Category: Российская экономика

Source: IMF – News in Russian

June 20, 2025

• The IMF Executive Board completed today the third review under the Extended Credit Facility Arrangement for Burkina Faso. This enables an immediate disbursement of about US$32.8 million.
• Supportive policies and favorable weather conditions boosted agricultural output in 2024; however, widespread insecurity continues to weigh on economic activity in other sectors, especially gold mining, the primary source of export earnings for the country.
• Program performance has been broadly satisfactory. While end-December 2024 performance criteria for the primary fiscal deficit and net domestic financing were missed by 0.6 percent of GDP, the 2025 budget includes adequate corrective measures. On this basis, the Executive Board approved waivers of nonobservance of these performance criteria. All continuous performance criteria were met. Seven out of eight structural benchmarks were achieved, with the remaining one implemented later as a prior action.

Washington, DC: The Executive Board of the International Monetary Fund (IMF) completed the third review under the 48-month Extended Credit Facility (ECF) arrangement that was approved on September 21, 2023. The completion of the review enables the immediate disbursement of SDR 24.08 million (about US$32.8 million), bringing total IMF financial support under the arrangement to SDR 96.32 million (about US$131.3 million). 

Real GDP growth is estimated to have reached 5.0 percent in 2024. Strong growth in agriculture and services outweighed contractions in mining and manufacturing. Real GDP growth is projected to average 4.2 percent in 2025, as growth in the agricultural output is expected to soften in line with average rainfall conditions. Inflation is projected to ease to 3.0 percent in 2025 amid moderating food prices.

Balance of payments strengthened, reflecting a positive shift in terms of trade. The current account deficit rose from 5.0 percent of GDP in 2023 to 5.7 percent in 2024 but is expected to narrow to 3.4 percent in 2025 due to record-high gold prices. Trade policy turbulences will likely have a marginal impact as the United States are not a major trading partner.   

Elevated capital spending affected fiscal performance in 2024. Nonetheless, the overall fiscal deficit narrowed from 6.7 percent of GDP in 2023 to 5.8 percent in 2024. Building on the 2025 budget, fiscal policy is expected to be tightened considerably in 2025, with the overall fiscal deficit projected in the 3.3 to 4.0 percent of GDP range, depending on the availability of external concessional financing. Risks to the outlook are tilted to the downside due to terrorist threats.

Progress under the ECF arrangement has been broadly satisfactory. Due to fiscal pressures in late 2024, the end-December performance criteria (PCs) on the primary fiscal deficit and net domestic financing were missed by 0.6 percent of GDP, while all other PCs were met. Three out of six indicative targets (ITs) were missed by small margins. All three continuous PCs and five end-March 2025 ITs, including on the primary fiscal deficit and net domestic financing were met, while the remaining four ITs were missed by small margins.

The Burkinabè authorities advanced their structural reform agenda under the program. They met seven out of eight structural benchmarks (SBs) and have addressed the missed SB on the preparation of the clearance plan for domestic arrears as a prior action for the third review. They have also implemented two other prior actions: they shared a list of treasury deposit accounts and cleared all domestic arrears outstanding at end-2023. Three new SBs under the program aim to strengthen the governance in public procurement, uphold integrity in revenue administration, and increase control over the public wage bill.

At the conclusion of the Executive Board’s discussion, Mr. Kenji Okamura, Deputy Managing Director, and Acting Chair, issued the following statement:

“Burkina Faso’s economy has proven resilient notwithstanding security challenges, a difficult humanitarian situation, and weather shocks. A lasting improvement in socio‑economic conditions will require progress on security and structural reforms to foster diversification, fiscal governance, and resilience.

            “While the policy framework remains strong, fiscal pressures affected program performance in 2024. For the first time, and in difficult circumstances, performance criteria on the primary fiscal deficit and net domestic financing were missed. The margin of nonobservance—while not negligible—did not undermine the fiscal consolidation trend. The authorities counteracted the slippage with strong measures on the expenditure side and remain committed to reducing the overall fiscal deficit to three percent of GDP by the end of the ECF arrangement, while safeguarding fiscal space for poverty-reducing social spending. This commitment is reflected in the 2025 budget and fiscal performance through end-March.

            “The authorities are on track and have expanded their structural reform agenda, focusing on fiscal governance and transparency. They have provided a list of treasury deposit accounts, adopted an arrears’ clearance plan, and cleared all arrears outstanding at end-2023 following their audit. These measures are informed by the preliminary findings of the IMF’s Governance Diagnostic Assessment (GDA). The GDA report is being finalized. The authorities intend to publish the final report in coming weeks and adopt, within four months from publication, an action plan reflecting its key recommendations. Structural conditionality for the fifth review has been strengthened with the addition of benchmarks on implementing the action plan from the procurement audit and strengthening further wage bill control and governance in revenue services.”

