Via IMF (Den Internationale Valutafond)

IMF Staff Completes Review Mission to Central African Republic







October 9, 2020







End-of-Mission press
releases include statements of IMF staff teams that convey preliminary findings
after a visit to a country. The views expressed in this statement are those of
the IMF staff and do not necessarily represent the views of the IMF’s Executive
Board. Based on the preliminary findings of this mission, staff will prepare a
report that, subject to management approval, will be presented to the IMF’s
Executive Board for discussion and decision.





  • The IMF team welcomes the progress made in the fight against the Covid-19 pandemic and the preparation of next December’s presidential and legislative elections.
  • The pandemic and the containment measures have had a significant impact on growth, inflation, and public finances.
  • The Central African authorities and the IMF team discussed a set of economic and financial policies necessary for the conclusion of the first and second reviews under the Extended Credit Facility. These discussions will continue over the next few days.

Washington, DC:
A team from the International Monetary Fund (IMF) led by Édouard Martin carried
out a virtual mission from September 28 to October 9, 2020 to lead discussions
as part of the first and second reviews of the Central African Republic’s
economic reform program supported by the Extended Credit Facility
.

At the end of the mission, Mr. Martin
made the following statement:

“The IMF team welcomes the progress
made by the authorities in the fight against the Covid-19 pandemic. While more
than 4,800 cases and 60 deaths have been recorded since the first case was
confirmed in March, the number of new cases and deaths appears to have fallen
sharply in recent months. We hope this improvement will be sustained. However,
it is important to remain vigilant, to continue to apply social distancing
measures and to be ready to implement additional measures, if need be. In this
context, and while the security situation remains fragile, the mission also
welcomes the progress made in the preparation of next December’s presidential
and legislative elections.

“The pandemic and the measures aimed at
minimizing its health impact, combined with the drop in external demand,
resulted in a marked slowdown in economic activity in the first half of the
year. The most affected sectors were transport, tourism, hotels, and the mining
sectors. Though the start of a recovery appears to be underway, economic
activity is expected to stagnate in 2020 before growing by around 3½ percent in
2021. Inflation rose significantly in the first half of the year mainly due to
higher food prices stemming from the temporary closure of the border with
Cameroon. The downward correction in these prices recorded since July is
expected to continue, allowing average inflation to remain below 3 percent in
both 2020 and 2021.

“Owing to the impact of the economic
slowdown on government revenue and the additional spending needed to fight the
pandemic, the domestic primary budget deficit is expected to be around 6
percent of GDP this year. The current account deficit is also expected to widen
to 6½ percent of GDP in 2020, from 5 percent of GDP in 2019, mainly due to
weak external demand and private transfers, which would be only partly offset
by greater budget support and the drop in the oil bill.

“Owing to a large extent to the
pandemic, the Central African authorities have been unable to meet all the
objectives set under the program supported by the Extended Credit Facility
(ECF). Most of the quantitative performance criteria could not be met and
significant delays were experienced in the implementation of structural
reforms.

“The Central African authorities and
the IMF staff have agreed that the main objectives of the program, such as
maintaining macroeconomic stability and debt sustainability and restoring
sustainable inclusive growth, remain central to the government’s efforts to
restore lasting peace and prosperity. Therefore, we discussed a set of economic
and financial policies necessary for the conclusion of the first and second
reviews under the ECF.

“Notable progress has also been made
towards the implementation of structural reforms delayed by the pandemic.
Discussions focused on controlling non-covid-19 related expenditure, on the
parameters of the draft budget law for 2021 and on the structural reforms to be
implemented over the next twelve months. We agreed that the latter should aim
to improve domestic revenues and the efficiency of public spending, and to
strengthen governance and the business climate. These discussions will continue
over the next few days.

“The team would like to thank the
authorities for their close collaboration and the openness that prevailed
during the discussions.”

The IMF team met President Touadéra,
Prime Minister Ngrébada, Minister of Finance Dondra, Minister of Economy
Moloua, Minister of Mines Mboli-Fatrane, Minister of Telecommunications
Gourna-Zacko, National Director of BEAC Chaïbou, other senior government and
parliamentary officials, as well as representatives of the private sector and
technical and financial partners.

IMF Communications Department
MEDIA RELATIONS

PRESS OFFICER: Lucie Mboto Fouda

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

@IMFSpokesperson








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