- The Gambia Secures IMF Staff-Level Agreement, Unlocking Potential US$28 Million
The Gambian authorities and the International Monetary Fund have reached a staff-level agreement that could unlock about US$28 million in additional financing under two programmes supporting economic reforms and climate resilience.
The agreement covers the sixth review of The Gambia’s programme under the Extended Credit Facility and the third review under the Resilience and Sustainability Facility.
It remains subject to approval by the IMF Executive Board and the implementation of agreed prior actions by the Gambian authorities.
Completion of the reviews would provide The Gambia with SDR20.73 million, equivalent to approximately US$28 million. It would bring total disbursements under the two arrangements to SDR105.75 million, or about US$142 million.
An IMF team led by Eva Jenkner visited Banjul from October 19 to October 30, 2026, to assess the country’s economic performance and progress on reforms.
“The Gambian authorities and IMF staff have reached staff-level agreement on the sixth review under the ECF arrangement and the third review under the RSF arrangement, subject to IMF Executive Board approval and the implementation of agreed prior actions,” Ms Jenkner said.
The IMF described The Gambia’s economy as resilient despite uncertainties in the global economy and domestic disruptions to electricity supply.
Real gross domestic product is projected to expand by 5.10% in both 2026 and 2027. Growth is expected to be supported by construction, tourism and remittance inflows.
Inflation has also continued to moderate, declining from 7.00% in April to 6.10% in September 2026. It nevertheless remains above the Central Bank of The Gambia’s medium-term target of 5.00%.
The Fund said the economic outlook remained favourable but warned that volatile global commodity prices, geopolitical uncertainty, climate-related shocks and vulnerabilities in the energy sector could undermine the recovery.
Program performance was described as strong, with the government meeting all eight quantitative performance criteria assessed at the end of June 2026. Three of the programme’s four indicative targets were also achieved.
The tax revenue target was missed by what the IMF described as a modest margin, highlighting continuing challenges in domestic revenue mobilisation.
The Fund said continued fiscal discipline would be required for the government to meet its end-December programme targets.
Progress has been recorded in cash management and the partial privatisation of Gambia Telecommunications Cellular Company Limited. However, the IMF said additional work was needed to strengthen public financial management and accelerate governance reforms.
The government’s 2027 budget is targeting an overall fiscal deficit of about 1.00% of GDP as the authorities seek to reduce debt vulnerabilities while maintaining support for critical social services.
The IMF said the government had reprioritised expenditure in response to the country’s electricity crisis, but stressed that sustained revenue mobilisation, expenditure control and improved cash management remained essential.
Timely clearance of government arrears would also be important, alongside protection of priority social spending to address persistent poverty.
“Fiscal policy should continue to focus on reducing debt vulnerabilities while addressing pressing social needs,” Ms Jenkner said.
A central concern raised during the review was the financial and operational condition of the National Water and Electricity Company.
Recent electricity disruptions forced the government to provide emergency financial support to the utility, including funds to clear arrears owed to regional electricity suppliers and restore domestic generation capacity.
The intervention helped address the immediate supply challenge but increased the fiscal burden on the government, underscoring the risks posed by financially weak state-owned enterprises.
The IMF called for reforms to reduce NAWEC’s operational losses, improve its revenue collection and gradually move electricity tariffs towards cost-recovery levels.
It stressed that tariff reforms should include measures to protect vulnerable households from the effects of higher electricity charges.
“The recent electricity crisis underscores the urgency of strengthening NAWEC’s operational efficiency and financial sustainability,” Ms Jenkner said.
“To contain fiscal risks and ensure reliable power provision, further efforts are needed to reduce operational losses, improve revenue collection and move toward cost-recovery tariffs, while protecting vulnerable households.”
On monetary policy, the IMF urged the Central Bank of The Gambia to maintain a prudent and data-driven approach until inflation moves sustainably towards the 5.00% target.
Exchange-rate flexibility and adequate international reserves were identified as important safeguards against external shocks.
The banking sector remains resilient, but the Fund warned that commercial banks’ exposure to government debt and concentration risks must be monitored closely.
Heavy banking-sector exposure to sovereign debt can create vulnerabilities by tying the financial health of banks more closely to the government’s fiscal position. It may also limit the amount of credit available to private companies.
The IMF called for stronger governance and greater autonomy for the central bank. Proposed amendments to the Central Bank of The Gambia Act and the cessation of quasi-fiscal activities were identified as critical reforms.
The Fund also welcomed progress in strengthening public accountability, including the National Audit Office’s clearance of longstanding audit backlogs.
It nevertheless called for the Anti-Corruption Commission to become fully operational and for further improvements in governance, transparency and the business environment.
Such measures, it said, would be essential to attract private investment and create employment, particularly as The Gambia seeks to make economic growth more inclusive.
Under the Resilience and Sustainability Facility, the authorities have advanced measures to strengthen groundwater management and incorporate climate resilience into coastal zoning regulations.
The reforms are intended to reduce The Gambia’s exposure to climate shocks, limit related fiscal risks and improve its ability to mobilise climate financing.
The IMF team held discussions with Finance and Economic Affairs Minister Seedy Keita, Attorney General and Justice Minister Dawda Jallow and First Deputy Governor of the Central Bank Abdoulie Jallow.
It also met officials of the Gambia Revenue Authority, National Audit Office and State-Owned Enterprises Commission, alongside representatives of the private sector, civil society and development partners.
The staff-level agreement represents an important endorsement of The Gambia’s reform programme, but access to the additional financing will depend on completing the remaining policy actions and securing Executive Board approval.
