SIERRA LEONE/Sierra Leone: IMF Executive Board Approves Arrangement Under the Resilience and Sustainability Facility and Completes Third Review Under the Extended Credit Facility

Sierra Leone: IMF Executive Board Approves Arrangement Under the Resilience and Sustainability Facility and Completes Third Review Under the Extended Credit Facility

FOR IMMEDIATE RELEASE

The IMF Executive Board completed the third review under the Extended Credit Facility (ECF) arrangement, enabling an immediate disbursement of about US$31.72 million. The Executive Board also approved a new arrangement under the Resilience and Sustainability Facility (RSF) for Sierra Leone, equivalent to about US$211.45 million, to support the authorities’ efforts to strengthen resilience to climate shocks.
The authorities’ macroeconomic policy tightening in recent years helped stabilize the exchange rate, lower inflation, contain borrowing costs, and restore private sector credit. However, reserve coverage remains low, and debt remains at high risk of distress.
While there is some fiscal space to address the fallout from the war in the Middle East, persevering on fiscal consolidation is critical to keep debt on a sustainable path. The RSF arrangement will focus on climate-sensitive public investment management, climate resilience, and financial stability.

Washington, DC – June 18, 2026: The Executive Board of the International Monetary Fund (IMF) completed the third review of Sierra Leone’s arrangement under the Extended Credit Facility (ECF). Completion of the review enables the immediate disbursement of SDR 23.333 million (about US$31.7 million), bringing total disbursements under the arrangement to SDR 116.664 million (about US$158.6 million).

In completing the review, the Executive Board approved the authorities’ request for waivers of nonobservance of the continuous performance criterion on the ceiling on concessional external debt and the end-December performance criterion on net domestic assets, based on corrective actions taken by the authorities.

The Executive Board also approved an arrangement under the Resilience and Sustainability Facility (RSF) for Sierra Leone in the amount of SDR 155.550 million (about US$211.5 million), with disbursements to begin upon completion of the first review. The RSF will support the authorities’ efforts to strengthen resilience and external stability, with a focus on climate-sensitive public investment management, climate resilience, and financial stability.

Sierra Leone’s economic outlook remains stable. Growth accelerated last year, but spillovers from the Middle East war are weighing on the economy in 2026. Growth is expected to fall to 4 percent, while end-year inflation will reach 11.6 percent. The outlook is subject to significant risks, including rising political tensions ahead of the elections, the fallout from the war in the Middle East, and possible reform fatigue amid the sustained fiscal consolidation.

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

“The authorities’ policy tightening has helped stabilize the exchange rate, lower borrowing costs and inflation, and restore private credit access. However, reserve coverage remains low, and debt is at high risk of distress.

“Growth accelerated last year, but spillovers from the Middle East war are weighing on the economy in 2026. Growth is expected to fall to 4 percent, while end-year inflation will reach 11.6 percent.

“The authorities have some space to accommodate fiscal pressures arising from the Middle East war but persevering on fiscal consolidation—while protecting critical social spending— is key to keep debt sustainable.

“In the absence of a strong social safety net to provide targeted relief, the fuel price subsidy can help avoid disruptive price movements. However, it needs to remain temporary and transparent and adhere to the agreed cost ceiling.

“Advancing energy and public financial management reforms will help contain spending, avoid arrears accumulation, and strengthen arrears monitoring. Revenue mobilization gains will require stronger tax administration and mining revenue collection, while stronger debt management will help mitigate risks.

“Monetary policy should be tightened if inflationary pressures persist, and efforts should continue to strengthen safeguards and implement the new monetary policy framework. The authorities should rebuild reserves, allow the exchange rate to adjust to shocks, and repay overdue budget support loans to the BSL.

“Structural reforms should be stepped up, including by strengthening arrears management, operationalizing the bank resolution framework, completing the resolution of the problem bank, and implementing the recommendations of the Governance and Corruption Diagnostic.

“The RSF arrangement will promote balance of payments stability by supporting resilience to climate shocks in the areas of public investment, social protection, fiscal planning, and financial risks.”

Sierra Leone: Selected Economic Indicators

	2024	2025	2026
	Prel.	Est.	Proj.



Output (annual percentage change)
Real GDP growth	4.4	5.0	4.0
Real GDP growth, excl. iron ore	3.8	4.8	4.0

Prices (annual percentage change)
Inflation, end of period (%)	13.8	4.3	11.6


Central Government Finances (percent of non-iron ore GDP)
Revenue, excl. grants	10.1	10.7	11.5
Grants	3.4	2.6	2.2
Expenditure and net lending	19.1	17.6	16.6
Overall balance	-5.6	-4.3	-2.8
Public debt	51.1	49.3	47.3

Money and credit (annual percentage change)
Broad money	18.0	19.3	13.6
Credit to the private sector	41.2	49.0	23.4

Balance of payments (percent of non-iron ore GDP)
Current account	-7.1	-5.4	-3.7
Gross reserves (months of imports)	2.1	2.0	2.7
External debt	31.0	26.9	25.5


Sources: Central Bank, Ministry of Finance, Statistics Sierra Leone, and Fund staff estimates and projections