(Ecofin Agency) - The International Monetary Fund -IMF- approved on July 19 an additional $25 million to help Burkina Faso further its economic reforms. This is to mark a satisfactory 2nd review of the 3-year Extended Credit Facility (ECF) signed with the country in March 2018.
IMF says Burkina Faso’s performance under the program has been broadly satisfactory and the economic activity remains resilient despite increased security and social tension pressures. The country is on the good path to meeting the WAEMU convergence criteria of fiscal deficit of 3% of GDP in 2019. However “additional effort is required to create fiscal space to support further progress in priority areas of development”.
A good way to hit target, the institution suggests, would be to “focus on broadening the tax base, including by reducing exemptions, improving tax administration, and enhancing the efficiency of expenditure, including by containing the wage bill and subsidies”.
The IMF-backed program is expected to help the country reduce budget gap by strengthening revenue mobilization and improving the efficiency of public investment. To date, IMF already granted $75 million under the ECF arrangement and another $75 million is expected.