Via IMF (Den Internationale Valutafond)

IMF Executive Board Approves an Additional US$171.9 Million Disbursement Under the RCF to Madagascar to Address the COVID-19 Pandemic

July 30, 2020

  • This is the second disbursement under the Rapid Credit Facility (RCF), which brings total IMF COVID-19 emergency support to the Republic of Madagascar to US$337.9 million.
  • Madagascar’s macroeconomic outlook has been affected by weaker external demand, the increased spread of the pandemic, and significant losses of revenue.
  • The additional resources under the RCF will help address urgent financing needs to mitigate the impact of the pandemic, including spending on health, social protection, and to support the most vulnerable, and catalyze additional donor resources.

Washington, DC –
The Executive Board of the International Monetary Fund (IMF) today approved
the disbursement of $171.9 million (SDR122.2 million, 50 percent of quota)
to the Republic of Madagascar under the Rapid Credit Facility (RCF). This
is the second emergency disbursement since the onset of the pandemic and
will help finance the country’s urgent balance of payments and fiscal
needs. It follows the Executive Board’s approval of the disbursement of US$
165.99 million on April 3, 2020 (see

IMF Press Release No. 20/133


This second disbursement was made possible by both the IMF Executive
Board’s decision to double the annual access limit under the RCF to 100
percent of quota (see IMF Policy Paper No. 20/018), and its most recent
decision on a temporary modification to the Fund’s annual PRGT access
limits (see

IMF Press Release No. 20/267

). This additional disbursement brings the total IMF COVID-19 support to
Madagascar to US$337.9 million.

Madagascar’s economic outlook has worsened since the approval of the first
RCF request, due to a further deterioration of the global environment and a
deepening of the impact of the COVID-19 pandemic, with GDP now projected to
contract by 1 percent in 2020. As a result, urgent balance of payments
needs arising from the pandemic have increased, with the financing gap now
estimated at about US$580 million, while the fiscal situation has been
severely affected by additional revenue losses and redirecting budget
resources to address critical spending, including increased social
assistance to the most vulnerable. The additional disbursement under the
RCF will help finance health and economic relief spending under the
government’s national contingency plan to fight the pandemic and continue
to catalyze further support from donors. The authorities have committed to transparency and accountability to ensure that the RCF resources are used appropriately and for their intended purpose.

Following the Executive Board discussion. Ms. Antoinette Sayeh, Deputy
Managing Director and Acting Chair, made the following statement:

“The COVID-19 pandemic continues to severely affect key sectors of
Madagascar’s economy, including tourism and export-oriented manufacturing,
further weakening the macroeconomic outlook. Growth is projected to be
negative in 2020 and urgent balance of payments needs arising from the
pandemic have increased. Additional emergency support under the Rapid
Credit Facility, following a first disbursement approved on April 3, 2020,
is expected to help finance health and economic relief spending, and
continue to catalyze donor support.

“In the context of a high degree of uncertainty, more support may be needed
to ease the adjustment burden. The authorities’ decision to apply for the
Debt Service Suspension Initiative supported by the G-20 and Paris Club,
and use of the released resources to finance spending on COVID-19 related
health and economic relief, is welcome.

“The authorities are implementing measures to address the humanitarian and
economic impact of the pandemic while preserving macroeconomic stability.
These include strengthening the health system and social protection,
supporting the private sector, preserving the stability of the financial
sector, and maintaining the flexible exchange rate regime.

“To ensure that the financing provided is efficiently spent on addressing
the crisis, the authorities have committed to enhancing transparency,
including with the publication of procurement contracts related to the
response to the pandemic, and post-crisis audits.

“Madagascar’s risk of public debt distress remains moderate, but risks to
the outlook are substantial. This underscores the importance of preserving
fiscal sustainability once the crisis abates. The authorities remain
committed, beyond their immediate response to the crisis, to continue
reforms needed toward higher, more inclusive, and sustainable growth.”

More information

IMF Lending Tracker (emergency financing request approved by the IMF
Executive Board)

IMF Executive Board calendar

IMF Communications Department

PRESS OFFICER: Lucie Mboto Fouda

Phone: +1 202 623-7100Email:


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