International Monetary Fund (IMF) Staff completes mission to Comoros on possible emergency financial assistance following Cyclone Kenneth

[Deeq A.]

PRESS RELEASE
International Monetary Fund (IMF) Staff completes mission to Comoros on possible emergency financial assistance following Cyclone Kenneth
IMF assistance would help address Comoros’ budgetary and external financing gaps arising from reconstruction and humanitarian needs
WASHINGTON D.C., United States of America, June 24, 2019/ — IMF mission reached a preliminary staff-level understanding on a possible emergency financial assistance to Comoros, following tropical Cyclone Kenneth; IMF assistance would help address Comoros’ budgetary and external financing gaps arising from reconstruction and humanitarian needs; the assistance could also play a catalyst role in securing grants from development partners and the international community.

An International Monetary Fund (IMF) team, headed by Montfort Mlachila, visited Moroni, Union of Comoros, from June 10 to 21, 2019 to explore a possible emergency financial assistance under the IMF’s Rapid Credit Facility (RCF) and Rapid Financing Instrument (RFI), following tropical Cyclone Kenneth. The request for IMF assistance, supported by a preliminary staff-level understanding, is expected to be submitted to the IMF Executive Board for consideration in mid-July 2019.

At the end of the mission, Mr. Mlachila issued the following statement:

“The Comorian authorities and the IMF mission discussed potential emergency financial assistance under the Rapid Credit Facility (RCF) and the Rapid Financing Instrument (RFI). The financial assistance is intended to address large budgetary and external financing gaps arising from reconstruction and humanitarian needs created by tropical Cyclone Kenneth, which caused several fatalities, human displacement, and loss of physical and productive capacity, including subsistence and export crops, and infrastructure. Emergency assistance and reconstruction costs are significant. Disbursement of IMF assistance will help address immediate financing needs and play a catalytic role in securing grants from development partners and the international community.

“Repercussions from cyclone Kenneth will exacerbate fiscal difficulties, which will require reallocation of budget resources to critical spending on buildings and infrastructure rehabilitation, including schools, and humanitarian assistance to the affected poor. The Comorian authorities remain committed to macroeconomic stability to create fiscal buffers and to improve the economy’s resilience, including in preparation for possible future calamities and climate change. Measures under implementation to enhance revenue mobilization and public financial management are in line with technical assistance recommendations. They focus on increasing fiscal credibility and realism, rationalizing current expenditures without lowering services, finalizing Treasury Single Account (TSA) implementation, improving tax compliance, and eliminating tax arrears.

“The authorities are committed to strengthening transparency, governance, and accountability. An inter-ministerial committee to coordinate post-cyclone reconstruction, humanitarian assistance and related spending decisions has been created. Funds provided to the government will be channeled through the budget and will be subject to enhanced budgetary procedures and controls, including regular reporting and audit.

“The mission thanks the Comorian authorities for their hospitality, cooperation, and constructive discussions.”

The mission met President Assoumani, and held discussions with Minister of Finance and Budget Chayhane, Minister of Economy and Planning Tharmidhi, Central Bank of Comoros Imani, Secretary General of the Ministry of Finance and Budget Ahamada, Permanent Secretary of the Economic and Financial Reform Unit (CREF) Oubeidi, and other senior government officials.

Distributed by APO Group on behalf of International Monetary Fund (IMF).
SOURCE
International Monetary Fund (IMF)

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