(Ecofin Agency) – Côte d’Ivoire secured $3.5 billion from the International Monetary Fund (IMF) last May, to implement an economic reform program. The Fund recently reviewed the deal for the first time and said it was happy with the results.
The IMF will back Côte d’Ivoire’s economic program with $500 million. The announcement was made at the end of a visit to Abidjan by an IMF mission, led by Olaf Unteroberdoerster. The mission was there to review the country’s economic program.
Unteroberdoerster said that “the program’s results, so far, are satisfactory” and all policies, including the key parameters of the 2024 budget framework, have been validated.
The facility, which still needs to be approved by the IMF’s Board of Directors, is part of the $3.5 billion MEDC/FEC agreement approved by the institution on May 24, 2023.
This year, the Ivorian economy was resilient, despite the current global shocks and imbalances recorded at the end of 222. The country is expected to record an economic growth of 6.4%, and an inflation of 4.7% in 2023. Higher tax revenues, according to the IMF, significantly contributed to this resilience, and they should help reduce the budget deficit for 2023 to 5.3% of GDP. However, challenges remain, including a high current account deficit.
Among its recommendations, the Fund called on the Ivorian government to step up efforts to reduce the budget deficit to 4.0% of GDP by 2024 and to increase revenues by 0.5% of GDP. This, the IMF noted, will help the country maintain a moderate risk of debt distress rating.
It is worth noting that Côte d’Ivoire has been taking several steps to end subsidies on energy and food products and replace them with direct transfers to the population. Alongside this commitment, the Ivorian authorities plan to raise the country’s tax burden to at least 20% of GDP, in line with the WAEMU target. This strategy is in line with the country’s overall objective of achieving upper-middle-income status in the medium term.
In a few days, the IMF will hold its annual meetings in Marrakech, Morocco. Ahead of the roundtable, Kristalina Georgieva, IMF Managing Director, is expected in Abidjan today, to give an overview of the global and regional economic outlook and discuss the Fund’s priorities for the months ahead.
Moutiou Adjibi Nourou