Journal Issue

Press releases

International Monetary Fund. External Relations Dept.
Published Date:
January 1999
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Cameroon: ESAF

Cameroon: selected economic and financial indicators

(percent change)
GDP at constant prices5.
Consumer prices (end of period)
(percent of GDP)
Overall fiscal deficit (excluding grants)-1.8-1.0-1.7-3.6-3.4-2.9-2.6-2.4
Current account balance (including grants)-4.1-2.8-2.7-4.4-4.4-3.2-3.0-2.4
(million SDRs)
Net international reserves (end of period)-409.0-286.0-312.0-313.0-286.0-228.0-129.0-14.0
Note: Fiscal year begins in July.


Revised program.


Starting in 1994/95, inflation reflects an updated basket of goods and services in the calculation of the consumer price index.

Data: Cameroonian authorities and IMF staff estimates and projections
Note: Fiscal year begins in July.


Revised program.


Starting in 1994/95, inflation reflects an updated basket of goods and services in the calculation of the consumer price index.

Data: Cameroonian authorities and IMF staff estimates and projections

The IMF approved the third annual loan under the Enhanced Structural Adjustment Facility (ESAF) to support Cameroon’s economic and financial program. The three-year ESAF loan was approved on August 20,1997, in an original amount of SDR 162.12 million (about $221.24 million), of which SDR 108.08 million (about $147.49 million) has been disbursed. The decision provides Cameroon with another SDR 54.04 million (about $73.75 million) to be disbursed during the third year of the ESAF, with SDR 18.01 million (about $24.58 million) available immediately.

Following are excerpts from IMF First Deputy Managing Director Stanley Fischer’s statement on the Executive Board discussion.

“Directors commended the authorities for their good performance in implementing the first two annual ESAF-supported programs. Despite the adverse impact of the deterioration in the terms of trade in the first half of 1998/99, economic activity remains buoyant, and inflation has declined to a low level, owing to appropriate macroeconomic policies.

“Directors noted the progress made in the past two years in strengthening public finances through a regular transfer of oil revenues to the budget, the successful introduction of the value-added tax (VAT), and the adoption of an action plan aimed at improving expenditure management. Directors stressed, however, the importance of further strengthening the fiscal position in the medium term.

“Directors noted the progress made in implementing structural reforms, including the rehabilitation of the banking system, the large-scale privatization of public enterprises, and the significant actions to liberalize the energy and transport sectors. They stressed the need to improve transparency and fight corruption to enhance the effectiveness of government operations and stimulate private investment.

“Directors urged the authorities to continue to demonstrate strong program performance and prepare well-defined spending plans in the social sectors to ensure efficient utilization of the additional resources in the priority sectors of health, education, and poverty alleviation. In sum, Directors hoped that steadfast implementation of structural reform and well-targeted spending on the social sector would make Cameroon eligible under the HIPC Initiative.”

Program summary

Cameroon’s good record of performance under the first annual ESAF program continued under the second, despite the adverse impact of a sharp deterioration in the terms of trade in the first half of 1998/99. Almost all quantitative and structural performance criteria and benchmarks for the year were met.

The medium-term strategy aims to restore external and internal viability, bring the economy onto a sustainable growth path, and substantially reduce poverty. Within this framework, the main macroeconomic objectives for 1999/2000 are to limit inflation to 2 percent and contain the external current account deficit to 3½ percent of GDP.

The key budgetary objectives are to achieve a primary surplus of 5.2 percent of GDP and thereby reduce the overall fiscal deficit to 2.9 percent of GDP, excluding grants. The authorities intend to strengthen non-oil revenue by improving the customs and tax administration, combat fraud, broaden the tax base, and strengthen VAT collection. At the same time, all export taxes have been eliminated except those on forestry products.

Structural reforms will focus on consolidating and deepening the ongoing reforms in agro-industry, public utilities, and the petroleum, transport, and financial sectors.

Improving transparency and fighting corruption are indispensable in enhancing the effectiveness of government operations and in stimulating private investment.

Cameroon’s objectives in the social area are to be achieved through higher economic growth combined with improvements in quality and volume of spending in the primary health and education sectors, and through policies to ensure access to safe water and generic drugs.

Cameroon joined the IMF on July 10, 1963, and its quota is SDR 185.70 million (about $253.41 million). Its outstanding use of IMF financing currently totals SDR 128.17 million (about $174.91 million).