Table 1.  Burkina Faso: Selected Economic and Financial Indicators, 2023–29
Population (2023): 23.3 million						Gini Index (2021): 37.4
Per capita GDP (2023): 910 USD					Life Expectancy (years): 60
Share of population below the poverty line (2022): 43.7%						Literacy rate (2022): 34%
	2023	2024	2024	2025	2025	2026	2027	2028	2029
	Act.	ECF 2nd Review	Prel.	ECF 2nd Review	Proj.	Proj.	Proj.	Proj.	Proj.
	(Annual percentage change, unless otherwise indicated)
GDP and Prices
GDP at constant prices	3.0	4.2	5.0	4.3	4.2	4.9	4.7	4.7	4.7
GDP deflator	2.0	7.2	8.9	5.6	5.9	4.0	3.3	2.8	2.3
Consumer prices (annual average)	0.7	3.6	4.2	3.0	3.0	2.5	2.1	2.0	2.0
Consumer prices (end of period)	1.0	3.4	4.9	2.8	3.0	2.5	2.1	2.0	2.0
Money and Credit
Net domestic assets (banking system) 1/	5.3	18.7	0.4	14.7	6.1	8.8	8.7	7.5	7.0
Credit to the government (banking system) 1/	3.0	9.8	3.7	8.1	3.8	3.4	3.3	2.3	2.1
Credit to private sector	5.9	13.1	-2.2	9.5	2.6	8.2	8.3	7.9	7.5
Broad money (M3)	-3.0	20.8	7.2	15.6	6.1	9.1	8.1	7.6	7.1
Private sector credit/GDP	31.6	30.7	27.0	30.5	25.1	24.9	24.9	25.0	25.1
External Sector
Exports (f.o.b.; valued in CFA francs)	-3.1	10.5	2.0	10.5	25.3	7.8	5.3	4.2	2.7
Imports (f.o.b.; valued in CFA francs)	-1.5	5.3	4.8	3.5	10.8	6.3	6.5	6.4	5.7
Current account (percent of GDP)	-5.0	-5.2	-5.7	-3.5	-3.4	-3.1	-3.4	-3.7	-4.4
	(Percent of GDP, unless otherwise indicated)
Central Government Finances
Current revenue	20.6	20.1	20.6	18.6	19.8	20.1	20.4	20.8	20.9
of which: Tax revenue	18.2	17.8	18.3	16.9	18.1	18.4	18.8	19.1	19.3
Total expenditure and net lending	29.0	26.3	27.7	24.1	25.0	24.7	24.6	24.9	25.1
of which: Current expenditure	17.9	16.5	16.3	15.4	16.0	15.5	15.1	14.7	14.3
Overall fiscal balance, incl. grants (commitments)	-6.7	-5.0	-5.8	-4.3	-4.0	-3.5	-3.0	-3.0	-3.0
Total public debt 2/	56.2	53.0	56.9	52.2	56.1	55.0	54.0	53.0	52.3
of which: External debt	25.9	23.7	25.4	22.2	24.8	24.0	23.7	23.3	23.1
of which: Domestic debt	30.3	29.4	31.6	29.9	31.3	30.9	30.3	29.7	29.2
Memorandum Items:
Nominal GDP (CFAF billion) 3/	12,328	14,330	14,098	15,791	15,561	16,973	18,355	19,755	21,153
Nominal GDP per capita (US$)	874	990	975	1,050	1,002	1,063	1,120	1,175	1,227
Nominal exchange rate (CFAF/US$, period average)	606	602	606	598	635	637	637	637	637
Gold price (USD/troy ounce)	1,943	2,342	2,387	2,608	2,821	2,963	3,096	3,198	3,244
Sources: Burkinabé authorities; IMF staff estimates and projections.
1/ Percent of beginning-of-period broad money.
2/ The 2nd review total public debt data has been retroactively adjusted to correct an exchange rate calculation error starting in 2023. In addition, the denominator (GDP) in the table has been revised (see footnote 3 below). Previously, total public debt in 2024 was estimated at 52.6 percent of GDP, while it was assessed to have reached 53.6 percent of GDP in 2023.
3/ Historical nominal GDP figures have been revised down, in line with the most recent publication of official estimates by the National Institute of Statistics.

https://www.imf.org/en/News/Articles/2025/06/20/pr-25211-burkina-faso-imf-completes-the-3rd-review-under-the-ecf-arrangement

MIL OSI

Source: IMF – News in Russian

June 20, 2025

• The IMF Executive Board concluded the fifth and final reviews under the Extended Fund Facility (EFF) and the Resilience and Sustainability Facility (RSF) arrangements with Barbados, allowing an immediate disbursement of about US$19 million under the EFF arrangement and about US$39 million under the RSF arrangement.
• Implementation of the home-grown Barbados Economic Recovery and Transformation (BERT 2022) plan has remained strong and the broad objectives of the EFF and RSF arrangements have been achieved. Macroeconomic stability has been reinforced, and reforms have been implemented to boost fiscal sustainability, enhance growth, and build resilience.
• Barbados’ economy has continued to perform well. Growth has been robust, inflation has moderated, the fiscal and external positions have improved, and the public debt-to-GDP ratio has continued to decline. The outlook is stable but subject to downside risks, given heightened global uncertainty and vulnerabilities to external shocks and natural disasters.

