With the support of the African Legal Support Facility (ALSF), a US$47.1 million extended credit facility (ECF) arrangement for The Gambia was approved by the IMF Executive Board.
In 2016, successful democratic presidential elections in the Republic of The Gambia resulted in a political transition to a new government led by His Excellency, Adama Barrow. As part of the new government’s commitment to pursuing policies to ensure sustainable and inclusive growth, it has sought ways for the country to obtain long-term debt sustainability.
The Government of The Gambia entered into negotiations with the IMF for a new Staff Monitored Program (SMP) with the aim of ultimately transitioning The Gambia to an ECF. One of the preconditions to the ECF was that the country attain “credible and specific” debt relief assurances from enough of its external creditors to ensure that the country’s debt was on a sustainable path.
It was within this context that the Government of The Gambia requested technical and financial assistance from the ALSF to further the country’s negotiations with its creditors, to develop a prudent and sustainable debt restructuring strategy, and to build its institutional capacity in the area of sovereign debt. In response to the Government’s request, the ALSF offered its support by engaging legal and financial advisors to assist with the aforementioned activities.
Following the close of the project, in an early February visit to the country, the IMF noted that The Gambia had built a positive track record of performance and that it had advanced the structural reform agenda outlined under the SMP. It further noted that the prerequisites for The Gambia to enter into an IMF financing arrangement, which included obtaining an adequate number of financing assurances from The Gambia’s creditors, were largely in place.
As a result of these achievements on the part of the Government of The Gambia, in February 2020, a Staff-Level Agreement with the IMF on a three-year program to be supported under the ECF was reached. The IMF’s Executive Board approved the US $ 47.1 ECF arrangement on 23 March 2020.
The ECF arrangement aims to help the Gambia better prepare for external shocks, pursue inclusive growth and lessen debt vulnerability. The ECF will also unlock necessary resources from other international partners, and empower The Gambia to meet its long-term social and economic development goals.
Created by the African Development Bank in 2010, the ALSF supports governments in negotiating complex commercial transactions, providing legal and technical assistance in public-private partnership projects across the oil and gas, mining and energy sectors, and covering sovereign debt issues and creditor litigation