Comoros-IMF: progress to consolidate

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A mission from the International Monetary Fund (IMF) headed by Mr. Matungulu Mbuyamu, head of mission for the Union of Comoros, visited Moroni from 16 to 23 August 2011 to review progress made in implementing economic reforms of the Comoros that are supported by the IMF under the Extended Credit Facility (ECF). We present the statement of the Head of Mission, Mr. Matungulu:

"According to projections, real GDP growth should be slightly above 2% in 2011, driven by a rebound in food crop production and income, and increased foreign direct investment. The resilience of food production contributes to contain pressures on domestic prices. Despite a sharp increase in July due to the pressure of demand resulting from the visit of members of the diaspora, inflation should probably not exceed 5% yoy in 2011. The external sector is characterized by strong imports, partly reflecting the recovery in foreign direct investment and rising oil bill, leading to a widening current account deficit. However, foreign exchange reserves should remain equivalent to six months of imports. In the area of ​​public finances, a supplementary budget approved by parliament in June placed the payroll of the public service to a level more consistent with the ability to raise state revenues. As a result, the fiscal outlook in the short term seem to be improving, and the domestic primary fiscal deficit is likely to be contained at around 1.3% of GDP, target set in the program for 2011.

"The authorities are committed to addressing the delays in structural reforms, particularly regarding the restructuring of public utilities services, essential reform to strengthen the productive economy and improving the provision of basic services to the population. They intend to seek immediate assistance from donors for this purpose.

"The mission will return in early October, and hopes to find upon return a consolidation of progress in stabilizing fiscal and decisive progress in structural reform program.

"The mission thanks the authorities for their hospitality."

SOURCE
African Press Organization (APO) / International Monetary Fund (IMF)

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