Chad secures over half a billion dollars IMF deal

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The International Monetary Fund (IMF) announced on December 22, 2021 that it had approved a new 3-year Extended Credit Facility (ECF) agreement for an amount of approximately $ 570.75 million to meet significant financing needs of Chad’s balance of payments and budget, in particular by attracting financial support from official donors. A first disbursement of $ 78.28 million is announced immediately.

According to the institution, the measures taken under the program supported by the ECF will contribute, in the long term, to placing the Chadian economy on a balanced and viable trajectory that will allow the country to achieve both green and inclusive growth, and reduce poverty. They will also support regional initiatives aimed at restoring and preserving the external stability of the Central African Economic and Monetary Community (CEMAC).

Worries

“The combined effect of the shocks caused by the Covid-19 pandemic, the volatility of oil prices, the rise in insecurity and the threat of a food crisis brought on by climate change has placed the already vulnerable economy of Chad under high tension. The macroeconomic outlook has deteriorated further, the country’s weaknesses in this area being more marked than expected and its liquidity needs becoming more pressing, ”said Kenji Okamura, Deputy Managing Director and Interim President. Adding that Chad’s public debt is no longer sustainable.

The first country to request, in January 2020, debt treatment under the G20 common framework beyond the ISSD, Chad is seeking restructuring agreements with the main official and private creditors by the end of March 2022 to launch the new ECF arrangement. The country has been ruled since April by a military council chaired by Mahamat Idriss Deby Itno (photo).

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