Sierra Leone seeks IMF loan worth $253 million

Sierra Leone has asked the International Monetary Fund (IMF) for a 38-month Extended Credit Facility (ECF) arrangement worth about $253 million.

The facility would support restoring stability through continued macroeconomic adjustment to address debt vulnerabilities, reduce inflation, and rebuild international reserves; bolster inclusive growth and poverty reduction through structural reforms and targeted social spending; and revitalize the reform agenda to strengthen governance and institutions, the IMF said in a statement following a staff-level agreement with Sierra Leone authorities.

The IMF noted that the West African country launched fiscal and monetary reforms that led to a deficit cut by 2.8% of GDP in 2023.

“The reform momentum has borne fruit. Inflation declined to 25 percent in August 2024, down from a peak of 55 percent in October 2023, and the sharp exchange rate depreciation experienced in 2022 and early 2023 was arrested,” the IMF said.

Economic growth reached more than 5 percent in 2022 and 2023, buoyed by strong mining activity. Sierra Leone’s public debt continues to be assessed as sustainable but at high risk of distress, it said.