Washington, DC: The Executive Board of the International Monetary Fund (IMF) today concluded the fifth and final reviews of the Extended Fund Facility (EFF) and the Resilience and Sustainability Facility (RSF) arrangements with Barbados. The completion of the reviews allows the authorities to draw the equivalent of SDR 14.175 million (about US$19 million) under the EFF arrangement and SDR 28.35 million (about US$39 million) under the RSF arrangement, bringing total disbursements under the EFF arrangement to SDR 85.05 million (about US$116 million) and SDR 141.75 million (about US$193 million) under the RSF arrangement. The authorities have consented to the publication of the staff report prepared for these reviews.[1]

Economic activity in 2024 remained robust, with growth estimated at 4 percent, driven by tourism, construction, and business services. Inflation moderated to an average of 1.4 percent due to easing global commodity prices and prices of domestic goods and services. The external position strengthened further, with the current account deficit narrowing to 4.5 percent of GDP, supported by tourism receipts, declining import prices, and one-off current transfers. Gross international reserves reached US$1.6 billion at end-2024, equivalent to over 7 months of import cover, providing continued strong support to the exchange rate peg.

The near-term outlook is stable. Growth is expected to reach 2.7 percent in 2025, supported by construction of tourism-related projects and government investment. Inflation is expected to pick up in 2025 due to the rising cost of non-fuel imports and some domestic agricultural products. Nevertheless, risks to the outlook are tilted to the downside, amidst the highly uncertain external economic environment and Barbados’ continued vulnerability to global shocks and natural disasters.

Program performance has remained strong. All quantitative performance criteria and indicative targets were met. The authorities exceeded the primary fiscal surplus target for FY2024/25 and are targeting 4.4 percent of GDP for FY2025/26. Public debt has fallen below 105 percent of GDP, and the authorities remain committed to bringing it down to 60 percent of GDP by FY2035/36. The authorities met the EFF structural benchmarks for the review, including completing the assessment of human resource needs at the Barbados Customs and Excise Department, preparing a public-private partnership (PPP) framework, and developing a daily liquidity forecasting framework. Both reform measures for the RSF fifth review were also implemented. Key elements to strengthen the integration of climate concerns into public financial management have been completed, including the development of project appraisal guidelines, the deepening of fiscal risk analysis, and the preparation of the PPP framework. The Central Bank of Barbados has also included physical climate risk analysis in its bank stress testing.

Following the Executive Board discussion on Barbados, Mr. Bo Li, Deputy Managing Director and Acting Chair, issued the following statement:

“The implementation of Barbados’ homegrown Economic Recovery and Transformation program has remained strong, supported by the Extended Fund Facility (EFF) and the Resilience and Sustainability Facility (RSF) arrangements. The completion of the fifth and final reviews marks the successful conclusion of the Fund arrangements.

“While the outlook is stable, risks remain tilted to the downside, given the highly uncertain external economic environment and Barbados’ vulnerability to shocks and natural disasters. The authorities remain strongly committed to ensuring macroeconomic stability and implementing structural reforms to boost potential growth and build resilience.

“Maintaining strong fiscal surpluses will be necessary to achieve the public debt target of 60 percent of GDP by FY2035/36. The authorities’ focus on strengthening revenue mobilization and improving public financial management is appropriate. These measures will be key to preserving fiscal sustainability and creating space for public investment. Finalizing ambitious reforms of state-owned enterprises is a priority. The authorities are taking the necessary steps to mobilize external financing.

“The exchange rate peg remains a critical anchor for macroeconomic stability, supported by ample international reserves. Measures have been taken to strengthen the monetary policy framework and financial safety nets. Efforts to enhance the local payments market and infrastructure are advancing, with the goal of moving to a digital payments system in 2026.

“Reforms to improve the business environment and boost growth potential are key. Important measures include advancing the digitalization of government services and investing in skills and education. The authorities focus on boosting macroeconomic resilience to natural disasters and facilitating the transition to renewable energy is welcome.”

