Lagos, Sept. 22, 2023 – The IMF has approved $302 million support to Burkina Faso under a 48-month arrangement under the Extended Credit Facility (ECF) with an immediate disbursement of $31.8 million.
The IMF said in a statement that the approval was granted by its board under a 48-month Extended Credit Facility (EFC).
It said the support was to assist Burkina Faso as it faces protracted balance of payments problems.
The IMF said the balance of payment problems, which had reflected in large development needs, were due to the impact of shocks such as the COVID-19 pandemic, adverse weather conditions, deteriorating domestic security, the food insecurity crisis, and spillovers from Russia’s war in Ukraine.
These shocks have disrupted economic activity, affected livelihoods, and exacerbated macroeconomic imbalances.
“The new arrangement aims to address protracted balance of payments problems, achieve macroeconomic stabilization, mitigate the impact of current shocks on the most vulnerable, and reduce poverty.
“This decision comes against the background of persistent, severe, and overlapping exogenous shocks, including a volatile political environment; fragile and deteriorating security conditions; the impact of Russia’s war in Ukraine on energy prices and key agricultural imports and the resulting food insecurity crisis; as well as the post-pandemic disruptions in international supply-chains.
“All these shocks have disrupted economic activity, affected livelihoods, and exacerbated macroeconomic imbalances.
“As a result, external and fiscal buffers eroded substantially in 2022, as the current account deficit reached 6.2 percent of GDP, the overall fiscal balance widened to10.6 percent of GDP, economic growth in 2022 decelerated to 1.5 percent year-on-year, after 6.9 percent of GDP in 2021, while more than 40 percent of the population remains below the poverty line. (GBN)
