(Ecofin Agency) - The International Monetary Fund (IMF) approved a $22.4 million financing for Benin under an Extended Credit Facility (ECF), an institution statement reported June 29.

This new investment is reportedly to encourage the country to pursue reforms undertaken in recent years. IMF indicated that last year, the country witnessed higher economic growth and inflation was kept at a relatively low rate. Budget performance was above expectations while overall deficit was maintained at 7% of GDP.

This good achievement was mainly driven by an increase in tax revenues thanks to a tax base growth as well as an improvement of the tax collection system. Moreover, thanks to Nigeria’s economy upswing and an increase in cotton production (with a record volume of 597, 986 tons for the 2017/2018 season), Benin achieved a 5.6% growth in 2017. IMF also pointed out a slowdown in public debt, motivated by the compliance with planned public spending.

However, the institution revealed that the rising in current account deficit in 2017 limited the potential for higher economic growth over the period. Nevertheless, government reforms provide positive economic outlook in the coming years. IMF forecasted a 6% growth for the country this year.

Moutiou Adjibi Nourou