The Executive Board of the International Monetary Fund (IMF) today approved a disbursement under the Rapid Credit Facility (RCF) equivalent to SDR 122.2 million (about US$ 165.99million at today’s US$/SDR exchange rate, or 50 percent of the quota) to help the country meet the urgent balance of payment needs stemming from the outbreak of the COVID-19 pandemic.
“The Covid-19 pandemic is having a severe impact on Madagascar’s economy. Due to dramatic declines in tourism and disruptions to manufacturing and extractive industry exports, as well as transport, communications, and services, real GDP growth is likely to decline sharply. The fiscal situation is also deteriorating rapidly with additional health and social spending outlays and a significant shortfall in tax revenue. Fund support under the Rapid Credit Facility will help the authorities meet the urgent fiscal and external financing needs to mitigate the impact of the pandemic”, Mr. Mitsuhiro Furusawa, Deputy Managing Director and Chair said.
According to the IMF report, the authorities are taking immediate measures to address the human and economic impact of the pandemic, while preserving macroeconomic stability. These include increases in health spending, help to the most vulnerable, support to the private sector, and actions to preserve the stability of the financial sector and maintain the flexible exchange rate regime.
