According to a recent report by The East African, six nations—Rwanda, Tanzania, DRC, Somalia, Burundi, and Kenya—selected by the IMF are grappling with debt issues, falling revenue collections, depreciating currencies, and declining forex reserves.
The IMF funding, contingent on the implementation of crucial socioeconomic and governance reforms, aims to address persistent budget deficits and bolster dwindling foreign exchange reserves, as highlighted in The East African’s report.
Funding Breakdown per Country:
- Tanzania: $150.5 million
- Rwanda: $268.05 million
- Democratic Republic of the Congo (DRC): $202.1 million
- Somalia: Additional $100 million under a three-year Extended Credit Facility (ECF) arrangement
- Kenya: Expanded financing of $938 million (awaiting January approval) with immediate access to approximately $682 million
- Burundi: 38-month agreement under the ECF, granting access to $261.7 million
Notably, Tanzania’s funding program dates back to July 2022, with the approval of a $1.04 billion Extended Credit Facility (ECF), allowing access to up to $455.3 million. Similarly, Rwanda secured a new $268.05 million, 14-month credit facility arrangement on December 14, with access limited to $138.84 million.
Additionally, a consensus between Somalia and the IMF led to substantial debt reduction and an extra $100 million in funding under a three-year ECF arrangement. The DRC saw the immediate transfer of $202.1 million towards international reserves after the conclusion of the sixth review under the ECF agreement.
As Kenya awaits an expanded $938 million financing approval in January, the country is poised to access approximately $682 million promptly. In July, the IMF board authorized a 38-month agreement under the ECF for Burundi, granting access to $261.7 million.
This substantial funding is expected to play a pivotal role in supporting these nations as they navigate economic challenges and embark on essential reforms.
Source: Business Insider