IMF approves 40-month, $312.4 million loan for Madagascar

The Executive Board of the International Monetary Fund (IMF) on Monday approved a 40-month, $312.4 million loan, for Madagascar under the Extended Credit Facility (ECF). The Board’s decision allows an immediate disbursement of $69.4 million.

Madagascar’s macroeconomic outlook has been affected by weaker external and domestic demand due to the pandemic reversing recent progress in per capita income and poverty reduction, the IMF said.

The ECF arrangement follows the Fund’s emergency support to Madagascar in April 2020 for about $165.99 million or 50 percent of its quota, and in July 2020 for about US$171.9 million or 50 percent of quota.

The arrangement is expected to catalyze additional bilateral and multilateral financial support, the IMF said in a statement, adding that the 40-month financing package will “support the implementation of the authorities’ ambitious economic reform agenda to raise sustainable and inclusive growth and reduce poverty.”

The IMF added that the reforms will focus on strengthening fiscal space to allow for much needed investment and social spending, improving the business environment, advancing the anti-corruption and governance agenda, and strengthening the monetary policy framework and supporting financial stability.

“The COVID-19 pandemic continues to take a severe human and economic toll on Madagascar, reversing recent social and economic progress, and creating fiscal and external financing needs,” said Ms. Antoinette Sayeh, Deputy Managing Director and Acting Chair. “The authorities’ program, which will be supported by a new arrangement under the Extended Credit Facility, will focus on supporting the economic recovery and implementing structural reforms to increase sustainable and inclusive growth that reduces poverty.”

Chief White House Correspondent for

Simon Ateba is Chief White House Correspondent for Today News Africa. Simon covers President Joe Biden, Vice President Kamala Harris, the U.S. government, the United Nations, the International Monetary Fund, the World Bank and other financial and international institutions in Washington D.C. and New York City.

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