The IMF Executive Board has approved the immediate disbursement of about US$14.4 million (over D720 million) to The Gambia to help meet the country’s financing needs and support the post-pandemic recovery.
In statement issued over the weekend, IMF said the second wave of the Covid-19 pandemic has dampened economic activity, with attendant socio-economic costs. “However, with the global vaccine rollout, development partners’ support of The Gambia’s vaccination campaign, and the resilience of some economic sectors, growth is expected to rebound to 4.9 percent in 2021,” it stated.
The international financial institution headquartered in Washington, DC, praised Finance Minister Mambury Njie and his team “for the strong performance under the IMF-supported programme and their ability to maintain macroeconomic stability, despite the challenges posed by the pandemic”.
The approval for the disbursement was given at the end of the second review under the Extended Credit Facility (ECF) arrangement with The Gambia.
The funds will be used to help meet the country’s balance-of-payments and fiscal financing needs as well as support the post-pandemic recovery. This brings total disbursements under the ECF arrangement to about US$50.5 million.
The Gambia has also benefited from an IMF Rapid Credit Facility disbursement of and is receiving debt service relief from the IMF under the Catastrophe Containment and Relief Trust.
The statement noted: “For 2021, economic growth is expected to rebound to 4.9 percent, supported by the global and domestic vaccine rollout as well as the continued resilience of some economic sectors. At the onset of the Covid-19 pandemic, the authorities relaxed the fiscal and monetary policy stances to help meet pandemic-related humanitarian needs and support economic activity, while keeping within programme limits. Inflation dropped from 7.7 percent (year-on-year) at end-2019 to 5.7 percent (year-on-year) at end-2020 before picking up to 7.4 percent at end-March 2021 due to seasonal factors. Large official and private forex inflows helped boost reserves to 4.7 months of imports at end-2020. Public debt declined.
“It is critical to persevere in the ambitious structural reform agenda, especially in the context of upcoming presidential and parliamentary elections, to fully reap the benefits from the country’s remarkable turn-around in recent years. Swift implementation of the business environment strategy will support strong and inclusive growth. The Public Procurement Act should be enacted to improve the value-for-money of spending. The SOE Bill, which is on hold because of the stalled constitutional reform, should be finalised to improve SOEs’ performance and reduce their reliance on the state budget.”