IMF Approves $31.4 Million Disbursement for Burkina Faso Under Extended Credit Facility
The International Monetary Fund (IMF) Executive Board has completed the Second Review under Burkina Faso’s 48-month Extended Credit Facility (ECF) arrangement, unlocking an immediate disbursement of $31.4 million (SDR 24.08 million).
This brings the total IMF financial support under the program to $94.3 million (SDR 72.24 million) since its approval on September 21, 2023.
Economic Challenges and Outlook
Burkina Faso continues to face economic pressures from security threats and adverse climate conditions, which have slowed growth and weakened key sectors such as gold mining and agriculture. The real GDP growth rate for 2023 was revised downward to 3.0% (from 3.6%) but is projected to increase to 4.2% in 2024 and 4.3% in 2025.
Despite the challenging environment, fiscal performance remains strong, supported by robust revenue collection. The fiscal deficit is expected to narrow from 6.5% of GDP in 2023 to 5.0% in 2024, while the current account deficit is projected to improve from 8.6% to 5.2% of GDP, driven by higher gold prices despite weaker production.
Inflation, mainly due to rising food prices, is expected to increase to 3.6% in 2024, while the financial sector continues to face challenges such as lower capital adequacy and rising non-performing loans.
Program Implementation and Reforms
According to the IMF, Burkina Faso’s progress under the ECF arrangement has been satisfactory, with the authorities meeting all six quantitative performance criteria and five out of seven structural benchmarks for the second review. However, the audit of government arrears was delayed, and the indicative target on non-accumulation of domestic arrears was not met.
To strengthen fiscal management, the government has committed to new structural measures in procurement and treasury management. The authorities have also provided a closing report and an audit of measures under the IMF’s Food Shock Window while implementing a tripartite performance contract with state-owned energy firms.
IMF’s Call for Continued Reforms
Following the Executive Board meeting, IMF Deputy Managing Director Kenji Okamura emphasized the need for sustained structural reforms to improve fiscal governance, economic diversification, and climate resilience.
“A substantial and lasting economic recovery will require meaningful progress on security, as well as structural reforms on fiscal governance, economic diversification, and fostering resilience to climate change,” Okamura stated.
He highlighted that maintaining debt sustainability, catalyzing concessional financing, and ensuring inclusive growth will require continued fiscal prudence and commitment to reforms.
The government remains committed to reducing the fiscal deficit to 3.0% of GDP by the end of the ECF arrangement, with a focus on domestic revenue mobilization, expenditure control, and energy sector reforms. Additionally, authorities have pledged to strengthen debt management and clear government arrears, while safeguarding resources for priority social spending.
The IMF stressed that enhancing fiscal transparency—including publishing the final report of the IMF’s Governance Diagnostic Assessment—will be crucial in restoring donor confidence and attracting concessional financing.
