Guinea-Bissau: Sixth Review Under the Extended Credit Facility, Request for a Waiver of Nonobservance of Performance Criteria, and Financing Assurances Review-Press Release; Staff Report; and Statement by the Executive Director for Guinea-Bissau

International Monetary Fund

No 2024/295, IMF Staff Country Reports from International Monetary Fund

Abstract: This paper presents Guinea-Bissau’s Sixth Review under the Extended Credit Facility (ECF), Request for a Waiver of Nonobservance of Performance Criteria, and financing assurances review. The authorities’ commitment to a range of challenging policy reforms is starting to show some results. They should persevere with their ambitious structural reform agenda to improve domestic revenue mobilization, strengthen expenditure controls, and enhance governance. Economic growth is expected to reach 5 percent in 2024, while inflation should slow to 4.2 percent compared to 7.2 percent in 2023. However, the economic outlook remains subject to significant near-term risks. Fiscal consolidation remains critical to reduce vulnerabilities and ensure debt sustainability and macroeconomic stability. This should be underpinned by strict rationalization of nonpriority expenditure and revenue mobilization. The authorities are implementing structural reforms which are pivotal to the program’s success. Urgent actions should be taken to mitigate fiscal risks from the public utility company. The authorities should also continue advancing the disengagement of the undercapitalized bank, including through contingency planning.

Keywords: Bissau-Guinean authority; expenditure prioritization; policy reform; Guinea-Bissau authorities; Policy discussion; government's share; headline inflation; Arrears; Debt service; Global; West Africa (search for similar items in EconPapers)
Pages: 69
Date: 2024-09-16
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