IMF Executive Board Completes Fourth and Fifth ECF Reviews for Burkina Faso and Approves US$26.2 Million Disbursement

imfThe Executive Board of the International Monetary Fund (IMF) today completed the fourth and fifth reviews of Burkina Faso’s economic performance under an economic program supported by an Extended Credit Facility (ECF) arrangement.[1] The decision enables the disbursement of SDR18.57 million (about US$26.2 million), bringing total disbursements under the arrangement to the equivalent of SDR46.70 million (about US$65.9 million).

In completing the reviews, the Executive Board also approved the authorities’ requests for the modification of performance criteria. The 36-month ECF arrangement was approved by the Executive Board on December 27, 2013 (see Press Release 13/542) for the equivalent of SDR 27.09 million (about US$38.2 million, or 45 percent of Burkina Faso’s quota). An augmentation of access of 40 percent of quota was approved in June 2015 by the Executive Board, bring total access to SDR 51.17 million (about US$72.2 million).

Following the Executive Board’s discussion today, Mr. Min Zhu, Deputy Managing Director and Acting Chair issued the following statement:

“Despite challenging internal and external circumstances, Burkina Faso’s performance under the Fund-supported program has remained satisfactory. Although the terrorist attacks posed some setback to economic recovery, growth should regain momentum in 2016-17, underpinned by robust mining activity, improved energy supply and enhanced public investment execution. The main risks to this favorable outlook relate to the fragile security situation, the challenges of meeting pent-up social and investment demands, and the impact of further declines in commodity prices.

“The authorities’ main objective for 2016 is to create adequate fiscal space for priority social and infrastructure spending, including implementation of their new development plan. To this effect, they are undertaking a broad package of tax and customs administration measures aimed at regaining the ground lost in domestic revenue mobilization. Continued efforts to contain recurrent spending, including the public wage bill and to address bottlenecks in project execution will be needed to allow public investment to recover quickly toward pre-crisis levels.

“The authorities are also seizing the opportunity of the oil price decline to address longstanding structural deficiencies in the energy sector. Full implementation of these measures will contribute to reducing state subsidies and contingent liabilities to the sector and support higher investments in electricity production. Going forward, it will also be important to take action to diversify the agriculture sector and provide a supportive environment to boost credit for the private sector.”