Press Release No. 99/40, September 7

Burkina Faso: ESAF

The IMF approved a three-year loan for Burkina Faso under the Enhanced Structural Adjustment Facility (ESAF), equivalent to SDR 39.12 million (about $53.79 million) to support the government’s 1999-2002 economic program. The first annual loan will be disbursed in two installments, the first of which, equivalent to SDR 5.59 million (about $7.69 million), will be available shortly.

Excerpts from IMF Deputy Managing Director Shigemitsu Sugisaki’s statement on the Executive Board discussion follow:

“Directors welcomed the progress made in reducing macro-economic imbalances and implementing structural reforms under Burkina Faso’s previous ESAF-supported programs. They were encouraged by the economic and financial developments in 1998 and the favorable prospects for 1999 in terms of economic growth, continued low inflation, and the further increase in the current primary budgetary surplus. They endorsed the focus of the new ESAF-supported program on completing the reform agenda, which should help reduce the economy’s vulnerability to external shocks and achieve the high economic growth necessary to reduce poverty and improve key social indicators.

“In the fiscal area, Directors noted that a main policy objective is to widen the tax base, through improved taxation of the informal sector and a curtailment of exemptions, to offset the potential revenue shortfall arising from the implementation of the common external tariff (CET) of the West African Economic and Monetary Union (WAEMU). Expenditure policy is to remain prudent while providing additional room for higher expenditure on economic infrastructure and priority in social sectors, including health and education. In this context, Directors welcomed the work under way to enhance the transparency and medium-term focus of the budget through multiyear program budgets in key ministries. They also welcomed the government’s commitment to further strengthen its policy in the key social sectors and to allocate to these sectors the resources that will be freed as a result of the HIPC Initiative.

Burkina Faso: selected economic and financial indicators
(percent change)
GDP at constant prices6.
Consumer prices (end of period)6.9-
Overall fiscal balance, excluding grants-9.0-10.2-10.3-9.8-10.1-10.0-10.4-9.9-8.8
Current account balance
(excluding current official transfers)-14.7-13.9-10.9-13.8-10.2-15.0-12.8-11.5-10.8
(months of imports)
Net official reserves10.710.
Data: Burkinabe authorities and IMF staff estimates and projections
Data: Burkinabe authorities and IMF staff estimates and projections

“Directors emphasized the need to carry out with determination the ongoing structural reforms. In particular, they urged the authorities to press ahead with diversification of the economy, privatization of the telecommunication and energy sectors, opening up of the cotton sector to private operators, further strengthening of the legal and judicial system, and improving the overall environment for private sector development. Directors attached importance to the recent progress made in attracting a growing domestic consensus in support of the economic reform strategy.”

Program summary

The medium-term strategy is to ensure the economy’s high growth by improving its overall competitiveness, expanding the export base, and tackling the remaining reform agenda. Fiscal policy in 1999 and 2000 will aim at offsetting in part revenue losses caused by the introduction of the CET and the fall of profitability in the cotton sector by improving tax administration and widening the tax base. The main objective of monetary policy, which is conducted at the regional level in the framework of the WAEMU, is to preserve the peg to the euro and strengthen the union’s foreign reserve position.

Structural reforms will focus on widening public enterprise privatization to include utilities and hotels, enlarging the private sector’s involvement in the cotton sector, and facilitating the role of the private sector—in particular, strengthening the judiciary.

The debt relief to be obtained under the Heavily Indebted Poor Countries (HIPC) Initiative will boost resources for the social sector. Improving key social indicators is a central objective of the medium-term program. In the health sector, a main objective is to ensure that the network of health centers is fully operative, adequately staffed, and supplied with key medicines. In the education sector, the government intends to devote additional resources to school construction and adequate teaching materials.

Burkina Faso joined the IMF on May 2, 1963, and its quota is SDR 60.20 million (about $82.77 million). Its outstanding use of IMF financing currently totals SDR 84.74 million (about $116.51 million).

Press Release No. 99/42, September 10

Guinea-Bissau: Postconflict emergency assistance

The IMF approved SDR 2.13 million (about $3 million) in postconflict emergency assistance for Guinea-Bissau to support the government’s reconstruction and economic recovery program in the aftermath of the 1998 armed conflict. The amount will be available immediately.

In commenting on the Executive Board’s discussion of the request by Guinea-Bissau, IMF First Deputy Managing Director Stanley Fischer made the following statement:

“Directors regretted that the 1998-99 civil conflict in Guinea-Bissau had inflicted grave suffering on the population and caused severe damage to the economy and infrastructure. They were encouraged by the determination shown by the government to redress the disruptions caused by the conflict, restore basic services, and rehabilitate the administrative structures. They expressed the hope that the institutional situation would consolidate rapidly and that the scheduled elections would be held in an orderly manner so as to give confidence to the international community and help create an environment conducive to economic development.

