Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

EXECUTIVE SUMMARY This is the final review under the Extended Credit Facility (ECF) arrangement. The program contributed to maintaining macroeconomic stability, and there was progress on structural reforms. The authorities intend to request a successor arrangement under the ECF. A new finance minister was appointed in April; uncertainly remains on the timing of elections. Preliminary data suggest that GDP in FY2014 grew by 3.5–4 percent, while inflation increased slightly to about 5 percent. An increase in fuel prices (in October) should result in fiscal savings of at least 1 percent of GDP during FY2015. The March performance criterion on net international reserves (NIR) was met, but although the deficit was lower than projected, the performance criterion on net central bank credit to the central government was missed. Downside risks are significant and include a pull-back of Venezuela-related flows, a resumption of political tensions, and vulnerability to weather events. A total of SDR 1.638 million will become available upon completion of this review, bringing total disbursements under the ECF to SDR 40.950 million. Key Policy Recommendations: • The policy mix, in particular the adjustment going forward, should come from a lower fiscal deficit rather than from a tighter monetary policy. The FY2015 fiscal deficit should be reduced to mitigate financing risks as part of a medium-term plan to restore fiscal sustainability. • The central bank should let the exchange rate adjust more to market pressures. Intervention should be parsimonious, geared at avoiding excess volatility and disorderly movements in the exchange rate; it should be guided by fundamentals in the medium term. • Progress on structural reforms (including on the energy sector and on public financial management) should catalyze more donor support and is essential for supporting growth. A possible new ECF arrangement would entrench macroeconomic stability and promote policies to generate sustained GDP growth.

Loans, Foreign --- Fiscal policy --- Monetary policy --- Structural adjustment (Economic policy) --- Economic development --- Monetary management --- Economic policy --- Currency boards --- Money supply --- Tax policy --- Taxation --- Finance, Public --- Foreign loans --- International loans --- Loans, International --- Loans --- Conditionality (International relations) --- Foreign loan insurance --- Development, Economic --- Economic growth --- Growth, Economic --- Economics --- Statics and dynamics (Social sciences) --- Development economics --- Resource curse --- Government policy --- International Monetary Fund --- Internationaal monetair fonds --- International monetary fund --- Haiti --- Economic conditions. --- Economic policy. --- Banks and Banking --- Financial Risk Management --- Money and Monetary Policy --- Public Finance --- Macroeconomics --- Debt --- Debt Management --- Sovereign Debt --- Monetary Policy, Central Banking, and the Supply of Money and Credit: General --- Banks --- Depository Institutions --- Micro Finance Institutions --- Mortgages --- Monetary Policy --- National Budget --- Budget Systems --- Energy: Demand and Supply --- Prices --- Public finance & taxation --- Banking --- Monetary economics --- Economic & financial crises & disasters --- Government debt management --- Credit --- Commercial banks --- Public debt --- International reserves --- Money --- Public financial management (PFM) --- Financial institutions --- Oil prices --- Debts, Public --- Banks and banking --- Foreign exchange reserves

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper discusses Liberia’s Request for Disbursement Under the Rapid Credit Facility (RCF) and Debt Relief Under the Catastrophe Containment and Relief (CCR) Trust. Economic activity has declined significantly, and fiscal and external financing needs are more pronounced than envisaged at the time of the Extended Credit Facility (ECF) augmentation. The authorities remain committed to the broad objectives of the ECF program. The IMF staff recommends approval of the authorities’ requests for a disbursement under the RCF and debt relief under the CCR Trust given the extensive economic damage caused by the Ebola outbreak and based on the authorities’ updated policy intentions and commitments.

Loans, Foreign --- Economic assistance --- Debt relief --- Financial crises --- Crashes, Financial --- Crises, Financial --- Financial crashes --- Financial panics --- Panics (Finance) --- Stock exchange crashes --- Stock market panics --- Crises --- Debt renegotiation --- Debt rescheduling --- Debt restructuring --- Relief, Debt --- Renegotiation, Debt --- Rescheduling, Debt --- Restructuring, Debt --- Debtor and creditor --- Economic aid --- Foreign aid program --- Foreign assistance --- Grants-in-aid, International --- International economic assistance --- International grants-in-aid --- Economic policy --- International economic relations --- Conditionality (International relations) --- Foreign loans --- International loans --- Loans, International --- Loans --- Foreign loan insurance --- Law and legislation --- International Monetary Fund --- Internationaal monetair fonds --- International monetary fund --- Budgeting --- Exports and Imports --- Public Finance --- Industries: Financial Services --- Diseases: Respiratory --- Money and Monetary Policy --- Health Behavior --- Debt --- Debt Management --- Sovereign Debt --- National Budget --- Budget Systems --- Trade: General --- Banks --- Depository Institutions --- Micro Finance Institutions --- Mortgages --- Monetary Policy, Central Banking, and the Supply of Money and Credit: General --- Infectious & contagious diseases --- Budgeting & financial management --- Finance --- Public finance & taxation --- International economics --- Monetary economics --- Ebola --- Budget planning and preparation --- Public debt --- Imports --- Health --- Public financial management (PFM) --- International trade --- Credit --- Money --- Ebola virus disease --- Budget --- Debts, Public --- Liberia