(JollofNews) – An International Monetary Fund (IMF) mission have visited Banjul to assessed the impact of exogenous shocks that have hit the Gambian economy recently and initiated discussions on providing IMF support through a Rapid Credit Facility (RCF).
The mission which was led by Ulrich Jacoby, assistant to the director of IMF, met with President Adama Barrow, Minister of Finance Amadou Sanneh, Central Bank Governor Amadou Colley, other government officials, development partners, and representatives of the private sector and civil society and also discussed plans to support economic policy implementation and the possibility of establishing a Staff Monitored Program (SMP).
At the end of the mission, Mr. Jacoby said: “With the transition to a new, democratically-elected government, The Gambia is at a historical turning point. Significant economic challenges lie ahead. Economic growth in 2016 is now estimated to have reached only 2.2 percent, down from 4.3 percent in 2015, due to limited availability of foreign exchange, weak agricultural output and the effect of the political impasse on tourism during high season.
“Headline annual inflation stands at 8.8 percent in February 2017, driven by higher food prices and the recent depreciation of the dalasi which increases the domestic price of imported goods. The situation is compounded by economic mismanagement and massive embezzlement of funds during the previous regime.”
He added that addressing the effects of these shocks and restoring economic stability will require concerted policy efforts as well as support from the international community.
“The key priority is to bring public spending in line with available resources, thereby drastically reducing domestic borrowing and interest cost,” he said.
Mr Jacoby further added: “Efforts need to include reforms of public enterprises, including the National Water and Electricity Company (NAWEC) and the National Telecom and Mobile Operators (GAMTEL/GAMCEL) to place them on a sound financial footing and limit their drain on the state budget.
“The international community has been quick to re-engage with The Gambia, and development partners have indicated that substantial financial support may be forthcoming. Such financial support will assist The Gambia in its reforms, but will need to be accompanied by significant domestic efforts to ensure a return to economic growth and stability.”