[1] Under the IMF’s Articles of Agreement, publication of documents that pertain to member countries is voluntary and requires member consent. The staff report will be published shortly on the www.imf.org/Barbados page.

https://www.imf.org/en/News/Articles/2025/06/20/pr-25210-barbados-imf-concludes-5th-reviews-under-the-eff-and-resil-and-sustainability-facility

MIL OSI

Source: IMF – News in Russian

June 20, 2025

Washington, DC: An International Monetary Fund (IMF) mission, led by Anke Weber and comprising Aleksandra Alferova, Jakree Koosakul, Moheb Malak, Augustus Panton, and Atticus Weller, visited Budapest during June 5-17 to conduct discussions on the 2025 Article IV Consultation with the Hungarian authorities. At the end of the visit, the mission issued the following statement:

The Hungarian economy is at a challenging juncture. Output has stagnated over the past 3 years, while inflation remains well above the central bank’s 3 percent target. Regulatory measures—such as price, interest and margin caps, along with windfall taxes and subsidized lending schemes—have distorted market signals and added uncertainty. Despite significant fiscal adjustment in recent years, public debt remains elevated given high financing costs. Timely domestic policy reforms are needed to reinforce resilience amid an unsettled external environment. Key to this will be well-designed fiscal measures to strengthen public finances, a continued tight monetary policy to bring down inflation, and structural reforms to raise productivity and safeguard growth against trade tensions and heightened uncertainty.    

 

Economic Outlook

High domestic and external uncertainty are expected to continue weighing on the outlook. Modest consumption-driven growth of 0.7 percent is expected in 2025, underpinned by favorable wage dynamics. Growth is projected to increase to 2 percent in 2026—on a recovery in investment and a positive impulse from German fiscal expansion—and to converge to its long-term potential of around 2½ percent by 2030. Inflation is forecast at 4.5 percent in Q4:2025, and to gradually decelerate to the MNB’s 3 percent target by 2027. The current account surplus is expected to fall to around 1¼ percent of GDP in 2025 and to increase gradually over the medium term as battery and electric vehicle production expands. These projections are based on the IMF’s April World Economic Outlook global assumptions.

Risks to growth remain on the downside. Deepening geoeconomic fragmentation and rising trade tensions would affect Hungary’s exports directly, while indirect effects may be even larger, arising from prolonged trade uncertainty undermining private investment and further weakening global economic activity. Geopolitical tensions could lead to commodity price volatility, intensifying inflationary pressures and negatively impacting fiscal and external balances. On the domestic front, a delay in the needed fiscal adjustment could heighten market concerns about debt sustainability, further increase risk premia, and exacerbate sovereign-bank linkages. A lack of progress on governance reforms being discussed with the EC could further delay or result in cancellation of EU funds with negative consequences for growth and market confidence. Inflation could be more persistent than projected, including from larger-than-anticipated effects of minimum wage hikes necessitating tighter monetary policy for longer.

Strengthening Fiscal Sustainability for Future Growth

Staff estimates that currently announced policies fall short of achieving the authorities’ budget targets. The authorities remain committed to reaching their 2025 and 2026 deficit targets of 4.1 and 3.7 percent of GDP, respectively. Their medium-term fiscal structural plan (MTFSP) envisages a further deficit reduction to below 2 percent of GDP by 2028. Under staff’s baseline scenario, which incorporates only legislated or officially endorsed measures, the deficit is projected to decline slightly to 4.8 percent of GDP in 2025 and 4.6 percent of GDP in 2026. In the medium term, the deficit would remain around 4½ percent of GDP, while the debt-to-GDP ratio would rise to about 79 percent in 2030 from 73½ percent in 2024. Debt dynamics have deteriorated since last year, following fiscal slippages and a weaker outlook, and remain sensitive to the real interest and growth path.

Significant additional fiscal efforts are needed to preserve fiscal space and rebuild buffers. Over the medium term, a surplus of around 1¾ percent of GDP excluding debt servicing and adjusting for economic cycles would appropriately balance debt sustainability and output stabilization objectives. The implied cumulative adjustment of around 2 percent of GDP over 2025-2028 would bring the deficit below 3 percent of GDP by 2027 and reduce the public debt ratio below 70 percent by 2029. Any additional defense spending should be accommodated within staff’s recommended path.

Measures underpinning the adjustment should be well-designed and growth-friendly.

• Revenue enhancements: The recent doubling of family tax allowances and expansion of personal income tax exemptions for mothers will significantly reduce revenues. In staff’s view an alternative that would minimize fiscal costs and labor market distortions would be to provide capped tax credits per child for both parents. A more targeted tax regime with fewer exemptions would raise revenue, improve efficiency, and simplify administration. Staff notes that a higher marginal personal income tax rate for high earners would increase revenue and fairness while taxation of corporates could be made more equitable and efficient by rationalizing tax incentives. A reduced reliance on distortionary windfall and financial transactions taxes would be more conducive to investment and growth.
• Expenditure rationalization: A phaseout of distortive retail energy subsidies and their replacement by targeted cash transfers would free up fiscal resources. A review of procurement and government employment would help the authorities to better target a reduction of administrative expenditures, which are high relative to peers, while a strategy is needed to limit transfers to SOEs and other public organizations. The realized savings from these measures could be used to bolster underfunded areas—health, primary education, and social protection. Public financial management reforms and a strengthened expenditure review process could enhance spending efficiency and support better fiscal governance. Relying on capital spending cuts to achieve targets would weaken growth and should be avoided.

