IMF staff reach agreement with The Gambia on sixth review of credit programme

Completion of the reviews would unlock about $28 million in new financing, with growth projected at 5.1% in 2026 and 2027

Staff of the International Monetary Fund (IMF) and Gambian authorities have reached a staff-level agreement on the sixth review under the Extended Credit Facility (ECF) and the third review under the Resilience and Sustainability Facility (RSF), the Washington-based lender said on Friday.

The agreement is subject to approval by the IMF Executive Board and the implementation of agreed prior actions. If the reviews are completed, The Gambia would receive additional financing of SDR 20.73 million (about $28 million) across both arrangements. That would bring total disbursements under the two programmes to SDR 105.75 million (about $142 million).

An IMF team led by Eva Jenkner visited Banjul from October 19 to 30 to discuss the country’s reform programme under the ECF and the RSF, which is meant to strengthen resilience to climate change. The IMF noted that the findings are preliminary and reflect the views of its staff, not necessarily those of the Executive Board.

Growth and inflation

Real GDP growth is projected at 5.1% in both 2026 and 2027, supported by construction, tourism and remittances. “The Gambian economy remains resilient despite external uncertainties and domestic energy supply disruptions,” Jenkner said.

Inflation eased to 6.1% in September from 7% in April but remains above the Central Bank of The Gambia’s (CBG) 5% target. The outlook is favourable but subject to significant downside risks, including commodity price volatility, geopolitical uncertainty, climate shocks and vulnerabilities in the energy sector.

Programme performance

All eight quantitative performance criteria for end-June 2026 were met, along with three of four indicative targets. The tax revenue target was missed by a modest margin, and the IMF said continued discipline will be needed to meet end-December targets.

Structural reforms have progressed in cash management and the partial privatisation of Gambia Telecommunications Cellular Company Limited (GAMCEL). Further work is needed on public financial management and governance reforms, the IMF said.

Fiscal policy

The IMF said fiscal policy should continue to focus on reducing debt vulnerabilities while addressing pressing social needs. The authorities have reprioritised spending in response to the electricity crisis, and the 2027 budget targets an overall deficit of around 1% of GDP.

The IMF called for sustained revenue mobilisation, expenditure control, better cash management and timely clearance of arrears, while protecting priority social spending to address persistent poverty.

Energy sector

The recent electricity crisis underscores the urgency of strengthening the operational efficiency and financial sustainability of the National Water and Electricity Companies (NAWEC), the IMF said. The authorities have given NAWEC emergency financial support, including to clear arrears to regional electricity suppliers and restore generation capacity.

To contain fiscal risks and ensure reliable power, the IMF said further efforts are needed to reduce operational losses, improve revenue collection and move toward cost-recovery tariffs, while protecting vulnerable households.

Monetary policy and banking

The IMF said the CBG should maintain a prudent, data-driven monetary policy stance to bring inflation sustainably toward its medium-term target. Exchange rate flexibility and adequate international reserves remain essential to external stability.

The banking sector remains resilient, although banks’ exposure to government debt and concentration risks warrant close monitoring. The IMF also said it is critical to strengthen the CBG’s governance and autonomy, including through amendments to the CBG Act and an end to quasi-fiscal activities.

Governance and climate reforms

The IMF welcomed progress in public accountability, including the National Audit Office’s clearance of longstanding audit backlogs. It called for further efforts to operationalise the Anti-Corruption Commission, strengthen governance and transparency, and improve the business environment to encourage private investment and job creation.

Under the RSF-supported agenda, measures are under way to strengthen groundwater management and build climate resilience into coastal zoning regulations. The IMF said continued climate reforms will help reduce vulnerability to climate shocks, contain fiscal risks and mobilise climate financing.

During the mission, the team met Finance and Economic Affairs Minister Seedy Keita, Attorney General and Justice Minister Dawda Jallow, CBG First Deputy Governor Abdoulie Jallow, Gambia Revenue Authority Commissioner General Yankuba Darboe, Auditor General Cherno Sowe and State-Owned Enterprises Commission Executive Secretary Bai Ceesay, along with other senior government and central bank officials. It also held discussions with the private sector, civil society and development partners.