Via IMF (Den Internationale Valutafond)

IMF Executive Board Approves an Additional US$68.49 Million Disbursement for Chad and Notes Cancellation of its Extended Credit Facility (ECF) Arrangement







July 22, 2020











  • This is the second disbursement under the Rapid Credit Facility (RCF), to address urgent balance of payment needs stemming from the COVID-19 pandemic.
  • The Chadian economy continues to be severely impacted by the twin Covid-19 pandemic and terms of trade shocks, which led to a weaker than previously envisaged economic outlook.
  • The additional RCF disbursement will provide timely support to fill an urgent financing need to contain the economic impact of the pandemic and provide essential COVID-19-related health expenditure.

Washington, DC – July 22, 2020
The Executive Board of the International Monetary Fund (IMF) today approved
a disbursement under the Rapid Credit Facility (RCF) for SDR 49.07 million
(about US$ 68.49 million or 35 percent of quota).


This is the second disbursement in three months
, under the RCF, to address the external financing needs arising from the
COVID-19 pandemic, bringing Chad’s total IMF emergency support since the
outbreak of the pandemic to SDR 133.19 million (US$183.60 million). The
Executive Board also notes the cancellation of the ECF arrangement, which
was to expire at end-September 2020.

The twin Covid-19 pandemic and terms of trade shocks have worsened Chad’s
economic outlook since the first RCF in April 14, 2020. Since then, the
authorities have adopted containment measures (including a curfew and
closure of markets and non-essential stores), which proved successful in
containing the pandemic spread. However, these had the unavoidable
consequence of further depressing the economy. Fiscal and external
positions have also worsened, reflecting reduced export proceeds and lower
oil and non-oil revenues, in addition to the higher than expected spending
to contain the COVID-19 crisis.

The Chadian authorities continued to take strong actions to upgrade the
health system and contain the economic impact of the pandemic. Additional
measures have been taken since the first RCF to help businesses and
households absorb the adverse impact of the pandemic. The IMF’s second RCF
will provide a timely support for the implementation of the authorities’
additional measures, to address the COVID-19 crisis and mitigate its severe
impact. The authorities are also taking steps to ensure transparency and
accountability in the use of COVID-related resources, including an ex-post
audit of crisis-related spending and the publication of crisis-related
procurement contracts.

Following the Executive Board discussion of Chad’s request, Mr. Mitsuhiro
Furusawa, Deputy Managing Director and Acting Chair, made the following
statement:

“The twin Covid-19 pandemic and terms of trade shocks continue to severely
impact the Chadian economy. The macroeconomic outlook has further
deteriorated, with greater economic contraction and higher balance of
payments and budgetary financing needs. The risk to the outlook is tilted
to the downside.

“In response to the shocks, the authorities continue to implement strong
measures to halt the community spread of the virus and mitigate the impact
of the crisis. Key measures focus on scaling up health-related spending,
protecting the most vulnerable and supporting households and businesses.
The authorities will also strengthen transparency and monitoring of
emergency resources.

“To help save lives and support those most affected by the pandemic, the
authorities will temporarily relax the fiscal deficit to allow for the
scaling up of health care spending and to accommodate the impact of the
sharp drop in oil prices. The IMF emergency assistance will support the
authorities’ policy response and catalyze donor support.

“Once the crisis abates, the authorities should stand ready to gradually
unwind the temporary emergency measures. Fiscal adjustment will be needed
in the medium term, especially since oil prices are expected to remain low,
including by allowing temporary expenditure measures to expire.

“Public debt vulnerabilities remain high and the authorities should
continue to refrain from non-concessional borrowing consistent with their
commitments under the DSSI and the terms of the World Bank’s Sustainable
Development Financing Policy.”

More information

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


https://www.imf.org/en/Topics/imf-and-covid19/COVID-Lending-Tracker

IMF Executive Board calendar


https://www.imf.org/external/NP/SEC/bc/eng/index.aspx


IMF Communications Department
MEDIA RELATIONS

PRESS OFFICER: Lucie Mboto Fouda

Phone: +1 202 623-7100Email: MEDIA@IMF.org

@IMFSpokesperson








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