The International Monetary Fund has completed its inspection mission in Djibouti, led by Brett Rayner, publishing on December 21 the preliminary results of the survey carried out in the country by its staff.
According to IMF officials, the large investments made in recent years to upgrade port infrastructure have certainly stimulated the country’s economic growth, while at the same time increasing its macroeconomic vulnerabilities, not affecting employment and generating lower than expected tax revenues.
The global pandemic and the conflict in neighboring Ethiopia have led to a sharp decrease in the overall values of Djibouti’s economy, exposing the country’s macroeconomic vulnerabilities.
The IMF therefore suggests intervening in fiscal policy in order to increase national revenues, while at the same time operating a closer surveillance of state-owned companies in order to restore debt sustainability and increase social spending.
On the same day that the preliminary conclusions were released, the International Monetary Fund also announced the granting of a fifth and final round of debt relief for 25 low-income countries, including Djibouti.
The funds are intended to help some of the world’s most vulnerable countries deal with the consequences of the pandemic, while the extension of the relief until April 13 next year means that an additional $115 million (102 million euros) will be made available.
On December 23, eventually, the government of Djibouti announced that it had appointed former Tunisian minister Slim Feriani as the new director of its sovereign fund, the FSD, replacing Senegalese Mamadou Mbaye, who had resigned last May after growing disagreements with the fund’s management.