Further efforts will be needed to reduce long-term spending pressures. Population aging is expected to add roughly 3.5 percent of GDP in additional pension and healthcare costs by 2050. An increase in the retirement age, adjustment of benefit levels, and a limited increase in the social security contribution rate would help to control pension costs in the long term. mproved digitalization and efficient procurement would help to contain health expenditures.  

Fiscal risk monitoring and mitigation could be improved. A comprehensive, consolidated and regular risk assessment of SOEs would provide early warning of potential vulnerabilities. The issuance of new guarantees should be capped by ceilings, and the stock of guarantees, risk of their activation, and performance of underlying liabilities assessed on an annual basis. Channeling public resources into fund management structures or private equity undermines budgetary transparency, risks resource misallocation and could result in unforeseen contingent liabilities. Finally, to mitigate distortions, it would be beneficial to limit the use of subsidized lending by state-owned banks to addressing market failures.

Bringing Inflation Durably Back to Target

The monetary policy stance will need to remain tight into next year to durably return inflation to target. Monetary policy has been appropriately cautious, with the MNB signaling that maintaining tight monetary conditions is warranted. With average inflation expected to remain above the tolerance band in 2025, staff sees limited scope for rate cuts this year. However, the balance of risks to growth and inflation is evolving. Given exceptional uncertainty, the MNB should thus maintain a data-driven approach. The flexible exchange rate regime and adequate reserve coverage can continue to help reduce Hungary’s vulnerability to external shocks. Price, fee, and margin controls are not a sustainable path to lasting disinflation and should be phased out.

Staff welcomes ongoing efforts to refine the MNB’s focus on the core objectives of price and financial stability. The proposed change to the MNB Act—prohibiting foundations from engaging in asset management activities—is a step in the right direction. In this context, a broader review of the MNB’s non-core functions is warranted, including measures relating to its secondary goal of environmental sustainability. While the MNB should play an active role in climate-risk supervision, prudential regulation should remain risk focused, and all climate-related initiatives be consistent with the MNB’s price and financial stability mandates.

Safeguarding Financial Sector Stability

Systemic risks in the financial sector are assessed as broadly contained. Overall, the banking system remains well-capitalized, liquid, profitable, and resilient to external shocks. But emerging pockets of vulnerability merit continued vigilance, including an increase in the share of FX corporate loans, banks’ growing sovereign exposure and significant FX positions, elevated commercial real estate (CRE) vacancies, and buoyant house prices.

The capital-based macroprudential toolkit is broadly appropriate, though further refinements may be warranted. The planned introduction of a one percent positive neutral countercyclical capital buffer (CCyB) in July 2025 amid heightened uncertainty is welcome, as was the reactivation of the systemic risk buffer (SyRB) for banks’ CRE exposures in 2024. While risks arising from banks’ growing sovereign exposures are partially mitigated by their high leverage ratio (capital-to-total exposure), consideration could be given to incorporating appropriate sovereign-bank nexus stress scenarios into regular supervisory stress testing.

Differentiation in borrower-based macroprudential limits should be introduced only on financial stability grounds. Recent relaxations of loan-to-value (LTV) and debt-service-to-income (DSTI) limits for first-time buyers and green homes appear to be partly driven by housing affordability and energy efficiency concerns. Such considerations should instead be tackled through appropriate structural and fiscal policies. Moreover, DSTI limits of 60 percent for first-time home buyers and for energy-efficient homes appear high relative to the overall limits in some peers. The reintroduction of voluntary APR ceilings for housing loans, while more restricted in scope, distorts risk pricing and should be reversed. Scaling back housing-related fiscal incentives would help contain future price pressures and safeguard financial stability.

Boosting Productivity Through Reforms

Boosting productivity growth will require comprehensive reforms that foster firm dynamism. Firm entry and exit rates remain low amid high regulatory barriers and an insolvency framework that impedes the timely exit of non-viable firms. Streamlining licensing and overlapping permits and enabling creditor-initiated and out-of-court restructuring would enhance capital and labor mobility toward more productive business ventures. Public R&D support should be performance-based and policy efforts aimed at promoting entrepreneurship and technology adoption better targeted, especially toward young, high-growth firms.

Productivity gains from industrial policy interventions remain elusive, underscoring the need for more effective horizontal reforms. Hungary has implemented repeated waves of industrial policies (IP) to boost competitiveness and productivity in targeted sectors. Yet, their impact on sustained productivity growth remains elusive. Given their high fiscal cost, IP should not substitute for broader structural reforms. Where used, such measures must be appropriately targeted to address market failures and be time-bound and transparent. As a small, open economy, Hungary would benefit most from a coordinated approach to state aid and IP at the EU-level.

Strengthening energy security can enhance competitiveness and facilitate the green transition. Ongoing efforts to diversify energy supply and increase renewable energy generation are commendable. Still, the Hungarian economy remains energy-intensive with high corporate energy prices weighing on cost competitiveness. EU-wide policy measures—including regional electricity market integration—should be complemented with domestic reforms such as targeted phaseout of household fossil fuel subsidies, enhanced energy efficiency standards, and accelerated permitting procedures for renewable energy investment.

