Panafrican News Agency

IMF Board approves US$ 34.4 million disbursement to Central African Republic

Bangui, Central African Republic (PANA)  – The Covid-19 pandemic has had a substantial impact on the economy of the Central African Republic (CAR) but it appears to be somewhat contained, according to International Monetary Fund (IMF) Deputy Managing Director, Mitsuhiro Furusawa.

Mr. Furusawa made the remark on Tuesday after the IMF Executive Board completed the first and second reviews of the CAR’s economic and financial programme, supported by an Extended Credit Facility (ECF) arrangement.

Completion of the reviews enables an immediate disbursement of US$ 34.4 million, bringing total disbursements under the arrangement to US$ 51.6 million.

A statement issued by the Fund said that performance under the ECF arrangement has been adversely affected by the pandemic and early policy and reform shortfalls.

Programme implementation has, however, improved over recent months, during which the CAR authorities focused on ensuring that emergency donor financing is efficiently and transparently used to fight the pandemic and alleviate its impact on the most vulnerable.

Substantial progress was also made in implementing structural reforms.

“Looking ahead, the authorities will pursue their efforts to support the economic recovery and make progress towards poverty reduction. They aim to prioritize social spending, improve domestic revenue mobilization, consolidate the single treasury account, and enhance public sector supervision. They will also implement reforms to strengthen governance and the business climate, including through the submission to parliament of a new anti-corruption law and the publication of public procurement contracts.

“Continued financial and technical support from development partners remains critical to the program’s success. Given its high risk of debt distress and limited revenue base, C.A.R. will have to continue to rely heavily on grant financing for its most pressing spending needs,” Mr.Furusawa said.

The IMF-supported programme aims to maintain macroeconomic stability, strengthen administrative capacity, governance and the business climate, and address the country’s protracted balance of payment needs.

 “CAR’s programme will continue to be supported by implementation of policies and reforms by the CEMAC regional institutions, which notably aim at supporting an increase in regional net foreign assets,” Mr. Furusawa added.

-0- PANA AR/VAO 13Jan2021