## Union of the Comoros: Second Review Under the Staff-Monitored Program-Press Release; and Staff Report

_IMF Staff Country Reports, April 20, 2023_

## Source details

**Canonical URL:** [Union of the Comoros: Second Review Under the Staff-Monitored Program-Press Release; and Staff Report](https://www.imf.org/en/publications/cr/issues/2023/04/20/union-of-the-comoros-second-review-under-the-staff-monitored-program-press-release-and-532688)

## Other formats

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## Bibliographic details
- Published: April 20, 2023
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400240751.002

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### Implementation of the Staff-Monitored Program (SMP)
- SMP supported the government’s reform program during 2021–2022.
- Implementation of the SMP was broadly satisfactory, with most quantitative targets and structural benchmarks being met on time.
- IMF welcomes the authorities’ commitment to continuing engagement with the IMF country and technical assistance teams as they push forward the remaining structural benchmark and tackle other structural reforms.

### Public enterprises, administered prices, and fiscal impact
- State-owned enterprises (SOEs) incurred substantial losses in 2022 as administered prices were slow to adjust to the surge in global commodity prices.
- Fiscal implications of SOE losses:
  - lower fiscal revenue,
  - higher public debt,
  - wider financing gaps over the medium term.

### Debt sustainability and financing gaps
- Comoros was already facing a high risk of debt distress and substantial financing gaps due to:
  - large projects financed by nonconcessional debt,
  - the restructuring of the insolvent state-owned postal bank (SNPSF).
- The recent deterioration in macroeconomic conditions has further heightened debt sustainability risks.

### External sector developments and cushioning factors
- The reported number of coronavirus disease 2019-related cases has remained relatively low.
- Strong remittances and a resumption of tourism have helped cushion the shock while maintaining an adequate level of foreign reserves.
- The fallout from the war in Ukraine has set back the expected fiscal gains, underscoring the need for continued fiscal consolidation efforts.

### Key takeaways and policy direction
- Continued fiscal consolidation is needed to restore and preserve debt sustainability in light of:
  - SOE losses in 2022,
  - preexisting high risk of debt distress,
  - substantial financing gaps from nonconcessional borrowing and SNPSF restructuring,
  - macroeconomic deterioration following global shocks (including the war in Ukraine).
- Continued engagement with IMF country and technical assistance teams is emphasized to implement remaining structural benchmarks and other structural reforms.

*Source: Union of the Comoros: Second Review Under the Staff-Monitored Program-Press Release; and Staff Report (April 20, 2023).*

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## Content in this bundle

- **Executive Summary**
  - [Executive Summary (Markdown version)](/-/media/files/publications/cr/2023/english/1comea2023001.pdf.md){rel="alternate" type="text/markdown"}
  - [Executive Summary (PDF)](/-/media/files/publications/cr/2023/english/1comea2023001.pdf){rel="external" type="application/pdf"}

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_Source: https://www.imf.org/en/publications/cr/issues/2023/04/20/union-of-the-comoros-second-review-under-the-staff-monitored-program-press-release-and-532688_