At the end of August, the Executive Board of the International Monetary Fund (IMF) is due to vote on this additional measure, valued at around $3.16 million.
According to the International Monetary Fund (IMF), Guinea-Bissau is on the right track. “Performance has been satisfactory in the first months of the program, particularly in terms of structural measures. Increasing domestic revenues, controlling the wage bill and other current expenditures and transfers will be essential to ensure the
sustainability of public finances and debt,” the financial institution said in a statement sent to APA Tuesday.
An IMF team, led by José Gijon, mission chief for Guinea-Bissau, held virtual discussions from May 17 to 22 and meetings in Bissau from May 23 to 30 to discuss the assessment of the Second Review of the Extended Credit Facility arrangement, a mechanism that provides financial assistance to countries facing protracted balance of
payments problems.
At the end of the mission, Mr. Gijon stated that “five of the eight quantitative achievement criteria at the end of March 2023 have been met. The three missed targets were the tax revenue floor mainly due to a drop in customs collection, the salary ceiling because some civil servants suspended on the basis of last year’s civil service census
were reinstated through statutory appeal, and the domestic primary budget balance floor due to lower fishing revenues, higher-than-expected current expenditure and payment of utility bills owed to the sole electricity supplier.”
He further asserted that “as regards structural reforms, all the benchmarks for the second and one for the third and fourth reviews have already been achieved. These include the initial installation of 10,000 prepaid electricity meters to increase utility revenues, increased transparency in public procurement and other key measures in
the areas of public financial management, expenditure control, revenue mobilization and the rule of law.”
However, estimated economic growth has moderated to 4.2 percent in 2022. Soaring commodity prices associated with the war in Ukraine, particularly in food and fuel, pushed average inflation up to 7.9
percent and contributed to a widening current account deficit.
Finally, argued the mission chief for Guinea-Bissau, “in the future, additional corrective measures must be taken to improve the fiscal balance and progressively reduce public debt. Additional financial support from the international community, through grants and concessional loans, remains essential for the successful implementation of the IMF-supported program.”
The next visit to Guinea-Bissau is scheduled for the second half of September.
ID/ac/fss/abj/APA