“Directors welcomed the adoption by the government of a program to be supported by the IMF under its guidelines on emergency assistance to postconflict countries. This program appropriately focuses on reconstruction, the demobilization of combatants, the restoration of key social and administrative services, and the strengthening of private sector operations. Directors stressed the importance of ensuring a prompt restoration of a functioning tax and customs administration and implementing rigorous controls in the expenditure process. They also urged that a plan of settlement of arrears to the private sector be speedily finalized and implemented with external financial assistance.

“Directors stressed the need to resume the restructuring and privatization of public enterprises and to strengthen the banking sector through the recapitalization of the main bank accompanied by the government’s divestiture of its minority participation.

“Directors considered that the satisfactory implementation of this IMF-supported program could pave the way for the preparation of a program that could be supported by a new ESAF arrangement; they hoped that, at the time of Board agreement on such a program, the country could be in a position to reach the decision point under the HIPC Initiative, which is essential to reduce the extremely heavy debt-service burden.”

Program summary

Following the intense warfare in mid-1998, the government is tackling the most urgent problems in the economic, humanitarian, and political areas. With elections set for November 28, 1999, preparations have to start without delay to ensure a peaceful and democratic vote. In the energy sector, electricity and water production and distribution have to be brought back to satisfactory levels. Occupants of homes destroyed or damaged during the conflict need assistance, and food provisions to certain parts of the country have to be ensured.

In addition to alleviating the immediate effects of the conflicts on the population, the government’s priorities include rehabilitating the social sector, providing support for the private sector, making repayments of arrears, and establishing law and order. The government has initiated private sector funding at highly concessional rates to foster renewed enterprise activity, has committed to settling its arrears at mid-1998, and is planning accelerated reimbursements of obligations for goods and services used during the time ofthe conflict, including for electricity and petroleum. By the end of July 1999, the government was current on its wage and pension payments for the first six months ofthe year.

Guinea-Bissau: selected economic and financial indicators
(percent change)
Real GDP at market prices4.65.15.4-28.17.5
Consumer price index (end of period65.610.316.87.96.0
(months of imports of goods and services)
Gross official reserves1.
(percent of GDP)
External current account
(excluding current official transfers)-27.4-18.0-23.4-19.3-38.4

On May 2, 1997, the CFA franc (CFAF) replaced the Guinea-Bissau peso (PG) as legal tender, at a conversion rate of CFAF 1 = PG 65.

Data: Guinea-Bissau authorities and IMF staff estimates and projections

On May 2, 1997, the CFA franc (CFAF) replaced the Guinea-Bissau peso (PG) as legal tender, at a conversion rate of CFAF 1 = PG 65.

Data: Guinea-Bissau authorities and IMF staff estimates and projections

On fiscal matters, the finance ministry has taken measures to reactivate the key budget and revenue services, notably the budget and treasury directorates, customs, and domestic taxation office. There is an urgent need to restore the computerized taxpayers’ database and begin the assessment of medium-scale taxpayers. For the 1999 budget, tax revenue will mainly come from customs tariffs and indirect taxes, as the yield from profit taxes will remain very low because of business losses suffered in 1998. The primary 1999 budget deficit is targeted at 4.2 percent of GDP, the same level as in 1997.

Monetary policy, conducted at the regional level by the Central Bank of West African States (BCEAO), will continue to aim at strengthening the foreign reserves of the West African Economic and Monetary Union (WAEMU) and at containing inflation at levels consistent with the exchange rate peg with the euro. Credit to the economy is projected to remain broadly stable, while bank credit to the government is expected to increase.

The government is determined to resume the structural reform program, including rapidly strengthening the banking system and ensuring its full compliance with the central bank’s prudential criteria. Furthermore, it is proceeding with the privatization of the water and electricity company and is planning to conclude the privatization of the ceramics, timber, shipyard, and semi-industrial fisheries industries in the coming months.

Social indicators in Guinea-Bissau remain weak. The conflict severely disrupted social services despite a strong increase in social spending in the previous years. However, the authorities are keen to restore social services. This requires rapid rehabilitation of schools and health centers and the return of personnel who left the country during the conflict.

Guinea-Bissau joined the IMF on March 24, 1977, and its quota is SDR 14.2 million (about $19 million). Its outstanding use of IMF financing currently totals SDR 11 million (about $14 million).

