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Gambia requests 3 years programme to tune of US$48m

Feb 12, 2020, 4:38 PM | Article By: Ismaila Sonko

Head of mission of the International Monetary Fund (IMF) in The Gambia has disclosed that Gambia has advanced a request to execute a three year programme. The programme could be supported by an Extended Credit Facility (ECF) arrangement in the amount of US$48 million.

Jaroslaw Wieczorek made these remarks at a joint press confab convened with the Finance Ministry on Tuesday.

He said Gross Domestic Product (GDP) growth in 2019 is estimated to reach 6% despite the temporary drop in tourist arrivals in November 2019, following the bankruptcy of Thomas Cook (UK) and a much lower agricultural output due to erratic rainfall.

“This strong performance reflected Gambia’s gaining competitiveness as a tourist destination, strong private sector consumption and investment supported by foreign exchange inflows, greater availability of credit, and a much improved reliability of electricity and water supply,” he added.

According to him, over the medium term, sound macro-economic policies will underpin the prospects for sustained growth; the strengthening of foreign exchange buffers and inflation moderating from an average of 7.1% in 2019 to the Central Bank of The Gambia’s target of 5%.

Mr. Wieczorek said the public debt to GDP ratio declined from nearly 87% of GDP in 2018 to around 81% in 2019.

The Gambia’s 2020 budget, approved in December 2019, he said, is aligned with IMF staff’s projections, adding that it aims to stabilise the domestic public debt, building on a continued strong domestic revenue performance and appropriate tax policy measures, with additional resources channeled toward public investment and social spending.

He observed that The Gambia’s performance under the 2019 SMP has been strong, noting that quantitative targets including domestic borrowing by the government and poverty reducing spending were met.

“The implementation of the 2019 budget was accompanied by strong tax revenue effort, improved expenditure control and debt management. The country is making concerted efforts to bridge governance gaps, tackle the vulnerability to corruption and take concrete actions to prosecute human traffickers. The works of the Janneh Commission and the Truth, Reconciliation and Reparations Commission have been particularly laudable, helping to identify past corruption, laying the basis for asset recovery and dispensing justice to the victims of the previous regime. The draft Anti Corruption Bill, recently submitted to the National Assembly, is expected to increase efficiency in tackling corruption”.

Wieczorek maintained that The Gambia’s debt outlook enabled it to exit from debt distress. Nonetheless, he added that great care is needed to avoid contracting any new non-concessional debt, given the high level of the public debt and the large existing pipeline of the already contracted project loans.

He explained that the Extended Credit Facility (ECF) arrangement will catalyze the much-needed resources from other international partners and enable The Gambia to fulfill its economic potential, address pressing social needs and build on the structural reform agenda of the 2019 SMP.

“Further efforts will be needed to strengthen revenue mobilisation, public financial management and the governance of state owned enterprises, while improving public investment and procurement processes.”