(Ecofin Agency) - The IMF has praised the country's growth and debt management. However, over the next 12 months, Côte d'Ivoire will have repaid more to the IMF than it will receive if new disbursements are not approved.

On December 4, 2023, the IMF Board of Directors approved the disbursement of resources equivalent to $495.2 million (around CFA300 billion) under an ongoing program with Côte d'Ivoire. The institution expressed satisfaction with the country's economic governance, leading the WAEMU region.

"Côte d’Ivoire’s performance under the Fund supported program has been strong, reflecting the authorities’ commitment to entrenching macroeconomic stability. Growth has been among the highest in Africa for more than a decade and the country has delivered the largest fiscal consolidation in the WAEMU region in the last six months," stated Kenji Okamura, Acting Chair and Deputy Managing Director.

Specifically, Côte d'Ivoire earns positive points thanks to an estimated growth of 6.5% in 2023, nearly double the expected average in Sub-Saharan Africa. The country is also expected to reduce its current account deficit, meaning the negative difference between international payments made and received. The IMF also applauds the government's efforts to reduce debt accumulation, notably through a decrease in the budget deficit.

"Safeguarding fiscal space will be aided by the authorities’ commitments to enhance the coverage, transparency, and management of public finances, especially to cover state owned enterprises. The authorities’ continued focus on improving the institutional and legislative framework for debt management remains critical in safeguarding debt sustainability," explains the IMF.

Although the current support from the Bretton Woods institution is termed concessional, it was disbursed when the interest rate on Special Drawing Rights (SDRs, IMF currency units) was 4.15%. Thus, the ECF resources have become 8 times more expensive compared to historically low rates of 0.5% at the end of 2021.

The currency components of countries such as the UK, the US, and the Eurozone are the main influencers of the rising rates. Until 2024, Côte d'Ivoire will have to repay up to 415 million equivalent resources in SDRs, amounting to $539.5 million, based on the conversion rate on December 4.

If a new disbursement from the IMF does not occur within the next 12 months, Côte d'Ivoire's balance of payments with the institution will be negative. Additionally, socio-economic costs must be monitored as potential adverse effects of the ongoing program.