The IMF Executive Board has approved a US$638 million loan to Benin. This loan from the IMF is ring fenced to help the government finance the country’s National Development Plan (2018-25).
Purpose of the loan
The IMF Executive Board approved a US$638 million loan to Benin to help the government finance the country’s National Development Plan (2018-25). The loan is also intended to strengthen the country’s fight against COVID-19, mitigate the negative effects of the war in Ukraine on food, fertiliser, and oil prices Further, as outlined in the July 2022 IMF press release, the loan will help Benin achieve the Sustainable Development Goals.
The document indicates that US$143 million of this amount is for immediate release.
The deteriorating security situation in Benin
“Benin faces significant headwinds from a deteriorating security situation at its northern border, COVID-19-induced scars, the war in Ukraine, as well as significant climate risks, which could erode hard-won economic gains in recent years. The government has requested a new fund-supported program to meet pressing financing needs, help catalyze further external financing, and anchor the country’s National Development Plan centered on achieving the SDGs,” said Mr. Okamura, IMF Deputy Managing Director and Acting Chair.
The IMF specifically encourages the country to take urgent action to address climate change and its effects (SDG13).
“Ongoing efforts to enhance resilience to climate change are also important. Achieving these ambitious goals will require continued commitment to clearly communicated reforms and strong technical and financial support from Benin’s development partners,” stated Mr. Okamura, IMF Deputy Managing Director and Acting Chair.
We’re keeping a close eye on the economic situation in Benin.
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