The Executive Board of the International Monetary Fund (IMF) completed the first and second reviews of the Central African Republic’s (CAR) economic and financial program supported by an Extended Credit Facility (ECF) arrangement. Completion of the reviews enables the disbursement of SDR 23.87 million, about US$ 34.4million), bringing total disbursements under the arrangement to SDR 35.8 million, about US$ 51.6million.

In completing the two reviews, the Executive Board also approved the authorities’ request for waiver of non-observance of performance criteria.

CAR’s ECF arrangement was originally approved by the Executive Board on December 20, 2019 for SDR 83.55 million, about US$ 115.1 million, or 75 percent of the Central African Republic’s quota in the Fund.

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

Following the Executive Board discussion on CAR, Mr. Mitsuhiro Furusawa, Deputy Managing Director and Acting Chair, made the following statement:

“The Covid-19 pandemic has had a substantial impact on C.A.R.’s economy but appears to be somewhat contained. Performance under the ECF arrangement has been adversely affected by the pandemic and early policy and reform shortfalls. Program implementation has, however, improved over recent months, during which the 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 toward 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.

“C.A.R.’s program 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.”