Samoa: 2026 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Samoa

International Monetary Fund

No 2026/250, IMF Staff Country Reports from International Monetary Fund

Abstract: The 2026 Article IV Consultation highlights that Samoa has been adversely affected by the global energy price shock, but strong fundamentals have continued to underpin resilience. Samoa’s economy faces a challenging outlook amid elevated global energy prices, adverse terms-of-trade developments, and heightened external uncertainty. Public debt remains low and international reserves ample, providing important buffers against external shocks. However, growth is projected to slow to around 2 percent in FY2026/27 as higher fuel costs weigh on economic activity, with an expansionary fiscal stance partially offsetting the external drag. Increased energy-related spending and public investment are expected to widen the current account deficit through higher energy imports. Over the medium term, growth is projected to stabilize at approximately 2½ percent, although risks remain tilted to the downside due to geopolitical tensions, commodity-price volatility, climate shocks, capacity constraints, and outward migration. Monetary policy should remain appropriately tight and vigilant against inflationary pressures, while stronger efforts to absorb excess liquidity could improve policy transmission. Structural reforms remain essential to raise potential growth and strengthen resilience, with priorities including improving the business environment, promoting economic diversification, and investing in human capital.

Pages: 90
Date: 2026-09-21
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