(Ecofin Agency) - Recent economic reforms in Guinea-Bissau have had a positive impact on the country’s outlook. Although the economy seems set to rebound, it still faces significant internal and external risks, according to the IMF.

The IMF announced yesterday a disbursement of $7.3 million to Guinea-Bissau under the Extended Credit Facility (ECF) agreement. This funding will help meet the country’s balance of payments and public finance needs. With this latest disbursement, the total amount received under the agreement reaches $33.44 million out of a total of $38.4 million.

The institution notes that the country's commitment to implementing ambitious policy reforms is starting to show results. For example, cashew nut production increased by 8%, rising from 200,000 tons in 2022 to 260,000 tons in 2023. Economic growth is expected to reach 5% this year.

However, the IMF urges continued efforts to implement the reforms outlined in the ECF agreement, address budgetary risks related to public services, and strengthen governance to better combat corruption, money laundering, and terrorism financing.

It is important to note that Guinea-Bissau’s economy is highly vulnerable to international price fluctuations and to cashew nut production, which accounts for 90% of exports and 10% of GDP, according to the French Treasury.