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Rwanda, IMF reach staff-level agreement for $310 million funding to support economic reforms

Published

2 years ago

October 7, 2022

The Rwandan government has reached a state-level agreement with the International Monetary Fund (IMF), to access $310 million funding to “support the country’s economic reforms and help it build resilience against climate change.”

The agreement which was reached on Friday, is, however, subject to approval by the IMF’s executive board which is scheduled to consider it in December this year.

A press release by the IMF posted on its website said a mission to the East African country had “discussed reforms to strengthen the fiscal framework, sustain effective forward-looking monetary policy and mitigate the effects of the COVID-19 pandemic.”

“An International Monetary Fund (IMF) mission, led by Haimanot Teferra, held meetings with the Rwandan authorities in Kigali during September 26 – October 7, 2022, to discuss the authorities’ request for support under the Resilience and Sustainability Facility (RSF) and an accompanying new 36-months Policy Coordination Instrument (PCI),” the statement said.

“At the conclusion of the Rwandan authorities and an IMF staff team reached a staff-level agreement on policies and reforms under a new 36-month Policy Coordination Instrument and Resilience and Sustainability Facility, with a requested access of 150 percent of quota (SDR 240.3 million).

“The PCI would support the authorities in their efforts to build on the progress in macroeconomic, fiscal, and financial reforms started under the PCI that was approved in 2019.

“The Rwandan economy has been staging robust growth despite the unfavorable global environment. Staff estimates GDP growth at 6.8 percent in 2022.

“The financial system continues to be sound, liquid and well capitalized. The exchange rate has remained stable while reserves stood comfortably above 4 months of prospective imports,” it added.

Related Topics:Featured Funding IMF loan Rwanda

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IMF, Egypt reach agreement for fourth review of Egypt’s $1.2 billion loan request

Published

20 hours ago

December 26, 2024

Ifeoluwa Dada

Egypt and the International Monetary Fund (IMF) have reached a staff-level agreement over the fourth review of the Extended Fund Facility arrangement, which might lead to a $1.2 billion payout under the program.

In March, Egypt, struggling with rising inflation and cash shortages, consented to the $8 billion, 46-month facility. Its economic problems were made worse by a precipitous drop in Suez Canal revenue over the last year due to regional tensions.

Over the next two years, Egypt’s government has committed to raising its tax-to-revenue ratio by 2% of GDP, according to the IMF, emphasising removing exemptions rather than raising taxes.

According to a statement from the IMF, this would allow it to expand social expenditure to support vulnerable populations.

“While the authorities’ plans to streamline and simplify the tax system are commendable, further reforms will be needed to enhance domestic revenue mobilization efforts,” the statement said.

According to the IMF statement, Egypt had also committed to maintaining its commitment to a flexible currency rate and to taking more urgent action to guarantee that the private sector became the primary driver of development.

The IMF’s executive board still has to accept the fourth review’s staff-level agreement.

VenturesNow

Libya’s eastern govt accepts petrol subsidy elimination

Published

20 hours ago

December 26, 2024

Ifeoluwa Dada

In a recent statement, the eastern government of Libya claimed it had reached a consensus on a plan to eliminate gasoline subsidies and would draft a mechanism to carry out the accord.

Additional information on the idea was not released by the administration led by Osama Hamad, a challenger to the internationally acknowledged Tripoli-based government.

However, it is uncertain if Hamad’s government would be able to carry out the plan in the divided nation.

According to the Global Petrol Prices online tracker, a litre of gasoline costs just 0.150 Libyan dinars ($0.03) in OPEC member Libya, making it the second-cheapest in the world.

Following an uprising against former ruler Muammar Gaddafi in 2011, smuggling networks have thrived in the ensuing political unrest and armed fighting. In 2014, conflicting eastern and western governments separated the nation.

A World Bank analysis estimates that the annual value of fuel smuggling from Libya is at least $5 billion.

In a meeting with Mari Barrasi, the deputy governor of the Central Bank of Libya (CBL), located in Tripoli, and four members of the bank’s board of directors, Hamad in Benghazi supported the idea of removing subsidies.

The CBL’s Benghazi branch offices served as the venue for the conference.

The eastern parliament appointed Hamad in 2023 to succeed Abdulhamid Dbeibah, who had been put in position in 2021 under a U.N.-backed procedure that the parliament said had lost its legitimacy.

Dbeibah, who is located in Tripoli, stated in January that he will conduct a public poll on the topic of eliminating gasoline subsidies, but he hasn’t done anything about it since.

According to CBL figures, gasoline subsidies cost 12.8 billion Libyan dinars between January and November of this year. 4.8 Libyan dinars to $1 is the official exchange rate.