A mission from the International Monetary Fund (IMF), led by Mr. Jaroslaw Wieczorek, visited Bujumbura from during December 4–17, 2014 to conduct discussions for the sixth review of the government’s economic and financial program supported by the IMF under the Extended Credit Facility (ECF).1
The mission met with the Second Vice-President, Gervais Rufyikiri; the Minister of Finance, Tabu Abdallah Manirakiza; the Minister to the Office of the President Responsible for East African Community Affairs, Leontine Nzeyimana; the Minister of Energy and Mines, Côme Manirakiza; the Minister of the Civil Service, Labor and Social Security, Annonciate Sendazirasa; the Governor of the Central Bank, Jean Ciza; members of the Finance Committee of the National Assembly and of the Senate; and other senior government officials. The mission also had constructive discussions with members of the donor community; private sector; and banks.
At the end of the mission, Mr. Wieczorek issued the following statement:
“Performance under the ECF-supported program has been broadly satisfactory. All quantitative performance criteria for end-September 2014 were met and the structural agenda under the program advanced, albeit some reforms have taken longer than envisaged to implement.”
“Economic growth is expected to reach 4.7 percent in 2014, supported by a rebound in coffee production and construction activity linked to the implementation of major infrastructure projects, including fiber optics, hydropower, and roads. Following the decline in international prices of fuel and food, consumer price inflation subsided markedly, and the average inflation rate for the year as a whole is expected to drop from about 8 percent in 2013 to 5–6 percent in 2014. The economic outlook for 2015 is positive. Growth is projected to remain at broadly the same level as in 2014, reflecting ongoing public investment activity, notably in roads and energy generation, and the start of the pilot phase of nickel mining. Inflation in 2015 is projected to average 5.5 percent.
“Revenue measures adopted in late July together with the receipts from the sales of telecom licenses helped reverse the revenue shortfall registered in the first half of the year. As a result, the annual revenue and budget deficit targets are within reach. Also, the reforms in public financial management advanced, with key steps including unification of the database of civil servants and preparation of a new law on public debt management. The authorities took advantage of the drop in international fuel prices to restore the petroleum pricing mechanism, which will help strengthen budgetary resources in the period ahead. The mission encouraged the authorities to maintain budgetary discipline in the run-up to the 2015 general elections and allow the exchange rate to respond to underlying economic conditions, including the recent appreciation of the U.S. dollar, to protect external stability and to foster competitiveness.
“The mission reached understandings ad referendum with the authorities on policies for 2015 and the reform agenda that could be supported by an extension of the ECF through March 2016. The IMF’s Executive Board is expected to consider the review and extension of the program in early 2015.
“The mission would like to thank the authorities for their warm hospitality and constructive cooperation.”
1 The Extended Credit Facility (ECF) replaced the Poverty Reduction and Growth Facility (PRGF) as the Fund’s main tool for medium-term financial support to low-income countries. Financing under the ECF currently carries a zero interest rate, with a grace period of 5½ years, and a final maturity of 10 years. The Fund reviews the level of interest rates for all concessional facilities every two years.
International Monetary Fund (IMF)