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Author(s):
International Monetary Fund. External Relations Dept.
Published Date:
January 1999
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Rwanda: ESAF

The IMF approved the second-year arrangement for Rwanda under the Enhanced Structural Adjustment Facility (ESAF) in an amount equivalent to SDR 23.8 million (about $32.77 million) to support the government’s economic program. Rwanda’s three-year ESAF arrangement was approved on June 24, 1998 (see Press Release 98/24, IMF Survey, July 6, 1998, page 216), in an original amount of SDR 71.4 million (about $98 million), of which SDR 23.8 million (about $33 million) has been disbursed. Today’s decision provides Rwanda with another SDR 23.8 million to be disbursed during the second year, with SDR 9.5 million (about $13.1 million) available immediately.

In commenting on the Executive Board discussion on Rwanda, IMF Deputy Managing Director Shigemitsu Sugisaki said:

“Directors commended the authorities for maintaining macro-economic stability, improving fiscal management and transparency, and making progress with structural reforms under the 1998/99 program—despite a difficult security environment and institutional capacity constraints. This allowed Rwanda to achieve solid economic growth and low inflation.

“Directors stressed the importance of improving tax and customs administration and accelerating the preparation of the value-added tax. They also attached particular importance to achieving the targeted reductions in defense outlays in 1999 and 2000.

“Directors stressed the need to enhance governance and welcomed the steps taken to improve budgetary transparency and control.”

Medium-term strategy

The government’s medium-term strategy aims at achieving high and sustainable growth and rapid poverty reduction. The macro-economic objectives for 1999-2002 are to achieve annual real GDP growth of 6 percent while keeping inflation at or below 3 percent a year. For the year 2000, revenues are projected to improve to 10.7 percent of GDP.

The government will also be implementing a strategy to reduce poverty, focusing on improving agricultural productivity, promoting small and medium-size enterprises in rural and urban areas, and encouraging the expansion of the coffee and tea sectors through liberalization and privatization.

Rwanda joined the IMF on September 30, 1963; its quota is SDR 80.1 million (about $110.3 million). Its outstanding use of IMF financing currently totals SDR 45.8 million (about $63 million).

The Gambia: ESAF

The IMF approved the second annual loan under the Enhanced Structural Adjustment Facility (ESAF) in the amount of SDR 8.6 million (about $11.8 million) for The Gambia to help establish durable and broad-based economic growth and a lasting reduction in poverty. The three-year ESAF loan was approved on June 29, 1998 (see Press Release 98/28, IMF Survey, July 20,1998, page 234), in an original amount of SDR 20.61 million (about $28.4 million), of which SDR 3.44 million (about $4.7 million) has been disbursed.

At the conclusion of the Executive Board’s discussion, IMF Deputy Managing Director Shigemitsu Sugisaki made the following statement:

“Directors noted that, despite broadly encouraging developments under the first annual arrangement, there were some difficulties in 1998 to do with fiscal policy and a number of structural reforms. The program seeks sustainable growth and poverty reduction through reestablishing macroeconomic stability, deepening structural reforms, and rebuilding investor confidence. Directors emphasized the need for determination in implementing fully the necessary measures.

“Directors stressed the need for a prudent monetary policy and continued fiscal consolidation to free resources for higher social and investment spending. Further improvements in tax administration are essential to maintain a sound revenue base. On the expenditure side, there is a need to strengthen the allocative efficiency of the budget, while updating the computerization of operations.”

Strategy for 1999-2000

The government’s strategy for 1999-2000 is to consolidate the gains made in 1998 and so far in 1999, despite some slippages and adverse developments during that period. The fiscal program through 2000 aims to reduce the overall deficit to 2.5 percent of GDP in 2000 from 4.5 percent in 1998. In its budget for 2000, the government plans to further reduce expenditure while bolstering domestic revenue.

The program further aims to reduce the external account deficit while increasing gross external reserves to an equivalent of about four months of imports of goods and services. Monetary policy will focus on containing average annual inflation at about 2.5 percent in 1999 and 2000 while maintaining adequate gross official reserves. On structural reforms, the government is taking steps to strengthen the legal and institutional framework. Social policy will focus on improving employment opportunities in key sectors and on providing better social services.

The Gambia joined the IMF on September 21, 1967, and its quota is SDR 31.10 million (about $42.8 million). Its outstanding use of IMF financing currently totals SDR 5.86 million (about $8.1 million).

Rwanda: selected economic and financial indicators
199419951996199719981199821999319992200042001420024
(annual percent change)
Real GDP growth-50.234.415.812.86.79.58.15.05.06.06.0
Consumer prices (end of period)64.438.39.216.67.0-6.05.02.53.03.03.0
(percent of GDP, unless otherwise indicated)
Overall balance (payment order; including grants)-11.5-2.4-5.7-2.4-5.6-2.9-5.6-5.4-5.9-6.5-6.5
External current account balance (excluding official transfers)-53.0-19.1-19.0-17.3-20.1-17.0-19.6-15.8-17.0-16.9-16.8
Gross reserves (in months of imports, c.i.f)1.35.05.05.46.06.16.07.36.25.74.5

Program.

Estimate.

Revised program.

Projections.

Data: Rwandese authorities; and IMF staff estimates and projections

Program.

Estimate.

Revised program.

Projections.

Data: Rwandese authorities; and IMF staff estimates and projections

The Gambia: selected economic and financial indicators1
1994/951995/961996/9719972199831998419993200032001320025
(annual percent change, unless otherwise indicated)
GDP at constant prices-3.45.30.84.93.84.74.25.05.05.0
Consumer price index (end of period)5.20.24.80.33.04.42.02.52.52.5
(percent of GDP)
Current account balance
(excluding official transfers)-12.5-20.1-12.8-10.6-10.6-11.6-10.8-10.5-10.1-9.5
Central government budget
(including grants)6-3.3-9.9-9.7-6.5-2.7-2.5-1.7-0.9-0.20.2
Gross official reserves
(months of imports, c.i.f.)73.94.64.43.94.43.94.24.44.84.9

Until 1996/97, fiscal years (July-June); from 1997, calendar years.

Estimate.

Program.

Preliminary.

Projection.

On a commitment basis.

Plus all other services payments.

Data: The Gambian authorities and IMF staff estimates and projections

Until 1996/97, fiscal years (July-June); from 1997, calendar years.

Estimate.

Program.

Preliminary.

Projection.

On a commitment basis.

Plus all other services payments.

Data: The Gambian authorities and IMF staff estimates and projections

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