GUINEE -BISSAU/IMF Executive Board Completes the Eleventh Review under the Extended Credit Facility Arrangement for Guinea-Bissau

IMF Executive Board Completes the Eleventh Review under the Extended Credit Facility Arrangement for Guinea-Bissau

FOR IMMEDIATE RELEASE

The IMF Executive Board today completed the Eleventh Review under the Extended Credit Facility (ECF) arrangement for Guinea-Bissau. This allows for an immediate disbursement of SDR 1.18 million (about US$1.6 million), bringing total disbursements under the arrangement to SDR 38.59 million (about US$54.8 million).
All end‑March 2026 quantitative performance criteria, indicative targets, and continuous structural benchmarks and performance criteria were met, reflecting strong policy implementation and continued commitment to the ECF-supported program.
The authorities remain committed to prudent macroeconomic policies, stronger revenue mobilization, and strict expenditure prioritization. In the face of elevated global uncertainty and ongoing shocks, sustaining reform momentum and strengthening cash and debt management remain critical to safeguarding macroeconomic stability and supporting inclusive growth.

Washington, D.C. – June 12, 2026: The Executive Board of the International Monetary Fund (IMF) today completed the eleventh review under the Extended Credit Facility (ECF) arrangement for Guinea-Bissau. The three-year arrangement, approved on January 30, 2023, aims to secure debt sustainability, improve governance, and reduce corruption, while creating fiscal space to foster inclusive growth. The Executive Board granted an augmentation of access on November 29, 2023. The completion of the review enables the disbursement of SDR 1.18 million (about US$1.7 million) to help meet the country’s balance-of-payments and fiscal financing needs. This brings total disbursements under the arrangement to SDR 38.59 million (about US$54.8 million).

Program performance under the Eleventh Review was strong. All end‑March 2026 quantitative performance criteria, both indicative targets, and all continuous structural benchmarks and performance criteria were met, reflecting firm policy implementation and adherence to the reform agenda. In completing the review, the Executive Board approved the modification of quantitative performance criteria on total domestic tax revenue and domestic primary balance and completed the financing assurances review.

Economic growth in 2025 is estimated at about 5.8 percent, supported by robust agricultural production, particularly cashew exports, and solid private investment. Growth is expected to moderate in 2026 amid a more challenging external environment, including elevated global fuel prices as a result of the war in the Middle East and risks to the cashew campaign. Downside risks including adverse weather, terms‑of‑trade shocks, and tighter financing conditions underscore the need for continued fiscal discipline. Sustained efforts to strengthen cash and debt management, prioritize spending, and promote diversification, including in fisheries and extractive sectors, will be key to reinforcing resilience over the medium term.

Capacity development (CD) has played a critical role in supporting Guinea-Bissau’s economic reforms and has been closely integrated into the ECF-supported program. Since 2023, CD support has increased significantly, with spending nearly doubling and remaining above the Sub-Saharan Africa average, amounting to about US$6 million during 2023-26. Assistance has focused mainly on revenue administration and tax policy, followed by public financial management, statistics, and debt management. CD has helped deliver key reforms, including replacing the sales tax with a VAT, digitalizing revenue administration, strengthening tax audits, supporting wage bill controls that reduced the wage bill by over 2 percent of GDP, and improving SOE oversight, including by eliminating the losses of the electricity and water utility of over 1 percent of GDP.

At the conclusion of the Executive Board’s discussion, Mr. Bo Li, Deputy Managing Director and Acting Chair, made the following statement:

“Guinea-Bissau continues to show resilience despite a complex economic and political backdrop. Growth in 2025 was higher than projected, fiscal discipline has been restored, and program performance has been strong. In the context of elevated fuel prices, continued commitment to program implementation is essential to maintain macroeconomic stability, contain debt vulnerabilities, and address development needs.

“The authorities’ fiscal consolidation plan remains appropriate. The corrective measures to restrain current expenditure continue, along with close monitoring of the execution of priority capital expenditure. At the same time, domestic revenue mobilization efforts are bearing fruit, notably through enhanced customs procedures and a stronger focus on large taxpayers. Continued vigilance to ensure that the path of fiscal consolidation is adhered to is essential to contain debt vulnerabilities. In view of the risks related to the persistence of elevated fuel prices, the authorities are committed to minimizing the fiscal impact of any measures to protect vulnerable groups.

“The authorities are advancing structural reforms that are critical to the successful implementation of the program. The authorities completed their disengagement from the undercapitalized bank with the new private investor injecting fresh capital, in line with the restructuring strategy. Progress has also been made in diversifying the energy supply mix. These measures are critical to enhancing the business climate and promoting the conditions for economic diversification.”

Media contact:

Kwabena Akuamoah-Boateng KAkuamoah-Boateng@IMF.org

(+1) 202.623.7100

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