Press Release No. 99/43, September 14

Nicaragua: ESAF

The IMF approved the second annual arrangement for Nicaragua under the Enhanced Structural Adjustment Facility (ESAF), equivalent to SDR 33.6 million (about $46.1 million), to support the country’s economic program. The Executive Board of the IMF also had a preliminary discussion of the HIPC document for Nicaragua and considered the country eligible, in principle, for assistance under the Initiative. Nicaragua’s three-year ESAF Arrangement was approved on March 18, 1998 (see Press Release 98/7, IMF Survey, April 8, 1998, page 107), in the amount of SDR 100.9 million (about $138.3 million), and in February 1999 was augmented by SDR 48 million (about $65.8 million).

Nicaragua: selected economic and financial indicators
AverageActualProg.ActualProj.1programNew program
(percent change)
GDP at constant prices4.
Consumer prices (end of period)
Unemployment rate (percent)16.714.313.
(percent of GDP)
External current account balance-39.6-30.3-23.2-32.9-31.4-33.9-31.7-29.1
(months of imports)
Adjusted official reserves (end of period)

Presented to IMF Executive Board, January 28, 1999, as posthurricane projection. 2Gross reserves net of outstanding stock of CENIS.

Data: Nicaragua Central Bank and Ministry of Finance and IMF staff estimates

Presented to IMF Executive Board, January 28, 1999, as posthurricane projection. 2Gross reserves net of outstanding stock of CENIS.

Data: Nicaragua Central Bank and Ministry of Finance and IMF staff estimates

Commenting on the Executive Board discussion on Nicaragua, IMF First Deputy Manager Director Stanley Fischer said:

“Executive Directors expressed their satisfaction with Nicaragua’s macroeconomic, structural, and social policies in 1998 and thus far in 1999, which were broadly in line with the objectives of the ESAF-supported program. Despite the adverse impact of Hurricane Mitch in late 1998, economic performance had strengthened in 1999, with more rapid GDP growth, a decline in inflation, an increase in net international reserves, and a further drop in unemployment.

“Directors endorsed the authorities’ new three-year program for 1999-2001, which aims at further fiscal consolidation and places renewed emphasis on structural reforms and improved governance. Directors supported the fiscal objectives of mobilizing domestic and external resources to meet priority spending needs while improving the overall public sector balance on a durable basis. They stressed that the success of the program would depend heavily on increasing public revenue and shifting spending priorities from unproductive areas to the social sector.

“Directors endorsed the authorities’ strategy for poverty alleviation and social development, which focused on reforms of the public health and education systems, the strengthening of the social safety net, and the promotion of rural development. Reflecting additional international aid in the wake of Hurricane Mitch and donor support for the Supplementary Social Fund, total social expenditures are expected to rise to over 15 percent of GDP during the next two years.

“Directors welcomed the authorities’ intention to give renewed emphasis to structural reforms, including the privatization program in the telecommunications and electricity sectors, as well as the reforms of the financial and social security systems. They strongly endorsed the authorities’ intention to improve governance.

Program summary

Over the past several years, Nicaragua has made substantial progress toward macroeconomic stabilization, external viability, and the restoration of a market-based economy. Notwithstanding improvements in social conditions, poverty remains widespread in a fragile macroeconomic context where the external position is weak.

In 1998, under the ESAF-supported program, the fiscal position improved more than envisaged, credit policy was tightened, and progress was made in reforming the financial system, streamlining the public sector, and setting the legal framework for the privatization of public enterprises.

Medium-term strategy

The governments medium-term strategy for the remainder of 1999 and 2000-01 attaches priority to the reconstruction and expansion of public spending in the social areas. The program aims at further progress toward sustainability of the public finances and the external sector and at strengthening structural reforms and governance. The macroeconomic objectives of the program include limiting the 12-month inflation rate to 7 percent by end-2001, raising GDP growth to 6.5 percent in 2000-01, and strengthening the net international reserves position.

To these ends, the fiscal program seeks to mobilize domestic and external resources toward priority spending sectors, while improving the public finances on a sustained basis. Achievement of the fiscal targets is based on expenditure restraint and the strengthening of tax administration. The monetary program is based on an increase in currency in line with nominal GDP growth.

Structural reforms

During 1999-01, the government’s structural and social policies agenda contemplates the consolidation of the reforms of the financial and public sectors, while “second-generation reforms” are introduced in the areas of social security and governance. A major reform of the social security system is planned to strengthen the financial position of the existing pension system and to introduce a fully funded system of individual, privately managed capitalized accounts.

Nicaragua joined the IMF on March 14, 1946; its quota is SDR 130 million (about $178.2 million). Its outstanding use of IMF financing currently totals SDR 101.7 million (about $139.4 million).

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