A mission from the International Monetary Fund (IMF), led by Mr. Carlo Sdralevich, visited Monrovia during October 19–30, 2015 to conclude discussions on the fourth review of the government’s economic program supported by the IMF under the Extended Credit Facility (ECF) arrangement1 approved by the IMF Executive Board in November 2012. 

At the end of the visit, Mr. Sdralevich, IMF Mission Chief for Liberia, issued the following statement:

“The IMF mission focused on issues concerning economic performance under the program, the near-term economic challenges, and the policy program for 2015/16 and beyond. The IMF mission and the Liberian authorities reached staff-level understandings on a set of economic policies detailed in an updated Memorandum of Economic and Financial Policies (MEFP) that would allow for the completion of the fourth review of the ECF.

“Ebola has been defeated, but Liberia’s economic situation remains challenging. The economic impact of the epidemic has been compounded by the steep decline in commodity prices, which has led to production cuts and the postponement of natural resource investment projects. As a result, growth in 2014 is estimated at 0.7 percent, and is projected to remain weak at 0.3 percent this year. A gradual recovery should take hold starting in 2016, largely driven by the gold sector and the strengthening of the post-Ebola rebound. 

“Reflecting the scaling up of spending to address the Ebola epidemic, the overall government deficit (including off-budget expenditures) increased to 8.1 percent of GDP in FY2015 from 1.9 percent of GDP in FY2014, even though tax revenue collection held up despite the emergency. The FY2016 budget maintains a broadly accommodative fiscal stance. 

“Discussions focused on policies to support growth in the current difficult environment, and in particular actions to improve public financial management, maintain a sustainable level of public sector debt, rebuild international reserves, and strengthen financial sector regulation and infrastructure.

“These staff-level understandings are subject to approval by the IMF’s Management and Executive Board. Provided that performance remains strong, Board consideration of the fourth review of Liberia’s IMF-supported program under the ECF is expected to take place by the end of December. Upon approval, SDR 7.382 million (about US$11 million) would be made available to Liberia. The Executive Board will also examine the Liberian authorities' request to extend the ECF arrangement until the end of 2016.

“The mission expresses its deep appreciation to the authorities and technical staff for their excellent cooperation and the quality of the policy dialogue.”

The mission met with President Ellen Johnson Sirleaf, Minister of Finance Amara Konneh, Central Bank Executive Governor Joseph Mills Jones, other high-level government officials, representatives of the private sector, and the donor community. 

1 The Extended Credit Facility (ECF) is the IMF’s main tool for medium-term financial support to low-income countries. It provides for a higher level of access to financing, more concessional terms, enhanced flexibility in program design, and more focused, streamlined conditionality. Financing under ECF currently carries a zero interest rate, with a grace period of 5.5 years, and a final maturity of 10 years. Details on Liberia’s current ECF are available at: http://www.imf.org/liberia