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HomeAfricaIMF approves credit facility for Sao Tome and Príncipe

IMF approves credit facility for Sao Tome and Príncipe

The Executive Board of the International Monetary Fund (IMF) has approved the disbursement of an amount equivalent to Special Drawing Right (SDR) 0.37 million (about US$ 0.57 million) for Sao Tome and Principe.

An IMF statement, made available to PANA in New York, on Tuesday, stated that the approval followed the completion of the second review of the three-year arrangement under the Extended Credit Facility (ECF) for the country.

It noted that the completion of the review brought the total disbursements under the arrangement to SDR 1.11 million (about US$ 1.71 million).

It recalled that the three-year SDR 2.59 million (then about US$ 3.9 million) ECF arrangement with Sao Tome and Príncipe was approved by the IMF’s Executive Board on 20 July, 2012.

Mr. Min Zhu, IMF’s Deputy Managing Director and Acting Board Chair, said: “The authorities are to be commended for a satisfactory performance under the Fund-supported programme.”

“Steady economic growth and disinflation have been maintained in a challenging global environment, and a prudent fiscal stance has underpinned the fixed exchange rate regime,” he said.

Mr. Zhu said: “Looking ahead, it is important to continue to strengthen economic resilience, particularly in the light of uncertain prospects for oil production. Fiscal discipline, particularly in the run-up to the 2014 elections, will be crucial.”

“In this regard, improvements in revenue mobilization continue to be necessary to create additional space for public investments and social spending. Reliance on grant and concessional financing will help mitigate the risk of debt distress,” the IMF added.

In a related development, the IMF has completed the seventh and final review under the Extended Credit Facility (ECF) for Burkina Faso.

It said that the completion of the review enabled the disbursement of an amount equivalent to SDR 3.225 million (about US$ 5million).

It said that the Board also discussed a request by Burkina Faso for a successor three-year arrangement under the ECF and expressed general support for such a new arrangement, which would be approved in the coming days once the existing ECF arrangement expires.

The three-year ECF arrangement for Burkina Faso was approved on 14 June, 2010, for the equivalent of SDR 46.154 million (about US$ 71.2 million), and it subsequently approved augmentation of access under the arrangement to the equivalent of SDR 82.274 (about US$126.8 million) on 8 June, 2012.

The statement said that, on 1 July, 2013, the Board also approved an extension of the arrangement until 31 December, 2013.

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