Statement by IMF Mission to The Gambia on Progress Under the PRGF-Supported Program

Press Release

The following statement was issued Thursday, May 21, in Banjul by Mr. Robert Powell, the IMF mission chief for The Gambia:

“The IMF team visited Banjul from May 8-21 to assess progress under the government’s economic program supported by the Poverty Reduction and Growth Facility (PRGF). Meetings were held with Minister of Finance and Economic Affairs Mousa Gibril Bala-Gaye, Governor of the Central Bank of The Gambia Momodou Bamba Saho, other senior government officials, legislators, the private sector, and members of the donor community.

“The economy of The Gambia grew by about 6 percent in 2008. Economic growth is expected to be weaker in 2009 in the face of a significant fall in receipts from tourism and remittances resulting from the global slowdown. Nonetheless, a strong rebound in agricultural production in 2008 is supporting a recovery in manufacturing and trade-related services this year, and 2009 growth is expected to be about 3 1/2 percent, which is higher than the regional average. Inflation is also expected to remain under control.

“The Gambia has continued to make progress under the IMF-supported program. In the period to March 2009, government revenues have achieved the budget targets, and government borrowing has been contained within planned levels. The central bank has also achieved its target for international reserves, following sharp falls at the end of 2008. Among the structural measures planned by the government, the key action of making the credit reference bureau operational is now expected by July 2009, after necessary legislation has been considered.

“Even after the debt relief provided recently under the Heavily Indebted Poor Countries and Multilateral Debt Relief initiatives, The Gambia’s external debt remains high. It remains critical, therefore, to establish a medium term debt management strategy that sets clear goals for reducing debt ratios further. This requires limiting external borrowing to highly concessional loans, and stepping up efforts to seek grant finance to support the implementation of The Gambia’s Poverty Reduction Strategy.”