By Kadijatu Bangura, Daily Scope Reporter
The International Monetary Fund (IMF) has reached a staff-level agreement with the Sierra Leone government to advance the first and second reviews of its Extended Credit Facility (ECF), paving the way for an anticipated $78.8 million in funding for the West African nation.
Pending approval from the IMF’s Executive Board in the upcoming weeks, this agreement is expected to significantly bolster Sierra Leone’s finances, which have been strained by substantial spending overruns and a decrease in foreign reserves.
During a mission led by Christian Saborowski from October 3 to 10, 2025, the IMF noted improvements in Sierra Leone’s economic performance after the government implemented tighter fiscal policies, responsible monetary measures, and various structural reforms. These efforts contributed to a reduction in inflation, which is now at 4.4%, and the IMF projects a growth rate of 4.4% for 2025.
However, significant challenges persist, particularly concerning the depletion of foreign reserves at the Bank of Sierra Leone (BSL), which currently cover only 1.5 months of imports. Mr. Saborowski emphasized, “The authorities and IMF staff agreed that a larger fiscal effort is needed to correct last year’s policy slippages.”
In response, the Sierra Leonean government has committed to a fiscal consolidation plan aiming for a reduction of 3.3 percentage points of GDP in 2025. Key elements of this strategy include revenue measures amounting to 1.5% of GDP, enhanced tax compliance, and strict expenditure control. Nevertheless, the IMF has noted that commitments to increase social spending remain unfulfilled.
The rebuilding of BSL’s reserve adequacy is described as an urgent priority by the IMF, necessitating efforts to purchase foreign currency and significantly cut government spending on imports and energy subsidies.
Upon final approval from the IMF Executive Board, the disbursement will provide essential support for Sierra Leone’s economic stabilization and reform efforts.
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