IMF supports Uganda, Nigeria & Senegal

The International Monetary Fund's Director of Communications, Julie Kozack, recently held her monthly media briefing, providing key updates on Uganda, Nigeria, Senegal, and Zambia. Starting with Uganda, the IMF's executive board concluded the fifth review of Uganda's ECF arrangement, enabling the disbursement of approximately 120 million US dollars. The ECF program aims to foster inclusive private sector-led long-term growth through reforms that strengthen governance, enhance monetary and financial sector frameworks, preserve debt sustainability, and increase priority social spending. Uganda has made significant progress, meeting all structural benchmarks and most quantitative performance criteria under the latest review. The country's post-COVID recovery is underway, with inflation decreasing due to a tight fiscal and monetary policy stance. Moving to Nigeria, an IMF team visited the country from February 12th to 23rd to discuss economic developments and policies. The IMF highlighted the challenges faced by many Nigerians, particularly related to high food, drug, and transportation prices. The IMF advised prioritizing assistance to alleviate this suffering by bolstering social protection measures. In response to soaring food price inflation, the recently approved targeted social safety net program aims to provide cash transfers to vulnerable households. The IMF suggested implementing this program fully before addressing costly fuel and electricity subsidies to protect low-income households. The IMF also noted Nigeria's recent decision to tighten monetary policy, which should help manage inflation and pressures on the Naira. Shifting to Senegal, the Executive Board completed the first review of a combined EFF, ECF, and RSF for Senegal, granting access to around 280 million US dollars. Senegal is actively implementing agreed reforms, including strengthening revenue administration, enhancing governance, and combating corruption. Discussions on the second review and the article for consultation are slated for after the completion of the electoral process. Regarding the drought situation, the IMF anticipates a significant impact on crop losses, energy imports, fiscal needs, and the current account balance. While the short-term effects are projected to be adverse, the IMF does not foresee a persistent impact over the medium term. As for Zambia, the IMF applauds progress on debt restructuring and urges all stakeholders to work towards restoring debt sustainability. The debt treatment outlined in the MOU between Zambia and official creditors aligns with IMF-supported program objectives and lending policies, aiming to enhance macroeconomic stability and stimulate growth. Zambia is actively engaging with external private creditors to reach a restructuring agreement that aligns with program parameters. The IMF remains optimistic about Zambia's efforts to navigate its debt challenges and restore economic stability.