## IMF Executive Board Completes the Eighth and Final Review Under the Extended Credit Facility Arrangement for Sierra Leone _IMF News, November 20, 2023_ ## Source details **Canonical URL:** [IMF Executive Board Completes the Eighth and Final Review Under the Extended Credit Facility Arrangement for Sierra Leone](https://www.imf.org/en/news/articles/2023/11/20/pr23403-sierra-leone-imf-exec-board-completes-8th-final-rev-ecf-arr) ## Other formats - [Markdown version](/en/news/articles/2023/11/20/pr23403-sierra-leone-imf-exec-board-completes-8th-final-rev-ecf-arr/index.md) - [Structured JSON version](/en/news/articles/2023/11/20/pr23403-sierra-leone-imf-exec-board-completes-8th-final-rev-ecf-arr/index.json) - [Bundle manifest](/en/news/articles/2023/11/20/pr23403-sierra-leone-imf-exec-board-completes-8th-final-rev-ecf-arr/bundle-manifest.json) ## Bibliographic details - Published: November 20, 2023 --- ### Review outcome and disbursement - The Executive Board completed the Eighth and final review of Sierra Leone’s arrangement under the Extended Credit Facility (ECF). - The completion of the review enables the immediate disbursement of SDR 15.555 million (or about US$20.7 million). - Total disbursements under the arrangement to date: SDR 124.44 million (or about US$165.6 million). - The Executive Board approved the authorities’ request for a waiver of nonobservance of the end-June 2023 performance criterion on the ceiling on the net domestic assets of the Bank of Sierra Leone, based on corrective actions taken by the authorities. ### Program background and duration - The ECF Arrangement for Sierra Leone was approved by the Executive Board on November 30, 2018, for SDR 124.44 million (about US$172.1 million at that time, or around 60 percent of the Sierra Leone’s quota) for 43 months. - The arrangement was extended by 12 months on July 27, 2021, and by another five months on June 5, 2023. - Program aims: reducing inflation, mobilizing revenue to allow for necessary spending consistent with debt sustainability, safeguarding financial stability, and maintaining resilience to external shocks. ### Key messages from the Acting Chair (Mr. Bo Li) - Successive shocks and policy slippages contributed to a build-up in macroeconomic imbalances in recent years; a cost-of-living crisis has taken a severe toll on the most vulnerable. - A decisive macroeconomic policy tightening is needed to restore stability and contain risks to debt sustainability. - The authorities have taken bold steps to tighten policies, but reform implementation is challenging amid the large adjustment need and the ongoing cost-of-living crisis. - As the ECF arrangement ends, continued reform momentum is critical. ### Policy recommendations and priorities outlined - Fiscal policy - Implement recent tax revenue measures and maintain steadfast spending restraint to help achieve fiscal targets while creating space for priority social spending to support the most vulnerable. - The updated debt management strategy should help bring down the high debt service burden and mobilize additional grant support. - Strengthen public financial management, avoid arrears accumulation, and gain better control of multi-year commitments, especially on domestically financed capital spending. - Monetary and exchange rate policy - Tighten monetary conditions further to bring down inflation, including through strict limits on central bank purchases of government securities. - Maintain exchange rate flexibility as a key element of the policy mix, with a focus on ensuring continued reserve adequacy. - Establish transparency around the currency redenomination and recapitalize the Bank of Sierra Leone to boost confidence in the currency and support the central bank’s mandate. - Financial sector and crisis management - Address solvency challenges in commercial banks and strengthen crisis management frameworks and the safety net to maintain financial stability. - Structural reforms and governance - Enhance governance, bolster anti-corruption efforts, further improve the AML/CFT framework, and strengthen the external audit function. - Improve the business climate and build climate resilience. ### Sierra Leone: Selected Economic Indicators Sources: Central Bank, Ministry of Finance, Statistics Sierra Leone, and Fund staff estimates and projections - Output (annual percentage change) - Real GDP growth: 2022: 3.5; 2023 Prel.: 2.7; 2024 Proj.: 4.7 - Real GDP growth, excl. iron ore: 2022: 2.6; 2023 Prel.: 4.6; 2024 Proj.: (blank in source) - Prices (annual percentage change) - Inflation, end of period (%): 2022: 37.1; 2023 Prel.: 44.3; 2024 Proj.: 22.9 - Central Government Finances (percent of non-iron ore GDP) - Revenue, excl. grants: 2022: 12.4; 2023 Prel.: 13.1; 2024 Proj.: 14.8 - Grants: 2022: 6.2; 2023 Prel.: 5.8; 2024 Proj.: (blank in source) - Expenditure and net lending: 2022: 29.5; 2023 Prel.: 23.6; 2024 Proj.: 23.5 - Overall balance: 2022: -10.5; 2023 Prel.: -5.8; 2024 Proj.: -2.8 - Public debt: 2022: 94.6; 2023 Prel.: 90.5; 2024 Proj.: 83.7 - Money and credit (annual percentage change) - Broad money: 2022: 41.1; 2023 Prel.: 27.2; 2024 Proj.: 13.6 - Credit to the private sector: 2022: 11.9; 2023 Prel.: 18.4; 2024 Proj.: 19.0 - Balance of payments (percent of non-iron ore GDP) - Current account: 2022: -9.0; 2023 Prel.: -6.1; 2024 Proj.: -4.2 - Gross reserves (months of imports): 2022: 3.8; 2023 Prel.: 3.4; 2024 Proj.: 3.2 - External debt: 2022: 64.8; 2023 Prel.: 66.0; 2024 Proj.: 60.1 *IMF Press Release No. 23/403, November 20, 2023 — IMF Communications Department* --- ## References - [https://www.imf.org/-/media/images/imf/bios/imfboard.jpg](https://www.imf.org/-/media/images/imf/bios/imfboard.jpg) - [The Executive Board](https://www.imf.org/external/np/sec/memdir/eds.aspx) - [Sierra Leone and the IMF](http://www.imf.org/external/country/SLE/index.htm) - [Special Drawing Rights (SDRs) -- A Factsheet](https://www.imf.org/en/about/factsheets/sheets/2023/special-drawing-rights-sdr) - [Press Releases](https://www.imf.org/en/news/searchnews) - [PRESS CENTER](http://presscenter.imf.org/) - [on November 30, 2018](https://www.imf.org/en/News/Articles/2018/11/30/pr18446-imf-executive-board-approves-arrangement-under-the-extended-credit-facility-for-sierra-leone) - [https://www.imf.org/en/home](https://www.imf.org/en/home) _Source: https://www.imf.org/en/news/articles/2023/11/20/pr23403-sierra-leone-imf-exec-board-completes-8th-final-rev-ecf-arr_