By Chernor Alimamy Kamara
The International Monetary Fund (IMF) is set to approve Sierra Leone’s Economic Performance under the Extended Credit Facility Programme by triggering an immediate disbursement of about US$20.8 million.
This was disclosed in a joint press release by the Ministry of Finance, Bank of Sierra Leone and National Revenue Authority on the 5th of June 2023.
The release noted that the global economy is currently facing challenges occasioned by unprecedented overlapping multiple crises, severely impacting all countries’ economic fabric. It stated that the crises have manifested into high inflation, depreciation of currencies, deteriorating external accounts, high-interest rates and rising debt levels and vulnerabilities.
It stated that the crises have also worsened food and energy insecurity but that the approval of Sierra Leone’s economic programme by the IMF amidst the overlapping multiple crises is a strong recognition and vote of confidence in the Government’s commitment to restoring macroeconomic stability, long-term debt sustainability and enhancing transparency and accountability in public funds.
During the Executive Board meeting and in view of the global multiple crises, the government in the release said it was pleased by the statement of the Deputy Managing Director and Acting Chair of IMF, Bo Li that ‘’Sierra Leone will continue to face significant economic challenges, amplified by multiple shocks, including Russia’s war in Ukraine. However, the Government’s commitment to bolster tax revenues represents important steps towards tightening the fiscal stance while creating space for priority social spending’’.
The release reiterated that the IMF’s approval of the economic programme will pave the way for other international financial institutions to scale up their support towards financing the Government’s priority programmes, including Human Capital Development. It informs the general public that the government is at an advanced stage in negotiating with the World Bank to disburse 65 Million United States dollars in budget support in 2023.
It noted that the approval will lay the basis for the ongoing negotiations with the European Union for the restoration of budget support of about 100 million Euros for a period of four years, effective 2023. It also noted that a sound economic programme with the IMF, among others, will provide comfort for the negotiation of the US Millennium Challenge Corporation (MCC) Compact and signature by the end of 2023.
It asserted the government’s commitment to implementing agreed reforms with Development Partners, including but not limited to prudent fiscal consolidation, exchange rate and monetary policy management that will lower inflation and stabilize the exchange rate. It went on to state that the reforms will also boost international reserves aimed at promoting macroeconomic and financial stability, thereby laying the foundation for inclusive green and sustainable growth.
Copyright © 2023 Politico (07/06/23)