Governance reforms are foundational for fostering a predictable business environment and boosting potential growth. Hungary has taken some important steps, including the 2023 judicial reforms aimed at strengthening the National Judicial Council. Further governance reforms and their effective enforcement—including related to public procurement, scope of the asset declaration system, conflict-of-interest rules, regulatory oversight, and functioning of the Integrity Authority—could unlock EU funds and amplify the growth dividends of other reforms.

The mission thanks the Hungarian authorities and our other interlocutors in Hungary for the productive collaboration, constructive policy dialogue, and warm hospitality.

https://www.imf.org/en/News/Articles/2025/06/20/hungary-staff-concluding-statement-of-the-2025-article-iv-mission

MIL OSI

Source: IMF – News in Russian

June 20, 2025

Staff-Monitored Programs (SMPs) are informal arrangements between national authorities and IMF staff to monitor the authorities’ economic program. As such, they do not entail endorsement by the IMF Executive Board. SMP Staff reports are issued to the Board for information.

• IMF staff and the South Sudanese authorities have reached a staff-level agreement on a nine-month Staff-Monitored Program (SMP), which is expected to start in August 2025, pending approval from the IMF’s Management.
• The SMP aims to support South Sudan in designing and implementing policies and key reforms to strengthen its economic resilience to shocks, enhance macroeconomic stability, restore sustainability, and improve governance and transparency.
• The South Sudanese economy is projected to start recovering as oil production has resumed from the oil pipeline damaged in February 2024 due to the war in Sudan. This disruption had halted oil exports, fiscal revenues, and foreign exchange (FX) proceeds for over a year, leading to liquidity and financing constraints. The recovery is expected to be gradual and hinges on continued improvement in the security environment and political stability.

Washington, DC: Upon request from the authorities, an International Monetary Fund (IMF) staff team, led by Ms. Mame Astou Diouf, held meetings in Juba, South Sudan, from June 11 to 20, 2025 to negotiate a Staff-Monitored Program (SMP) in support of the authorities’ economic and financial reform program. This SMP request follows the conclusion of South Sudan’s Staff Monitored Program with Board Involvement (PMB) on November 15, 2024 (See Press Release No. 24/434).

At the end of the mission, Ms. Diouf issued the following statement:

“The South Sudanese authorities and the IMF team have reached a staff-level agreement on the economic and structural policies and reforms that will underpin a nine-month SMP, pending approval by the IMF’s Management.

“Since early 2014, South Sudan has faced severe shocks that have exacerbated the country’s post-conflict fragility and humanitarian situation. Due to the war in Sudan, the country’s main oil pipeline was damaged in February 2024, halting related oil exports, fiscal revenues, and FX proceeds for over a year. The conflict also triggered a large influx of refugees, compounding an already-dire social and humanitarian situation caused by recurrent floodings, agricultural production losses, widespread food insecurity, and large-scale population displacement. The recent steep decline in international aid flows risks exacerbating the humanitarian challenges facing the country.

“The short- and medium-term economic outlook is moderately favorable and improving, contingent on a continuously improving security environment and political stability. The resumption of oil exports through the main pipeline since April 2025 is promising. While real GDP growth is projected to have contracted during FY2024/25 due to the lower oil production, it is expected to recover in FY2025/2026 as oil exports gradually strengthen. The rebound in oil exports is expected to significantly improve the current account balance, helping rebuild external buffers. The parallel foreign exchange (FX) market premium stood at 30.8 percent on June 11, 2025.

“While the budget execution of FY2024/2025 has been constrained by the financing constraints, non-oil domestic revenue collection was strong. This has allowed the resumption of government salary payments. However, structural bottlenecks partly hinder the effective distribution of salaries to civil servants due to cash shortages. For FY2025/2026, oil revenue is expected to recover substantially. Non-oil revenue will remain strong, benefiting from the continued implementation of tax policy reforms approved under the FY2024/2025 budget and broader revenue administration improvements. This will gradually ease liquidity constraints and provide some fiscal space for cautious repayment of salary arrears and a gradual increase of priority social spending and debt service repayments, while maintaining prudent fiscal management and cautious investment plans, given the continued risks to the outlook.

“Inflation has remained high. Average inflation is projected at about 143 percent in FY2024/2025, and expected to slow down in FY2025/26, thanks to ongoing tight monetary policy and a reduction in monetary financing. The debt-to-GDP ratio is forecast at about 58 percent of GDP in FY2024/2025, with large debt vulnerabilities. With the easing liquidity constraints, debt sustainability is projected to strengthen.

