FEDERAL
COURTHOUSE, June 28 – When the
International Monetary Fund
held its biweekly embargoed
press briefing on June 24,
Inner City Press asked about
crypto-currency and El
Salvador, and institutions'
attempts to stay relevant, and
about COVID-19 lack of
transparency in Cameroon, and
the letter to the IMF by civil
society (not Biya government)
representatives there. IMF
video and transcript
forthcoming.
Spokesperson Gerry Rice
responded on each. [And on
Indonesia, below]
Now on June 28 on
Uganda the IMF says, "On June
28, 2021, the Executive Board
of the International Monetary
Fund (IMF) approved a 36-month
arrangement under the Extended
Credit Facility (ECF) for
Uganda in an amount equivalent
to SDR722 million (200 percent
of quota or about US$1
billion) to support the
post-COVID-19 recovery and the
authorities’ plan to increase
households’ incomes and
inclusive growth by fostering
private sector
development. Approval of
the ECF arrangement enables
immediate disbursement of
about US$258 million, usable
for budget support. This
follows Fund emergency support
to Uganda under the Rapid
Credit Facility (RCF) in May
2020 of SDR361 million... At
the conclusion of the
Executive Board’s discussion,
Mr. Tao Zhang, Deputy Managing
Director and Acting Chair,
made the following
statement: “Uganda’s
economy has been severely
impacted by the COVID-19
global pandemic, which
reversed decade-long gains in
poverty alleviation and opened
up fiscal and external
financing gaps. The
authorities’ program,
supported by a new arrangement
under the Extended Credit
Facility, focuses on keeping
public debt on a sustainable
path while improving the
composition of spending and
advancing structural reforms
to create space to finance
private investment, foster
growth and reduce poverty."
Bobbi Wine?
On June 24 Inner
City Press asked, "what is the
IMF's comment or response to
analysts saying that the
adoption of BTC might stop El
Salvador from accessing a $1
billion program from the IMF.
"The IMF expressed legal and
economic concerns about the
adoption. The president of El
Salvador countered that his
government had not only made
its plan more than clear but
said outside support would
have been “nice” to have but
“we really don’t need it."
For the IMF, Rice
reiterated legal and financial
concerns about crypto, and
said that discussions with El
Salvador about a program
continue.
Inner City Press
followed up, beyond El
Salvador, on the critique that
institutions like the IMF, and
the Federal Reserve, are all
for innovation as long as they
would remain relevant. This
one, Rice deftly
sidestepped. More to
follow.
Inner City Press
on Cameroon asked, among other
things, "On Cameroon, what is
the IMF's response to calls by
human rights groups that the
program(s) be specifically
conditioned on ending
corruption in COVID-19
procurement? The audit found,
for example, that the
government had bought 16
ambulances from the company
for US$1,6 million and none
had been delivered. In
light of these findings, 20
prominent Cameroonian women
also urged the IMF not to
approve any additional funding
until those complicit in the
corruption and mismanagement
of the loans were held
accountable." Will the $335
million just disappear into
the ether?
The IMF's Rice
noted the investigation, and
said that beneficial owners of
those given procurement
contracts should be disclosed.
He said the letter has been
received and the IMF wants to
meet with the women leaders.
There was no direct response
on accountability. Again, more
to follow.
Inner City Press
submitted a question on
Indonesia: "On Indonesia, what
are the IMF's comment or
response now that the Supreme
Audit Agency (BPK) has warned
the government over a
potential decline in its
ability to service its
increasing debt, after it
hiked state spending in 2020
to finance economic stimulus
measures as part of the
national pandemic response.
BPK chairman Agung Firman
Sampurna said that interest
payments on national debt
relative to government revenue
stood at 19.06 percent last
year, much higher than the 7
percent to 10 percent
recommended by the IMF."
Inner City Press
later received this, from
Gerry Rice: "We have not yet
had an opportunity to review
the BPK report. We are not in
a position to comment on the
IMF recommendation cited by
you without having seen the
report. Let me use the
opportunity to highlight our
assessment of fiscal policy
and public debt in Indonesia,
as laid out in our latest
Article IV report issued in
February 2021, just a few
months ago: Ø
First, Indonesia has
appropriately and forcefully
responded to the pandemic. A
bold and comprehensive policy
package has prevented a more
severe economic contraction in
2020, reduced economic and
social hardship from the
pandemic, and prepared the way
for economic recovery.
Ø Second, Indonesia bold
response required higher
budget deficits in 2020 and
2021. In our assessment,
Indonesia has the fiscal space
for temporarily higher
deficits. The debt
sustainability analysis
presented in the Article IV
report shows that Indonesia’s
external and public debt
remain moderate and
sustainable. Ø
Third, the government’s plan
to return to the budget
ceiling of 3 percent of GDP by
2023 is a welcome commitment
to the fiscal rules. It should
be backed by a medium-term
fiscal strategy, which would
help anchor expectations, and
should include revenue
measures. Ø
Fourth, the IMF has long
called for comprehensive
revenue reform to improve and
sustain revenue mobilization.
A credible medium-term revenue
strategy would be essential to
enable higher spending on
medium-to-long development
while maintaining debt
sustainability."
Watch this site.
Back on January 8
Inner City Press asked the
IMF's Helge Berger, Mission
Chief, about China's so-called
Belt and Road Initiative:
"Your Article IV report cites
China's "overseas lending
projects" amid "rising
geopolitical tensions and
economic and trade frictions."
How does the IMF think that
rising debt levels among
African countries, and
increased skepticism about the
"Belt and Road" will impact or
be addressed going forward?
-Matthew Russell Lee, Inner
City Press. Video here.
(An aside: Inner
City Press has
reported on
the CEFC China
Energy Fund
Committee's
activities in
Chad and
Uganda and in
the UN, on
which the UN is
UNresponsive.)
Other questions
included
China's digital
currency (Inner
City Press also reports
on
crypto-currency
cases in the
U.S. District
Court for the
Southern
District of
New York and
elsewhere).
Berger said
when used
overseas an
issue is that
residents
could start
using another
country's
currency, if
it is easier.
We'll have more
on this.
***
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