IMF Approves Nearly $50M for Liberia as Economy Set to Grow 5.5%

The International Monetary Fund has approved nearly 50 million US dollars in new financing for Liberia after completing reviews of the country’s economic reform programmes, as strong mining activity is expected to lift economic growth to 5.5 percent this year.

The IMF Executive Board approved an immediate disbursement of about 26.2 million US dollars under Liberia’s Extended Credit Facility and a further 23.96 million US dollars through its Resilience and Sustainability Facility.

The latest financing is intended to support Liberia’s efforts to maintain macroeconomic stability and debt sustainability, strengthen the financial sector and advance reforms aimed at improving resilience to climate-related shocks.

Liberia’s economy grew 5.1 percent in 2025, supported by mining production, construction and manufacturing. The IMF expects growth to accelerate to 5.5 percent in 2026, although it warned that higher fuel prices, weaker donor support, commodity-price volatility and climate-related shocks pose risks to the outlook.

The latest disbursements follow the completion of the fourth review of Liberia’s 40-month Extended Credit Facility programme and the first review of its 21-month Resilience and Sustainability Facility programme.

The IMF approved the ECF arrangement in September 2024, providing access of SDR 155 million, equivalent to 60 percent of Liberia’s IMF quota. With the latest disbursement, total payments under the programme have reached SDR 96.5 million, or about 131.67 million US dollars.

The Fund approved Liberia’s Resilience and Sustainability Facility in April 2026, with total access of SDR 193.8 million, equivalent to about 265 million US dollars.

The IMF said Liberia has maintained prudent fiscal and monetary policies, with stronger revenue collection helping to reduce debt vulnerabilities. Capital spending has also increased, although the Fund called for further efforts to reduce unproductive expenditure and create room for priority infrastructure investment.

Liberia plans to introduce value-added tax in 2027 as part of efforts to strengthen domestic revenue mobilisation. The IMF said the VAT, together with mining tax reforms and a review of tax exemptions, could provide a more stable source of government revenue for investment.

The government also plans to phase the use of a one-off mining concession payment over 2026-27. The IMF said the approach was appropriate given Liberia’s capacity to implement public investment projects.

Financial-sector reforms remain another priority. Bank recapitalisation is progressing, although more slowly than initially planned, while the IMF called for faster action to reduce non-performing loans and strengthen banks’ capacity to extend credit to the private sector.

The Central Bank of Liberia has been urged to monitor inflation closely amid risks from higher international oil prices. The IMF also identified the issuance of new banknotes as an immediate priority to address shortages of physical currency.

Governance reforms are also part of the programme. The IMF called for publication of Liberia’s governance diagnostic report and a focused reform plan, alongside the removal of legal restrictions on publishing asset declarations by public officials.

Climate-related reforms under the Resilience and Sustainability Facility have made initial progress, according to the Fund. Continued technical assistance and coordination with development partners will be needed to implement the measures and strengthen Liberia’s resilience to climate and external financing shocks.

Bo Li, acting chair and deputy managing director of the IMF, said Liberia had made significant progress under both programmes despite increased global risks, particularly volatile oil prices.

Source: FSX Business News