“Against this background, the South Sudanese authorities have requested a nine-month SMP to help strengthen economic resilience to shocks and foster macroeconomic stability through sound and prudent policies conducive to sustained growth. Key priorities under the SMP include:

“Restoring fiscal and public debt sustainability in the near term and laying the groundwork for positive medium-term prospects through prudent debt management and improved domestic revenue mobilization to increase fiscal space for priority spending, including salary and social programs. Enhancing spending efficiency, including through public financial and investment management reforms, will support public service delivery against the backdrop of high spending needs and limited availability of domestic and external financing.

“Maintaining a tight monetary policy stance to curb inflationary pressures and exchange rate depreciation. This includes containing monetary financing and continuing liquidity mop-up operations. While the official exchange rate has gradually decreased since August 2024 to narrow the parallel FX market premium, further policy adjustment is required to unify the official and parallel FX markets and increase FX reserves.

“Steadfast implementation of the governance and accountability reform agenda will be critical to addressing the country’s sources of fragility and creating an environment conducive to strong, diversified, and sustained growth and improved living standards. This includes the governance and transparency of oil-related investment programs.

“The mission met His Excellency, Dr. Benjamin Bol Mel, Vice President and Chairperson of the Economic Cluster, the Minister of Finance and Planning, Honorable Dr. Marial Dongrin Ater, the Governor of the Bank of South Sudan, Dr. Addis Ababa Othow, and other senior government officials, as well as representatives from civil society, private sector, and development partners.

“The mission takes the opportunity to thank the authorities and stakeholders for their warm hospitality, strong cooperation, and for open and productive discussions.”

https://www.imf.org/en/News/Articles/2025/06/20/pr-25200-south-sudan-imf-and-south-sudan-reach-agreement-on-9-month-staff-monitored-program

MIL OSI

Source: IMF – News in Russian

June 20, 2025

Washington, DC: On June 17, 2025, the Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation[1] with Fiji, and considered and endorsed the staff appraisal without a meeting.

The economic recovery continued in 2024. Staff estimates aggregate GDP growth in 2024 to have reached 3.7 percent. While employment has recovered to pre-pandemic levels, investment has recently been held back by labor shortages and supply-chain challenges. Inflation decelerated though 2024 as the impact of the 2023 value-added tax increase faded and the nominal exchange rate appreciated. The public debt-to-GDP ratio has continued to decline from the peak reached in 2022, but remains elevated, at 80 percent. Likewise, the current account balance has improved, but the deficit in 2024 is estimated to be around 6.7 percent.

Monetary and financial conditions remain accommodative, while the fiscal stance has tightened. The Reserve Bank of Fiji (RBF) has maintained the policy rate at 0.25 percent since early 2020. The fiscal stance tightened in FY2024, with the overall deficit declining from 7.2 percent of GDP in FY2023 (August-July) to 3.5 percent of GDP in FY2024, compared to a budgeted deficit of 4.8 percent of GDP.

Executive Board Assessment

In concluding the 2025 Article IV consultation with Fiji, Executive Directors endorsed staff’s appraisal, as follows:

The economy has been recovering from the pandemic but is facing new setbacks. Growth is expected to fall in 2025, to about 2.6 percent, mostly because of slowing external demand, and to take a couple of years to recover to its medium-term potential rate. The baseline projection implies that public debt would remain elevated. In addition, FX reserve coverage would fall, implying that the external position remains moderately weak. Growth would be higher with successful structural reforms, or should the external environment be more favorable than assumed. But the balance of risks appears to be mostly to the downside, both in the near term, if trade tensions were to worsen or their effects be more severe than assumed in the baseline, or over the medium term, mostly given vulnerabilities to natural disasters.

 

Fiscal and monetary policies should focus on addressing macroeconomic imbalances.

• Fiscal policy should focus on lowering public debt while continuing with growth-friendly fiscal consolidation, oriented toward capital spending. Significant progress has been achieved in recent years, but additional adjustment measures are needed to put public debt on a clear downward path. Targeted and temporary social protection measures should be used to protect the vulnerable. Fiscal tightening would also contribute to reducing external imbalances.
• Over the medium term, given potential pressures on the exchange rate peg, monetary conditions should be gradually tightened, raising the policy rate and reducing excess liquidity.
• Financial policy should be attentive to emerging credit risks and to safeguard against money laundering risks.
• The authorities should avoid using exchange rate restrictions and CFMs in place of macroeconomic adjustment and focus on a gradual, sequenced capital account liberalization to support high long-run growth objectives.

Raising potential growth calls for sustained structural reforms.

• Progress has been achieved in enhancing the business environment and addressing near-term constraints to growth. Immediate concerns include addressing ageing infrastructure in electricity, water, and waste utilities, and improving the transport network and digital connectivity. Ongoing concerns include training and human capital. Successful measures would also encourage more foreign investment, ease external imbalances, and reduce “brain drain.”
• As for other Pacific states, Fiji faces ongoing challenges from natural disasters and climate change. Increasing resilience adds to the motivation to shift away from current toward capital spending.

Such issues require sustained political consensus and good governance. The government’s recognition of the importance of institutional reform, commitment to the rule of law, and reducing corruption and bribery is welcome. Recent legislative progress will need to be matched by proper enforcement and addressing capacity constraints in the civil service.

