Central African Republic on track with IMF loan

The Central African Republic is performing “satisfactorily” with its International Monetary Fund (IMF) arrangement.

The IMF has just released a second interim report on the deal, with Mitsuhiro Furusawa, deputy managing director and acting chair of the executive board at the IMF, saying: “Performance under the programme has been satisfactory despite the challenging security environment.

“Along with ongoing efforts to promote dialogue and national reconciliation, sustained programme implementation is critical to create fiscal space for development spending, improve the business environment, and foster higher and more inclusive growth.

“The authorities have adopted measures to streamline quasi-fiscal taxes, enhance budget transparency and address revenue shortfalls,” he added.

The IMF said: “The authorities should build on recent progress to improve public financial management, including by ensuring regular publication of budget execution reports, consolidating the treasury single account, and limiting the use of exceptional spending procedures.

“The reduction of domestic payment arrears to small and medium-sized enterprises will support growth and help restore the state’s credibility, thus contributing to social cohesion.”

Mr Furusawa said: “Swift implementation of the national plan for recovery and peace’s investment programme will boost economic prospects. Given the country’s high risk of debt distress, continued reliance on grant financing, while limiting borrowing, even in highly concessional terms, is essential.

“Available assistance needs to be channelled effectively into priority projects to lift economic growth, create jobs and reduce poverty.”

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