The Staff-Monitored Program (SMP) will help to build a strong track record of policy and reform implementation, possibly paving the way for an IMF-supported program; the six-month SMP will support the government’s program of reforms aimed at (i) supporting the recovery from the COVID-19 pandemic including by providing cash transfers to the poor; and (ii) enhancing prospects for inclusive growth by strengthening fiscal revenue, public financial management, and governance.
On September 29, 2021, the Management of the International Monetary Fund (IMF) approved a Staff-Monitored Program (SMP) for Comoros for the period July – December 2021.
Comoros has been significantly affected by the COVID-19 pandemic. The number of recorded casualties has remained comparatively low, but the pandemic has nevertheless disrupted economic activity and depressed growth.
The authorities’ top priority since the pandemic hit has been to limit the impact on the health of the population and preserve macroeconomic and financial stability. This required financial support from the international community, including emergency financing under the Rapid Credit Facility (RCF) and Rapid Financing Instrument (RFI) approved in April 2020 . Comoros’ participation in the debt service relief approved under the Catastrophe Containment and Relief Trust and the G20 Debt Service Suspension Initiative has provided additional resources to fight the pandemic and preserve debt sustainability.
The authorities are providing substantial fiscal support to the economy in 2021. Spending includes, among other things, substantial cash transfers to the poor, financed in part through the IMF’s allocation of Special Drawing Rights (SDRs).
Comoros now has a window of opportunity to recover robustly from the pandemic while at the same time improving prospects for reaching higher and more inclusive growth over the medium term, all while preserving debt sustainability. The SMP aims to help the authorities establish a track record of policy implementation to pave the way to a potential arrangement under the Extended Credit Facility.
Distributed by APO Group on behalf of International Monetary Fund (IMF).