Fiji: Selected Economic Indicators, 2022–30
	2022	2023	2024	2025	2026	2027	2028	2029	2030
			Est.	Proj.
Output and prices (percent change)
Real GDP	19.8	7.5	3.7	2.6	2.8	3.2	3.2	3.2	3.2
GDP deflator	2.4	4.1	6.3	3.2	3.1	3.2	3.3	3.4	3.5
Consumer prices (average)	4.3	2.3	4.5	3.2	3.1	3.2	3.3	3.4	3.5
Consumer prices (end of period)	3.1	5.1	1.3	3.1	3.2	3.3	3.4	3.5	3.5
Central government budget on fiscal-year basis (percent of GDP)
Revenue and Grants	21.4	23.2	27.4	27.1	27.1	26.8	26.8	26.6	26.5
Expenditure	33.5	30.3	31.0	31.5	31.2	31.0	31.0	30.9	30.9
Overall balance	-12.1	-7.2	-3.5	-4.4	-4.2	-4.2	-4.2	-4.3	-4.4
Primary balance	-8.5	-3.3	0.5	-0.3	-0.3	-0.6	-0.6	-0.7	-0.8
Central government debt	90.4	83.3	79.5	77.7	77.7	77.6	77.3	77.0	76.8
Central government external debt	33.3	30.6	28.7	26.5	26.5	26.4	26.1	25.8	25.6
External sector (percent of GDP)
Current account balance	-17.3	-7.7	-6.7	-7.0	-7.7	-7.5	-7.2	-6.9	-6.9
Trade balance	-32.9	-32.7	-30.0	-29.1	-27.7	-27.3	-27.3	-26.9	-26.4
Services balance	11.8	20.4	20.0	19.9	18.4	17.8	17.3	17.1	16.5
Primary Income balance	-5.3	-5.7	-6.4	-6.8	-6.6	-6.4	-6.0	-5.9	-5.9
Secondary Income balance	9.2	10.3	9.6	9.0	8.2	8.5	8.8	8.9	9.0
Capital account balance	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1
Financial account balance (-= inflows)	-14.0	-4.9	-6.6	-4.1	-5.3	-5.7	-6.9	-6.5	-6.5
FDI	-1.8	-1.1	-1.6	-4.5	-5.4	-6.1	-7.3	-7.1	-7.2
Portfolio investment	0.5	1.0	1.7	1.7	1.7	1.7	1.7	1.7	1.7
Other investment	-12.7	-4.8	-6.7	-1.3	-1.5	-1.3	-1.3	-1.1	-1.0
Errors and omissions	5.1	4.2	0.0	0.0	0.0	0.0	0.0	0.0	0.0
Change in reserve assets (-=increase)	-2.1	0.3	0.1	2.9	2.3	1.7	0.3	0.3	0.4
Gross official reserves (in months of prospective imports)	5.5	5.3	5.2	4.4	3.7	3.1	2.9	2.6	…
Money and credit (percent change)
Net domestic assets of depository corporations	4.9	12.1	8.0	6.4	6.1	…	…	…	…
Claims on private sector	6.7	7.5	11.4	10.0	8.0	…	…	…	…
Broad money (M3)	5.1	9.1	6.6	4.1	4.1	…	…	…	…
Monetary base	15.8	-4.0	7.5	3.6	1.4	…	…	…	…
Central Bank Policy rate (end of period)	0.25	0.25	0.25	…	…	…	…	…	…
Commercial banks deposits rate (end of period)	0.4	0.4	0.3	…	…	…	…	…	…
Commercial banks lending rate (end of period)	5.2	4.8	4.6	…	…	…	…	…	…
Memorandum items
Exchange rate, average (FJD/USD)	2.2	2.3	2.3	…	…	…	…	…	…
Real effective exchange rate, average	108.2	106.4	108.3	…	…	…	…	…	…
GDP at current market prices (in millions of Fiji dollars)	10,940	12,245	13,494	14,286	15,148	16,130	17,193	18,342	19,594
GDP at current market prices (in millions of U.S. dollars)	4,970	5,442	5,949	6,257	6,564	6,913	7,284	7,674	8,089
GDP per capita (in U.S. dollars)	5,450	5,933	6,447	6,740	7,030	7,359	7,707	8,072	8,508
Sources: Reserve Bank of Fiji; Ministry of Finance; and IMF Staff Estimates and Projections.

[1] Under Article IV of the IMF’s Articles of Agreement, the IMF holds bilateral discussions with members, usually every year. A staff team visits the country, collects economic and financial information, and discusses with officials the country’s economic developments and policies. On return to headquarters, the staff prepares a report, which forms the basis for discussion by the Executive Board.

https://www.imf.org/en/News/Articles/2025/06/20/pr-25208-fiji-imf-concludes-2025-article-iv-consultation

MIL OSI