The International Monetary Fund (IMF) Executive Board has completed the third and fourth reviews of the Extended Credit Facility (ECF) arrangement for the Central African Republic (CAR). The ECF, initially approved in April 2023, provides access to SDR 147.48 million (approximately US$197 million). The completion of these reviews enables an immediate disbursement of SDR 43.22 million (about US$58 million), bringing total disbursements under this arrangement to SDR 92.29 million (around US$124 million).
The IMF Executive Board also approved requests from CAR authorities for waivers concerning performance criteria related to fiscal balance and net domestic financing for end-June and end-December 2024. Additionally, a waiver was granted for nonobservance of continuous criteria on non-accumulation of new external arrears.
The ECF arrangement aims to support CAR's economic stability by addressing balance of payments needs and sustaining essential public services expenditure, particularly in health and education. Structural reforms have been anchored through program implementation, with noted improvements in fuel supply, revenue collection, digitalization efforts within revenue administration, enhancements to the Financial Intelligence Unit, and progress at the Court of Audit.
Economic projections suggest a growth rate increase from 1.9 percent in 2024 to 3 percent in 2025, driven by higher energy use, mining recovery, infrastructure projects, and improved security conditions. Inflation is expected to ease by late 2025 due partly to recent pump price reductions. However, fiscal tightening is necessary to manage rising debt vulnerabilities effectively.
Fuel market reform remains crucial for macroeconomic stabilization and inclusive growth in CAR. Accelerating audits on fuel procurement could address inefficiencies despite recent increases in supply and price cuts; pump prices remain high due to costly imports.
Kenji Okamura, Deputy Managing Director and Acting Chair at IMF commented: "The Central African Republic (CAR) has shown renewed commitment to structural reforms under the ECF-arrangement despite facing deep-rooted fragility and significant uncertainty."
He further noted that while program performance was mixed with half of the six PCs met by June-end or December-end deadlines last year being missed largely because targets regarding deficits weren't achieved either along domestic primary deficit lines nor net financing ones but strong corrective actions are underway now as part efforts towards improving tax compliance controls boosting revenue alongside accelerating audits related fuel procurement among other measures deemed vital enabling reductions pump prices well-functioning markets essential fiscal macroeconomic stability ultimately ensuring success this initiative depends heavily stronger public financial management especially ahead elections preventing arrears limiting extraordinary procedures ensuring effective social spending mobilizing grants concessional financing reducing costly regional borrowing safeguarding debt sustainability enhancing governance reinforcing PFM efforts."
Okamura emphasized that enhancing governance would reinforce public financial management efforts while stressing prompt operationalization asset declaration system maintaining donor support pivotal policies designed enhance growth potential improve equality should anchor National Development Plan NDP covering period between years ranging from twenty-four through twenty-eight catalyzing donor support attracting foreign private investment flows integral overall success CAR’s economic program supported implementation agreed policies reforms CEMAC regional institutions aimed increasing regional net foreign assets critical successful outcome anticipated long-term results derived concerted coordinated action stakeholders involved process ongoing discussions future developments unfold course time accordingly closely monitored evaluated periodically basis determined objectives established beforehand relevant parties concerned same context stated clearly articulated terms reference available 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