2.1; 2022 3.7; 2023 6.2; 2024 6.7; 2025 6.9.\n\nIMF Communications Department, Press Release No. 20/386, December 21, 2020.\n\n---\n\n\n References\n\n- Tao Zhang\n- Liberia and the IMF\n- Press Releases\n- PRESS CENTER\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2020/12/21/pr20386-liberia-imf-executive-board-first-second-review-ecf-approves-us-million-disbursement"
    }
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    "Published: December 21, 2020",
    "Completion of the first and second reviews enables an immediate disbursement of US$48.86 million.",
    "Of the US$48.86 million disbursement, US$38 million will fill the fiscal financing gap arising from the impact of COVID-19.",
    "The four-year ECF arrangement has total access of SDR155 million (60 percent of quota or about US$214.30 million) and was approved on December 11, 2019.",
    "Completion of the first and second reviews brings total disbursements under the arrangements to SDR51 million (about US$72.20 million).",
    "The authorities have taken corrective actions after mixed program performance initially and continue to make progress in structural reforms.",
    "Liberia continues to be assessed as having a sustainable debt burden, but borrowing space is limited.",
    "Economic activity is projected to contract by about 3.0 percent in 2020.",
    "Growth is projected to reach 3.2 percent in 2021, assuming global conditions gradually normalize; downside risks to the outlook are high.",
    "The growth forecast for 2020 was revised down from 1.4 percent at the program’s inception to -3.0 percent.",
    "Key projections (selected):",
    "Inflation (consumer prices, annual average): 2018 23.5; 2019 27.0; 2020 21.3; 2021 17.6; 2022 16.25; 2023 13.5; 2024 9.8; 2025 7.0; additional values: 5.5, 5.0.",
    "Consumer prices (end of period): 2018 28.5; 2019 20.3; 2020 15.0; 2021 11.65; 2022 12.0; 2023 8.0; 2024 6.0.",
    "The monetary policy stance is described as appropriately aligned with the inflation objective, and significant progress has been made in strengthening central bank independence.",
    "Further efforts recommended: contain the central bank’s operational expenses and build up reserves; refine instruments for open market operations; enhance policy coordination between the central bank and the government.",
    "Gross official reserves (millions of U.S. dollars): 2018 297; 2019 292; 2020 308; 2021 336; 2022 331; 2023 333; 2024 401; 2025 403; further values: 429, 448, 438, 443.",
    "Months of next year’s imports: 2018 2.2; 2019 2.3; 2020 2.5; 2021 2.4; 2022 2.9; 2023 3.0; 2024 3.1; 2025 2.8.",
    "CBL's net int'l reserves (millions of U.S. dollars): 2018 70; 2019 27; 2020 54; 2021 -16; 2022 13; 2023 63; 2024 28; 2025 75; further values: 82, 105, 135.",
    "The fiscal stance has been loosened to meet humanitarian needs during COVID-19 while maintaining tight monetary policy and no central bank financing.",
    "Authorities committed to fiscal discipline, improvements in cash management, transparency and accountability in spending, and domestic revenue mobilization.",
    "Central government operations (percent of GDP, fiscal year):",
    "Public external debt (percent of GDP): 2018 31.5; 2019 38.0; 2020 39.2; 2021 37.2; 2022 42.7; 2023 45.4; 2024 43.1; 2025 46.2; further values: 46.9, 46.5, 46.1.",
    "Public domestic debt: 2018 8.1; 2019 19.4; 2020 18.4; 2021 20.2; 2022 18.8; 2023 16.3; 2024 14.7.",
    "Priority recommendations and actions:",
    "External sector indicators (percent of GDP, unless otherwise indicated):",
    "Monetary and credit indicators:",
    "[Tao Zhang](https://www.imf.org/en/About/senior-officials/Bios/tao-zhang)",
    "[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/)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
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