Addressing macroeconomic issues

Officials from the International Monetary Fund (IMF) have arrived in Madagascar for the first review of the Extended Credit Facility (ECF).

Several key macroeconomic issues need to be addressed. The first review mission of the second Extended Credit Facility, led by Frédéric Lambert and Kodjovi Eklou, the IMF representative, is already underway. In the capital, the team held its first working meeting at the Ministry of Economy and Finance in Antaninarenina, in the presence of Rindra Hasimbelo Rabarinirinarison, Minister of Economy and Finance, and several collaborators.

These preliminary discussions focused on two key areas. First, the list of items to be included in the IMF’s Article IV review. This includes an update on debt sustainability, risk assessment through a matrix, identification of capacity needs, evaluation of governance effectiveness in fighting corruption, analysis of the impact of education on growth, and the development of a service delivery statement. The IMF closely monitors member states’ policy changes under Article IV of its statute. Regarding debts, Rindra Hasimbelo Rabarinirinarison reiterated that Madagascar has not exceeded the 800 million USD threshold agreed with the IMF, despite many attractive financing offers.

There are multiple objectives to achieve with this first review of the second ECF, which runs from June 2024 to June 2025, provided attention is given to the list of preliminary actions and structural benchmarks. The IMF requires the state to provide a monthly dashboard with key performance indicators for tax and customs administration within 30 days after the end of each month. This is part of the continuous measures that the government must implement. Similarly, the monthly report from the board of directors detailing the revenues and operating costs of Jirama, along with details of any budget transfers to Jirama’s suppliers, must be submitted to the IMF within 45 days after the end of each month.